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John Legere  (Source: businessweek.com)
T-Mobile is the last of the major U.S. carriers to join the iPhone bandwagon

T-Mobile USA's CEO said that the company will finally begin selling the iPhone and eliminate cell phone subsidies in about three to four months.

"They're all, I would call them, in three to four months as opposed to six to nine months," said John Legere, T-Mobile USA CEO.

Last year, T-Mobile said it would try to bring in more customers from rivals by offering the iPhone and cutting cell phone subsidies in 2013. By eliminating these cell phone subsidies, customers can enjoy lower service prices and more flexibility (meaning that customers will pay the entire purchase price of the phone right off the bat instead of getting a discount in exchange for a two-year contract).

Meanwhile, rivals like Verizon and AT&T still depend on subsidizing cell phones to give device discounts while pulling customers into two-year contracts.

"If the old industry structure chooses to ignore what we do, that's a potential," said Legere.

T-Mobile is the last of the four major U.S. carriers to sell the iPhone. AT&T was the first carrier to sell Apple's smartphone when it was released in 2007. In early 2011, Verizon finally got its hands on the iPhone as well, and later that year, Sprint started selling the iPhone 4 and 4S with unlimited plans (which was a competitive edge, considering AT&T and Verizon had both nixed their unlimited data plans for tiered packages).

T-Mobile is now moving along with its introduction of the iPhone as well, and seeks a competitive edge of its own with the elimination of cell phone subsidies.

T-Mobile also has a few other tricks up its sleeve, such as a possible merger with MetroPCS. The companies are currently seeking approval.

Source: Reuters



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Phone prices
By Gunbuster on 1/9/2013 3:42:13 PM , Rating: 2
Maybe once people have the full phone price in their face 100% of the time they can work on lowering those prices.

Galaxy note II: $699
HTC 8X: $579
...

WTF




RE: Phone prices
By SpartanJet on 1/9/2013 4:20:22 PM , Rating: 4
People really need to do the math and see even paying full price for a phone you will save money over the 2 year period.

For example at the time when I purchased my Samsung S3 from Tmobile full price at 650 ATT and Verision both had the phone for ~199 subsidized. On Tmo I pay $65 a month which is the 5GB "sort of unlimited" plan + tethering. I priced similar plans from ATT and Verison using subsidized phones and couldn't get something similar for under $100. Lets do the math:

$199 + (~$100x24) = ~$2600 for 2 years
$650 + ($65x24) = ~$2200 for 2 years

Why is it so hard for people to figure out that you save money using this method PLUS I can get a new phone whenever the hell I feel like it (which is about now I'm itching to get the Note 2 lol).


RE: Phone prices
By KOOLTIME on 1/9/2013 6:23:53 PM , Rating: 3
Incorrect,

Subsidies have nothing to do with your monthly phone bill.

All vendors use IPhone and other brands, its the monthly service contract

they want to make sure they keep YOU paying THEM.

Telco companies could care less what brand of phone a person uses. Since they dont manufacture them, all they get is a % commission for the device to access their networks. Other then that its the monthly recurring bill they charge, why they love 2 year contracts, due it keeps customers in check even if services is terrible.


RE: Phone prices
By SpartanJet on 1/9/2013 7:28:54 PM , Rating: 2
LOL its not incorrect, it is correct you do save money.


RE: Phone prices
By Cheesew1z69 on 1/10/13, Rating: 0
RE: Phone prices
By AEvangel on 1/10/2013 10:47:32 AM , Rating: 3
quote:
So, you are trying to say, someone like Verizon, if you buy it outright, that you save money? Bullshit, the bill is going to be the same as if you didn't buy it outright. That is not saving money.


No he is right if you buy a PREPAID plan rather then a 24 month contract plan with a subsidized phone you will end up playing on average of $15 to $25 a month less, which is about the cost of the phone.

The side benefit is that you can now upgrade your phone and or change your plan whenever you like.


RE: Phone prices
By Gunbuster on 1/10/2013 11:27:58 AM , Rating: 2
What I'm saying is why do smartphones cost $700? You can go to target and pick up a prepaid flip phone for $29. It connects to the same network, has two screens (small ones), Bluetooth, etc...

Now how does a smartphone BOM jump over 2000%? The manufactures hide the cost of the phone behind the subsidy and are happily making huge profits.


RE: Phone prices
By Mint on 1/10/2013 12:53:38 PM , Rating: 2
The top smartphones cost that much because they are quasi-monopolies. If someone is pretty dead set on Apple - whether through iTunes investment, marketing, trust, friends, whatever - then Apple will price their phone according to what people can afford, not according to cost.

The Galaxy Note II is the only phone with an inductive stylus, and even beyond that there really isn't anything that offers the same software, size, battery life, AMOLED, etc. Samsung doesn't have to worry about competition, so its demand is not as elastic with price as most products.

If smartphones were really such money makers, Samsung and Apple wouldn't be getting 90%+ of the industry profits. Everyone else is pricing them as low as they can while recouping development costs. Blame the consumers for not rewarding them enough.

Finally, and most importantly, most smartphone contracts cost $2000+. Not many people are going to stray away from the biggest brands just to save 5-10%.


RE: Phone prices
By Dr of crap on 1/10/2013 12:53:20 PM , Rating: 2
Same reason everyone goes to buy a car and wants to know monthly payments from the loan process. Thinking "can I afford that much each month?"
It's the monthly charge added to all those other monthly charges that matters.

IF the savings were closer to a grand THEN the full price phone idea might have a bigger following.


RE: Phone prices
By iluv2fly on 1/10/2013 10:51:23 AM , Rating: 2
Looks like $399 Nexus 4 will be selling like Gangbusters :-)))


RE: Phone prices
By Dr. Kenneth Noisewater on 1/10/2013 12:57:33 PM , Rating: 2
Yeah right if they ever actually have any in stock.. Have you tried buying a Nexus 4 on google lately?


RE: Phone prices
By jthistle on 1/10/2013 2:24:34 PM , Rating: 2
People still won't be paying the full price up front. There will be an installment plan to pay for the phones.


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