I know I'm surely in the minority here but back in August I was so fed up with AT&T that I spent most of the month planning a move to Sprint. I was in and out of stores, researching phones online, talking to friends and more. Even with their poor coverage (my parents live in western mass and basically that entire side of the state is a black hole for sprint) I was so close to making the switch, at least for a one mon…
May be someone could answer a question I have for a long time. There are two different modes of operations wrt the mobile phone industry. US and most other European countries package phone and services together. Whereas in a lesser sophisticated market like here in India phone and services are independent of each other. Both have their own pros and cons - Here I would never choose a crappy network because they have a…
Bundling uses a common pricing psychological trick - by reducing the fixed price (i.e. the phone price) but increasing the variable charge (i.e. the monthly bill) the consumer has a perception that the deal is "cheaper". I'd venture to say that the wealth level of consumers who buy high end smartphones in the US is lower than those who do in other markets - essentially the lower one time charge encourages consumers to buy phones they really can't afford (it's like layaway for mobile phones). Furthermore, the consumer is locked into a long term contract (usually 2+ years) so they can't churn.
Finally, carriers can exploit uninformed consumers. For example, you can offer two free phones with a plan, one of which has a cost of $300 and the other $200 to the carrier. You can list both phones at a fake MSRP $350 making both phones seem like equivalent deals when in fact consumers who buy the $200 phone are essentially writing a $100 check to the carriers. Since carriers bundle phones with the service and most models are carrier specific, there is no perception of the actual value of a phone and thus, it's really easy to do this.
In general, the US market is pretty anti-competitive because of i) bundling ii) carrier locked phones iii) lack of pre-paid options (esp on the high end) iv) long term contracts v) CDMA networks which prevent re-using phones with another carriers
So in general US customers get a raw deal when compared to other markets (don't get me started on how we get charged for incoming calls and SMS). On the plus side, we do tend to get coolest phones first.