Print 44 comment(s) - last by Piiman.. on Jul 27 at 2:24 PM

T-Mobile's CEO ranted about the plan on Twitter

With three out of four of the major U.S. wireless carriers rolling out upgrade plans, there was bound to be some heated competition -- and even an exchange of words. 

T-Mobile CEO John Legere bashed AT&T's "Next" upgrade plan on Twitter several times over the last 24 hours, claiming that T-Mobile's "Jump!" upgrade plan is cheaper and better for consumers. Here are some of the tweets, starting from oldest to newest:

Last week, T-Mobile launched its new "Jump!" program, which lets customers upgrade every six months for an extra $10 fee each month on top of their regular, monthly wireless charges. However, it differs from the "Next" plan in that it applies to only smartphones, not tablets. Also, customers have to pay the $10 monthly fee unlike AT&T, which doesn't require an activation fee or down-payment for using its plan, but does make customers pay the remaining months’ fees. 

Earlier this week, AT&T announced its "Next" plan, which will allow customers trade in their smartphones and tablets every 12 months on a post-paid basis -- meaning they pay a monthly fee on top of their regular AT&T plan based on a 20-month cycle.

For example, if a customer were to get a new smartphone or tablet, the retail cost of the device would be divided by 20. That number would then be added to the monthly bill on top of the traditional or family-share AT&T plan. In 12 months, the customer can upgrade to a new device and start the process over again. 

The "Next" plan won't lay any extra fees on the customer other than the retail price divided by 20, but customers will be forced to pay the remaining months’ fees. You can expect to see it roll out on July 26. 

T-Mobile and AT&T aren't alone in offering new upgrade plans. Verizon is planning a big reveal of the "VZ Edge" plan, which will reportedly allow customers to upgrade to new devices as soon as they pay off 50 percent of their current smartphone. 

Source: Phandroid

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How to fix the cellphone industry.
By Motoman on 7/17/2013 12:00:20 PM , Rating: 4
As noted before, but it's worth noting again.

The cellphone industry should work *exactly* like the landline phone industry.

You walk into K-Mart. You pick out a phone, pay for it, and bring it home.

You contact a phone service provider. They give you service. You can cancel that service and change to another provider at any time, for any reason.

And if something goes wrong with the phone you bought, you deal with it like every other consumer product in the world - via the warranty you got from the retailer and/or manufacturer. Not enter an endless refurb hell from which there is no return.

Done. No long-term subsidized rate plans to obfuscate the cost of the device. No penalties for changing service providers. And no service providers endlessly passing around untold numbers of defective phones as "refurbs" instead of actually ensuring that consumers have devices that work as advertised.

RE: How to fix the cellphone industry.
By Red Storm on 7/17/2013 12:26:38 PM , Rating: 3
To be fair, if you walked into a carrier store and paid for a phone as you said, then you wouldn't be tied to a contract. That's for subsidized phones.

But I agree with you, unfortunately it's just wishful thinking, I don't see it ever happening.

RE: How to fix the cellphone industry.
By Motoman on 7/17/2013 1:12:55 PM , Rating: 4
Yes, and I'm saying there should be no option at all for a subsidized phone plan, and/or long-term contracts.

If you want a phone and find that you can't afford to pay it's full price at once, USE A CREDIT CARD. Or maybe, *gasp*, buy a phone you can actually afford.

Vast herds of consumers literally have no idea what they're actually paying for a cellphone. They honestly think they paid $99 for their latest iThing, since that's what the initial payment was.

If they actually were confronted with the *actual* cost of the cellphone they want to buy, and then realize they're considering carrying around a $600 device that they're prone to drop, sit on, and forget somewhere...maybe they'll reconsider. And at some point, maybe the manufacturers will switch from using advancing technology to perpetually increase the cost of cellphones by stuffing more crap in them that doesn't help 99% of the population, and instead use technological advances to simply decrease the cost of cellphones over time, granted that we're already at a point where any given smartphone is likely to provide vastly more functionality and capability than the vast majority of users would ever care to do, or even want to know about.

RE: How to fix the cellphone industry.
By crimson117 on 7/17/2013 1:30:59 PM , Rating: 2
Or instead of using a credit card, phone retailers could offer 2-year no-interest or low-interest financing, like they do in europe.

By Rukkian on 7/17/2013 2:03:53 PM , Rating: 2
Or instead of using a credit card, phone retailers could offer 2-year no-interest or low-interest financing, like they do in europe.

Isn't this exactly what they are rolling out with this?

As for double dipping, yes they are, but you did get the last phone to do with what you want. At this point, it just shows the actual difference in cost of service is around 30-40$/month from Tmobile to everybody else. Just wish they had coverage more than 2 miles from my house, or for my way to work.

By Bateluer on 7/17/2013 4:24:23 PM , Rating: 2
This is exactly what TMO does with their uncarrier plans.

