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AT&T Wants Device Subsidies to Be As Low As Possible

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May 17, 2012, 12:07 PM   by Eric M. Zeman   @phonescooper

AT&T Mobility CEO Ralph de la Vega told investors at the JPMorgan Global Technology, Media and Telecom Conference today that the company is doing what it can to offer devices with low subsidies. "We have to watch subsidies and make sure that we bring devices to market that customers love and will keep and have low subsidies," he said. In the U.S., wireless network operators often subsidize the cost of handsets for customers who sign new contracts. Customers are then able to afford a decent device, and the carrier recoups the subsidy over the life of the contract. de la Vega cited the Nokia Lumia 900 and HTC One X as good examples of devices with low subsidy points. "These are great devices that I think customers will like," de la Vega said. The full retail price of the Lumia 900, for example, is $449. AT&T sells it for $99, meaning it subsidizes $350 of the device cost. The iPhone 4S, however, costs $649 at full retail (16GB version). AT&T sells it for $199, meaning it subsidizes $450 of the device cost. Keeping device subsidies low will help AT&T reduce its margins and other costs. de la Vega also reiterated that the company is working to offer shared data plans later this year, which he believes will help increase sales of tablets.

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Subject Author Date
Why not end subsidies? kingstu May 17, 2012, 3:06 PM
In Other News... crood May 17, 2012, 1:32 PM
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