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Verizon To Double Smartphone ETFs?
From $175 to $350 starting November 15
According to a leaked memo posted over at the Boy Genius Report, Verizon is preparing to double the early termination fee for customers who buy new smartphones via Verizon. According to the memo, customers after November 15 who buy an "advanced device" (smartphones) can expect to pay a $350 ETF, though that total will decrease $10 a month every month a user's under contract. The BGR surmises that the change is to stop people from flipping subsidized smartphones over at eBay, though you can also be sure Verizon's forced migration to open devices and platforms has them eager to make up some of that lost revenue in other places.
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Robert
Premium Member
join:2001-08-25
Miami, FL

1 edit

1 recommendation

Robert

Premium Member

I agree..

A lot of people bought the iPhone from AT&T at the subsidized price of $199. Then they paid the ETF of $175, then turned around and sold the iPhone on ebay or craigslist for $600+.

So yea, I think they are doubling the ETF to prevent this from happening with the Droid.

Bad move, IMO.

snipper_cr
Premium Member
join:2002-01-22
Wheaton, IL

snipper_cr

Premium Member

Re: I agree..

said by Robert:

A lot of people bought the iPhone from AT&T at the subsidized price of $199. Then they paid the ETF of $175, then turned around and sold the iPhone on ebay or craigslist for $600+.

So yea, I think they are doubling the ETF to prevent this from happening with the Droid.

Bad move, IMO.
I never thought of it that way... It still sucks that there is an ETF and that they are doubling it. People who are buying smart phones are paying a premium on data services so Verizon is already making extra off them.

fifty nine
join:2002-09-25
Sussex, NJ

fifty nine

Member

Re: I agree..

If someone owns a phone for 1 month, Verizon doesn't make a hefty premium on them.

To me it would seem to be the other way around - i.e. the ETF is necessary so that they don't lose that upcharge over the duration of the contract.

CurGeorge8
join:2005-05-02
South Park, PA

CurGeorge8 to snipper_cr

Member

to snipper_cr
said by snipper_cr:

said by Robert:

A lot of people bought the iPhone from AT&T at the subsidized price of $199. Then they paid the ETF of $175, then turned around and sold the iPhone on ebay or craigslist for $600+.

So yea, I think they are doubling the ETF to prevent this from happening with the Droid.

Bad move, IMO.
I never thought of it that way... It still sucks that there is an ETF and that they are doubling it. People who are buying smart phones are paying a premium on data services so Verizon is already making extra off them.
Not if the user cancels and pays the ETF within the first few months, which is what this is designed to prevent.

NOCMan
MadMacHatter
Premium Member
join:2004-09-30
Colorado Springs, CO

NOCMan to Robert

Premium Member

to Robert
It's the wrong move. If you cancel the contract you must return the phone or pay the balance up to the full retail cost of the phone.

Pay 200 + 200 ETF and the phone is 600 full retail. You owe 200 more.

It's even more ironclad, you get the phone back, refurb and resell.

Cheese
Premium Member
join:2003-10-26
Naples, FL

Cheese

Premium Member

Re: I agree..

said by NOCMan:

It's the wrong move. If you cancel the contract you must return the phone or pay the balance up to the full retail cost of the phone.

Pay 200 + 200 ETF and the phone is 600 full retail. You owe 200 more.

It's even more ironclad, you get the phone back, refurb and resell.
Who says you must return the phone? Is this in the contract? Obviously, people are doing it so it must not be.

NOCMan
MadMacHatter
Premium Member
join:2004-09-30
Colorado Springs, CO

NOCMan

Premium Member

Re: I agree..

I worded that wrong. I meant to say if you cancel the line, then you should be required to return the phone. It completely eliminates the scam. Though people will cry foul about their personal information being on the phone.

Still if you cancel and want to keep the phone, pony up the full retail cost.

I'm against ETF's generally, especially for things like cable contracts where you return the equipment. I can understand a reasonable processing fee, but nailing people for money because they're leaving your service because of whatever issues is just plain wrong.

