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August 17, 2015

Say Bye-Bye to $199 iPhones at Verizon

Filed under: Electronics,Telephone — Edgar (aka MrConsumer) @ 6:14 am

  As of August 13, Verizon Wireless is no longer going to subsidize the purchase of new cellphones. That means you can kiss that $199 price for iPhone 6 or Samsung Galaxy S6 goodbye. When you get a new phone, you’ll be asked to pay around $650 for those high-end phones, but you can do so in monthly installments of about $27 to soften the blow. Other phones will be available at other prices. Current customers can apparently continue to renew their two year contracts and get subsidized phones, according to the AP.

On the bright side, elimination of subsidies also means the elimination of two-year contracts. So you are no longer bound to remain a customer for 24 months. You will, however, need to fully pay off the remaining monthly payments on your phone if you choose to leave Verizon.

Now the big question: Since you are now paying full price for the phone, are Verizon’s monthly rates for service lower than they were? Remember, depending on the plan, they did have embedded in them a roughly $20 charge to cover the cost of that $650 phone that you got for only $199.

Old plan pricing choices:

Verizon old plan phone costs

In the old system, you had three choices: pay for the phone in full ($650), pay in 24 equal installments ($27.08), or pay $199 (with a two-year contract.)

In the new system, you only have two choices: pay $650 in full or pay it off in 24 installments of $27.08:

new payment options

Besides the cost of the phone, there has always been a line charge, or a charge for the cost of the service per smartphone. The old charge was $40 per line, but if you were on “Edge,” you got a $15 monthly discount making it $25.

Data charges were separate charges also. In the old system, there were many choices with varying prices. Some examples, old/new: 3 gigs – $50/$45; 6 gigs – $70/$60.

Putting it all together, here is the old pricing for an iPhone 6 with monthly installments, on Edge, and with 3 gigs of data:

old total

Here under the new system is pricing for an iPhone 6 with monthly installments and 3 gigs of data:

new system pricing

In this scenario, you are paying $10 a month less than in the former system.

So how does this compare to the old system if you had gotten an iPhone 6 for $199 upfront with 3 gigs of data? You would have been paying $90 a month ($40 for line, $50 for data) plus the equivalent of $8.33 for the phone itself, or $98.33 per month. It is now $6.25 a month cheaper.

At least in these scenarios, the new plan is a little less money, but the rate shock of paying $650 for a phone may still be too bitter a pill to swallow for some. The problem is that you don’t have a ton of alternatives since increasingly the other carriers are also moving away with subsidized telephones.

• • •

July 6, 2015

Sprint’s New Pitch: (Not Quite) All-In Pricing Plan

Filed under: Electronics,Internet,Telephone — Edgar (aka MrConsumer) @ 5:44 am

  Could it be that some of the top executives at the cell and cable companies have been reading our latest rants in Mouse Print* about deceptive low-ball pricing and unexpected additional charges and terms. Probably not. But, as if to say “we can hear you now,” Sprint started a big promotional campaign last week touting its new “all-in” pricing plan.

Sprint’s CEO put it this way:

“If you went to a restaurant that advertised a cheeseburger for 99-cents, but when you show up, they said it’s an extra $2 for the bun or $1 for lettuce, you would feel misled. Yet, that’s what the industry has been doing with its wireless plans. Why can’t everyone just advertise the full price of both the plan and the smartphone – an All-In plan? That was the idea behind what we’ve created.”

As part of the campaign, Sprint produced this extended commercial that pokes fun at its competitors who double-talk customers about all the extra charges they impose.



Wow. One monthly price for service and the phone.

Not so fast.

*MOUSE PRINT:

Sprint $80 a month

The $80 price you see is not the price you pay. Taxes, surcharges [including USF charges of up to 17.40%(varies quarterly), up to $2.50 Admin. & 40¢ Reg. /line/mo. & fees by area (approx. 5-20%)], roaming fees are still extra, and there is a $36 activation fee. Although this screen doesn’t say it (a prior one does in small print), this is for the lease of a phone. So you don’t own the phone, and will have to pay $200 at the end of two years if you want to keep it.

And here’s a new one: apparently Sprint is capping/throttling the speed of streaming videos to just 600Kbps — more like the 3G speeds that it uses on its prepaid service for videos.

So much for advertising a price that is “all-in.” Thanks, Sprint.

UPDATE: This video streaming restriction caused outrage among Sprint users and watchers, and within 24 hours Sprint backtracked removing that throttling of video speeds.

• • •

June 29, 2015

You May Not Own Your New Cellphone

Filed under: Electronics,Telephone — Edgar (aka MrConsumer) @ 6:07 am

  If you are about to get a new cellphone from Sprint or T-Mobile, you better read the fine print, because you may not actually be buying that phone. You may only be leasing it.

MOUSE PRINT*:

Sprint ad

That’s right. Sprint is turning back the clock to the 1950s when you paid a monthly rental fee to Bell for your black landline Western Electric telephone. The difference: you are responsible for repairs if you don’t have a costly protection plan or warranty, and that old phone really sounded good.

For the iPhone 6, $20 of your monthly payment for 24 months is a lease payment, because under this plan, Sprint owns the phone. What happens after the lease ends?

  • You can turn in the telephone, get a new one if you want, and pay its monthly lease payments.

  • You can continue leasing it at an undisclosed monthly cost.

  • You can buy it outright for an undisclosed “purchase option price.”

  • The first option assumes your phone is in “good working condition.” If it isn’t, or if you lose the phone during the lease term, you owe the balance of any yet-to-be-paid monthly installments plus the “purchase option price.”

