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FCC Task Force Tackles AT&T, Google, Sprint, T-Mobile, Verizon

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No subsidies = bad thing

bluecoyote

Jan 26, 2010, 3:01 PM
You pay the same price for your monthly rate whether or not your handset is subsidized.

So if you buy your handset full price

You're throwing hundreds of dollars

out the window.
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60dollarcarcharger

Jan 26, 2010, 3:01 PM
he's got a point
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Globhead

Jan 26, 2010, 4:43 PM
No he doesn't. Monthly fees are padded to make up for subsidies. If subsidies end, the next time a carrier comes up with a new rate plan to under-cut the others, it will be calculated to NOT have to cover "free" phones.
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bluecoyote

Jan 26, 2010, 5:20 PM
Yeah that's in fantasy land. More than likely just hold onto the costs and increase activation fees and claim that "it's necessary to cover customer expenses."


Bluecoyote : fair and balanced┞¢ | to the point┞¢ | always right┞¢
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hepresearch

Jan 26, 2010, 5:27 PM
bluecoyote said:
Yeah that's in fantasy land. More than likely just hold onto the costs and increase activation fees and claim that "it's necessary to cover customer expenses."


My goodness, you must not like companies very much...

Well, when all the evil companies are gone, I'm sure you'll be enjoying your non-existant phone service...

bluecoyote said:
Bluecoyote : fair and balanced┞¢ | to the point┞¢ | always right┞¢


🤣
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Globhead

Jan 26, 2010, 6:46 PM
It's called "competition". If you hadn't noticed, airtime has been getting cheaper for 30 years because nobody wants to lose customers.

I suppose, in your dystopia, you are still paying $1 per minute.
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nikkifm

Jan 27, 2010, 3:43 PM
That's kind of why T-mobile offers lower rate plans if you pay retail price......
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Azeron

Jan 26, 2010, 3:17 PM
You pay for service rendered. Carriers should not even be involved in selling handsets. That's where you get this sense of entitlement from in the first place. For a carrier to discount the price of a phone in order to entice a customer to use its wireless service would be akin to Texaco discounting the price of a Nissan to get a person to buy gas exclusively from them. It is crazy. Let's end this madness!
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bluecoyote

Jan 26, 2010, 3:35 PM
Except you're comparing

apples to oranges.

Gas stations have a low barrier to entry, this pricing strategy wouldn't work.

Cincinnati Bell, T-Mobile, and others have tried to make contract-free work

It doesn't. Because you throw money away.

Bluecoyote : fair and balanced┞¢ | to the point┞¢ | always right┞¢
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Menno

Jan 26, 2010, 4:01 PM
tmobile discounts monthly plan rates if you buy phone retail
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ac2913

Jan 26, 2010, 4:24 PM
Cincinnati Bell, T-Mobile, and others have tried to make contract-free work

It doesn't. Because you throw money away.




You're kidding right??? T-mobile released these no contract plans on Oct 25 (Q4).
Tmo adds 951,000 cust in q4 (more than any quarter in the last 2 years), WITHOUT releasing any major nice phones (cliq, mytouch, behold2, and g1 all came before start of q4) and this is before nexus one (jan. 5)....not only did they add nearly a million, churn was below 2% (lower than its ever been)... 😲 😲 😲

these no contract plans do work!



source: reuters: http://bit.ly/abJFdi
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nikkifm

Jan 27, 2010, 3:49 PM
Honestly you can't tell why that was with the payment plan for 'Non contract' phones (which sounds like a contract to me) people could easily decide to get a $500 phone for 20 bucks a month. All they did was reword it where it sounds like it's not a contract. Not everyone loves month to month. 🤣
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jundibasam

Jan 27, 2010, 12:14 PM
Its tough to swallow that I find myself in agreement with bluecoyote for the first time ever. 😕
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sugarb85

Jan 26, 2010, 4:03 PM
Good Analogy
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hepresearch

Jan 26, 2010, 3:24 PM
So, in one post you argue that ETF's are bad, and in the next breath you post saying that subsidies are good. They go together, my friend. One is the consequence of the other. Without ETF's, there will be no subsidies.