Cheese
Premium Member
join:2003-10-26
Naples, FL

Cheese

Premium Member

Re: I agree..

said by NOCMan:

I worded that wrong. I meant to say if you cancel the line, then you should be required to return the phone. It completely eliminates the scam. Though people will cry foul about their personal information being on the phone.

Still if you cancel and want to keep the phone, pony up the full retail cost.

I'm against ETF's generally, especially for things like cable contracts where you return the equipment. I can understand a reasonable processing fee, but nailing people for money because they're leaving your service because of whatever issues is just plain wrong.
Agreed on all points.

vzdollars
@qwest.net

vzdollars to NOCMan

Anon

to NOCMan
said by NOCMan:

Still if you cancel and want to keep the phone, pony up the full retail cost.
The retail "cost" is inflated. Most items sold in stores are sold at twice the price, often more, that the store paid for them. And many online stores manage to sell at half the suggested retail price and still turn a profit.

C0deZer0
Oc'D To Rhythm And Police
Premium Member
join:2001-10-03
Tempe, AZ

C0deZer0 to Robert

Premium Member

to Robert
Except that the iPhone is sold as a GSM phone, which meant it could be unlocked and used on another carrier, or even another account with AT&T.

You have no such benefit on CDMA networks like Verizon's.

PGHammer
join:2003-06-09
Accokeek, MD

PGHammer to Robert

Member

to Robert
Actually, why is it a bad move?

Consider the original (classic) Storm, their cheapest subsidized touch-screen smartphone ($50 with a two-year contract). At that price, the Storm is cheaper than a lot of VZW's own dumbphones! (And it's also cheaper than the Droid.) Some of their other BlackBerries are even cheaper.

So this move has nit to do with the Droid (or the recently-released Storm2), but more a move to prevent general smartphone-churn, andd sensible from a business POV.

Eagles1221
join:2009-04-29
Vincentown, NJ

Eagles1221

Member

Re: I agree..

And you pay 29.99 a month for data on the Blackberry. VZ won't activate even a retail bought BB without the data fee. Thats a real scam RIM and VZ get you on.

PGHammer
join:2003-06-09
Accokeek, MD

PGHammer

Member

Re: I agree..

said by Eagles1221:

And you pay 29.99 a month for data on the Blackberry. VZ won't activate even a retail bought BB without the data fee. Thats a real scam RIM and VZ get you on.
Why do most folks buy a smartphone (any smartphone)? For data usage. Considering that VZW also has pay-as-you-use data plans, this also prevents anyone using a smartphone without a real need (don't other providers do the same thing with their smartphones, including AT&T Mobility with the iPhone?).

You want a smartphone; however, you don't want the provider making ANYTHING off you using the smartphone's features (most of which, more often than not, require that you use the provider's network). I don't have major data needs; however, when I DO use the provider of choice's network (since I have said quite plainly that VZW suits my needs/requirements in terms of voice, data, AND smartphone choice options), I most certainly expect to have to pay for using VZW's network. However, I have three different options even with VZW (since my data needs are miniscule):

1. Per-month data billing.
2. Daily when-I-need-it data billing.
3. Byte-allowance billing.

Considering that I would almost certainly prefer a smartphone with wifi (and VZW now offers several), and my biggest smartphone use would be sync with a desktop or portable PC, I would most likely choose options #2 or #3, since I am not one of those that uses a smartphone as a PC substitute!

Eagles1221
join:2009-04-29
Vincentown, NJ

Eagles1221

Member

Re: I agree..

Sorry - you missed what I was saying. I have a ton of 8830s that I want to give away so people can use the full text keyboard for texting. Verizon will not let me put a voice and text plan on it unless I pay for the data as well. I don't need data on them.

PGHammer
join:2003-06-09
Accokeek, MD

PGHammer

Member

Re: I agree..

So your complaint is that you can't usde a smartphone as a dumbphone (you got attracted because the smartphone is cheaper than the dumbphone), without realizing that there is going to be a *gotcha* in there somewhere. In what way is that VZW's fault?

If you are still stuck with one or more of those 8830s, PM me and we can exchange information (I'm a VZW customer, and have nary a quibble paying for a data plan that I would actually use).

Eagles1221
join:2009-04-29
Vincentown, NJ

Eagles1221

Member

Re: I agree..

