Another boring money post

[Patler]

Smart phones are a luxury to you, perhaps, but to the average consumer they're looked at as an essential part of life, which is why sales are blowing up. Right or wrong, it is what it is.

An essential part of life? For someone without a job, or with reduced income? For someone who has to take a lower paying job while putting food on the table for a family?

To be honest, I can't think of anyone for whom a smartphone really is essential.

[SkinBasket]

An essential part of life? For someone without a job, or with reduced income? For someone who has to take a lower paying job while putting food on the table for a family?

To be honest, I can't think of anyone for whom a smartphone really is essential.

Haven't you seen the masses of dead poor people in the street? Sad, really. They had plenty of food, free health care, shelter... hell even free cable TV converter boxes. But alas, they had no smartphones.

[retailguy]

With cell contracts and subsidies, you're paid 400 dollars over 2 years essentially to sign a contract. You could go the prepaid route and see significant monthly savings but then you're paying full price for the handset. Seeing as prepaid is such a small fraction of the market in America, why would someone not upgrade? They're not getting the 400 dollars back into their pocket if they don't.

If the phone sells for $400 more than I'm "paying" for it, then SOMEONE is paying for it. The only person that "pays" for anything is the CONSUMER. ME. If a business "pays" for it, and doesn't pass on the cost, THEY LOSE MONEY. They aren't losing money.

Your assertion that I'm "losing" money if I don't upgrade misses a very important point. The other options. I have freedom to move if I don't renew my contract. I don't have freedom to move if I sign another contract. I lose flexibility once I sign my name. I take on risk once I sign my name. If I have to get out on early termination, I lose any "pocketed money" of gaming the system.

Right now, on boost I can get a Samsung Prevail (which is 80% of an epic) for $179, or a curve for the same price. All inclusive price? $50. With shrinkage that drops by $5 each six months until I settle at $35 a month.

If I just want a smartphone without all the hassle and add on fees, OR a contract, why would I not consider this?

In summary, it would be pretty dumb to not upgrade. At the very least, take the 650$ phone for 200 bucks and sell it for 500 and pocket the money. It's essentially wasting money and padding the lines of wallet. American carriers don't do reverse subsidization now that TMobile got rid of it.

I don't know of very many phones that sell for $650. Let's use $400 from your previous example. Day 1 - you go to the sprint store and buy an Epic. I go to the Boost store and buy a Prevail. Here's how the math breaks down for the 1st two years.

Sprint - You get a subsidized Epic. Your plan costs are $79.99 plus $10 for the epic data pack add on. $89.99 monthly or $1,079.88 per year plus $200 initially for the phone. Total cost - 1st two years - $2,359.76

Boost - I pay full retail for my Prevail $179.99. My contract is $50 per month for unlimited service. I also sign up for shrinkage. My bill decreases by $5 each 6 months that I make an on time payment. My plan costs $300 for 1st 6 months, and $270 for the second six months for a total of $570 for the first year. The second year my costs are $240 & $210 making the total for the 1st two years $1,199.99 including purchase of the phone.

It's important to note that I have excluded taxes from the analysis because I was too lazy to look it up. Boost fees include taxes, Sprint fees do not.

End of two years, I have spent $1,159.77 less than you have. Now, it's time to test your hypothesis.

Beginning of year three - you get your new Smartphone. It's the new super duper epic on steroids. You're happy with your epic and decide to sell the super duper new one. You get the FULL $650 for your new phone, less your $200 upgrade fee. Prices haven't even risen and you lock in for another 2 year contract. End of the two year period, you have spent the same $2,359.76 less the $650 you realized from the sale of your phone - $1,709.76.

I decide to stay with Boost, but I want a new phone. The Epic you're using is now offered on Boost, and I decide I want a fancy phone like you. My cost is $249. I'm still on shrinkage, and like you, my rates have not increased. 24 months of service at $35 per month is $840 plus my $249 phone leave total outlay - 1,089. (I also sold my prevail on ebay - $50 for parts, but I blew it on wine, women and song so I didn't include it).

At the end of 4 years, you have a 4 year old epic, and I have a 2 year old epic. You have spent $4,069.52, and I have spent $2,288.99, or $1,780.53 less than you have for the same phone service.

I fail to follow your math and your upgrade plan. Sounds like a great deal for Sprint and a crappy deal for me.

You're passing judgement. I have no idea if that's true or not about the computers. Don't care. Suburban schools will have iPads. Soon. This is what curriculum will be taught on. The paper book is a thing of the past. There isn't a better device for a toddler than an iPad. What parent would rather have their child corrupting their brain watching cable television when they could be playing fun education oriented games?? Interactive learning is the next big thing.

I was just at my daughters new high school in suburban America last night. I was in 7 classrooms, all AP classes. NOT ONE Apple machine in the place. I did see a bunch of Dell's running Windows XP.

