Google Says Nexus One $350 'ERF' Is Necessary
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Top message: Man Up. Stop crying. And look at the facts people. by cwcanty
Replying to: Re: Think about what you just said... by Otowncell
Google sells the phone to Tmobile at a loss. essentially subsidizing T's purchase. In exchange, Tmobile promises to pay Google a sum of money after a set period of time, usually 3-6 months. By doing so, Google gets to sell more phones at lower price points and Tmobile has time to generate revenue from the customer they sold the phone to. If a customer breaks their contract before they've achieve ROI, both companies lose.
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