My complaint is I upgraded to Curve - which are awesome. The 8830 is a great phone but I cannot just give them a way as dumbphones. It just seems odd to me that an off contract phone cannot have a downgraded plan. I'm PMing you my info if you really want an 8830

PGHammer
join:2003-06-09
Accokeek, MD

PGHammer to Eagles1221

Member

to Eagles1221
Since you are complaining, here are current prices for VZW's wifi-ready BlackBerry smartphones (including the "infamous" $29.99 MONTHLY data plan):

Curve 8530: $99.99
Tour 9630: $149.99
Storm2 9550: $179.99

Monthly charges:

Nationwide Connect (450 plan minutes + 5 F&F + unlimited nights/weekends + unlimited VZW-to-VZW): $59.99
Unlimited E-Mail and Web for BlackBerry: $29.99

Note that is $89.98 for my second-worst monthly plan choice, as I don't need another e-mail address (however, one is generally included with any smartphone, so you're stuck with it whether you want one or not). Unlimited Web *is* included (however, I'm not one to download videos, even viral ones, and especially NOT to a smartphone).

What's the beef?

Because both e-mail *and* Web are included, I can deal with weblinks included in mail.

I can live with this.

Eagles1221
join:2009-04-29
Vincentown, NJ

Eagles1221

Member

Re: I agree..

I am not complaining of the subsidy. What I as saying is I have many BBs purchased at FULL PRICE retail. I cannot use them as basic phones. That's my complain. I'm actually FOR Verizon subsiding and using ETFs

cdru
Go Colts
MVM
join:2003-05-14
Fort Wayne, IN

cdru

MVM

Lease only

I'm suprised they don't do what Toyota/Lexus is doing with the LFA, only "selling" it at the end of the lease.

It's better for the phone companies to charge for the cell plan, an extra fee for data, more for unlimited texting, a monthly lease, then in the end make them pay even more for the phone.
hottboiinnc4
ME
join:2003-10-15
Cleveland, OH

hottboiinnc4

Member

Re: Lease only

Wasn't there a company on here a while back that leased cell phones?

Does anyone remember the name of them?

ptrowski
Got Helix?
Premium Member
join:2005-03-14
Woodstock, CT

ptrowski

Premium Member

Great timing....

With the Droid right around the corner I would imagine that is why they did this. ETF's should be going down, not up.

Pathfinder5
Dazed Confused
Premium Member
join:2000-03-26
New York, NY

Pathfinder5

Premium Member

Re: Great timing....

Agreed. Charge $599 for the phone and no ETF.
milrtime83
join:2009-11-04
Katy, TX

milrtime83

Member

Re: Great timing....

What does that accomplish? It essentially charges the ETF up front and raises the total price that most people would end up paying over the life of the phone.

Pathfinder5
Dazed Confused
Premium Member
join:2000-03-26
New York, NY

Pathfinder5

Premium Member

Re: Great timing....

The bitch here is that most posters don't want to be tied to a contract. So if they pay full price up front they are free to leave whenever they want.
dfxmatt
join:2007-08-21
Crystal Lake, IL

dfxmatt to ptrowski

Member

to ptrowski
wasn't there serious legal battles surrounding ETF's, if I recall correctly?

meanwhile, that droid is in no way worth 350$, it's like a $175 actual retail value phone. The new processor actually is cheaper to make than the old one, not more expensive. This is like switching something that costs you $10 for something that costs you $5, but charging $20.

Mike_
join:2003-06-24
Philadelphia, PA

Mike_

Member

Lame

Lmao, talk about being scared of people leaving? What do they expect people are actually not going to like "the network".. How could that be?
/sarcasm

FFH5
Premium Member
join:2002-03-03
Tavistock NJ

1 edit

FFH5

Premium Member

Re: Lame

said by Mike_:

Lmao, talk about being scared of people leaving? What do they expect people are actually not going to like "the network".. How could that be?
/sarcasm
It is more about protecting against fraudsters looking to make a quick buck by flipping the phone and selling at a profit and not REAL customers who will stay or go based on service quality.

