So, when T-Mobile launched their JUMP
(Just Upgrade My Phone) plan last week, a lot of people said that it would change the way that we think about upgrades and it really had the potential of drawing away a lot of AT&T, Sprint and Verizon's customers since none of their competitors had a plan anything like it.
Well, today, we got wind of two of their competitors launching similar (but nowhere near the same) programs. AT&T'
s program is dubbed Next
and appears to be more of a ripoff more than an actual upgrade plan. The plan requires that you pay a monthly fee which breaks up the phone's cost into 20 monthly payments (a little over a year and a half finance plan) and requires that you make a minimum of 12 payments in order to upgrade the phone. Which means you essentially get an upgrade after 1 year of having the device (instead of AT&T's standard 2 year) and you have to pay 60% of the device's cost and you don't actually own it at all. Then, you hand over your old phone having paid 60% of the cost of the device and get to pay the on-contract price of the new device. Keeping in mind, that you could be paying upwards of $383 (if you have a Galaxy S4) over the course of one year plus the cost of taxes on the retail price of the device which will come out to about $60 for most people in most cases. This ends up costing over $443 over the course of one year, and you can only upgrade once a year and you don't get to keep the phone. In T-Mobile's scheme you end up paying $120 a year extra which includes an accidental insurance policy (which almost costs $10 a month already).
So, AT&T's program costs 3x as much as T-Mobile's program and you get to upgrade only once a year instead of twice a year and you still have to pay for your voice and data plans as if you had a subsidized phone. So, you're essentially double paying for your phone with AT&T's Next plan and your voice and data plan. AT&T's plans are still structured so that you are paying anywhere between $20 and $30 a month to pay off your device depending on the device's cost. Now, if you take both into account, you are probably paying between $50 and $60 a month for your phone if you go with AT&T's Next pan. If anyone were to ever go for this plan, they would actually end up making AT&T significantly more money if they had just stuck with their once in 2 years plan or even just opened a new line with a family plan (it would be cheaper).
Now, there have also been some leaked (rumored) pictures
that describe Verizon's Edge plan which is also designed to compete with T-Mobile's JUMP plan. Verizon's plan looks to offer customers an upgrade once a they have paid off at least 50% of the device's cost. This is admittedly less than what AT&T is demanding from their customers, but once again it requires the customer to pay upwards of $300 (on a $600 phone, most flagship phones retail between $600 and $700 nowadays). This is still better than what AT&T offers since, for example, you would already pay $199 upfront for the Galaxy S4 and an additional $100 already buys you the ability to upgrade whenever you want. You could theoretically upgrade more often on Verizon's plan than on T-Mobile's but it isn't likely that people will do that. Verizon's plan isn't bad if you consider that T-Mobile's plan still requires you to pay the new contract price of the device + the $120 annual fee, which ends up coming out to about the same price as half of the price of the phone. And when you consider that most phones don't depreciate at 50% over 6 months to 1 year, you can safely say that they're still making money, albeit not that much when compared to AT&T's ludicrous plan.
However, a few things that Verizon's plan appears to lack that T-Mobile's already has built-in is the integrated device insurance policy which protects you from being screwed and without a phone if you do drop and break your phone. You also have to consider that you will still probably be paying the same monthly fee for your service, which like AT&T's factors in your device's subsidy, which could mean that you would be paying for your device twice like on AT&T. Since Verizon's plan hasn't launched yet and we don't know the details about their new contract, there's still a chance they won't make customers pay for their devices twice like AT&T.
Looking at all of these plans, T-Mobile's appears to still be the best option with Verizon coming in close behind and AT&T being a very dead last. Sprint hasn't announced anything quite yet, but it would be hard to be worse than AT&T's plan.
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