2 year subsidy phone upgrades early warning info

[teeitup]

Yeah the retention rep I talked to seemed a bit frazzled. I told them straight out they just need to pull the plug on ed1500 plan and just forgive the contracts. Just convert everyone to the new plans and forget the 25 sub charge. But, they just don't seem to get it. Either give me the subsidised phone or let me move off the plan either one.

 

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The rep I spoke to said that sometimes they will make special considerations for waving the $25 subsidy fee for long-term customers with who have been with sprint for over 10 years. Possibly worth a try if you are wanting to switch to one of the new plans.

 

 

Sent from my iPhone using Tapatalk

[teeitup]

I'm weighing a lot of options right now. Four of my lines are will be out of contract September 1 which will be good timing for the iPhone 8 release if the two year upgrade is still available on Apple.com, one of my lines is out of contract now and the other one is in contract until next September. The new T-Mobile One unlimited plan is only $160 for six lines if you can get one of the T-Mobile "hook up" promo codes which is pretty appealing but I think I'm just gonna take a gamble and hope my subsidy will still work in September and stay on ED1500.

 

 

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[teeitup]

Out of curiosity what are some of you guys seeing on the Sprint Zone app for your two-year upgrade eligibility. Is it showing an actual date you will be eligible or saying "not eligible"?

[ase500]

The rep I spoke to said that sometimes they will make special considerations for waving the $25 subsidy fee for long-term customers with who have been with sprint for over 10 years. Possibly worth a try if you are wanting to switch to one of the new plans.

 

 

Sent from my iPhone using Tapatalk

The one I talked you refused to waive them. I have been with them for 12 years. The sheer lack of communications at sprint is just sad. I have had one tell me they can't do something then call back a few minutes later and have a lower level rep do whatever I wanted right away. One hand doesn't seem to know what the other is doing.

 

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[troyd96]

I just had a somewhat enlightening conversation at BB. Turns out that switching from ED1500 that we're currently on to a new Sprint unlimited plan costs exactly the same. Given my observation above, seems like a few dollars more in either case to upgrade devices. So, I now see no reason to change until they force the issue somehow. BB does offer the temptation of a $200 gift card toward the account or a second device.

 

Sent from my HTC One M9

This is what frustrates me over all the people here and in the media acting like these new unsubsidized plans are cheaper and better for the consumer. If you get a new premium device every two years and do the math for buying a phone full cost it cost way more money.

 

 

Plan to plan it may be almost the same, but add the cost of the phone in full and it isn't even close compared to $200-300 per phone and a legacy plan over 24 months. Not to mention the employer discounts that come off the whole primary line versus just the data for these new plans.

 

The funny thing is the phone companies knew this going in. They aren't going to start a new plan unless it is going to make them money, and they are making out like bandits with these new plans. Yet everyone was still so gung-ho about "no contracts" are better for consumers.

 

Now we see them offering $10-15/month credits for installment phones, or $200-300 off phones, or B1G1F offers. Now you throw that in and the new plans get better and almost the same as the legacy ones. My problem is why change all the stuff to begin with if you are just going to end having to offer deals for people to stay with you or go to your service to begin with?

 

IMHO, as a consumer who wants a new premium phone every 2 years or so, the whole mobile market should have stayed with the status quo. It was better for the consumer, and the change to get rid of subsidies was nothing but a money grab by all cellular companies.

 

Now they gotta offer deals to get people to stay, but it's still a bad thing for consumers because you are giving up your legacy (unthrottled, or "unoptimized" as they put it) for throttled service with a lot more caveats in the fine print.

 

Just my two cents...

 

Sent from my LG-LS997 using Tapatalk

[travismheim]

Something I think most people on old subsidy plans seem to forget is they are not owed an upgrade in the future. You agree to a two year service commitment for your device to be subsidized. Service plans should have been separated from equipment long ago. If you're still in contract, your device is still being repaid for via service subsidy. Anybody trying to switch to the new plan without the subsidy penalty is no different than some one on easy pay asking for a bunch of their device payments to be waived because they don't want to pay it.

