Motorola KRZR K1
Top message: Why do GSM phones wholesale cheaper? by vzwbellstar
Replying to: Re: Why do GSM phones wholesale cheaper? by graeloch
Re: Why do GSM phones wholesale cheaper?
Practically speaking, if you use a cell phone as a communications tool, there's no observable difference between CDMA and GSM. If you use your cell phone as an entertainment device, (and don't mind being locked-in to your cell carrier for content), CDMA currently has an edge (no pun intended).
I disagree that GSM will eventually emerge as the standard. GSM already *IS* the worldwide standard. The only places I've been where GSM is not supported is Japan and South Korea.
As for discounts, it's easy to explain why GSM phones are offered at larger discounts when you understand that CDMA carriers enforce monopoly distribution rights on their equipment. You cannot buy an unlocked or generic CDMA phone and then activate it with Verizon or Sprint, or take one carrier's phone and activate with the other. The phone MUST have been manufactured for and sold through the carrier's distribution network, and the ESN registered in the carrier's database, in order to activate the phone. This lack of an open and competitive marketplace allows the CDMA carriers to protect pricing and margins, even improve margins, regardless of supply and demand, amortization of start-up costs or other traditional pricing factors.
I disagree that GSM will eventually emerge as the standard. GSM already *IS* the worldwide standard. The only places I've been where GSM is not supported is Japan and South Korea.
As for discounts, it's easy to explain why GSM phones are offered at larger discounts when you understand that CDMA carriers enforce monopoly distribution rights on their equipment. You cannot buy an unlocked or generic CDMA phone and then activate it with Verizon or Sprint, or take one carrier's phone and activate with the other. The phone MUST have been manufactured for and sold through the carrier's distribution network, and the ESN registered in the carrier's database, in order to activate the phone. This lack of an open and competitive marketplace allows the CDMA carriers to protect pricing and margins, even improve margins, regardless of supply and demand, amortization of start-up costs or other traditional pricing factors.
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