»I agree..

ptrowski
Got Helix?
Premium Member
join:2005-03-14
Woodstock, CT

ptrowski

Premium Member

Re: Lame

said by FFH5:
said by Mike_:

Lmao, talk about being scared of people leaving? What do they expect people are actually not going to like "the network".. How could that be?
/sarcasm
It is more about protecting against fraudsters looking to make a quick buck by flipping the phone and selling at a profit and not REAL customers who will stay or go based on service quality.

»I agree..
VZ gets their initial fees, and they get an ETF. I don't see they really "hurting" in that situation, subsidized phone or not.
dynodb
Premium Member
join:2004-04-21
Minneapolis, MN

1 recommendation

dynodb

Premium Member

Re: Lame

said by ptrowski:

VZ gets their initial fees, and they get an ETF. I don't see they really "hurting" in that situation, subsidized phone or not.
The non-subsidized price for the droid is $600 but they're selling for $200 after rebate and subsidy. If the $200 price + the old $175 ETF didn't cover the wholesale cost of the phone, they'd be losing money to people selling them on e-bay to make money.

With a $375 ETF plus the $200 price, they're coming in close to the retail price of the phone. Can't really blame them- why should they subsidize profits for people just out to sell the phone?

ptrowski
Got Helix?
Premium Member
join:2005-03-14
Woodstock, CT

ptrowski

Premium Member

Re: Lame

said by dynodb:
said by ptrowski:

VZ gets their initial fees, and they get an ETF. I don't see they really "hurting" in that situation, subsidized phone or not.
The non-subsidized price for the droid is $600 but they're selling for $200 after rebate and subsidy. If the $200 price + the old $175 ETF didn't cover the wholesale cost of the phone, they'd be losing money to people selling them on e-bay to make money.

With a $375 ETF plus the $200 price, they're coming in close to the retail price of the phone. Can't really blame them- why should they subsidize profits for people just out to sell the phone?
So that is the price VZ is getting them for? Doubtful.
dynodb
Premium Member
join:2004-04-21
Minneapolis, MN

dynodb

Premium Member

Re: Lame

said by ptrowski:

So that is the price VZ is getting them for? Doubtful.
I don't know what they're paying for them, but it's no doubt less than $600. It's not at all hard to believe that they might be paying more than $375 though.

ptrowski
Got Helix?
Premium Member
join:2005-03-14
Woodstock, CT

ptrowski

Premium Member

Re: Lame

said by dynodb:
said by ptrowski:

So that is the price VZ is getting them for? Doubtful.
I don't know what they're paying for them, but it's no doubt less than $600. It's not at all hard to believe that they might be paying more than $375 though.
I would be extremely surprised if it was. My guess, and it is only a guess, is that they get them at a much lower price than $375.

fifty nine
join:2002-09-25
Sussex, NJ

fifty nine

Member

Re: Lame

It doesn't matter what they pay wholesale for the phone. What matters is their expected revenue over the contract period. If ebay flippers are substantially decreasing that then there's the rationale behind the increased ETF.

RARPSL
join:1999-12-08
Suffern, NY

RARPSL to dynodb

Member

to dynodb
said by dynodb:

said by ptrowski:

VZ gets their initial fees, and they get an ETF. I don't see they really "hurting" in that situation, subsidized phone or not.
The non-subsidized price for the droid is $600 but they're selling for $200 after rebate and subsidy. If the $200 price + the old $175 ETF didn't cover the wholesale cost of the phone, they'd be losing money to people selling them on e-bay to make money.

With a $375 ETF plus the $200 price, they're coming in close to the retail price of the phone. Can't really blame them- why should they subsidize profits for people just out to sell the phone?
If the non-subsidized cost is $600 and the subsidized and rebated cost is $200 (with a 2 year contract) with a $375 EFT, the monthly reduction should be $15.65 not just $10 (ie: It should go down based on how long you have paid under the contract so the EFT is fully paid off at the end of the contract - At $10 a month, you still owe $145 after 23 months). The supposed reason for an EFT is to pay back the unearned subsidized discount you got by not buying at the full price.
Chaldo
join:2008-03-18
West Bloomfield, MI

Chaldo to ptrowski

Member

to ptrowski
said by ptrowski:

said by FFH5:
said by Mike_:

Lmao, talk about being scared of people leaving? What do they expect people are actually not going to like "the network".. How could that be?
/sarcasm
It is more about protecting against fraudsters looking to make a quick buck by flipping the phone and selling at a profit and not REAL customers who will stay or go based on service quality.