 

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[Rocket87]

Something I think most people on old subsidy plans seem to forget is they are not owed an upgrade in the future. You agree to a two year service commitment for your device to be subsidized. Service plans should have been separated from equipment long ago. If you're still in contract, your device is still being repaid for via service subsidy. Anybody trying to switch to the new plan without the subsidy penalty is no different than some one on easy pay asking for a bunch of their device payments to be waived because they don't want to pay it.

 

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Ive been explaining it to customers for years. You got the benefit at the begining of the contract of a disxounted device. After 2 years both you and Sprint have completed their ends of the bargin. Now you can make another agreement with Sprint if you want. You didnt earn anything you simply fullfilled your agreed upon terms of your contract.

 

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[ase500]

Something I think most people on old subsidy plans seem to forget is they are not owed an upgrade in the future. You agree to a two year service commitment for your device to be subsidized. Service plans should have been separated from equipment long ago. If you're still in contract, your device is still being repaid for via service subsidy. Anybody trying to switch to the new plan without the subsidy penalty is no different than some one on easy pay asking for a bunch of their device payments to be waived because they don't want to pay it.

 

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Your comparison is a bit off. The difference is how things are being financed. With subsidised plans the provider would buy the phones direct at a massive discount compared to the full price. When cell service first came about the phones would be about 1500 in today's dollars and the customer would pay zero up front. Now a top of the line phone is 650-700 retail and wholesales for about half of that, with a customer paying 250 up front, that leaves about 50-100 in real cost to the provider. Now the cost of the phone is factored into the plan month by month, at a pretty hefty premium.

 

Easy pay is a whole different ball of wax. The provider is selling you a phone at retail price and making money doing so. They then have the option to monetize that payment by selling it up as an account collectible. Similar to how banks sell mortgages as derivatives.

 

At any rate it isn't about entitlement it is about retention. Walmart doesn't have to sell you big screen TVs at a loss either, but they do to get you to buy the much higher mark up accessories. That is the way business works, sometimes you take a loss on one thing to make a profit on another.

 

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[dkyeager]

Many people are still locked in for two years with phone payment plans.

 

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[travismheim]

Your comparison is a bit off. The difference is how things are being financed. With subsidised plans the provider would buy the phones direct at a massive discount compared to the full price. When cell service first came about the phones would be about 1500 in today's dollars and the customer would pay zero up front. Now a top of the line phone is 650-700 retail and wholesales for about half of that, with a customer paying 250 up front, that leaves about 50-100 in real cost to the provider. Now the cost of the phone is factored into the plan month by month, at a pretty hefty premium.

 

Easy pay is a whole different ball of wax. The provider is selling you a phone at retail price and making money doing so. They then have the option to monetize that payment by selling it up as an account collectible. Similar to how banks sell mortgages as derivatives.

 

At any rate it isn't about entitlement it is about retention. Walmart doesn't have to sell you big screen TVs at a loss either, but they do to get you to buy the much higher mark up accessories. That is the way business works, sometimes you take a loss on one thing to make a profit on another.

 

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It's really not. A portion of the subsidized plan cost is to pay for that discounted phone you receive at the beginning of the two year agreement. Do you think it's coincidence that the subsidized plan was 80 and the unsubsidized plan ended up at 60? When you agree to a two year contract and receive a discounted phone, it's not any different than agreeing to pay for the device over two years on easy pay except the phone payment is now separate from the service plan, as it should be.

 

Wholesale on these phones is not nearly as low as you seem to think it is. Just because the bill of materials for an iPhone or Samsung galaxy is a couple hundred dollars does not mean that's what carriers and retailers are purchasing them for.

Many people are still locked in for two years with phone payment plans.

 

Sent from my LG-LS980 using Tapatalk

As they should be, since they have not finished their obligation to pay for the device via the plan subsidy (or easy pay/lease for that matter) that they agreed to when they signed a two year contract to receive a discounted phone.