RE: How to fix the cellphone industry.
By Mint on 7/18/2013 11:25:51 AM , Rating: 2
Yes, and I'm saying there should be no option at all for a subsidized phone plan, and/or long-term contracts.
Yeah, but that eliminating an option from the marketplace. I don't think that would fly.

What we really need is a consumer protection law where all fixed-term contracts are required to print in a large font "TOTAL CONTRACTUAL OBLIGATION" and "MAXIMUM TERMINATION FEE". So when Verizon sells you a $200 iPhone on a two year contract with a $100/mo plan, you see $2600 in bold.

The problem is not financing options. The problem is duping people into committing to things they aren't aware of.

RE: How to fix the cellphone industry.
By rountad on 7/18/2013 1:11:46 PM , Rating: 3
I'm not defending AT&T because I think that they are scumbags, but how difficult is $200 + ($100 x 24) to determine?

I do agree that the numbers should be laid out clearly and not buried in a mound of legalese.

By sorry dog on 7/18/2013 2:16:46 PM , Rating: 2
Not hard at all.

But the truth of the matter is that if you see a $2600 dollar bold print figure and $800 termination fee, then they might think a little harder about what they can afford and how much that shiny Iphone 7 really costs.

Then after they think about it twice, they will probably still pay the 30% premium because your not cool if your phone doesn't have I in the name....but at least they got screwed over on the up and up.

By alpha754293 on 7/18/2013 10:43:38 AM , Rating: 2
While I can't speak for their carrier speeds or reliablity etc., but you CAN do that already with Virgin Mobile USA. Buy the phone outright, and then for example, the cheapest iPhone plan is $35/month a month (300 minutes, unlimited data). No contract.

That's EXACTLY what you're talking about.

Now, if you don't like the carrier for whatever reason, can't help you with that. (You can also go with like MetroPCS which I think has like $40/month plans which is advertised (IIRC) as unlimited everything (I think - I dunno, I never checked/looked into it.))

So it can be done already. And back when landlines were still owned by a majority of households, you were pretty much stuck with one carrier anyways, so if that carrier sucked, there wasn't much that you could have done about that back then either.

By sleepeeg3 on 7/17/2013 2:38:46 PM , Rating: 2
It's call a "Prepaid" plan. Most consumers are not aware that all the major carriers offer them. Some have limitations, but others have ways of getting around those limitations...

RE: How to fix the cellphone industry.
By MrBlastman on 7/17/2013 2:43:48 PM , Rating: 3
You can. It is called Ebay. Just buy an unlocked phone off there and proceed to laugh at the carriers by putting it on a pre-paid plan.

RE: How to fix the cellphone industry.
By Motoman on 7/17/2013 3:15:59 PM , Rating: 2
Yes, to you and the poster above you.

However, I'm saying that phone subsidies and long-term contracts should simply not be available. Period.

And also the bit about warranty service instead of the endless hell of refurb replacement phones.

RE: How to fix the cellphone industry.
By MrBlastman on 7/17/2013 5:15:58 PM , Rating: 2
Should and are are two different concepts. How do you propose making this occur? Through regulations? Or are you speaking purely from an idealistic, conceptual point of view?

Idealistically I agree with you. They shouldn't exist, nor should lots of things in the pay-as-you consume digitial playground. The problem is people will buy them, so they are.

Unless some sort of law is written or regulatory body is imposed, I don't see it changing any time soon--unless, of course, a less-costly alternative is implemented. That's the impetus of all of this... cost and ease of acquisition.

I hate the whole phone game. I think it sucks. It exists the way it does though because the primary carriers who own the towers and equipment fight tooth and nail over maintaining control of it, much like they did back in the day when we relied on copper wire for everything. To do this it requires money and the best way to fleece money from the consumer is to disguise in a way they can never tell they're being robbed. Thus, you have these ridiculous offers and contracts.

The handset makers like the contracts because it increases revenue and helps give them free advertising (through the provider's store and clerks). They also can force in some instances the provider to pay them a ransom in order to market their product. The entire system is screwed up.

So beyond being idealistic as we both would like to end all of these shenanigans, what exactly would you do to stop this, realistically speaking (other than competition)?

RE: How to fix the cellphone industry.
By Motoman on 7/17/2013 6:02:19 PM , Rating: 2
I'd honestly vote for industry regulation. Knock it off with the shenanigans. Sell phones. Provide service. Period.

There's no reason in any possible universe why it shouldn't be that way.

By bigboxes on 7/17/2013 8:14:02 PM , Rating: 2
Again, I agree with you 100% on this front. There should be regulations that stop this anti-competitive behavior. There is no reason they can't offer all the required bands on one chip these days. You buy the phone at retailers that compete to offer you the best price/warranty and you then choose a provider that gives you the best price/service/customer service. Can't compete? Then get out of business. I'm tired of the industry lobbying to continue their anti-competitive behavior. The same with cable/satellite tv/internet providers.

