Edge, Jump, and Next: the “opt out” shell game, and how to win.

July 19, 2013
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    Edge Next Jump Digital Trends

    Save for Sprint, every other major US carrier has some sort of “opt out early” plan. T-Mobile kicked things off with their “Jump” offer, which was followed by AT&T’s costly “Next” scheme. Verizon was late to the game, but had a very fair showing with their “Edge” plan.

    Where do we go from here, though? Are these plans really good for us, or are we still twisting in the wind with our carriers? These all take care of some of our needs, but only one option will solve them all.

    Why is this happening?!

    T-Mobile struck a nerve when they went with their “un-carrier” approach. Theirs was the first domino to be tipped, and the chain reaction has been poignant. What we can really take away from all of these plans is that each carrier views their customers differently, and that they probably make more money from the current business model than we’d be comfortable with.

    Of the three plans on offer, T-Mobile’s is probably the most sound option, simply because their pricing is best.

    Of the three plans on offer, T-Mobile’s is probably the most sound option, simply because their pricing is best. Then again, their network is the worst of the three, so you get what you pay for. AT&T is engaging in some unsettling price gouging, plain and simple. Their offering is so insulting, it’s painful to think about customers who don’t know better being coerced into that scam by AT&T employees.

    With Verizon, I noted previously it was nearly perfect. Roundly criticised, I stand by that for one simple reason: Verizon has the best network in the country. The country’s largest carrier has presented a very fair “opt out” plan, void of monthly fees or hidden cost. They also have a customer base which is often frustrated about their Android update cycles, and this gives those users the chance to take off or get a new phone if they like.

    Jump Edge Next Techspot

    Bad business

    The argument has shifted as of late. What was once a desire to be able to leave a contract early has now morphed into a discussion about monthly plan cost. With all three carriers, you’ll have to sign up for a plan; one that hasn’t changed in cost, save for T-Mobile who altered their monthly pricing a bit. The other two still have the monthly plan pricing you’ll find with a subsidized plan. Many consider this to be double dipping for the price of the phone.

    If Verizon dropped their plan cost slightly, but charged a monthly fee, that would put them on par with T-Mobile.

    They’re right.

    Verizon’s CFO has gone so far as to say they won’t be altering the monthly plan cost like T-Mobile did, and that Verizon doesn’t expect many will even opt for Edge. On the flipside to that argument, they aren’t charging a monthly fee like the others.

    If Verizon dropped their plan cost slightly, but charged a monthly fee, that would put them on par with T-Mobile. By not doing so, they’ve simply not been as translucent as we would like. This doesn’t mean they’re any more devious or greedy than the rest, just that they structured that greed differently. AT&T’s avarice is pretty straightforward, and T-Mobile’s is a bit more confusing with so much broken-out line-item costs. Verizon’s rapacity is plainly obvious, but not any better than the rest.

    AT&T Next is a scam

    What we want

    Like we do with these plans, let’s break down the argument a bit. We wanted a way out of our two-year contracts early, without paying an early termination fee. Each carrier has done that for us, although the ETF is really just parsed out differently. Be it making sure your device is half paid for like Verizon asks, or a monthly fee for the option to leave, you’re still paying for that ETF in some way. You’re still covering the carrier’s’ financial backside, so to speak.

    We wanted to save money, too, right? Well, that really doesn’t happen with any of these plans. Verizon may not discount their plans based on you paying for the device over time, but they also don’t charge a monthly fee for the thrill of being able to opt-out. T-Mobile discounted their rates, but the monthly fee probably makes up for that. AT&T is, well, AT&T.

    Nexus 4

    The solution

    The carriers have taken care of some of our needs, as we now have the option to leave early. What they didn’t address was cost associated with doing so, but are we really surprised? Verizon alone has a near 50% profit margin, so why upset the apple cart? With the others charging a monthly fee for their various new schemes, the parity among the major carriers still exists, it just looks different.

    If you want to own your device, be slave to no carrier master, have the option to come and go as you please, and save money, there is an answer. This option been there all along, but we’re reluctant to bite the bullet due to upfront cost. We should probably come to the understanding that carriers will never look out for our overall best interest, and it’s time we dignify that with a response.

    If we did the math for our own pocketbook, as so many have done for the carriers’, we’d find this was probably our best option. We’ve told you how to get a great plan with T-Mobile by following this route, and I’ve made it clear how much money I’ve saved doing it. You’ll see no change in service, but you’ll avoid the headaches you see with any carrier plan, these new ones included. You know it, and I know it, so why not look into it already? It’s time to go prepaid.

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    Comments

    • MasterMuffin

      I don’t understand why people, who have the money to buy their phone at full price, choose to buy their phone “cheaper” with a carrier plan, because they’ll just end up paying more!

      • Kusuriya

        Some people just don’t realize that buying with a subsidy is more expensive. I pretty regularly school people in various places about the actual cost of a subsidized phone.

    • OniGokuMonji

      I don’t understand why the author doesn’t realize that carriers service is based on location. It’s not a bad. Carriers will suck is some places others excel. Why is this hard to understand?

    • darkraider

      Been using the T-Mobile prepaid since I got my Nexus and no problems till now. Unlimited 4G, own my phone and can do whatever I want.

    • King-Podigy-X

      So where is Sprint in all of this.

    • Chris

      Having the “best service” or the “largest network” means absolutely NOTHING when you constantly bleed peoples pockets. T-Mobile out of all 4 major carriers has done way more for their current and potential customer base in a shorter amount of time and have actually delivered. Sprint, Verizon and At&t all have noticed which is the reason they are all now trying their hardest to mimic Magenta.

    • MSmith79

      Both of these articles are a serious embarrassment to Android Authority.

      • MSmith79

        I apologize for my response here. It was rude and should never have been written. I appreciate the work you do Nate. Sorry for this.

    • Railwayman

      It is necessary to change the whole model in the US and implement the following system instead:

      1. Carriers should be disallowed to alter devices. There should be ONE standard version per product in the US like it is in Europe. In many countries, there are just ONE Galaxy S 4 (GT-i9505) or Xperia Z (C6603) and that is how it should be.

      2. Carriers that break the point 1 by disabling frequency bands (in order to make the device incompatible with other networks) and work for getting exclusivity deals (thus destroying the free market) should be forbidden to do so.

      3. Devices should be available as outright off contract purchases and then with financing options running for 6, 12, 18 and 24 months. You can simply split the device cost by agreeing to an installment or “raised monthly fee” that pays off the phone.

      4. Because of no 3, the plans are just for the service and doesn’t cover devices at all.

      5. Support for devices are handled by the store or the manufacturer. Not the carrier per se. It is abnormal to call Verizon when a Samsung has a problem – the natural thing is to call Samsung that made the device.

      The thing is that a market working according to those 5 points exists. In fact, many markets are like that and the positive results are:

      1. Cheaper devices (the prices are lower since the competition is greater).

      2. More retailers (many independent retailers like The Phone House et al sell devices, not just carrier stores).

      3. The device selection is much bigger (since the carriers doesn’t mess with the devices, it is possible to bring a big selection in that can be distributed and sold through many channels, thus creating a more stimulating market with a great choice).

      The device selection in the US together with the price is just a disaster. It is the worst selection I have ever experienced. A small country like Denmark (5.5 million of citizens) have a lot more smartphones available.

      The US carriers are just a huge limitation for the deployment and development of smartphones. Their prices ($100/month) make a basic, modern communication tool into a luxury product, which is just wrong. A decent flagship smartphone like the Galaxy S 4 should be available for around $50 per month depending on contract.

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