Why is 3G so expensive?

[jsh1120]

You lucked out for sure!!! Very expensive for phone across the pond!!

Sent from my Verizon Black 64GB iPad 2 IOS 5.0.1 Update using iPF

We don't get a true price break. We pay back the subsidy (and much more) over the course of a two year contract. The carrier is simply financing the purchase of the phone at a very high interest rate and locking the consumer into a two year contract. And if you try to switch carriers before your two year contract is over, you pay a penalty that covers the remainder of the price for the phone. American consumers, however, are addicted to credit purchases and our schools don't bother to teach the basics of credit purchases.

 

[tlbaker]

We don't get a true price break. We pay back the subsidy (and much more) over the course of a two year contract. The carrier is simply financing the purchase of the phone at a very high interest rate and locking the consumer into a two year contract. And if you try to switch carriers before your two year contract is over, you pay a penalty that covers the remainder of the price for the phone. American consumers, however, are addicted to credit purchases and our schools don't bother to teach the basics of credit purchases.

Yup!!! They didn't teach us about credit when I was in school...

Sent from my Verizon Black 64GB iPad 2 IOS 5.0.1 Update using iPF

 

[Kaykaykay]

We don't get a true price break. We pay back the subsidy (and much more) over the course of a two year contract. The carrier is simply financing the purchase of the phone at a very high interest rate and locking the consumer into a two year contract. And if you try to switch carriers before your two year contract is over, you pay a penalty that covers the remainder of the price for the phone. American consumers, however, are addicted to credit purchases and our schools don't bother to teach the basics of credit purchases.

Agreed. I'd prefer to buy my devices unsubsidized and pay for data in a more competitive market.

I've never understood why borrowing money -- whether via credit cards, student loans, etc., -- was so hard for people to grasp. It boils down this: Borrow anything from lenders, expect to pay back in multiples.

 

[tlbaker]

Agreed. I'd prefer to buy my devices unsubsidized and pay for data in a more competitive market.

I've never understood why borrowing money -- whether via credit cards, student loans, etc., -- was so hard for people to grasp. It boils down this: Borrow anything from lenders, expect to pay back in multiples.

Yes, you are the master of finding good data deals.

Sent from my Verizon Black 64GB iPad 2 IOS 5.0.1 Update using iPF

 

[twerppoet]

We don't get a true price break. We pay back the subsidy (and much more) over the course of a two year contract. The carrier is simply financing the purchase of the phone at a very high interest rate and locking the consumer into a two year contract. And if you try to switch carriers before your two year contract is over, you pay a penalty that covers the remainder of the price for the phone. American consumers, however, are addicted to credit purchases and our schools don't bother to teach the basics of credit purchases.

I would agree with you except for one thing. In most credit purchases the consumer has the option of paying up front for the product and saving money in the long run. With a cell phone both the contract and off contract customer will pay exactly the same amount over two years. The only benefit is that the off contract purchase may leave at any time with less penalty (there will still be activation fees and such), in search of a cheaper offer. On the other hand, the cheaper carrier also has contracts, and chance are if you'd started with them you'd have saved even more money.

 

[Kaykaykay]

I would agree with you except for one thing. In most credit purchases the consumer has the option of paying up front for the product and saving money in the long run. With a cell phone both the contract and off contract customer will pay exactly the same amount over two years. The only benefit is that the off contract purchase may leave at any time with less penalty (there will still be activation fees and such), in search of a cheaper offer. On the other hand, the cheaper carrier also has contracts, and chance are if you'd started with them you'd have saved even more money.

That's essentially JSH's point: In the U.S. market, the consumer doesn't have much choice.

 

[twerppoet]

That's essentially JSH's point: In the U.S. market, the consumer doesn't have much choice.

Don't disagree with that point, just nitpicking the part about American's and credit, since the contracts do not follow a credit model. If they did you'd pay less in the long run if you bought the phone up front. The only way to save money with a non-subisded phone is to chase deals, and hope you pay enough less monthly to make up for the activation fees.

Btw, I remember being taught about credit in school, and that was before credit cards. I'm sure American students are taught, it's just that a few hours a year of logic have little chance against 18 years of constant immersion in consumerism and then the credit card offers start rolling in.

 

[Kaykaykay]

Don't disagree with that point, just nitpicking the part about American's and credit, since the contracts do not follow a credit model. If they did you'd pay less in the long run if you bought the phone up front. The only way to save money with a non-subisded phone is to chase deals, and hope you pay enough less monthly to make up for the activation fees.

Btw, I remember being taught about credit in school, and that was before credit cards. I'm sure American students are taught, it's just that a few hours a year of logic have little chance against 18 years of constant immersion in consumerism and then the credit card offers start rolling in.

Agreed on the need to chase deals, which to me seems time-consuming and not worth the effort given limited options in the U.S. market.

No one taught me about credit, but it seems basic: Borrow and you will have to pay. Even if all interest were forgiven in the U.S., I'd bet that many American consumers couldn't even come up with the principal of what they borrowed, because they've lived beyond their means. Of course, there are some things we must borrow for, but borrowing has become automatic among many Americans, without thought on how to repay.

 

[Bob Maxey]

We don't get a true price break. We pay back the subsidy (and much more) over the course of a two year contract. The carrier is simply financing the purchase of the phone at a very high interest rate and locking the consumer into a two year contract. And if you try to switch carriers before your two year contract is over, you pay a penalty that covers the remainder of the price for the phone. American consumers, however, are addicted to credit purchases and our schools don't bother to teach the basics of credit purchases.

In high school, I had a class called Consumer Math. We learned about credit, budgets, and checkbook balancing.

 

[jsh1120]

...

Btw, I remember being taught about credit in school, and that was before credit cards. I'm sure American students are taught, it's just that a few hours a year of logic have little chance against 18 years of constant immersion in consumerism and then the credit card offers start rolling in.

You're absolutely right. And soon after I hit send I regretted an unnecessary swipe at teachers and schools.

 

[f4780y]

Orange (UK) do a £10 1Gb+1Gb (peak and off-peak) plan with no ongoing commitment. I've been on it for months and works for me.

 

[twerppoet]

You're absolutely right. And soon after I hit send I regretted an unnecessary swipe at teachers and schools.

Not that there aren't things that need improving in the school system, but neither the subject material nor the teachers are to blame for most of it. Can't go further than that without going further off topic, and skirting the edge of forum rules; so I'll just swallow my usual ranting.

I didn't think of your comment as a swipe. Education is one of my automatic opinion dispensation buttons. Sorry.

 

[Procypher]

Fewer carriers?

May because there are fewer cellular carriers today after all the mergers?

 

[wxman2003]

The real issue with mobile providers in the US is there is no competition. Sure, there is AT&T and Verizon, but in reality there is only one CDMA provider and one GSM provider. The others are just fleas. Without the ability to take my phone or iPad from Verizon to AT&T and vice versa, makes it nothing more than a rigged market where the 2 companies have almost identical plans. Even with more cell phone makers coming out with both CDMA/GSM phones, the mobile providers can still decide whether or not to allow you to use that phone on their network. Remember a few years ago when all that additional bandwidth came up for sale by the US government? Remember Verizon and Google buying it all up? Remember Verizon saying they were going to open their network up so people can bring their own phones over to their network? So far, it has been a big scam. Still no real competition, and there never will be.

 

[AdmiralAdama]

I wish Charles Bronson was still with us.
He'd fix the heartless greedy telcos.
AA