RE: How to fix the cellphone industry.
By Reclaimer77 on 7/18/2013 12:55:32 AM , Rating: 2
I'd honestly vote for industry regulation.

On what grounds? The usual "I'm Moto and issue X should work the way I think it should"?

Calling for added regulation on an industry that's doing nothing essentially wrong, and is able to meet the needs of millions of consumers in an ever-growing field? That's just insanity.

You can't just snap your fingers and make everything work the way you think it should. Especially if you're calling for more Government claptrap. We have way too much of that already! Government is not the answer. If you want someone to blame for the current situation look no further than those around you, if you MUST blame someone.

RE: How to fix the cellphone industry.
By croc on 7/18/2013 3:18:17 AM , Rating: 2
Although I no longer live in the US, I still vote. So I do try to keep up with the issues. One issue that I do pay some attention to is the amount of monopoly / duopoly positions that are currently developing, especially in the communications field. Given that in many areas there is a LEGISLATED monopoly / duopoly, I see no reason for it not to also be REGULATED. However, I suppose that you are willing to once again let your conservative values bite your pocketbook in half. Gods... The rich boys must really have fun with you, toting their water and all...

By sleepeeg3 on 7/18/2013 9:48:31 AM , Rating: 2
Regulation costs money. The invisible hand always finds a way around it, at the expense of the consumer. Despite regulation, we have prepaid plans, because the smaller carriers brought them out and the larger carriers brought out competing plans (i.e. GoPhones and AIO). Go figure.

By retrospooty on 7/18/2013 7:50:02 AM , Rating: 2
"On what grounds? The usual "I'm Moto and issue X should work the way I think it should"?"

LOL... But in his defense, most of his "ideal scenarios" would be really nice. Too bad the world is completely nuts and his ideals aren't realistic given the world's relentless insanity.

By karimtemple on 7/18/2013 8:39:49 AM , Rating: 2
If I was making an action cartoon for children, the main villain would be like a reverse He-Man who would raise his sword and yell "THERE OUGHT TO BE A LAW!!®" He'd become imbued with evil society-destroying energy.

Here's how the rest of my day goes step-by-step, after reading your post:

1) Laugh to myself. "Thank God you're not in office!"
2) Reflect on the actual state of American politics.
3) Realize people like you ARE in office.
4) Weep deeply, alone.
5) Illicit substances as a coping mechanism.

By Piiman on 7/27/2013 2:01:55 PM , Rating: 2
Why? If the carrier is willing to pay 75% of the cost for a phone if I do business with them 2 years i'm fine with it. The ETF is only the retail cost of the phone - what you paid up front + how long you still have left on your contract. The plan cost the same if you buy the phone from them or not.

Well these new plans don't work that way and that’s the new got you.

By Vardant on 7/17/2013 4:12:41 PM , Rating: 2
You can get that already in the UK.

I bought the Galaxy Nexus and have price plan that is unlimited calls, text and data for only £16.49/month ($25/month) with Vodafone. No long term contract to worry about either :)

RE: How to fix the cellphone industry.
By StevoLincolnite on 7/17/2013 8:40:32 PM , Rating: 2
You walk into K-Mart. You pick out a phone, pay for it, and bring it home. You contact a phone service provider. They give you service. You can cancel that service and change to another provider at any time, for any reason.

You can buy unlocked phones from Kmart, then you can sign up with any provider you want. - In Australia at-least you can, not sure about the USA.

By Motoman on 7/17/2013 9:25:20 PM , Rating: 2
Yes, to all the people pointing this out...yes.

My point is that this should be the ONLY option. There should be no other way that this works. There should be no long-term contracts, with subsidies that obfuscate the cost of the device.

But I'm not sure it fixes the refurb-go-round problem though.

By flyingpants1 on 7/18/2013 1:12:52 AM , Rating: 2
How to fix the cellphone industry by Motoman:
-First, raise the price of the smartphone to $650.
-Then, in case anyone still wants to buy it, sell the phone and the cell phone service in two different physical locations, making them even harder to buy.
-Finally, stop offering contracts, which bring the cell provider anywhere from $1200-1700 per signup every 2 years.

All joking aside, I think you have the right idea. You just stated it in a way that sounds very impractical.

My friend does something similar with the Nexus 4 and Koodo (canadian provider). He walked into Koodo and got a Nexus 4 for $0 (he could have chosen to pay *any amount* between $0-300), on a $40 plan with no contract and no hidden fees. He owes the provider $300, they decrease it by $4 every time he pays his bill ($48/year) and he can pay it back whenever he wants. I think this is the best way.

For this model to work, phone prices have got to come down. No more 70% margins.

By Piiman on 7/27/2013 1:51:59 PM , Rating: 2
The problem with that is these phones now cost 600.00 or more. Land line phones were a fraction of that cost. It would be nice to get a nice smart phone for 25.00 though :-)

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