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- HOTNESS UNHOT
We just published the fifth entry in our series of Holiday Gift Guides: Smartphones! These constantly evolving gadgets are one of the hottest gifts out there right now. Nobody wants an *old* phone (though they may deny it). Be sure to create Deal Alerts for any gift ideas you like - that way you won't miss out on any upcoming sale prices!
Nov. 12: Home Theater Gift Guide
Nov. 9: Laptops Gift Guide
Nov. 8: Fitness Gift Guide
Nov. 7: Digital Cameras Gift Guide
Who buys smartphone as a gift? Perhaps to the spouse or family, but you don't get into the whole 2 year plan part for anybody else.
^ You can get some Android phones on pay as you go plans for reasonable prices, but they're those *old* phones. Some can be upgraded to Android 3.x or 4.x and some can't.
http://www.i-ontheweb.com/shop/phones.aspx
For example the LG P9992 G2x at $210, though of course it's non-competitive with contemporary models for a few reasons including the 480x800 res. screen, memory, CPU, etc.
http://www.i-ontheweb.com/shop/phones/7227.aspx
http://www.androidauthority.com/g2x-p999-t-mobile-cyanogenmod-10-cm10-unofficial-115536/
We were considering getting an unlocked phone, but when we checked the monthly charges with the carriers you have to use, they seemed to be higher than what you get when you're locked in to a two-year contract. Seems like they get you either way.
Exactly, and as it turns out they end up losing money giving these phones out at $150 or $200 even with a 2 year plan (specially with the iPhone).
So what's the big turn off for dumb phones?
How do you figure that? Take AT&T for example, they're offering a 16GB iPhone 4 for $100 with 2 year contract with 5GB data at $120/mo., so they're taking in a total over 2 yrs of $2980 plus a $36 activation fee that I'll ignore.
They claim that otherwise the phone would cost $550, so the $450 difference is only $19/mo, so if they are still raking in over $100/mo. they're not losing money. You could get a cheaper plan from them, Verizon, or Sprint but if you have an iPhone you're probably going to want over 1GB data allowance /mo. so it won't get much cheaper.
Now contrast that site I linked 2 posts ago, they have an unlimited monthly plan at $60/mo., so that's $1440.... the iPhone ended up costing you $1,540 over what an unlimited plan would've without it from some MVNOs.
Granted, you can't get an iPhone from i-ontheweb, but if they can RESELL airtime for $1,540 less than the primary carrier, certainly the primary carrier is making at least that much more.
Did you read the fine prints on that i-ontheweb? You get 500mb and then the speed is reduced. There are always give and takes. You either take a hit on the quality or speed or roaming or all. There is always a payback for paying less. If you are willing to live with it great.
I'm paying $120 a month for a limited data plan and 750 minutes with t-mobile for 2 phones. That has proven plenty and I got HTC mytouch phones for free for switching over 2 years ago. Tomorrow and Saturday they are offering free phones for switching or re-upping even the Galaxy s 3. There is no way I can make that up by paying $1200 for two unlocked phones.
^ True the speed is reduced at that point, but that iPhone from the majors is still being subsidized by the large price difference.
Take Verizon for example, they offer a lesser 300MB data plan for $80/mo. and charge more if you exceed it, $20 more per month than i-ontheweb @ $60 is still $480 addt'l profit over 2 years.
Okay, I hear this a lot but I really don't get it? You're going to pay for a plan somewhere so how does that factor in? Are plans off-contract cheaper at equivalent quality? I haven't seen that.
I don't like to be locked into a contract or phone for 2 years but from a financial standpoint I don't get how it matters if you've got to pay somewhere. I'm on an original ATT plan that is unlimited and I pay $85/month (just me) for unlimited data, a lot of texts and phone. I'd like to be able to upgrade phones sooner if needed but I don't know if I could find something worth the unlocked expense.
Am I missing something?
^ My point was only that you are paying for the phone and then some, they are not losing money even if it's the best option to get the phone model you want.
If you want a particular phone the prepaid I linked probably doesn't even offer it, that was only an example of service pricing as it relates to total cost and whether that would be an amount high enough to subsidize an iPhone. Service cost to the provider won't be any more or less based on which phone you choose, except for the comm standards required for support (3G, 4G, etc)