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iPhones are not intended to be purchased for $649 except by the very impatient (or people who break/lose their uninsured phones). If you wait your 2 years, it's

iPhones are not intended to be purchased for $649 except by the very impatient (or people who break/lose their uninsured phones). If you wait your 2 years, it's $100 or $200 on-contract. Of course it's different in emerging markets where contracts aren't the norm, but smartphone prices in the US are pretty damn close in terms of 2-year TCO.

glesica 13y ago
I, and quite a few people I know (admittedly perhaps not average consumers) refuse to sign contracts partly because the phones are so expensive to replace, and breaking the phone doesn't get you out of the contract. That means you need insurance, which adds to the cost. I would rather fully own my device, have the flexibility to switch carriers, and be able to downgrade my plan if my phone breaks or my needs change.
- wvenable 13y ago
  The biggest problem with that is most carriers don't give you a discount if you own your own phone. So you can either pay $50 a month and get your handset for $200 or pay $50 and get your handset for $600. Which one makes more financial sense?
  - glesica 13y ago
    Many carriers are starting to give discounts. T-Mobile does already. Also, I can use an MVNO for quite a bit cheaper than a subscription plan, but I need a phone to do that. Most of the MVNOs will sell you a phone, but it will be a either a full-price model, or a terrible piece of crap.
simbolit 13y ago
in 'emerging markets' like germany more and more people are getting PAYG sim cards due to the prices being much much cheaper. so much cheaper in fact, that it often makes economic sense to buy a phone unlocked and pair it with PAYG, compared to the on-contract alternative.
Negitivefrags 13y ago
I don't understand why people in America are so keen to pay for expensive monthly plans. I pay $5-$10 dollars per month on average for my cellphone on prepay. It doesn't make sense all to buy a phone on plan.
- thaumasiotes 13y ago
  Your problem is that you believe sensible plans are offered in the American market at all. Look at all the love people express for t-mobile's $30 / month plan. That's because it is leaps and bounds ahead of anything else you can get. In China, I pay about US$15 every 3-4 months for a level of texting and voice talk that would easily cost $30 / month by itself in the US. (I don't have a data plan.) I've tried going prepaid (also t-mobile) in the US. The economics worked out as long as I never expected to use my phone at all; if I expected anything, it was a money loss. And even while I expected nothing, I had to keep paying $10 / month so that all my paid credit wouldn't suddenly expire.
  - lostlogin 13y ago
    The irony of capitalism working better in China the the US is strong. What failed in the US? Under or over regulated? Or is it the lobbyists thing?
    - thaumasiotes 13y ago
      The market for phone voice service isn't exactly the entirety of each country. "What failed in the US", if we want to compare only the situation in the US with that in China, could easily be that people in the US have so much more money that phone service prices are nine times higher.
      - lostlogin 13y ago
        I didn't mean to imply entirety with my comment, but it does read that way, apologies. Another issue could be the artificially low value of the Yaun?
tostitos1979 13y ago
Your math isn't correct. If one switches to T-Mobile in the US, you get pretty substantive savings. The con is that you don't get a phone subsidy. I did the math a while ago. Don't know how it holds up. As a datapoint, we pay between $90-$100 for two phone lines with T-mobile. Includes 500MB data/tethering per phone, unlimited minutes in the US and text messages.

glesica 13y ago

I, and quite a few people I know (admittedly perhaps not average consumers) refuse to sign contracts partly because the phones are so expensive to replace, and breaking the phone doesn't get you out of the contract. That means you need insurance, which adds to the cost. I would rather fully own my device, have the flexibility to switch carriers, and be able to downgrade my plan if my phone breaks or my needs change.

wvenable 13y ago
The biggest problem with that is most carriers don't give you a discount if you own your own phone. So you can either pay $50 a month and get your handset for $200 or pay $50 and get your handset for $600. Which one makes more financial sense?
- glesica 13y ago
  Many carriers are starting to give discounts. T-Mobile does already. Also, I can use an MVNO for quite a bit cheaper than a subscription plan, but I need a phone to do that. Most of the MVNOs will sell you a phone, but it will be a either a full-price model, or a terrible piece of crap.

simbolit 13y ago

in 'emerging markets' like germany more and more people are getting PAYG sim cards due to the prices being much much cheaper. so much cheaper in fact, that it often makes economic sense to buy a phone unlocked and pair it with PAYG, compared to the on-contract alternative.

Negitivefrags 13y ago

I don't understand why people in America are so keen to pay for expensive monthly plans. I pay $5-$10 dollars per month on average for my cellphone on prepay. It doesn't make sense all to buy a phone on plan.

thaumasiotes 13y ago
Your problem is that you believe sensible plans are offered in the American market at all. Look at all the love people express for t-mobile's $30 / month plan. That's because it is leaps and bounds ahead of anything else you can get. In China, I pay about US$15 every 3-4 months for a level of texting and voice talk that would easily cost $30 / month by itself in the US. (I don't have a data plan.) I've tried going prepaid (also t-mobile) in the US. The economics worked out as long as I never expected to use my phone at all; if I expected anything, it was a money loss. And even while I expected nothing, I had to keep paying $10 / month so that all my paid credit wouldn't suddenly expire.
- lostlogin 13y ago
  The irony of capitalism working better in China the the US is strong. What failed in the US? Under or over regulated? Or is it the lobbyists thing?
  - thaumasiotes 13y ago
    The market for phone voice service isn't exactly the entirety of each country. "What failed in the US", if we want to compare only the situation in the US with that in China, could easily be that people in the US have so much more money that phone service prices are nine times higher.
    - lostlogin 13y ago
      I didn't mean to imply entirety with my comment, but it does read that way, apologies. Another issue could be the artificially low value of the Yaun?

tostitos1979 13y ago

Your math isn't correct. If one switches to T-Mobile in the US, you get pretty substantive savings. The con is that you don't get a phone subsidy. I did the math a while ago. Don't know how it holds up. As a datapoint, we pay between $90-$100 for two phone lines with T-mobile. Includes 500MB data/tethering per phone, unlimited minutes in the US and text messages.