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The Death of Unlimited Data and/or Subsidized Plans: Tell Us What You Think
- Thread starter dgstorm
- Start date
If my posts were any less, you guys and gals would think I've come down with something! LOL!
jackiescivic
Diamond Member
If my posts were any less, you guys and gals would think I've come down with something! LOL!
FoxKat strikes again with his novel answers! ;-) And you're right, we would think you were very sick!
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gadgetrants
Senior Member
@FoxKat, your posts definitely made my day -- thanks for elaborating. At one point I was struggling to remember what I'd learned from my one and only microeconomics course a lifetime ago, but your explanation brought it all back.
At the risk of sounding like I'm disagreeing, though, I want to chip away just a little at your notion of "subsidy." It seems that you're aiming toward the idea that, bottom line, a subsidy is a net cost for a company. It is a gain for the customer/client/user, offered at a loss by the seller. But I can think of two scenarios where that might not be the case.
The first is a very simple scenario -- I call it the "drug dealer on the corner." The metaphor here is that he offers you a free sample or two, hooks you, and you become a loyal, devoted, perhaps addicted customer. You always have the "freedom" to stop consuming, but you "choose" not to do so. In this scenario, the so-called subsidy is equivalent to the Black Friday "loss leader": "if I can get you in the door, even at the risk of losing on a subset of transactions, overall my profits will be higher."
The second scenario is a little more complex. The idea is this: when I have a 2-year, subsidized phone contract, I get a new phone (or I used to!) every 2 years for $100 (or whatever). I think, "HOLY COW, I got this $700 phone for $100." But I didn't. The other $600 is baked into the monthly amount I'll pay on my contract, hidden in a variety of places (including the monthly data charge). So, I might say to myself, "Yeah, yeah, OK so I realize the other $600 is baked in over 2 years. BUT I'M GETTING IT INTEREST FREE!" That too is unlikely logic, business-wise. I could easily imagine that the cell-phone provider, knowing their actual costs, has set the monthly contract amount in a way that if the customer could actually partition out the part devoted to paying for the phone, it would end up being $600+interest (or see Scenario 1 above, i.e., "take a loss on the hardware, make a killing on the data+minutes"). I won't labor the point (and I'm making it crudely) but the idea here is that the remaining cost of the phone is not only distributed throughout the contract, it is probably done so with a profit. I don't think it would take much tinkering to update this thought-experiment for an Edge-like "you're paying 0%" scenario -- the outcome is the same. Just because my contract says "net monthly cost of phone = total-cost-of-phone/24-months" doesn't mean that's what I'm actually paying.
So yeah, I think that subsidies can often be construed as short-term investments for an organization that come with anticipated long-term gains. It's a cynical view, but I see them as a shrewd business tactic (even things like welfare, farm subsidies, social security, and other so-called "liberal" assistance programs), not as a form of aid or assistance, and certainly not as an altruistic act.
-Matt
At the risk of sounding like I'm disagreeing, though, I want to chip away just a little at your notion of "subsidy." It seems that you're aiming toward the idea that, bottom line, a subsidy is a net cost for a company. It is a gain for the customer/client/user, offered at a loss by the seller. But I can think of two scenarios where that might not be the case.
The first is a very simple scenario -- I call it the "drug dealer on the corner." The metaphor here is that he offers you a free sample or two, hooks you, and you become a loyal, devoted, perhaps addicted customer. You always have the "freedom" to stop consuming, but you "choose" not to do so. In this scenario, the so-called subsidy is equivalent to the Black Friday "loss leader": "if I can get you in the door, even at the risk of losing on a subset of transactions, overall my profits will be higher."
