AT&T Confirms Device Upgrade Fee Rising to $36
WHAT Costs Will Be Increased?
Wireless devices today are more sophisticated than ever before. And because of that, the costs associated with upgrading to a new device have increased and is reflected in our new upgrade fee.
Exactly what "costs have increased?" They switch your account from one SIM to another. How is this any more difficult with a more sophisticated phone?
If I was to 'upgrade' my iPhone 4 to another iPhone 4, or even 'downgrade' to a 3GS, I would still have to pay an increased fee. This does not make sense.
They are effectively tagging 'everyone' an administrative fee of $36, wether you upgrade or even downgrade.
Increasing the "Upgrade" fee and blaming the cost of the fee on the cost of equipment is underhanded and doesn't make a lot of sense.
Also, your argument that it's better to pay it on your bill than at the time of the phone purchase makes no sense to me. Either way the person is going to have to pay that fee. Why not pay it when you purchase the phone?
"Pay the fee or switch to prepaid" - better yet, switch carriers.
There is enough complaining about AT&T, and this fee increase mey help increase churn.
You can't make this a conspiracy theory.
Did you just pull that out of your hat?
Discounts to the carriers vary dependent upon volume, except for iPhone as I understand it.
Reduced costs of phones has been around for quite some time, and in the infancy of the industry, it was a way to lure customers, especially ones who never had cellular service.
Now, as the market is maturing, the exponential growth bloom is gone, the carriers will be charging more for the phones.
I'd love to see the figures of churn customers compared to brand new customers (never had sv prior).
ATT is being somewhat disengenous with the upgrade fee. The price of the phone is a lure. Get a $600 iPhone for $199. If you make it $235, you will lose some customers. There are number threshold...
So... on a $9.99 partner line, let's say with a $20 data plan, factoring in the subsidy cut on the phone, assuming AT&T didn't pay commissions on the sale as well, it would take 10 months before they turn a profit on the customer. In real life, it's much longer.
With all due respect, you don't know what you're talking about. I agree with the point that the fee increase is the right place to drive revenue, but you're wrong. It drives me nuts when people think we as dealers don't take a hit on the devices.
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