AT&T Next is a poorly devised scam

July 16, 2013
70
284

AT&T Next is a scam

AT&T’s Next actually makes us laugh out loud. Heartily.

For all the consternation about paying full price for a phone, this new AT&T Next thing is a head scratcher. Rather than pay full price for a phone, AT&T is asking you to pay in installments, then a premium for the option to give the device back if you want to bail out early.

The gut reaction is that this is a great option for those of us who want a new device every few months, almost like a rental plan. Sure, we’d pay a premium to be able to exit a plan early. We’d be on the bleeding edge, all the time.

Rather than offering something fair, they're preying on our impatience as consumers.

No. AT&T’s plan only kicks in after 12 months, so you can’t turn the device in after 6, or even 10 months. You pay for the device in installments, in addition to the Next scam, and you still wait a year before you can turn the phone back in.

Let’s break it down: If you paid full price for the Samsung Galaxy S4 ($640), you’d have that cost amortized over 20 months ($32/month). On top of that extra $32/month, you’ll pay a subsidy for the Next program, which is currently unknown. The common thinking is right around $20/month, so we’ll go with that.

Over the course of 12 months, which is the earliest you can opt-out of this plan, you’ll have spent $624 for the device. At that point, you still don’t own the device. After 12 months, you will have paid AT&T nearly the exact cost of the device, and it’s still not yours.

If you keep that device for the full 20 months, you will spend over $1,000 on a $640 phone.

If you keep that device for the full 20 months, you will spend over $1,000 on a $640 phone. I don’t know if you know this, but cell phones don’t appreciate in value. Rather than biting the bullet and paying for the device upfront, you will have gone and paid AT&T a lot of money for the pleasure of using their device for 12-20 months.

This is another instance in a long line of carriers’ acting as though mobile devices are theirs to dole out at their whim, on their terms. Rather than offering something fair, they’re preying on our impatience as consumers. While Next solves the problem of ending your contract earlier than planned free of penalty, it does not save you money or even wink at being fair for consumers.

I believe the proper term for describing Next is ‘bamboozled’.

Comments