Verizon CEO Open To Eliminating Service Contracts, T-Mobile Could Have Started a Trend
You know, it's a funny thing -- it seems that while the Big Four compete against one another for wireless sales in the U.S., they sure don't offer a lot of differentiation. Each carrier charges roughly the same thing each money, offers roughly the same portfolio of phones, and after one carrier went all-in with shared data contracts, it looks as if the dominos are falling there as well. Now, there's word that Verizon Wireless may follow T-Mobile's "no contract" lead.
Verizon CEO Lowell McAdam recently stated that he'd be open to the thought of getting rid of contracts, but here's the thing: while T-Mobile doesn't do contracts, they still have a grip on customers. T-Mobile's scheme has you on the hook for monthly payments on whatever phone you select up-front, so even though there's no contract per se, you'll still owe T-Mobile a wad of money for that phone should you duck out early. Really, it's six in one hand and a half-dozen in the other. To T-Mobile's credit, this scheme is marketing well, and people tend to be falling for it -- or, at least paying attention to a carrier that has largely been left behind
So, while Verizon may go the same route, be careful before assuming that it's a pro-consumer move. Moving payments and fees around isn't the same as actually reducing the cost of phones and mobile services.
Verizon CEO Lowell McAdam recently stated that he'd be open to the thought of getting rid of contracts, but here's the thing: while T-Mobile doesn't do contracts, they still have a grip on customers. T-Mobile's scheme has you on the hook for monthly payments on whatever phone you select up-front, so even though there's no contract per se, you'll still owe T-Mobile a wad of money for that phone should you duck out early. Really, it's six in one hand and a half-dozen in the other. To T-Mobile's credit, this scheme is marketing well, and people tend to be falling for it -- or, at least paying attention to a carrier that has largely been left behind
So, while Verizon may go the same route, be careful before assuming that it's a pro-consumer move. Moving payments and fees around isn't the same as actually reducing the cost of phones and mobile services.