»I agree..
VZ gets their initial fees, and they get an ETF. I don't see they really "hurting" in that situation, subsidized phone or not.
It's because Verizon can't stand it when ANYONE makes a single buck of them. They want to rule your money, and give you nothing in advantages besides service in return. This type of stuff is way easier on GSM and happens so much more with GSM carriers, then Verizon. Trust me Verizon does not have a big issue with this. Yes I know GSM is used way more then CDMA. The problem is they can control it better on CDMA. Verizon closes any holes that are an advantage to customers, that's just how they roll.

NOVA_Guy
ObamaCare Kills Americans
Premium Member
join:2002-03-05

NOVA_Guy to FFH5

Premium Member

to FFH5
How is paying an activation fee, paying for a phone, then paying an early termination fee being fraudulent? Perhaps it's gaming the system a little, but those who are clever enough to do so should not be punished for it.

•••••••••••••••••••

Mike_
join:2003-06-24
Philadelphia, PA

Mike_ to FFH5

Member

to FFH5
That is not a "fraudster". There is nothing wrong with a customer no longer liking their service, canceling, paying their etf as required, and legally selling an asset that is no longer usable to make back what they spent on the services. Explain how that is "fraud" ? Also, how and in what way does that hurt poor old mr. Verizon who has no say in what an individual does after a contract is closed?
sides14
join:2007-11-29
Peoria, AZ

sides14 to FFH5

Member

to FFH5
How is gaming the system (legally) fraud? Like the iPhone 3GS, it only costs $179 to make (»mytriniphone.com/blog/20 ··· 3gs-179/). If Apple doubled the cost to ATT that is only $358. In addition, most wireless companies buy phones in the 10s of thousands and receive a substantial bulk discount. With ETFs, the only people making out are the wireless companies.

Pathfinder5
Dazed Confused
Premium Member
join:2000-03-26
New York, NY

Pathfinder5

Premium Member

Re: Lame

According to your article
" These estimates do not include other charges, such as the costs to develop the iPhones software, shipping and distribution, packaging, royalty fees and miscellaneous accessories included with each iPhone."

$359 is not very unreasonable. It may be on the cheap side.

RickNY
Premium Member
join:2000-11-02
Bellport, NY

RickNY to FFH5

Premium Member

to FFH5
said by FFH5:

It is more about protecting against fraudsters looking to make a quick buck by flipping the phone and selling at a profit and not REAL customers who will stay or go based on service quality.
What exactly is fraudulent about that? There is absolutely nothing fraudulent -- the original buyer performed in accordance with the legally binding contract -- where is the fraud?
tlkudo
Premium Member
join:2007-09-20
Fort Pierce, FL

tlkudo

Premium Member

Business as usual

If all they're worried about is people terminating and then selling the phone for profit, then why not give the option to return it and avoid paying an ETF?

Oh wait, that's right, this is really about pissing on customers and telling them it's raining.

I seem to remember that the ETFs were chopped across the industry as a way of saying "hey FCC, we're fixing everything on our own, see? No need for regulation. Everybody just move along." Now that the flavor of the day has moved on to something else, it's back to business as usual for ETFs.

•••

rudnicke
Premium Member
join:2004-10-23
Rantoul, IL

rudnicke

Premium Member

Contract

So it his a change in contract? Does this mean someone can escape from their contract without paying the ETF?

ptrowski
Got Helix?
Premium Member
join:2005-03-14
Woodstock, CT

ptrowski

Premium Member

Re: Contract

said by rudnicke:

So it his a change in contract? Does this mean someone can escape from their contract without paying the ETF?
Looks like for new customers.

SimbaSeven
I Void Warranties
join:2003-03-24
Billings, MT
·StarLink

SimbaSeven

Member

What a ripoff..

So.. They're doubling the ETF rates? Why?

