Verizon Eliminates Contracts and Device Subsidies
by Brandon Chester on August 7, 2015 2:58 PM EST
North America has always had a fairly unique pricing structure for buying mobile devices. In many places, the concept of purchasing a device for a heavy subsidy and committing to stay with a given carrier for two or three years is unheard of, but in the United States and Canada it has always been the norm. However, that dynamic has been changing as it has become more difficult for operators to subsidize expensive smartphones for the wide market of consumers. Both T-Mobile and AT&T have moved away from the original model of contracts and subsidies in favor of installment plans or simply selling devices at full price, and today Verizon announced that they will follow in their footsteps.
With Verizon's new plans, there are no more contracts and no more device subsidies. Instead, consumers pay for their phones, pay for a bucket of data, and then pay a fee for each device that they add onto the account. The base monthly data fees are 1GB for $30, 3GB for $45, 6GB for $60, and 12GB for $80. On top of the data bucket fee, users will pay $20 to add a smartphone to the account, $10 for a tablet/data stick, and $5 for a smartwatch with cellular capabilities. Additional data over the limit will cost $15 per gigabyte,
As for existing consumers, Verizon will apparently offer avenues for them to get another subsidized device when they transition to these new plans, and they can also hold onto their older plans if they desire. Verizon customers interested in the new plans can switch over when they go live on August 13.
Source: Re/code
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A5 - Friday, August 7, 2015 - link
No it isn't. They just sell the phone as $200 down, then $25/mo.Your bill "magically" ends up being the same as was before, but at least now you save money if you keep it longer.
Impulses - Saturday, August 8, 2015 - link
Pretty much, they've kept pricing constant for half a decade thru all sorts of similar switcheroos... Unless you're on Sprint/Tmo, or on a family plan, or you're buying your own devices and shopping sound, you're probably paying close to the same per month to AT&T/VZW as you were five years ago.cmdrdredd - Friday, August 7, 2015 - link
T-Mobile lets me get whatever I want for no money down and I pay $25 per month or so. After I pay half the device cost off I can trade up for something new if I want.cmdrdredd - Friday, August 7, 2015 - link
They really need an edit button lol.Nobody I know pays outright for their device. Everyone on any major carrier I can think of either got a subsidy or pays installments.
RT81 - Friday, August 7, 2015 - link
Yep. I don't see this making much of a difference for the flagship phones. You're going to be paying roughly $200 plus tax for the full cost of the phone and then financing the phone through a monthly fee.It's honestly not much different than a contract, really. T-Mobile has rules in their agreement that won't allow you to sell your phone immediately. But you do have the added benefit of being able to payoff the full amount of the phone at any time and lower your bill.
cmdrdredd - Saturday, August 8, 2015 - link
Yep and what's good is when you pay off the device, the $25 a month is dropped off the bill. The way a subsidy worked was the extra charge was always on the bill and you could not get it removed.kaidenshi - Friday, August 7, 2015 - link
So...still the most expensive carrier. I guess it's nice to see the angry red giant join the ranks of most other carriers though.Still, I think I'll be sticking with Ting, who has been doing the bucket thing for a long time and costs less than half of Verizon's insane prices. On Ting it's $6 per device, and the lowest buckets start at $3 each.
mortimerr - Friday, August 7, 2015 - link
Does anyone know enough about this to know if phones through Verizon will still come with a ton of useless bloatware?Ian Cutress - Friday, August 7, 2015 - link
Wow. I pay £16/mo for unlimited 3G data/minutes/texts on EE.Impulses - Saturday, August 8, 2015 - link
How far can you travel before you're facing long distance and roaming charges? What kinda 3G speeds do you see in congested areas?