I don't understand people who think they can get a subsidy without having an ETF...
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bluecoyote

Jan 26, 2010, 3:31 PM
It's very simple:

If I buy a phone that was subsidized for $150.00

And I cancel

I pay the carrier back the prorated amount.

That isn't what's going on. See: Nexus One.



Bluecoyote : fair and balanced┞¢ | to the point┞¢ | always right┞¢
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Azeron

Jan 26, 2010, 3:49 PM
How about a variable ETF? ETF equals full retail price of handset minus contract price of the handset. The ETF would also be prorated by the amount divided by the length of the contract.
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nikkifm

Jan 27, 2010, 3:53 PM
They do.....they don't tell you but the longer you're in a contract....the less your termination fees.
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enin

Jan 26, 2010, 3:54 PM
ETF does not just cover the subsidized cost of the device however.

Customers never take into account the cost of adding someone to their network. The amount of money it costs to activate a line, change anything related to their account and ultimately to cancel said line. There's a lot of man hours, network costs and such that you aren't thinking about. No carrier can afford to eat that cost every time, they would go out of business very quickly.
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sugarb85

Jan 26, 2010, 4:06 PM
Couldn't have said it better myself...Goodness BC is getting on my nerves..."always right"...yeah right
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bluecoyote

Jan 26, 2010, 4:11 PM
I believe the "cost to activate a line" is the "activation fee."

But quite honestly that's a cost they have to eat themselves. If I return something to Wal-Mart yes they lose the money of keeping the lights on. (some retailers charge a 10% restocking fee, think of that as losing your activation fee.) Cost of doing business- there's obviously a reason for cancelling the service.


Bluecoyote : fair and balanced┞¢ | to the point┞¢ | always right┞¢
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enin

Jan 26, 2010, 10:55 PM
If half the people that are charged activation fees actually paid them, I would agree with you however they get them waived 60-70% of the time by the provider.

As far as you saying "that's a cost they have to eat themselves", it just sounds like you have something against large companies. If that's the case, that's fine but your argument should state that.

Concerning the restocking fee, that covers part of the cost for the equipment only and has absolutely no bearing on network or labor costs. That phone cannot be resold as new (at least not honestly), and the company has to recoup that cost by charging a restocking fee.

And as far as reasons for cancelling service, there are tons of reasons ranging from poor customer service, to bu...
(continues)
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sugarb85

Jan 26, 2010, 11:06 PM
Preach!
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Azeron

Jan 27, 2010, 4:33 PM
It's too bad none of these guys who matter have the balls to tell the FCC where to stick it.
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hepresearch

Jan 26, 2010, 3:59 PM
Yes, it is very simple, but why are you trying to make it complicated? You rant in one post about how President Obama is coming in to take away all the evil ETF's, and then you post this. The prorated amount IS the ETF. The providers used to NOT prorate ETF's, so you should feel lucky that many of them do now. What exactly are you trying to say here?
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bluecoyote

Jan 26, 2010, 4:09 PM
Read Verizon's response, they're using the ETF to cover other miscellaneous expenses.

Bluecoyote : fair and balanced┞¢ | to the point┞¢ | always right┞¢
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hepresearch

Jan 26, 2010, 4:22 PM
Again, you didn't answer the original question, so why do you keep changing the subject? What's your point, Mr. Always Right? So what if they covered other expenses? They have to find ways to cover their expenses, or they will not be in business much longer anyway. If you don't think Verizon treats customers fairly, don't buy their services. It's called a free market, and every dollar you spend is a vote...
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CS2006

Jan 26, 2010, 4:43 PM
There is always a tenuous and delicate balance between buyer and seller. The seller wants to make as much profit as possible, the buyer wants to spend as little as possible. Sounds really simple, but it is very complicated in how it plays out.
The entire system goes awry when one of the two parties gains an absolute upper hand. The other party reacts unfavorably. An absolute upper hand would be granted by the government removing the protection (ETF's) of the company that makes it worth the risk to offer discounted handsets. So companies would begin to charge higher prices for the handsets which would cause the buyer to buy less often if at all.
So by pandering to the buyer the government would reshape the industry forever.
The current ...
(continues)
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bluecoyote

Jan 26, 2010, 5:10 PM
This isn't a 'free market' like you're thinking.