 

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[ase500]

It's really not. A portion of the subsidized plan cost is to pay for that discounted phone you receive at the beginning of the two year agreement. Do you think it's coincidence that the subsidized plan was 80 and the unsubsidized plan ended up at 60? When you agree to a two year contract and receive a discounted phone, it's not any different than agreeing to pay for the device over two years on easy pay except the phone payment is now separate from the service plan, as it should be.

 

Wholesale on these phones is not nearly as low as you seem to think it is. Just because the bill of materials for an iPhone or Samsung galaxy is a couple hundred dollars does not mean that's what carriers and retailers are purchasing them for.

As they should be, since they have not finished their obligation to pay for the device via the plan subsidy (or easy pay/lease for that matter) that they agreed to when they signed a two year contract to receive a discounted phone.

 

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You are missing the fact that you pay a large part of the cost down on a subsidised phone vs a financed phone. I also know exactly what the wholesale on a phone is as well as the manufacturing cost. Kinda one of the areas I make my living.

 

As I said before though that isn't even the point. The point is to retain customers.

 

Verizon did what it did very strategically, it understood the flaw with Sprint's current billing structure and knew that it could exploit it. Sprint however, blew the response, which is what Verizon wanted.

 

From a retention standpont sprint has two options to retain the contract customers, maintain the contracts and subsidised phones (bad idea) or forget the subsidised phones, waive the fees and covert the current accounts. With the second option they can upsell those customers on new phones and monetize them allowing more free cash flow. This all the while under cutting Verizon to its current customers. If they do not do this churn is going to go up massively.

 

You will also be surprised at how once phone makers are forced to compete, how the prices will drop.

 

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[travismheim]

 

 

You are missing the fact that you pay a large part of the cost down on a subsidised phone vs a financed phone.

I'm not missing anything. You pay a portion of the phones cost down and then the rest of it in subsidy over two years. That's why some cheaper phones were "free" and an iPhone was $200. That's why there's an early termination fee, and why there is a subsidy fee if you change to a newer plan that doesn't already include it. There's little to no difference in the end besides the actual price of phones is no longer hidden by subsidy.

 

 

 

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[jreuschl]

You are missing the fact that you pay a large part of the cost down on a subsidised phone vs a financed phone. I also know exactly what the wholesale on a phone is as well as the manufacturing cost. Kinda one of the areas I make my living.

 

As I said before though that isn't even the point. The point is to retain customers.

 

Verizon did what it did very strategically, it understood the flaw with Sprint's current billing structure and knew that it could exploit it. Sprint however, blew the response, which is what Verizon wanted.

 

From a retention standpont sprint has two options to retain the contract customers, maintain the contracts and subsidised phones (bad idea) or forget the subsidised phones, waive the fees and covert the current accounts. With the second option they can upsell those customers on new phones and monetize them allowing more free cash flow. This all the while under cutting Verizon to its current customers. If they do not do this churn is going to go up massively.

 

You will also be surprised at how once phone makers are forced to compete, how the prices will drop.

 

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It would be nice if say LG would make the G6 price competitive with the S8 and start a little price war but that isn't likely to happen. Flagship phones are all max cost. Unfortunately not much of an option in the middle range. Entry level on Sprint are all worse than flagships 3 years ago. Sprint and Verizon have a disadvantage of not being GSM and being able to use the 'off brand' phones.

 

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[ase500]

I'm not missing anything. You pay a portion of the phones cost down and then the rest of it in subsidy over two years. That's why some cheaper phones were "free" and an iPhone was $200. That's why there's an early termination fee, and why there is a subsidy fee if you change to a newer plan that doesn't already include it. There's little to no difference in the end besides the actual price of phones is no longer hidden by subsidy.

 

 

 

Sent from my 2PYB2 using Tapatalk

SMH. It isn't about the cost of the phone. Phones where subsidised back in the 1980s because the cost of the phone was to high for customers to pay. Granted a method that should have been gone a decade ago.