This is a nationally ranked high school with one of the top academic and football programs in the US. Graduates commonly are accepted to Ivy League schools. I pay $4,500 a year in school related property taxes, and the money is fully spent on the schools. Well run district from what I can see.

An essential part of life? For someone without a job, or with reduced income? For someone who has to take a lower paying job while putting food on the table for a family?

To be honest, I can't think of anyone for whom a smartphone really is essential.

Me neither. Well said.

[mraynrand]

.... I'm still on shrinkage...

Sorry to hear that

[Partial]

I disagree. The relevance is that you're preaching to all of us that it is "a great deal" and "everyone" has it, but you don't because it's too expensive. It's "don't do as I do, do as I tell you".

You're probably out of contract on that old phone, and haven't "cashed in" either, most likely. Yet we're all "fools" for not upgrading phones.

More preaching from the peanut gallery.

Huh, when did I do this? I'm not telling anyone it's a good deal because it's not. Cell phone data is ridiculously priced. It's overpriced for every phone, not an iPhone, or a Thunderbolt, or a Tralala. That doesn't change the fact a hundred million people are going to buy iPhones and iPads and that it's not a great stock. I'm not debating anything beyond A) the relative cost of the product to other comparable products b) that the product is not overpriced c) the stock and it's current/future value

I told you that an iphone for her would be $105 a month, estimated including taxes. You said it could be cheaper. I said she would use more than 400 minutes a month and therefore it wouldn 't be cheaper.

Please be specific on how I overstated anything? She uses her phone about 700 minutes a month. She uses text messaging as we have two teenagers, so please show me where it would be less than $105 including taxes? I priced it about 10 times on the AT&T website while we were exploring what to do.

Sure, I was stating the base price. I didn't know of her usage. Again, I'm not looking for a fight. Are you?

Good for you. See my analysis above. Those SERO plans are a really good deal. Probably knocks the math down to an additional $1,200 over 4 years instead of $1,800.

You're a genius Partial. Underappreciated and misunderstood too.

Agreed on both accounts.



--- This was a response to your previous post ----
RG, you're presenting a scenario that was not discussed. Sure, if you went to a prepaid carrier that costs less money, bought a cheaper phone at full cost then the subsidized version it's going to be cheaper.

All I'm saying is this:

I'm paying X amount of money per month to get a shiny new HTC Thunderbolt plus we'll say 200 up front for the subsidized phone.

If after two years, I stick with the same plan without upgrading, I'm getting served. If I do buy a new phone, I'm not getting served as much. The subsidy is built into the base rate of X no matter if I use it or not. I could sign up on a contract and keep and NOT get a new phone to begin with and am still paying X. Same thing.

I'm of the belief that the business model for cell phones is very much business friendly and not consumer friendly at all the way we do it in America (with contracts). The sooner pre-paid makes some dents and forces change, the happier I'll be.

It really is too bad that TMobile got rid of there reverse subsidization plan. On their plan, I could get a phone for 200 and take a 2 year contract, or pay the full price for the phone, not have a contract, and have my monthly charge be significantly less. Someone did the comparison with a Nexus one a few years back and there was a couple hundred bucks in savings over the two year period if I remember correctly.

I cannot emphasize enough that I hate cell phone contracts. I haven't had one in 2 years and don't look forward to going back to one. Having said that, I'm paying the same price whether I do or not so I'm going to take the subsidy and keep my 40$ unlimited plan and get the iPhone.

[retailguy]

Huh, when did I do this?

Virtually every other post since you've been back, you've preached that none of us know what we're talking about.

I'm not telling anyone it's a good deal because it's not. Cell phone data is ridiculously priced. It's overpriced for every phone, not an iPhone, or a Thunderbolt, or a Tralala. That doesn't change the fact a hundred million people are going to buy iPhones and iPads and that it's not a great stock. I'm not debating anything beyond A) the relative cost of the product to other comparable products b) that the product is not overpriced c) the stock and it's current/future value

You've preached the "relative cost" the past few days of the IPAD and what a great deal it is. I, and others, vehemently disagree.

You've encourged me to leap into the tablet market, in part because I've wanted to try some available flight software, but in part to "experience" just how bad an android tablet can be.

Years and years ago, I bought a VHS player instead of a BETAMAX, so I escaped the relative value of obsolecense. I thought I'd take the proceeds, saved over 30+ years and sink them into a couple of android tablets.

I bought an Acer Iconia A500 for my wife, and a Viewsonic G Tablet for myself. I want you to know that I bought the G Tablet specifically because all the "online experts" hated it. I plan to root it, and install the latest version of Honeycomb.

