Nexus One: ETFs And Then Some... Subsidized phone has potential for $550 in fees (plus $180 price) Again, if Google's goal is really to disrupt the subsidized pricing system implemented by the major wireless carriers with their new suite of "Google phones," they're going to have to do better than this. Not only is their new Nexus One pricing (subsidized or not subsidized) not disruptive, Engadget indicates there's even more fees than usual. Customers who buy the subsidized Nexus One face not only a $200 ETF from T-Moble, but a $350 Google "Equipment Recovery Fee." In other words, if you cancel after the first 14-day trial period is over but before four months have passed -- you're socked with $550 in fees. That's more than the cost of the unsubsidized phone, especially considering users already paid $180. Ok, so the obvious answer is to buy the unlocked, unsubsidized phone directly from Google and pay $550, but they're you're stuck with a company that apparently doesn't know how to support phones. This pricing revolution's having a rocky start.
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  ptrowskiGot Helix?Premium
join:2005-03-14
Putnam, CT
kudos:4 | Equipment Recovery Fee? What the hell? This just doesn't seem beneficial at all to consumers. | |
|  |  56403739Less than 5 months leftPremium
join:2006-03-08
Naples, FL
kudos:2 | Re: Equipment Recovery Fee? Anyone who expects Google to not be in it for the money (and a lot of it) is naive. Right now they are where Microsoft was in the 80's going up against IBM's entrenched business model. At some (very soon) point in the future Google will be the Internet equivalent of Microsoft with all the hate and vitriol that accompanies a market dominating position.
Google is just getting started. Wait to see what happens in the next 5 years. | |
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 pnh102Reptiles Are Cuddly And PrettyPremium
join:2002-05-02
Mount Airy, MD |  Not Legal
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| |  The Dv8orJust call me Dong Suck Oh, M.D.Premium
join:2001-08-09
Denver, CO | Re: Not Legal You havent fully paid for the device if you bought it subsidized, just like you havent fully paid for a vehicle if you took a loan out on it from the manufactuer. Technically, there can be a "recovery fee".
Now that we're done with all the technicalities, this is psychotic.
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| | |  JulioBachatero y Que?Premium
join:2003-03-19
Brooklyn, NY
kudos:1
1 edit | Re: Not Legal said by The Dv8or:You havent fully paid for the device if you bought it subsidized, just like you havent fully paid for a vehicle if you took a loan out on it from the manufactuer. Technically, there can be a "recovery fee". Now that we're done with all the technicalities, this is psychotic. but the ETF is supposed to be used to reclaim the price of the subsidized device, at least that's what carriers claim to be the reason as to why they charge you a high ETF.
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| | | |  Matt3All noise, no signal.Premium
join:2003-07-20
Jamestown, NC
kudos:12 | Re: Not Legal said by Julio:said by The Dv8or:You havent fully paid for the device if you bought it subsidized, just like you havent fully paid for a vehicle if you took a loan out on it from the manufactuer. Technically, there can be a "recovery fee". Now that we're done with all the technicalities, this is psychotic. but the EFT is supposed to be used to reclaim the price of the subsidized device, at least that's what carriers claim to be the reason as to why they charge you a high EFT. They also claim they have to charge $1.99 per megabyte to 'scrape' by ... | |
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| | | | The subsidy is between you and the carrier, not you and google. | |
| | | | | | Re: Not Legal You don't know this. Google could be subsidizing the phone purchase and T-Mobile could be paying Google each month or after the subscriber's contract is up. | |
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| | ouchy exactly why I bought the unsubbed one. If I dont like it over my 3gs, it goes back on Monday.
I looked at the subbed pricing structure and did read all the fine print. Now this article doesnt mention the extra 40$ you pay for a plan in those first four months, so add that to the:
180$ new phone price
350$ (cancellation fee from google first four months)
200$ (ETF)
40$ (plan costs of subbed phone first four months)
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770$ !!!! If you cancel after 14 but before 120days! Insane. Now, you should be able to get 400$ for the phone on ebay, but still, come on google. Revolution? How about Damnation?
