Saul Hansell suggests that hated U.S. cellular carrier practices such as text message markups and fee-packed contracts
ultimately give American consumers what they really
want: predictable bills.
In pursuit of this we learn of the psychological "nuances" of pricing and the "supersized logic" of using fat overage fees to upsell customers to expensive all-you-can-eat plans.
"This year," he writes, "the deals are becoming even better."
His piece even claims that the industry would love to give up the adhesive contracts, early termination fees and locked-in subsidy handsets that it won't give up, even when threatened by congress
Now all the carriers are selling heavily subsidized smartphones. They hate this state of affairs -- and wish that American consumers would just pay full price for the phones, the way people do in Europe.
Hansell's evidence for this is the iPhone, which was "unsubsidized" when it was $600. It only dropped to $400 and then $200, he writes, when they moved to subsidies. He implies that the iPhone launch was initially unsuccessful and that this shows Americans won't buy contract-free phones: "Consumers balked at the high upfront cost. By the second generation of the iPhone, Apple reverted to a traditional subsidy model."
For customers, however, the only practical option with the $600 U.S. iPhone was to activate it on the standard subsidy-payoff contract, with a compulsory data plan to boot. Whatever the unsubsidized payment arrangements between Apple and AT&T, the contract arrangements between AT&T and consumers always
assumed a subsidy. In fact, my recollection is that AT&T itself wouldn't even sell you that "unsubsidized" iPhone without activating a 2-year contract on the spot. Buying one from the Apple store did not enforce activation, but everyday customers couldn't activate on other carriers (or on a pre-paid AT&T plan) without using warranty-busting hacks that emerged only later.
In fact, AT&T didn't market a no-contract iPhone until March, 2009
-- for $600-$700 depending on model, more than the original iPhone model ever cost "full price."
Throughout his piece, Hansell writes often of people's confusion. He claims that even economists find cellphone plans baffling. But they're not hard to understand except in the nickel-and-dime details. Hansell's repeated evocation of "confusion" is reminiscent of when characters in novels continually ask what's going on, or when they wake up in white rooms: it's because the writer himself doesn't know.
Excepting the Yale professor whose words introduce the article, the people quoted in it are carrier flacks and cellular industry analysts: a fair sign of a piece tossed off inside a snowglobe of PR.
Though Richard “Datamancer” Nagy died unexpectedly in 2013, his business partner and family continue to fabricate the extraordinary steampunk designs he pioneered.
I have a 64GB iPhone, but I don’t like using iTunes to transfer videos to it because it is a hassle. I have this little $30 USB/Lighting flash drive that holds 32GB of files, including videos, photos, and songs. I plug it into my computer, copy over a bunch of card magic instruction videos, and […]
Researchers at UC Riverside and Centro de Investigación Científica y de Educación Superior de Ensenada have published a paper describing their ongoing success in setting a “transparent nanocrystalline yttria-stabilized-zirconia” into patients’ skulls, which reveal the patients’ brains so that the patients’ brains can be zapped with therapeutic lasers.
Looks like all of your potential employers are hiring candidates with programming skills (which you don’t have). With all of the languages out there today, it’s tough to know where to start.With the Complete Front-End to Back-End Coding Bundle, you can beef your resume up in all the right places, no confusion necessary. This package of […]
Those of us who love music wish we could listen to it 24/7. But it’s impossible when we’re trying to converse with our friends, or when are swimming in the local pool.That is, until now. The KOAR Bone Conduction Bluetooth Headset, now 48% off, has changed the audio game.Made with lightweight titanium memory metal, this headset boasts patented bone conduction technology to transport sound […]
It’s one thing to enjoy dinner at home and a nice glass of Cabernet Sauvignon with your best friend, Netflix, but it’s another thing entirely to make that meal from scratch and get that wine delivered right to your doorstep.But what if we told you there’s a way to make this possible? To keep your social life, […]