Then I'll benchmark it against my daughters IPAD 1's that their grandfather bought them. I'll be happy to provide the specs for you to benchmark your IPAD 2. Look for the thread in a week or so.

BTW - My cost was $580 for both tablets, $80 bucks cheaper than the best priced 16gb IPAD 2 with GPS that I could find. I needed one tablet with a GPS for the flight software, so a basic IPAD to share between us (which was the original plan until you spouted off over and over about how great they were) wasn't an option, so instead we EACH got a tablet of our own, and I've got $80 bucks left to pay the selling fees on ebay when I can't use the 90k apps that I apparently need.

Sure, I was stating the base price. I didn't know of her usage. Again, I'm not looking for a fight. Are you?

So, is this your way of admitting that you were w-w-wrong? Seriously. You spouted off with limited information about how "smart" you were and how "dumb" I was, then when you got the facts, you reiterated that you "didn't believe" my analysis and then disppeared into the ether.

I don't need to look for a fight, I just have to wait 10 minutes for you to post and there it comes again... Just before I responded to this, I read your post "instructing" skinbasket on how to educate his children.

Your pompous ass knows no bounds, does it? As you'll find out, the decisions to educate your children are yours, and yours (almost) alone, and are best left there. You don't seem to get that, but when some 25 year old idiot tells you "how" to educate your children somewhere in the future after you're no longer 25, (without a request for their expertise), you have my permission to knock their fucking idiot head off. At that point, you just might get it, but my hope for that is fading like a shooting star on a clear night.

--- This was a response to your previous post ----
RG, you're presenting a scenario that was not discussed. Sure, if you went to a prepaid carrier that costs less money, bought a cheaper phone at full cost then the subsidized version it's going to be cheaper.

I am beginning to believe that you don't remember what your little fingers type. Let's refresh your memory, shall we?

With cell contracts and subsidies, you're paid 400 dollars over 2 years essentially to sign a contract. You could go the prepaid route and see significant monthly savings but then you're paying full price for the handset. Seeing as prepaid is such a small fraction of the market in America, why would someone not upgrade? They're not getting the 400 dollars back into their pocket if they don't.

You defined my response. You dismissed prepaid on the basis of a small footprint, and used that "small footprint" to justify an upgrade.

I purposely picked one of the most expensive phones that they offer, AND, I purposely upgraded after two years to the SAME PHONE you were using and paid for both upgrades.

All I'm saying is this:

I'm paying X amount of money per month to get a shiny new HTC Thunderbolt plus we'll say 200 up front for the subsidized phone.

If after two years, I stick with the same plan without upgrading, I'm getting served. If I do buy a new phone, I'm not getting served as much. The subsidy is built into the base rate of X no matter if I use it or not. I could sign up on a contract and keep and NOT get a new phone to begin with and am still paying X. Same thing.

Your analysis was incomplete on so many levels, I just focused on the financial end of the deal.

There are many reasons not to upgrade and enter into a new contract that have ZERO to do with money. You want the freedom to leave at any time with no prepayment penalty, is just one of them.

If I make that decision, I'm not getting "hosed". Rather, I'm choosing to pay slightly higher monthly cost for less risk and the freedom to move service in MY time instead of the carriers.

I'm of the belief that the business model for cell phones is very much business friendly and not consumer friendly at all the way we do it in America (with contracts). The sooner pre-paid makes some dents and forces change, the happier I'll be.

I'll throw this one out to the group. In Partials previous posting, in this and other threads, did ANYONE reach this conclusion as to what he was saying? Anyone?

It really is too bad that TMobile got rid of there reverse subsidization plan. On their plan, I could get a phone for 200 and take a 2 year contract, or pay the full price for the phone, not have a contract, and have my monthly charge be significantly less. Someone did the comparison with a Nexus one a few years back and there was a couple hundred bucks in savings over the two year period if I remember correctly.

So, then, WHY did T-mobile get rid of it? Do you think perhaps, THAT THEY MADE LESS MONEY THIS WAY? Hello? McFly? You in there?

I cannot emphasize enough that I hate cell phone contracts. I haven't had one in 2 years and don't look forward to going back to one. Having said that, I'm paying the same price whether I do or not so I'm going to take the subsidy and keep my 40$ unlimited plan and get the iPhone.

So, let me get this straight. You have been "off" contract for two years. This means that the "advice" that you offered ziggy about her boss not upgrading is something that YOU chose not to do? But he was "stupid" for not doing it? HUH? Are you for real?

I don't have a SERO plan, so I haven't read the details. However, typically when you move to a new handset with Sprint, you have to change plans. Since the Epic requires special data, and the IPHONE certainly will, I won't be shocked when that shiny $40 plan will not work with the IPHONE, or the Epic. You need special data plans with those phones and they weren't in existence when that phone plan you have was developed. Good luck.