 

Let me break it down in numbers for you. I have 3 subbed lines two S7s wholesale price at the time of purchase was 400 dollars each, my upfront cost was 250/ea leaving 150 dollars subed per phone. The third is an S6 which had a wholesale price of 250 dollars at the time, and was subject to black Friday manufacturer rebate of 150 dollars (Sprint recouped 150 of the cost) and I paid 150 upfront. That means my total subed cost would be 300 dollars across 2 years. A break even figure of 12.50/per month for my entire account. Based on the cost of my plan vs current plans, I paid for my phones and then some. And my wholesale figures come from DH wholesale, who buy a lot less phones than Sprint, I am sure Sprint paid less than what I can buy wholesale.

 

So again I will say this again. It is about retention. The phones are paid for and their costs don't go down if they lose me as a customer. It's not like they shut down a tower if I leave.

 

Furthermore the people on contracts are generally speaking the bread and butter. Like me most are upper middle income, excellent credit and buy top line phones. Retention, Retention, Retention.

 

 

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[travismheim]

So again I will say this again. It is about retention. The phones are paid for and their costs don't go down if they lose me as a customer. It's not like they shut down a tower if I leave.

 

Furthermore the people on contracts are generally speaking the bread and butter. Like me most are upper middle income, excellent credit and buy top line phones. Retention, Retention, Retention.

 

 

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Yes, the phones are paid for and they expect to receive a certain amount of money from them back in plan subsidy. Just because they bought them wholesale and sold them to you on contract does not mean you should expect them to accept less money for them because you want to change plans to something that no longer includes the subsidy.

 

The people still on contracts are the ones left over trying to hold onto their sweetheart deals from the past. Easy pay and leases lock customers down just as much as the subsidy model if not more in terms of retention.

 

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[ase500]

Yes, the phones are paid for and they expect to receive a certain amount of money from them back in plan subsidy. Just because they bought them wholesale and sold them to you on contract does not mean you should expect them to accept less money for them because you want to change plans to something that no longer includes the subsidy.

 

The people still on contracts are the ones left over trying to hold onto their sweetheart deals from the past. Easy pay and leases lock customers down just as much as the subsidy model if not more in terms of retention.

 

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OMG it just flies right over your head. RETENTION. They won't make any money on the phone or the plan if they don't RETAIN THE CUSTOMER. The contract plans are NOT SWEETHEART DEALS. Based on comparison they are hands down some of the most expensive. And you missed the math yet again. Based on 12.50 per month for 3 phones for BE point and a difference 45 dollars per month from current plans to mine, they already made GREATER THAN RETAIL price. Now factor that across 12 years. I am sure that it would be in the best interest to retain me as a customer. Hence the reason why they are calling me to try and retain me.

 

HOWEVER, my original point was the inconsistentancy of how they go about it and how it would be better be proactive rather than reactive on RETENTION. As the cost of new customers is higher than RETENTION, of current ones.

 

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[travismheim]

 

 

OMG it just flies right over your head. RETENTION. They won't make any money on the phone or the plan if they don't RETAIN THE CUSTOMER. The contract plans are NOT SWEETHEART DEALS. Based on comparison they are hands down some of the most expensive. And you missed the math yet again. Based on 12.50 per month for 3 phones for BE point and a difference 45 dollars per month from current plans to mine, they already made GREATER THAN RETAIL price. Now factor that across 12 years. I am sure that it would be in the best interest to retain me as a customer. Hence the reason why they are calling me to try and retain me.

 

HOWEVER, my original point was the inconsistentancy of how they go about it and how it would be better be proactive rather than reactive on RETENTION. As the cost of new customers is higher than RETENTION, of current ones.

 

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I'm not missing anything, nobody is owed anything. You have paid them for twelve years, and in return they have provided twelve years of service. Neither you, me, or anyone else are entitled just because we have been customers for any period of time and they come out with new plans. You agreed to the terms when you signed up for two years, knowing you would be locked in for two years. You were fine receiving a discounted phone up front, why are you not fine with holding up your end of the bargain when Sprint held up theirs? I don't understand why you or anybody else would be complaining, if you can find a better deal with another provider then go elsewhere.

 

The legacy ED plans were sweetheart deals up until subsidized upgrades were killed off, they are no longer the cheapest without that discounted phone. When you're eligible then move onto a newer plan, or pay the fee and move now if hotspot is really that important to you, or port out to another provider. You and everyone else have options, but you want Sprint to make up another option that you want that isn't available.