1. The technology is CDMA. Which means if the phone is blacklisted, it can't be used at all. I bumped into this on my first 6800, but the person was decent enough to replace it with one that does work.
..as for GSM, which you could unlock the phone and shove in a prepaid/contract SIM card.
2. Are they already screwing people for going over their 5GB cap? If the ETF ever went up, I'd expect that cap GONE.

This.. is yet another reason I will never switch over to Verizon.. I will keep Alltel until the towers get shut off.

••••
tmc8080
join:2004-04-24
Brooklyn, NY

tmc8080

Member

inflated pricing

Smart phones should not be $600.. they are ripping the consumer off.. the cost of making these devices since the iphone (gen2) have been cut by neary 30% and yet they still love these wack-job gouging prices! A top of the line smart phone should be $450, tops (with every possible feature you could imagine).. not $600+ yet, there are millions of people who keep falling for the higher prices scam all the time.

Also, in an industry which is seeing that $99 price tag of unlimited everything wireless (a rarity now), Verizon is a last hold-out at this high pricing for post paid accounts**. Leave it to someone to point out that Verizon has a majority interest in its wireless licenses/technology standard and deployed network to try to justify higher pricing... good luck!

Prepaid is the biggest growth in the wireless industry because of it's low pricing, yet the quality of the phones are terrible-- many of the lower quality phones are nearly featureless (compared with smart phones).

•••

obeythelaw
Premium Member
join:2003-04-16
Warren, NJ

obeythelaw

Premium Member

why are people complaining?

to all the verizon fanbois out there, you are never going to leave verizon anyway. if you are upset because now you can't make a profit off of the sale of your phone then find a new job!
BosstonesOwn
join:2002-12-15
Wakefield, MA

BosstonesOwn

Member

Re: why are people complaining?

easy way to profit , buy the phones , ink a family share plan 4 or 5 lines get 5 androids , wait a week swap them for cheesy phones and sell the contract on ebay for low cost.

Sell off the phones.

Profit still ad pass on the bill to the next guy.

Guspaz
Guspaz
MVM
join:2001-11-05
Montreal, QC

Guspaz

MVM

Increasing it is justified

My provider has an ETF of $500 for my iPhone contract (3 years).

Know why I don't see a problem? Because the retail price of the phone is $500 more than I paid. If I had bought the phone outright with no contract, I'd have paid $500 more. If I terminate my contract, I'd have paid $500.

Although, my contract is pro-rated after 50% through, I believe. Would have preferred if it started at the beginning, but meh.

My point is, the telco charges at retail what Apple charges them; as far as I know, there isn't a markup. If you cancel and pay an ETF that doesn't let them recoup the cost (as in, buy it and cancel immediately and pay the ETF), then they're losing money.

atuarre
Here come the drums
Premium Member
join:2004-02-14
EC/SETX SWLA

atuarre

Premium Member

RE

I applaud Verizon for making this move. I really think the Storm 2 started this. You can look on e-Bay and see people auctioning off Storm 2's for 400+ when you can get them from Verizon for 175 if your a regular customer signing a contract or a VIP customer for 125.

The carrier is the one getting screwed here, and I think it is about time that they made this move.

One poster mentioned giving the device back. I do think AT&T implemented this for the iPhone where if you cancelled the contract not only were you responsible for the ETF but also the FULL retail cost of the phone, as it should be.

PGHammer
join:2003-06-09
Accokeek, MD

PGHammer

Member

Re: RE

said by atuarre:

I applaud Verizon for making this move. I really think the Storm 2 started this. You can look on e-Bay and see people auctioning off Storm 2's for 400+ when you can get them from Verizon for 175 if your a regular customer signing a contract or a VIP customer for 125.

Actually, I think the deep discounts for the Original (Classic) Storm (and other BBs) started this.

There are six BlackBerries that are $50 or less with a two-year contract.

THere are *two* different Android phones (one from Motorola, and one from HTC), with the HTC model $100 with a two-year contract. (HTC DROID ERIS: »www.verizonwireless.com/ ··· eId=5070)

There are those that want to break carrier-exclusivity (and make a tidy profit) by selling their subsidized handset on eBay or craigslist (or even in the local paper), and now they are mad that their scheme has been rather neatly derailed. VZW (nor any other carrier) doesn't do handset-exclusivity deals for the customer to rip them off, people.
cyclone_z
join:2006-06-19
Ames, IA

cyclone_z

Member

Wrong again!