The second scenario is a little more complex. The idea is this: when I have a 2-year, subsidized phone contract, I get a new phone (or I used to!) every 2 years for $100 (or whatever). I think, "HOLY COW, I got this $700 phone for $100." But I didn't. The other $600 is baked into the monthly amount I'll pay on my contract, hidden in a variety of places (including the monthly data charge). So, I might say to myself, "Yeah, yeah, OK so I realize the other $600 is baked in over 2 years. BUT I'M GETTING IT INTEREST FREE!" That too is unlikely logic, business-wise. I could easily imagine that the cell-phone provider, knowing their actual costs, has set the monthly contract amount in a way that if the customer could actually partition out the part devoted to paying for the phone, it would end up being $600+interest (or see Scenario 1 above, i.e., "take a loss on the hardware, make a killing on the data+minutes"). I won't labor the point (and I'm making it crudely) but the idea here is that the remaining cost of the phone is not only distributed throughout the contract, it is probably done so with a profit. I don't think it would take much tinkering to update this thought-experiment for an Edge-like "you're paying 0%" scenario -- the outcome is the same. Just because my contract says "net monthly cost of phone = total-cost-of-phone/24-months" doesn't mean that's what I'm actually paying.
So yeah, I think that subsidies can often be construed as short-term investments for an organization that come with anticipated long-term gains. It's a cynical view, but I see them as a shrewd business tactic (even things like welfare, farm subsidies, social security, and other so-called "liberal" assistance programs), not as a form of aid or assistance, and certainly not as an altruistic act.
-Matt
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Last time you did a short post I asked the staff to check to make sure your account hadn't been hacked.If my posts were any less, you guys and gals would think I've come down with something! LOL!
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ROFLOL! @mountainbikermark, that's so kind and caring of you. [emoji6] after all, we all know about those dictatorship governments and their aggressive hacking programs. [emoji12]
P.S. love the new Avatar, but shouldn't it say "No, it's not an Apple Watch"? [emoji33]
I am on a month to month plan with unlimited everything. If you ditch the subsidy there is nothing saying you have to be in contract unless you choose one of those extended plans that the carriers are snowballing people with.
Unless the telcos adopt a space in their stores for 3 year old tech then the sales of phones will plummet.
I look at subsidy as saving money in my pocket. Because I've been with carrier for a decade and plan on staying with them for just as long. My bill doesn't change but getting a $700 phone for $200 is $500 savings for me. I don't care about contract as I was planning to remain with carrier because there is nothing better in the whole country so why would I want to jump ship?
So yeah, subsidy = winning for me.
So yeah, subsidy = winning for me.
Thats the point of the OP.....If you're still buying phones "on contact" (ie: subsidy) then you're SOL when it comes to keeping your unlimited data.
S5 tap'n
Have to reverse priorities. What is more important unlimited data or subsidy? OK data is more important so you look for other ways to obtain subsidy, and there are ALWAYS ways to get things your way. Only thing you need is smarts and determination. Vzw aren't the brightest bunch in a lot of cases, too many if you ask me.
Yeah, I get your point. There are ways to save significantly on a new device purchase, it just requires a bit of finesse. But "subsidy", in the true sense of the word, (or a carrier's definition) will not allow you to do both. As you pointed out though, there are always ways around this to enable you to keep your UD. The point is, these "options" are becoming much more scarce.
For me personally, UD is more important. Planning & saving in advance is what I'll continue to do, so I can get a new device at least every two years.
S5 tap'n
For me personally, UD is more important. Planning & saving in advance is what I'll continue to do, so I can get a new device at least every two years.
S5 tap'n
That has been tempting me off unlimited, but I think the Edge program is better because you're net is like $10 a month, and after two years you're saving $15 a month. So it's almost equivalent to the subsidy, but if you keep you're phone 2.5-3+ years you come out a good bit ahead.
For me, I look at it as an added cost to keep unlimited. I had my Rezound for almost 3 years, which I got on subsidy. I paid like $550 for my Turbo with trade-in...keeping it 3 years would average out to a net of about $12 a month - call that $42 a month for unlimited data.
Here is a good read how to get subsidised phones and keep unlimited data on vzw.
Verizon - How to Use a Subsidized Upgrade and Keep Your Unlimited Data Plan Or Avoid A 2 year Data Plan on a Basic Line - Slickdeals.net
That thread used be over 1000 pages long which has been edited for clarity.
Verizon - How to Use a Subsidized Upgrade and Keep Your Unlimited Data Plan Or Avoid A 2 year Data Plan on a Basic Line - Slickdeals.net
That thread used be over 1000 pages long which has been edited for clarity.
gadgetrants
Senior Member
Thanks, very helpful link ^^^. I had no idea people were that devious. 
-Matt
-Matt