 

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[ase500]

I'm not missing anything, nobody is owed anything. You have paid them for twelve years, and in return they have provided twelve years of service. Neither you, me, or anyone else are entitled just because we have been customers for any period of time and they come out with new plans. You agreed to the terms when you signed up for two years, knowing you would be locked in for two years. You were fine receiving a discounted phone up front, why are you not fine with holding up your end of the bargain when Sprint held up theirs? I don't understand why you or anybody else would be complaining, if you can find a better deal with another provider then go elsewhere.

 

The legacy ED plans were sweetheart deals up until subsidized upgrades were killed off, they are no longer the cheapest without that discounted phone. When you're eligible then move onto a newer plan, or pay the fee and move now if hotspot is really that important to you, or port out to another provider. You and everyone else have options, but you want Sprint to make up another option that you want that isn't available.

 

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It's like talking to a wall. Retention is the point. NOT ENTITLEMENT. No offense but I hope you don't run a business. With that logic you'd be bankrupt. Most customers wil just quietly leave and give someone else their money. Sprint is in business to make money. They can't make money without customers. It is quite clear either you don't understand P/L or are driven by a petty need to be right, either way, I am done trying to give you a tutorial in business models and the economics of said business models. Have a good night. [emoji4]

I'm not missing anything, nobody is owed anything. You have paid them for twelve years, and in return they have provided twelve years of service. Neither you, me, or anyone else are entitled just because we have been customers for any period of time and they come out with new plans. You agreed to the terms when you signed up for two years, knowing you would be locked in for two years. You were fine receiving a discounted phone up front, why are you not fine with holding up your end of the bargain when Sprint held up theirs? I don't understand why you or anybody else would be complaining, if you can find a better deal with another provider then go elsewhere.

 

The legacy ED plans were sweetheart deals up until subsidized upgrades were killed off, they are no longer the cheapest without that discounted phone. When you're eligible then move onto a newer plan, or pay the fee and move now if hotspot is really that important to you, or port out to another provider. You and everyone else have options, but you want Sprint to make up another option that you want that isn't available.

 

Sent from my 2PYB2 using Tapatalk

 

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[dkyeager]

I trust that each side will made decisions that they feel are in their best interest.  Marcello made clear in the last quarterly results that Sprint was prepared to lose some customers on subsidized plans.  Given that they recently seem to becoming more flexible, they may be having more churn than anticipated.  Marcello recently stated that Verizon was not listening to its customers right before they offered unlimited.  Marcelo may wish to listen more to his own customers.  However that does not mean he needs to agree with them.

 

Readers of this thread should be aware that some ED1500 customers are reporting receiving special deals from Sprint before or after they leave. Personally I would hope for a more widespread offer, which likely would not meet the desires of all current customers, yet could retain more of these customers (up to  approximately 30% of Sprint customers are on subsidy plans).  Sprint has an opportunity here to simplify its plan offerings and thus reduce sales and service costs.  We are no longer in the Great Recession, service has improved, so Sprint in many ways has a stronger hand.  While Sprint was focused on getting positive free cash flow, Verizon chose wake up to current trends.  Hopefully Sprint navigates these waters correctly..

[travismheim]

 

 

Sprint is in business to make money.

 

 

You're right, they are in business to make money. You're asking them to take a loss on revenue because you and others feel entitled to the new benefits of new plans without following through on your commitment when you signed a two year service contract to receive a discounted phone.

 

I don't understand what the problem is, when you're done with your two year commitment you are free to move to whatever new non subsidy plan you want without penalty. Or move onto another provider without an early termination fee.

 

You agreed to pay for your device by signing a two year service commitment. If you want to change service to something that no longer includes that device subsidy then you pay that subsidy fee, or an early termination fee if you change providers. It would be no different than me bitching I don't feel like paying the last six months on my lease because I want to change to something new.

 

 

 

 

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[kajex]

Well they have zero revenue from me now. I jumped ship. With subsidies off the table, I stand to save a lot by dumping our family's SERO plans. The only real disadvantage is we lose the individual bills going to each user. I'm okay with that since we save money. Tmobile routinely offers deals to existing users on devices. Most of Sprint's offers exclude all but new users.

