Mobile carriers seem to battle it out more often than guests on that “not-to-be-named” popular daytime talk show. If it’s not over plan pricing and data packages, it’s over who does or doesn’t have the iPhone. But now with that available in nearly every major carrier, who or what will enter the ring for the next blood bath of advertising cage matches? Contracts and Upgrades….Let’s Get Ready to Rumble
New models of existing phones seem to be popping up faster than the heads in a game of Whack-a-Mole. And for the obsessive tech addict who always wants to have the newest and best devices, limiting factors like contracts and upgrade pricing can be very stressful on the mind and wallet. But carriers are now finding there is more money to be made in eliminating contracts and allowing customers to upgrade more frequently.
AT&T Next was the counter attack announcement to the recent release of T-Mobile’s Jump plan, and it looks like Verizon will be releasing its own version of this type of plan in the weeks to come. Both plans (AT&T and T-Mobile) give customers the option to avoid a lengthy limiting contract and the ability to upgrade their mobile devices more frequently than they used to. Both plans do away with the cumbersome 2-Year service agreement and invoke a monthly fee in its place. This monthly fee allows you to upgrade your phone without penalty and without having to wait until the end of your contract to avoid paying full price for a new phone.
Each plan is a little different in the details, but don’t worry I’m going to break ’em down as simple as I can. I won’t be telling you which one to choose, if you need help with that go find the closest adult and I’m sure they can hold your hand through your decision-making process. I simply want to provide the facts and let you choose which option is best for you.
T-Mobile recently phased out its reliance on contracts and subsidies to new and existing customers. This combo removed some significant fees that you paid each month and reduced the overall pricing of their Voice and Data plans. The Jump plan pricing depends on two things:
1. Type of phone you choose
2. The Voice + Data plan
With T-Mobile’s Jump plan, you pay a $10 fee each month for the ability to upgrade your device up to two times a year after an initial 6 month waiting period. Each upgrade requires that you trade in your old device and pay an upfront cost for the new device. You also pay a monthly rental fee for the device (for no more than 2 years) plus the monthly charge for whatever Data + Voice plan you choose.
AT&T has given its customers the choice to opt out of signing a contract by choosing to go with their Next plan. AT&T’s Next plan eliminates the contract and upfront cost fee of a new phone, but only allows you to upgrade your phone once every 12 months, with the trade-in of your old device. The plan pricing for Next also depends on two things:
1. The type of phone you choose
2. The Voice + Data plan
With AT&T Next, you do not pay a monthly fee to upgrade early, but the monthly rental fee you pay for the device is a little more than what you pay with T-Mobile. Also, AT&T did not make any changes to their Voice and Data plans, the same plans are available to everyone, contract or not.
Since a picture is worth a thousand words, here is a nice table that summarizes what you would pay over a two-year period with T-Mobile and AT&T. Each plan is based on the most current model of iPhone.
The Data + Voice plans are based on each carriers Unlimited Voice and Text package, T-Mobiles 2.5 GB data package, and AT&T’s 3 GB data package.
Even though AT&T does not charge an upgrade cost or monthly upgrade plan fee, their overall cost are slightly more than that of T-Mobile’s. Most of this is due to the fact that AT&T still uses the same Voice and Data plans that contain the subsidy fees contract customers pay. You could argue that your essentially paying for your phone twice, but the new plan does eliminate the initial upfront $199 cost and the 2 year wait. T-Mobile, on the other hand, reduced the price of their Voice and Data plans but still require you to cough up nearly $150 each time you upgrade, $300 a year if you upgrade twice within that time period.
Overall I think they’re about even. It really depends on which dollar amount is most important to you, paying more over 2 years for nothing upfront, or paying more upfront for less over 2 years. But that’s your dilemma to battle, I just picked the fight.