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Question about upgrading T-Mo w/ 2yr ext

post #1 of 6
Thread Starter 
A buddy of mine told me that if I were to upgrade to a phone and get a 2 yr extension to receive full discount I would still pay the full price for the phone over the span of 2 years.. how is this so? I figured if I were to upgrade my phone the only thing I would be paying for monthly would be the data plan?
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Mr. Clueless
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post #2 of 6
Sigh.

I guess you don't understand how it works.
You get the phone at a lower/no cost, because T-Mobile will end up recouping the cost over the 2-year period.
post #3 of 6
Thread Starter 
You are correct, I do not understand how it works, and still do not, hence the name .. clueless

How do they recoup the cost?
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Mr. Clueless
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post #4 of 6
they recoup the cost by making sure that you are indeed their customer for the next two years. thus you have to stay with them for the two years.

they don't charge you extra or anything but the two year plan guarantees them that they have a hand in your monthly check.

this is why when upgrading, they make you pay a tad more for a phone vs. the cost as a new customer. new customers = harder to snag on the plan vs. existing customers are already accustom to the monthly plan.
    
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post #5 of 6
Not to mention, that's why you just can't cancel at any time before you're two years are up. And another reason why they charge you a ETF (Early Termination Fee) if you do. It's a way to recoup the cost they would lose.

I believe Verizon has it prorated over the two years. So say I terminated my contract in the first month of my two year contract, it would be much higher than if I terminated it on my 23rd month.

You have to realize that the carriers buy these phones at full price and give them to customers at a subsidized price. But people still complain that the costs are so high... But would you rather buy the phone at 600-700$ or for 100-200$? lol I would go for the latter.
post #6 of 6
So basically if you're going to stay with them regardless you might as well get a free phone out of it because your plan reflects the price of a discounted phone regardless
But the fact that they force data plans on you also tells me that they make profits of the data plans but if you would have the data plan regardless then it really doesn't matter
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