    If you opt to buy your Sprint iPhone 6 at the end of the lease, they will charge you $200 according to a local Sprint representative. That makes the phone slightly more expensive than buying it outright to start.

    Not to be outdone, effective this week, T-Mobile joins the leasing world also, by offering Jump on Demand. It is an 18-month lease program that allows you to upgrade your phone up to three times a year. T-Mobile, however, adds all kinds of penalties if the phone you turn in is not in working order.

    *MOUSE PRINT:

    You could be charged up to $750 in fines for the following:

    Cracked Screen Damage fee – $250
    Liquid Damage fee – $250
    Device does not power on fee – $250

    There are a whole bunch of other terms and conditions in both the Sprint and T-Mobile lease programs. It is getting to the point that you need a Ph.D. in cellphonery to understand all the choices, options, and terminology.

    • • •

    June 15, 2015

    PayPal Gets Its Wrist Slapped by FCC for Violations

    Filed under: Internet,Telephone — Edgar (aka MrConsumer) @ 5:49 am

      In May, PayPal sent its customers an email notifying them of forthcoming changes to the PayPal User Agreement because eBay and PayPal are becoming separate companies.

    One section of that revised agreement announces changes to how the company can contact you.

    In short, it provides that you automatically give permission to PayPal to call or text you, via autodialed or prerecorded call, on any telephone number (cell or landline) you have given them or that they can find for you, for almost any purpose including to sell you stuff and to collect debts.

    *MOUSE PRINT:

    1.10 Calls to You; Mobile Telephone Numbers. You consent to receive autodialed or prerecorded calls and text messages from PayPal at any telephone number that you have provided us or that we have otherwise obtained. We may place such calls or texts to (i) notify you regarding your account; (ii) troubleshoot problems with your account (iii) resolve a dispute; (iv) collect a debt; (v) poll your opinions through surveys or questionnaires, (vii) contact you with offers and promotions; or (viii) as otherwise necessary to service your account or enforce this User Agreement, our policies, applicable law, or any other agreement we may have with you. The ways in which you provide us a telephone number include, but are not limited to, providing a telephone number at Account opening, adding a telephone number to your Account at a later time, providing it to one of our employees, or by contacting us from that phone number. If a telephone number provided to us is a mobile telephone number, you consent to receive SMS or text messages at that number. We won’t share your phone number with third parties for their purposes without your consent, but may share your phone numbers with our Affiliates or with our service providers, such as billing or collections companies, who we have contracted with to assist us in pursuing our rights or performing our obligations under this User Agreement, our policies, applicable law, or any other agreement we may have with you. You agree these service providers may also contact you using autodialed or prerecorded calls and text messages, as authorized by us to carry out the purposes we have identified above, and not for their own purposes. Standard telephone minute and text charges may apply if we contact you.

    It also provides that if you don’t like it, you can cancel your account:

    *MOUSE PRINT:

    IF YOU DO NOT AGREE TO THE AMENDED USER AGREEMENT, PRIVACY POLICY OR ACCEPTABLE USE POLICY, YOU MAY CLOSE YOUR ACCOUNT BEFORE JULY 1, 2015 AND YOU WILL NOT BE BOUND BY THE AMENDED TERMS.

    There is just one small problem with all of this. It is illegal. PayPal cannot just impose all these terms. With respect to robocalling, for example, they have to get your express written permission to allow it. They also have to tell you that you are not required to agree to these terms and they cannot deny you services or terminate your account if you opt-out. Oops.

    Here, for your reading pleasure, is the much too polite letter that the FCC sent to PayPal last week:

    Click top right corner to enlarge.

    Because of the uproar created about the calling changes even before the FCC letter was sent to PayPal, the company posted a link in their blog to opt-out of being called. In relevant part, the post says this:

    You can choose not to receive autodialed or prerecorded message calls by clicking here and contacting customer support.

    MrConsumer clicked that link and only found the means to contact PayPal by phone or email message. There was no specific opt-out choice. So he filled out their form, using the closest relevant topic (changing/updating account information) and said that he wanted “to opt-out of all calls and texts from PayPal.”

    What did he get back from them? An automated, non-responsive answer, that in essence says to write again. Great work, Paypal.

    PayPal answer

    • • •

    June 8, 2015

    The Price They Advertise is Not the Price You Pay

    Filed under: Electronics,Internet,Retail,Telephone — Edgar (aka MrConsumer) @ 6:08 am

      Enough is enough. Isn’t it time that cell and cable companies stopped advertising seemingly low monthly prices for their service, while tacking on a multitude of junk fees, undisclosed charges, and taxes that significantly boost your bill?

    Recently the Huffington Post did an exposé, using Verizon FiOS’ new pick your own channel bundle for $74.99 as an example. When you added all the other charges, you actually had to pay over 60% more than the advertised price.

    *MOUSE PRINT:

    Huffington Post
    Click to Enlarge

    There were equipment/HD fees, FDV administrative fee, broadcast TV fee, regional sports fee, franchise fee, USF fee, federal/state/local taxes, etc. There could also be installation fees, activation fees, and early termination fees depending on the offer.

    Verizon is certainly not alone in tacking on all these fees. Comcast and Time Warner are equal opportunity offenders, as are the wireless cell companies.

    Is it any wonder that these types of companies rate low in customer satisfaction surveys and on trust indices?

    Maybe there needs to be a requirement, like airfares, that a single all-inclusive price must be the amount advertised, and not these bait and switch prices.

    • • •
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