Kg | |
| |  FBGuyPremium
join:2005-03-19
Evanston, IL | Re: ouchy the subsidized price is not meant to help anyone but the carrier. if you back out you get hit hard with penalties.
it makes perfect sense.
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 gballMaster YodaPremium
join:2000-11-28
South Bend, IN
1 edit | isn't this the same as when you buy a phone from Amazon or any other 3rd party reseller?
I'm pretty sure if you buy from Amazon you have to have the service for like 4 to 6 months or they also will charge you an ETF on top of the ETF from the carrier.
I'm at work so I can't verify that but if its true then this is pretty much standard no?
Not that I agree with it especially if you end up paying more than you would buying the phone outright. | |
| |  meister_sdPremium
join:2006-01-29
La Mesa, CA
kudos:7 | Re: isn't this the same said by gball:or they also will charge you an ETF on top of the ETF from the carrier. What is happening here is the reseller, Amazon in your example, gets a commission for signing up new subscribers. If the user cancels, the commission is reversed against future commissions. Since the reseller doesn't like it, and it hurts them, they make the second contract to get their commission back from you - the buyer.
There is so much bullsh*t that the carriers put the resellers through. Once we sold a phone to a person who wanted it only for emergencies. So, 4 months go by and we got a charge back. The reason was that even though the subscriber paid her bill on time, she never made a call. This is one reason that when you buy a new phone, the reseller will usually make a "test" call. | |
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 BlitzenZeusBurnt Out CynicPremium
join:2000-01-13
kudos:2
 ·Frontier FiOS
| I can't see why google would implement this fee I could understand T-Mobile making sure they don't take a loss if somebody were to only take the service 15 days, and then cancel to possibly pay less for the phone even after the $200 etf, however Google? Google already got their money, and if anything T-Mobile might actually loose money here, not Google.
Google upset that they can't charge all customers full price, and want to make sure they are not just going to resell their phone?
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| | | . I thought they said it was $180 for the phone and $350 for the ETF? Did they change that? | |
| Reviews:
 ·ooma
 ·Optimum Online
·Verizon FiOS
| you know what? SCREW GOOGLE! up until this point they've been given the benefit of the doubt about doing anything good in the wireless space-- be it handsets or service.. but this is a cheap sell-out to the walled garden cellcos. a $500+ handset IS NOT anything revolutionary these days.. and not even competition for anything else locked into a CELLPHONE HANDSET MORTGAGE CONTRACT! carriers are interested in nothing more than a money grab that will drain a FEW THOUSAND DOLLARS from your wallet over the course of TWO (2) YEARS!! The only difference is google now wants in on that profiteering scam!
so friggen what if the O/S dressing (android) is on a linux based open source framework... if your wallet gets lightened to the tune of thousands per year what good is the so-called 'free' software your paying that much for the priviledge of accessing via a wireless handset?!
There's another legal scheme they call racketteering where the handset makers & the cellcos put a new spin on an old congame. Get the handsets into prepaid for 1/5th the price and then you'll have a revolution in handsets & service! Nothing less than that would do in 2010! All we're seeing is higher overall pricing for contract service after the largest consolidation in the wireless industry ever! | |
| |  NOVA_GuyObamaCare Kills AmericansPremium
join:2002-03-05 | Re: you know what? SCREW GOOGLE! Hmmm... Android-based phones for cheap on a prepaid network? Yes, I think that would be revolutionary... this is the route that Google should have taken with the Nexus One, IMHO.
While I like all of Google's free goodies and love my Droid, I'd hardly call their pricing structure on the Nexus One "revolutionary". Well, maybe it's "revolutionary" in the same way that a 70-something year old politician is a "maverick"... 
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rmdir
join:2003-03-13
Chicago, IL | . This is Google's idea of rocking the system? Gawd, Verizon is less shady than Google. | |
| ndwbr
join:2003-07-10
Atlanta, GA
1 edit | No Thanks Google I was really hyped about the Nexus One (existing T-Mobile customer here) - I was excited about the free Android SDK and creating my own phone apps but after all this bad press - no discounted price for existing customers, EDGE/3G firmware issues, absolutely no tech support from Google, and now outrageous ETF's, I'm going to say No Thanks Google, I won't even consider buying this now - you really screwed up on this one! Looks like I'll have to look to a Verizon/Droid; pity, I was really happy with T-Mobile; I've never experienced happier or more helpful tech support! | |
| | | Rent to own Hitting you twice for the same thing seems a bit out of place.
