This is my opinion. The opinion is mine and in no way is it the opinion of Don’t Hate the Geek. I wanted to write about something that has been bothering me for a while. This is partly motivated by the fact that cellular carriers are selling the Samsung Galaxy S9 (and S9+) for more than what the actual Samsung site has it listed for.
The Way It Was
Years ago, when you signed up for a new cell phone plan or upgraded to a new phone, you paid a subsidized price in exchange for committing to that carrier for 2 years. Generally, the flagship phones would run you somewhere in the neighborhood of $250. All this money was due up front, and then you owned that phone after your 2-year contract was up. I know some people will say something like, “well I don’t like being locked into a contract”. The question I pose to you is: do you really pay off your phone that much quicker than 2 years the way it is set up now?
Okay, I lied. I said there wasn’t going to be any facts or sources in this article. I found a press release from T-Mobile from 2012 that was highlighting the fact they were bringing unlimited 4G data plans as an addition to their voice plans. This quote is taken directly from the press release which you can find here.
The Unlimited Nationwide 4G Data plan will cost $20 per month when added to a Value voice and text plan or $30 per month when added to a Classic voice and text plan. For example, a single line Value plan with unlimited talk and text combined with unlimited nationwide 4G data will cost $69.99 or a single line Classic plan with unlimited talk, unlimited text and unlimited nationwide 4G data will cost $89.99.
Basically, you could get unlimited everything for either $70 or $90, depending on what voice plan you had. Currently, for a single line of unlimited service on T-Mobile, you will pay $70 – in addition to the cost of your device. I’m not picking on T-Mobile out of all the cellular carriers. They are just who I’m using as my example. They are actually a perfect example. Their plan pricing is virtually unchanged, yet we now pay more for our phones.
What if You Break Your Phone?
Let’s say you completely FUBAR your phone and you’ve only had it for 4 months. You will have to pay off your device at its full price and purchase a new device at full price. Let’s say your remaining balance was $680 ($30/mo for 4 months). Your new phone would cost somewhere in the neighborhood of $800. That’s $1,480 ($1,600 total) you have to come up with out of pocket for your phone. Previously, let’s say you paid $250 to be under contract. Well, that phone is yours and let’s say your new phone costs $800. That’s $1,050, total!
Are Cellular Carriers Screwing You?
Do you feel like you are getting screwed everytime you go get a phone? Or, is it perfectly okay for you to pay full price for your phone? Let us know what you think in the comments!