The Death of Unlimited Data and/or Subsidized Plans: Tell Us What You Think

[mountainbikermark]

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 have that for my watch itself.
On another forum there was a thread complaining about folks being upset that their S is mistaken for Apple and one member jacked the thread complaining folks have more important things to complain about than their smartwatch being mistaken for a Timex. I got a kick out of that analogy

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[furbearingmammal]

Kill subsidized phones, then legislate mandatory unlimited data plans. Carriers need to know they're just "big, dumb pipes" and they provide as important and necessary a service as any other utility, like electricity.

Remember, the reason the unlimited plans cost so much in the first place was to pay the carrier for the phone's subsidy.

 

[furbearingmammal]

There is no doubt for those of us fortunate enough to be able to afford the full price of a phone in one fell swoop this is the safest and simplest way to protect your unlimited plans. It's unfortunately a fact that most people don't have $650 to drop on a new phone on a whim. This is why I do believe that phone subsidy won't go away completely, but will be perhaps yet another iteration of the EDGE program or something like it.

My X cost $220. If you don't need a flagship phone that's fresh from a Chinese sweatshop, you don't have to pay more than the subsidized cost of said phone.

Also, companies like Blu and Malais are offering very compelling phones for $200 or less. As long as you're on A GSM carrier, there's no problem. As long as Verizon lets you activate a new/used phone, deals like mine will always be an option.

 

[kodiak799]

I don't need to have the latest and greatest phone, so I don't pay $650.
I buy phones off Swappa.

Easily the most prudent and responsible choice. I NEEDED to upgrade my Droid (and did so under contract), but I kept my Rezound for 3 years. So buying a year old phone on Swappa vs. a new phone that could last me another 3+ years...I didn't do the math but I figure that's a fairly equivalent route. Part of that is I felt the Turbo had the battery and power for more needs, whereas phones the prior year weren't that big a step-up from my Rezound.

 

[thunderbolt_nick]

LWA, I hear what you're saying and I am not in disagreement in principle. Still, subsidy, even in the pure sense of the word does not apply exclusively to government, although I agree that government is one of the largest players in the economy regarding subsidy. The definition of subsidy is below in several sources. In one definition, it says "pay part of the cost of producing (something) to reduce prices for the buyer." Producing encompasses everything from conceptualizing and initial R & D, all the way to financing, distribution and implementation.

Merriam-Webster says "to help someone or something pay for the costs of (something)". If I don't have all the funds to pay up front, and so the manufacturer or retailer helps me to pay by allowing me to pay over time, they are financing or bankrolling my purchase and by multiple definition sources are subsidizing my purchase. Coupons, store specials, "buy one get one free", any assistance provided to me as the consumer which makes it easier to purchase and take ownership of a product or service is a subsidy. It may be a hard concept for some consumers to grasp since they are looking at the lost profit by the corporation as something that wasn't there to begin with had they not made the purchase so it's not a cost in their minds. They also look at zero percent financing as having no cost to the provider, simply because the provider has the money already and isn't earning additional profits by lending it for free.

Money as it pertains to Time Value of Money, has a cost. A dollar in my hands today has greater value than a dollar in my hands 2 years from now. There are many reasons from inflation to opportunity cost (the cost of the lost opportunity to investv that dollar and receive a return on that investment otherwise). So if I have to put out a dollar today, it's more expensive to me than if I have to only put out one 24th of that dollar each month over the next 24 months. That reduced cost to me is a subsidy.

So likewise a dollar received today by the manufacturer or retailer for the purchase of a product has greater value than that same dollar sliced into 24 equal payments and received over two years. That manufacturer or retailer has to bankroll the purchase, and that means financing it - even if at zero percent interest. Just because they have profit built in doesn't mean it isn't less profitable to receive that payment in 24 installments versus one lump sum. There are a gamut of costs involved for the manufacturer or retailer in order to bankroll those purchases from administrative, to accounting, to billing, to postage , to insurance, etc., not to mention opportunity cost as those delayed dollars are not there in the corporate coffers to fund new products or services, purchase additional inventory, fund the operating expenses or advertise to increase sales, thereby reducing the potential for additional profits.

Wikipedia says (with references);

"Subsidies come in various forms including: direct (cash grants, interest-free loans) and indirect (tax breaks, insurance, low-interest loans, depreciation write-offs, rent rebates)."

Thefreedictionary.com says;

"subsidize

verb

To supply capital to or for:

back, capitalize, finance, fund, grubstake, stake.

Informal: bankroll.

Idiom: put up money for."

So in this debate, either as the manufacturer or as the retailer financing or bankrolling the purchase of a product by installments over time, even if at full retail price and even if at 0 prevent interest OR at an agreed upon interest rate is by definition subsidizing.

References; I.word.com, thefreedictionary.com, Merriam-Webster, Wikipedia

TL;DR version: still a subsidy! *drops mic and dictionary* [emoji23]