You guys missed it, as usual. This has NOTHING to do with handset costs. I guarantee you that they wouldn't have had the ETF at $175 for so long if they were losing tons of money. Retail prices often have NOTHING to do with the actual price paid, especially for a big dog like Verizon. I would bet they are paying $250-$275 for the high-end handsets.

It has EVERYTHING to do with contracts. Verizon LOVES 2-year contracts. If you call up with a reception problem, their solution is a new handset and new 2-year contract. Fix the problem? HAHAHA! It's The Network (TM) -- how could there be a problem? A higher ETF keeps more people under contract -- right where Ivan wants you.

It wasn't until very recently that you could even start service without signing a contract EVEN IF YOU BROUGHT YOUR OWN VERIZON APPROVED HANDSET. The handset is how they lure people into the services they sell. It's like the free first hit. (and to many people a cell phone is crack). If you can buy a "compatible" handset on ebay, why sign a contract? You can start and stop service when you need/feel like it, or use it with a prepay and only use it when you need it. Prepaid/no-contract plans are growing in popularity and Verizon HATES that idea.

marcusj3000
Darkness Rising
Premium Member
join:2003-05-26
Memphis, TN

marcusj3000

Premium Member

Cost of phone

the cost of the phone is more than the parts just put into it for the people that can't understand manufacturing. In addition to the cost of parts to make the phone include labor, R&D, distribution, shipping, and advertisement. For the ones that say it doesn't cost that much you are not at all knowledgeable about this subject.
They must pay for all this and may even pay more for the parts because they don't just make all the parts for the phone themselves it's a lot of companies involved with making that phone. The cost is well past $450 to make a advance smart phone. You armchair amateurs need to take a course on business and manufacturing.
cyclone_z
join:2006-06-19
Ames, IA

cyclone_z

Member

Re: Cost of phone

said by marcusj3000:

The cost is well past $450 to make a advance smart phone. You armchair amateurs need to take a course on business and manufacturing.
What are you basing any of this on? I based my points on my experience in retail when I was younger. I was able to buy a limited amount of products "at cost" -- the cost of the store -- which was 1/2 the listed retail price. 100% markup is typical, although in some industries and with some products it is more.

I was able to find the HTC hero for sale in the UK for 321 british pounds, which converts to 532 US dollars. 1/2 of that is $266.

I found some analyst estimates that Apple has about $200 in parts in an iPhone. They also have software development and testing costs. As the number of devices sold increases, this cost decreases. Android makers have little software cost since Google provides Android for free. Yes, they have design and testing costs, but in the US there are few marketing costs since the carriers do most of the advertising.

dvd536
as Mr. Pink as they come
Premium Member
join:2001-04-27
Phoenix, AZ

dvd536

Premium Member

So why?

is the ETF only coming down $10/month instead of $14.58/month?
-
10 * 24 = 240[who's pocketing that extra $110?]
cyclone_z
join:2006-06-19
Ames, IA

cyclone_z

Member

Re: So why?

said by dvd536:

is the ETF only coming down $10/month instead of $14.58/month?
-
10 * 24 = 240[who's pocketing that extra $110?]
Because it's about keeping customers under contract and profiting off ETFs, instead of just recovering costs.
manhole0
join:2000-09-12
Modesto, CA

manhole0

Member

A more fair approach

I think a more fair approach would have been to institute the following policy.

Leave the ETF at $175. But if you cancel your service within 6-months you must also pay back the difference between the price you paid for the phone and the retail price. I believe most of the online cell phone stores have had a policy like this for many years and they seem to work.

chinchan
@10/24.bsnl.in

chinchan

Anon

verizon

Ever heard of Cellswapper.com? It may be the only way out,
kurtaustin
join:2006-03-25
Chicago, IL

kurtaustin

Member

Change in ETF, can I opt out now without penalty?

does this increase an ETF's qualify as a change in the contract, so I can opt-out with no penalty?