The thing that's odd to me. This isnt new. They've done this for practically every phone out there.
It's basically the system of rent to own. The system is specifically designed to make you pay more in the end; no matter what.
If you dont want to be screw over. You have to buy the thing outright. Always. That even counts for practically anything else in life.
The problem; at least in Canada. If you say buy your own unlocked phone; the carriers try to fuck you over by charging you a "foreign equipment activation fee" on top of the activation fee.
They are basically recouping the lost profit from the "subsidized" plan. | |
| |  El QuintronResident Mouth BreatherPremium
join:2008-04-28
Etobicoke, ON
kudos:2
 ·TekSavvy DSL
 ·WIND Mobile
·voip.ms
| Re: Rent to own said by munky99999:The problem; at least in Canada. If you say buy your own unlocked phone; the carriers try to fuck you over by charging you a "foreign equipment activation fee" on top of the activation fee. They are basically recouping the lost profit from the "subsidized" plan. WTF, the Nexus is a GSM phone, pop your simcard out and put it in the nexus end of story.
That's how I've always brought my foreign phone to GSM providers...
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jeraden
join:2002-06-10
Coraopolis, PA | This is a non-story, this is how it is everywhere This story is ridiculous. This is the same exact policy that every cell-phone reseller has. They act like its some heinous act on Google's part. Anytime you buy a subsidized phone, you get hit for extra fees if you cancel. That's because the cell phone carrier will not give the reseller the subsidy unless the customer maintains service.
Here's Amazon's policy:
"When you purchase your device with service from Amazon.com, we automatically pass along an instant discount from the carrier to you. This discount has been provided to you based on your agreement to (a) activate a new, or extend an existing, line of service for this device with the carrier, and (b) maintain this service in good standing for a minimum of 181 consecutive days. If you do not activate or extend a line of service in connection with this device, or if your service is canceled/disconnected before 181 consecutive days, Amazon.com will charge you $250 per device, plus applicable taxes. "
So where is the hate for Amazon? | |
| | ndwbr
join:2003-07-10
Atlanta, GA | Re: This is a non-story, this is how it is everywhere It's not exactly like this everywhere; One difference: I got my Blackberry from Amazon (net price $50 - sweet!) and the service is with T-Mobile - I was reluctant at first but here I am two months shy of my two years and I haven't had any complaints or major issues. However, both T-Mobile and Amazon have tech support; they don't just blow you off like Google - and the Nexus apparently has substantially more problems (most notably the EDGE/3G firmware issue) than just getting a new phone configured and working. | |
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1 edit | There is a difference with Google and the other providers.
Example if you buy a Droid you pay X dollars for the phone and sign a new 2 year contract. If you cancel you have a $350 early termination fee. That fee used to be $175 but went up. That's all you pay here, you don't pay Motorola another fee for canceling.
With Google it seems you pay T-Mobile $200 to cancel (The fee supposed to recoup the subsidy) then you pay another $350 to Google.
That is what I think people are really complaining about. If I cancel my At&t contract I've got a $175 termination fee and I don't have to pay Apple anything extra for my iPhone. | |
| | | ptrowskiGot Helix?Premium
join:2005-03-14
Putnam, CT
kudos:4 Reviews:
·VOIPo
| Re: This is a non-story, this is how it is everywhere said by BB_Hunter:There is a difference with Google and the other providers. Example if you buy a Droid you pay X dollars for the phone and sign a new 2 year contract. If you cancel you have a $350 early termination fee. That fee used to be $175 but went up. That's all you pay here, you don't pay Motorola another fee for canceling. With Google it seems you pay T-Mobile $200 to cancel (The fee supposed to recoup the subsidy) then you pay another $350 to Google. That is what I think people are really complaining about. If I cancel my At&t contract I've got a $175 termination fee and I don't have to pay Apple anything extra for my iPhone. That's how I read it also. I can't seem to make sense of the double dip idea.
