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> That $199 iPhone? It really costs $650! It's been really nice to see unsubsidized wireless become more of a thing in the US. I can't even begin to describe t

> That $199 iPhone? It really costs $650! It's been really nice to see unsubsidized wireless become more of a thing in the US. I can't even begin to describe the confusion my family members have when I tell them that their iPhone actually cost $600-700. Their response is, "oh, no, it was only $200." It's astonishing how misunderstood this is... like saying you financed a car purchase and it only cost you the downpayment.

derekp7 12y ago
For the car analogy, it is like the car cost you $1000 up front, but you have to buy a specific brand of gas for the life of the car. Which could be a good deal, since you have to buy gas anyway, as long as that gas isn't much more expensive then other brands of gas. And if that brand is available in all the cities that you drive.
- vog 12y ago
  > Which could be a good deal, since you have to buy gas anyway Is there any market where this has ever been a good deal? For printers, mobile phones, etc. I'm not aware of a single example. Maybe renting a flat is a model where this works, compared to repeatedly buying and selling your house whenever you move. However, maybe this just works in countries like Germany which have very good laws to protect customers/lodgers.
  - Agustus 12y ago
    The question is how you see it as a good deal. If you need to defer up front costs and facilitate it through increments then yes. If you see it as the total cost, then it is not a good deal.
- mikeash 12y ago
  That used to be the case. That iPhone really did cost you $200, because you paid $70/month (or whatever) regardless of whether you bought the thing subsidized or unsubsidized. Now, the carriers are getting away from that model. AT&T, for example, charges you less if you bring your own phone, or buy it from them at full price. The monthly difference is almost exactly 1/24th of the subsidy.
  - derekp7 12y ago
    That's good information to know for comparison -- I'm with T-mobile, and when they switched to the BYOD model, they got rid of the subsidized plans. The replacement plans look like a good deal, but it is hard to compare because plans were getting better every year anyway. And providers went from making money on voice to making money off of data.
- spacehome 12y ago
  Yea, but it is more expensive. For instance, I'm paying $30/month on Page Plus, whereas the cheapest plan I can get from Verizon is $80/month. (Though admittedly, the Verizon plan gives more data. None of the Page Plus plans give exactly 2GB of data, but the Page Plus plans at $40 and $55 straddle that amount)
  - steanne 12y ago
    if you need more data but don't care about minutes, t-mobile has a prepaid plan that is $30 for 5gb data (and throttled after), unlimited text, and 100 minutes.
bluedino 12y ago
You've been able to pay full price for the phone and get a reduced price contract for quite a while. It's just more common for people to get a $50-$150 Android phone with that plan. Many people who get an iPhone can't afford the one-time purchase of a $650 phone but don't have a problem paying $90/month for it.
- robmcm 12y ago
  There often isn't much in it when you compare costs (at least in the UK, when you want decent limits). The killer is when you are on a contract and want to break it early, or forget to upgrade and keep paying your inflated rate after you have paid off the phone.
- spacehome 12y ago
  Sadly, the fact they don't have a problem paying $90/month is probably the reason they can't afford the $650.
dottrap 12y ago
I was really excited when the very first iPhone launched because that one was essentially unsubsidized (or as close as us in the US had ever seen). Unfortunately, the mass consumers showed they wanted subsidized so the next generation of iPhone saw the plan cost go up and the upfront cost go down. Everybody I complained to thought I was crazy about the cost going up because all they looked at was the initial cost of the phone going down and failed to do the math at how much the increased plan cost would cost them over 2 years.
- RodericDay 12y ago
  I honestly don't know where the "scam" line lies.

derekp7 12y ago

For the car analogy, it is like the car cost you $1000 up front, but you have to buy a specific brand of gas for the life of the car. Which could be a good deal, since you have to buy gas anyway, as long as that gas isn't much more expensive then other brands of gas. And if that brand is available in all the cities that you drive.

vog 12y ago
> Which could be a good deal, since you have to buy gas anyway Is there any market where this has ever been a good deal? For printers, mobile phones, etc. I'm not aware of a single example. Maybe renting a flat is a model where this works, compared to repeatedly buying and selling your house whenever you move. However, maybe this just works in countries like Germany which have very good laws to protect customers/lodgers.
- Agustus 12y ago
  The question is how you see it as a good deal. If you need to defer up front costs and facilitate it through increments then yes. If you see it as the total cost, then it is not a good deal.
mikeash 12y ago
That used to be the case. That iPhone really did cost you $200, because you paid $70/month (or whatever) regardless of whether you bought the thing subsidized or unsubsidized. Now, the carriers are getting away from that model. AT&T, for example, charges you less if you bring your own phone, or buy it from them at full price. The monthly difference is almost exactly 1/24th of the subsidy.
- derekp7 12y ago
  That's good information to know for comparison -- I'm with T-mobile, and when they switched to the BYOD model, they got rid of the subsidized plans. The replacement plans look like a good deal, but it is hard to compare because plans were getting better every year anyway. And providers went from making money on voice to making money off of data.
spacehome 12y ago
Yea, but it is more expensive. For instance, I'm paying $30/month on Page Plus, whereas the cheapest plan I can get from Verizon is $80/month. (Though admittedly, the Verizon plan gives more data. None of the Page Plus plans give exactly 2GB of data, but the Page Plus plans at $40 and $55 straddle that amount)
- steanne 12y ago
  if you need more data but don't care about minutes, t-mobile has a prepaid plan that is $30 for 5gb data (and throttled after), unlimited text, and 100 minutes.

bluedino 12y ago

You've been able to pay full price for the phone and get a reduced price contract for quite a while. It's just more common for people to get a $50-$150 Android phone with that plan. Many people who get an iPhone can't afford the one-time purchase of a $650 phone but don't have a problem paying $90/month for it.

robmcm 12y ago
There often isn't much in it when you compare costs (at least in the UK, when you want decent limits). The killer is when you are on a contract and want to break it early, or forget to upgrade and keep paying your inflated rate after you have paid off the phone.
spacehome 12y ago
Sadly, the fact they don't have a problem paying $90/month is probably the reason they can't afford the $650.

dottrap 12y ago

I was really excited when the very first iPhone launched because that one was essentially unsubsidized (or as close as us in the US had ever seen). Unfortunately, the mass consumers showed they wanted subsidized so the next generation of iPhone saw the plan cost go up and the upfront cost go down. Everybody I complained to thought I was crazy about the cost going up because all they looked at was the initial cost of the phone going down and failed to do the math at how much the increased plan cost would cost them over 2 years.

RodericDay 12y ago
I honestly don't know where the "scam" line lies.