[ase500]

You're right, they are in business to make money. You're asking them to take a loss on revenue because you and others feel entitled to the new benefits of new plans without following through on your commitment when you signed a two year service contract to receive a discounted phone.

 

I don't understand what the problem is, when you're done with your two year commitment you are free to move to whatever new non subsidy plan you want without penalty. Or move onto another provider without an early termination fee.

 

You agreed to pay for your device by signing a two year service commitment. If you want to change service to something that no longer includes that device subsidy then you pay that subsidy fee, or an early termination fee if you change providers. It would be no different than me bitching I don't feel like paying the last six months on my lease because I want to change to something new.

 

 

 

 

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Banging head against wall. How can they lose money on if they passed the Break Even point. Bro Do you even business. The only loss they can have at that point is the loss of revenue from loss customer. I will restate this once more the devices subbed to put them in the hands of the customers so they could sell the service. They are not a retailer. Once the wholesale cost is paid, the profit comes from the sale of the service. Get it yet?

 

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[WiWavelength]

Banging head against wall. How can they lose money on if they passed the Break Even point. Bro Do you even business. The only loss they can have at that point is the loss of revenue from loss customer. I will restate this once more the devices subbed to put them in the hands of the customers so they could sell the service. They are not a retailer. Once the wholesale cost is paid, the profit comes from the sale of the service. Get it yet?

 

Even if a customer is minimally profitable, that customer may not be worth retaining.  That customer still places burdens on the resources of the business.  The opportunity costs to the business and to other customers may not be worth continuing to serve the aforementioned customer.

 

Some food for thought...

 

AJ

[ase500]

Even if a customer is minimally profitable, that customer may not be worth retaining. That customer still places burdens on the resources of the business. The opportunity costs to the business and to other customers may not be worth continuing to serve the aforementioned customer.

 

Some food for thought...

 

AJ

The name for that attitude is called bankrupt. I help operate a 120 million a year operation for one of the largest companies on earth. And that statement alone would have gotten you fired. Every customer counts. In a connected world one angry customer, no matter how small the profit can make huge dent in your bottom line as they lampoon you on facebook and Twitter. It is quite clear many of you here don't understand business. I really hope none of the people at Sprint share your view. If they share such an anticustomer view the company has earned its reputation for poor customer service and it will not make a full turn around.

 

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[Arysyn]

The name for that attitude is called bankrupt. I help operate a 120 million a year operation for one of the largest companies on earth. And that statement alone would have gotten you fired. Every customer counts. In a connected world one angry customer, no matter how small the profit can make huge dent in your bottom line as they lampoon you on facebook and Twitter. It is quite clear many of you here don't understand business. I really hope none of the people at Sprint share your view. If they share such an anticustomer view the company has earned its reputation for poor customer service and it will not make a full turn around.

 

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I happen to agree with you here. I think that is why there is a huge difference between carriers such as Sprint and T-Mobile. Notice how Sprint doesn't seem to care about giving great promo deals to existing customers, whereas T-Mobile gives great promo deals to all customers. Sprint's promo deals often expire for customers on them, then Sprint raises their rates, whereas T-Mobile's promo deals keep customers on them grandfathered in for as long the customer keeps the plan. T-Mobile also is actively doing SERO-like discounts, whereas Sprint stopped doing that years ago and is taking away discounts from its loyal long-time customers.

 

Also, Sprint removed and banned several customers some years ago for calling customer service too often. I had two major issues with T-Mobile last year involving T-Mobile messing up on my preorders of the Samsung Galaxy S7 Edge and the Samsung Galaxy Note 7, both involved several calls and emails to T-Mobile's Executive Response Corporate Customer Care department. Yet, the same people went to find a 20% off discount code for me and are working to get me on the two line for $100 with tax included, along with an upgrade to one line of $25 for unlimited 4G LTE hotpot data.

 

So right there is a big example of customer service experience differences, between two familiar companies to this site.