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| | | jeraden
join:2002-06-10
Coraopolis, PA | The problem with your example is that in your scenario, you are buying the Droid directly from Verizon. You aren't buying the Nexus directly from Tmobile. If you bought the Droid through Amazon, they'd hit you for a fee and Verizon would hit you for another fee. Its the same exact thing.
Did you buy your Iphone from Apple, or did you buy it through AT&T?
The Nexus costs $530 or whatever, regardless of where you buy it from. If you buy it for $180 from Google, Tmobile is paying the other $350 for you. If you cancel your service with tmobile right after buying it, they don't give Google their money. Just like amazon wouldn't get their money. Or ANY other reseller wouldn't get their money. So they hit you up for what you bought from them and the money they aren't receiving.
Like really, what do you expect Google to do? Oh, we sold that phone to Mr. Smith for $180, but he cancelled service and now Tmobile isn't giving us the other $350. Oh, that's ok, we don't care if we lose money, let that guy keep his $180 Nexus One and we'll just be out the difference.
Sounds like your issue should be with Tmobile, not google. Otherwise you have to include EVERY OTHER PHONE RESELLER in your anger. | |
| | |  dvd536as Mr. Pink as they comePremium
join:2001-04-27
Phoenix, AZ
kudos:4 | said by BB_Hunter:With Google it seems you pay T-Mobile $200 to cancel (The fee supposed to recoup the subsidy) then you pay another $350 to Google. sounds a lot like double dipping to me.
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| | Not me Not me Not me I was kind of excited about all this and have been waiting for the phone. Now.. I'll just stick with what I have rather being stuck. Google is really stupid and will need to do a better job. | |
| | | Buy Unlocked If you don't want the fee, buy the phone unlocked for $530 and get on one of Tmobile's Everything More Plus plans. Over the course of 2 years you'll have no contract and save money. | |
| | FBGuyPremium
join:2005-03-19
Evanston, IL Reviews:
·Comcast
·T-Mobile US
| Re: Buy Unlocked the only reason they offer the subsidized phone is because people are afraid of change. they think the $580 pricetag is not game changing because they are accustomed to the contract-subsidy model. people are the ones not willing to change.
I intend to never buy a subsidized phone again. my wife is having a hard time grasping this idea but she will come around. if you do the math you save over the long term. Americans are too used to this idea of saving over the short term and don't look over the long term.
if you want the latest and greatest every 2 years or so you will pay for it. but then again you should expect that if you live that way. $580 is perfectly reasonable for an unlocked phone.
if you go the subsidzed route don't bitch. you have to agree to their terms when you get the phone.
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sbcglobal.net speedtest result 11/11/09 - 5256kbps | |
| | | | | Re: Buy Unlocked I agree with you 100%. However, something I should mention is that all Nexus Ones are unlocked, whether you go subsidized or full price. | |
| | | | FBGuyPremium
join:2005-03-19
Evanston, IL | Re: Buy Unlocked makes sense since you are not buying it from t-mobile. its kind of hard to lock it to a carrier if your not the carrier.
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2 edits | said by FBGuy 
if you want the latest and greatest every 2 years or so you will pay for it. but then again you should expect that if you live that way. $580 is perfectly reasonable for an unlocked phone. Considering the theory that these phones cost boocoo bucks to make and therefore the price is justified has long since been debunked as a myth (the Nexus One costs all of $179 to manufacture), I disagree with your assessment about "perfectly reasonable". Especially when they take a non-smartphone and charge the same amount. No sir, there is WAY too much profit in these phones.
For a non-smartphone the total price - that's base plus fair amounts for marketing, distrib, etc...$200 max.
For a smartphone the total price should be around $300 max.
If the prices were more reasonable for unsub phones, people wouldn't do the contracts. That's of course why the phones are overpriced; the carriers want people in contracts. It's all a big extortion ring.