This is a market with high barriers to entry because of government regulation necessary for them to exist at all (so I can't legally jam VZW's signals or interfere with their spectrum.) There's limited competition because we gave these companies the privilege to merge in the interest of "lowering costs for us." I could take it and move to another provider, but I have 2-3 choices, and chances are high they'd pull the same shenanigans.

Bluecoyote : fair and balanced┞¢ | to the point┞¢ | always right┞¢
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hepresearch

Jan 26, 2010, 5:53 PM
I get your point... obviously there has to be some regulation, but in the end a market at liberty is the best one. More government regulation does not improve competition, and more government regulation will never reduce costs to the consumer.

You are looking at this through the goggles of Marxist Economics...
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Azeron

Jan 26, 2010, 7:41 PM
...and there it is.
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Jayshmay

Jan 26, 2010, 4:24 PM
No, your making it so that your a free consumer. That's what paying full retail is all about, not bein *binded* to a carrier.
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island-guy

Jan 26, 2010, 6:17 PM
Subsidies will never go away because wireless providers depend on releasing exclusive devices to entice new subscribers and retain existing ones. It's whoever's paying when it comes to handset manufacturers. This ETF thing is really a no brainer and the FCC is just wasting more of our money. It looks like all of the self centered whiners are finally having their voices heard. Don't be surprised if one day you have to buy your phone at MSRP. If you have any problems you have to take it up with THE MANUFACTURER via the number on the back of the box and not the store you bought it from. You have to pay an activation fee of $150. If you can't deal with any of this then turn around and let the next guy in line through.
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Azeron

Jan 26, 2010, 8:01 PM
Carriers WANT to provide subsidies, but only if it is profitable to do so in the long run. If the FCC bans ETFs...it won't be. Bye bye subsidies. Carriers can no longerbank on having a customer for two years, customer can no longer get a high end phone for forty percent of cost. I think it is a win.
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nikkifm

Jan 27, 2010, 4:07 PM
Ok....just a thought. If it's unfair..not liked...and just plain cruel....what happened to prepaid cheap phones and $1 a day? Verizon has a huge base with it....T-Mobile nearly eliminated theirs and Sprint/Nex have it. If you don't wanna pay it...don't. BC you better have a tracphone cuz I swear the way you talk is insane.
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stephen5688

Jan 26, 2010, 11:01 PM
I have been saying for years to do away with subsidies, just check most post over the years, The only sub I ever took was the first phone I got when I first signed up and that was over 8 years ago. I like it much better this way, I mean when a new phone comes out that I like better I dont worry about OH is it time to upgrade, hell no! I just but the phone unlocked and I am very happy this way. I mean do you guys need to check with your cable company to see if your contract is up to get a new TV. Give me a break. Cellular service provider are not any different than cable providers or satellite, they provide a service but it is up to me to buy my TV and it should be up to each of us to buy our cell phones too and not from the same place that w...
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nikkifm

Jan 27, 2010, 4:16 PM
Business makes the world go round. when you think about it...why'd they tie the two together in the first place? Cuz the manufactuers wanted people to buy their phones....make a deal with providers. From there call centers and what not were made to FIX the phones and what not...if thousands of people were cut because they didn't have a use and responsibility was given to the manufactuer (more than now...) the price of the phone WILL go up to cover THEIR call centers and future stores because that would eliminate shipping back to warehouse. Quality of service would go down because they can't afford to update everything for phone's that have more power than the service. not good.
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Azeron

Jan 27, 2010, 4:35 PM
Don't worry. It's coming. You are correct. With the no contract model there won't be a need for commissions.
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Mektah

Jan 27, 2010, 5:38 PM
Actually T-mobile's pricing scale is different for people who get subsidies and people who get retail pricing. For their new play no contract unlimited = 49.99 while unlimited with 2 yr agreement is 59.99. Either way their gonna get their money.
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