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Sprint Confirms $350 ETF Change

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Top message:  iPhone.... by glinc   Aug 31, 2011, 9:35 AM

Replying to:  Re: Of course you do by furyx639   Sep 1, 2011, 2:30 PM

Re: Of course you do

by T Bone    Sep 1, 2011, 6:18 PM

Offering wireless service costs what it costs, there is no 'mark up' on the cost of rate plans to cover the subsidy of the phone. The difference is made up over time, not by marking up the cost of rate plans.

The reason the subsidy system exists is because carriers at one time had difficulty convincing people to sign up for rate plans, which used to be a lot more expensive than they are now, so they had to offer the incentive of a 'free' phone to get people to pay for the expensive rate plans.

Rate plans are a lot cheaper now, but the subsidy remains because customers by and large like it that way.

But the rate plans would cost the same they do now even if there was no subsidy.

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