Have you ever asked yourself why Tracfone and Virgin Mobile can sell phones for less than $200 whose counterparts on the big postpaids are unsub priced over $400? Profit, dude. | |
| | | | FBGuyPremium
join:2005-03-19
Evanston, IL Reviews:
·Comcast
·T-Mobile US
2 edits | Re: Buy Unlocked whether you like it or not they will get the money they want with the phones.
if you want to pay the subsidized price which in reality is more than the unsubsidized price go right ahead.
virgin and tracphone sell chopped down phones. I've never seen windows mobile, iphone, blackberry, or android work on either of those carriers. and looking at their site I see no smartphones to begin with.
wait, are they real carriers? i thought they were virtual carriers.
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| | | | | | | Re: Buy Unlocked said by FBGuy:virgin and tracphone sell chopped down phones. I've never seen windows mobile, iphone, blackberry, or android work on either of those carriers. and looking at their site I see no smartphones to begin with. wait, are they real carriers? i thought they were virtual carriers. Windows Mobile phones work on any carrier that piggybacks on GSM. The old AT&T GoPhone (unrelated to the current AT&T) had a selection of smartphones on the docket for reasonable prices. Why do you think Cingular swallowed them up?
iPhone also works on GSM prepaid - though it's worthless without data.
Blackberry was sold by T-mobile ToGo at one point.
Android didn't exist.
The point I'm making is different than your counterargument. We're not talking about how feature rich the phone is. All I'm saying is that the manufacturers are clearly in bed with the postpaid carriers with regards to pricing. You won't convince me that a BlackBerry Pearl is to this day still a $400 device. Nor will you convince me that the Nexus One costs nearly $320 to package. They have profit padded in like a mug.
"They can charge what they want!!" is true. But the point remains - the previous statement that "$580 is reasonable for an unlocked phone" is false. It's not reasonable given the manufacturing costs for things has dropped significantly since the 90's. Don't you find it mighty funny that at one time, a 50" plasma was $15,000, and now a good quality one is around $2,000? It's because the cost to manufacture is less than it was back then. Cell phones are no different, but the sheeple continue to be fooled into thinking that they're getting a discount. | |
| | | | | | FBGuyPremium
join:2005-03-19
Evanston, IL Reviews:
·Comcast
·T-Mobile US
| Re: Buy Unlocked ah i understand what your saying now and your right the cost of manufacturing the product has gone down.
at this point the only reason that these devices cost so much is because people will pay it. Thats the way it is with any high-ish end item. So the market is dictating how much the devices are. Google is selling them at a price that people will pay. they have to recover the R&D costs as fast as possible. thats why these devices typically go to their true cost after a few years.
I go back to my previous statement now about how having the latest and greatest will bite you in the ass. If you want that latest and greatest you will be the one paying for that innovation.
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| | | | | Sure the parts cost $180, what about the R&D? Advertising? If you don't want to pay more than $300, then don't buy it. There are plenty of people who will. | |
| | | | | | | Re: Buy Unlocked said by CCNnorthcali:Sure the parts cost $180, what about the R&D? Advertising? If you don't want to pay more than $300, then don't buy it. There are plenty of people who will. Come on now. R&D? It's the same basic hardware as all of the other HTC devices and you're not going to convince me otherwise that internally this is any different than the HTCs that came before it. The only R&D is on the software side, which is open source, meaning FREE.
Marketing? Google placing their ad on their website? Yeah, I'm sure that broke their bank. That corny commercial? A fraction of the advertising for the DROID, to be sure.
There is nothing anyone can say that will make me believe this phone has anything in it that deserves to be sold at such a premium. I'd respect the manufacturers more if they came out and say, "you know what? Yes, we threw $200 worth of profit into this, so what? You want it, you pay it." At least people would wake up and do what many are saying here - stop with the whole subsidized/unsubsidized stuff.
I'll admit, I have bought sub stuff, but I don't do it for the discount. I do it so I can bill it to my account and pay off when and how I please rather than cutting an immediate chunk out of my wallet. But I've also bought my fair share of unsubsidized phones over the years as well. That was back when the price they charged WAS reasonable. | |
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| | Fail. Fail on a massive scale.
- A
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LETS GO METS! | |
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