Why Can"t I Buy an iPhone Outright?

[vacageo]

Can someone please explain to me the AT&T business model that prevents me from simple buying an iPhone at full price and having it activated through AT&T? The "AT&T Next" upgrade program is an installment agreement. I pay the taxes up front and then 20 equal payments that add up to the full purchase price. How does AT&T benefit from requiring me to enter in to an installment agreement instead of just paying for the darn phone?!

 

[chscag]

Who said you can't buy an iPhone 6 outright? You certainly can from your local Apple store and then have it activated with AT&T or another carrier as long as it's compatible. For example, you can buy a GSM iPhone 6 or 6 plus from Apple and activate it with AT&T or T-Mobile. You may have to pay $10 for a sim card but that's no big deal.

 

[vacageo]

I wish you were correct! I have now checked with Apple and AT&T. In fact, after reading your response, I went down to the AT&T store to make sure I hadn't been provided bad information by the first AT&T (phone rep) or even by the Apple Chat Rep. Nope. I have been consistently advised that the ONLY way to get an iPhone 6 on the AT&T network is to purchase it on an installment agreement. Either the Apple Store or AT&T will set up the installment plan. This is consistent with the Apple Online Store configuration, where you will be offered the option to buy a T-Mobile iPhone 6 "without contract" but not through AT&T. While at the AT&T store, I ask why. The rep either played dumb, or was dumb. He just said he didn't know. When I asked the Apple rep, she said, "I don't have that information." The AT&T rep said that not only could I not buy an iPhone 6 outright from Apple, but AT&T would not allow me to pay the full price up front either! Only one option - the installment agreement. The AT&T rep did say that policy might change in "about 6 months." Very annoying.

 

[vacageo]

I just re-read your response. Is there any reason I can't just buy the T-Mobile phone and have it activated through AT&T? I didn't pose that question to the AT&T rep because of was ignorant of the compatibility. So any "GSM" iPhone can be activated with AT&T and T-Mobile uses the GSM format?

 

[chscag]

That's exactly what I was getting at. The Apple Store employee was playing "coy" with you because they fully know that the T-Mobile iPhone is exactly the same as the AT&T iPhone. The only thing that differentiates them from one another is the sim card. Both phones use GSM and will work on each other's network.

If you buy a T-Mobile iPhone 6 from Apple it will come with a sim card already inserted but not activated. Just pop the sim card out (with paper clip) and take the phone to AT&T and tell them to activate it. They'll likely charge you for an AT&T sim ($10.00) and activate it with your number.

 

[pigoo3]

I wish you were correct!

If you go to the Apple online store...and "pretend purchase" an iPhone 6, 5.5", 16gig model (and choose the T-mobile contract free option)...it will cost you $749.

- Nick

 

[vacageo]

Thanks to both of you for the information. Much appreciated and very helpful.

 

[chas_m]

Actually, if you're willing to wait you can just get what you want directly. Apple **has always** barred direct sales of brand new iPhones for a short period (about a month) as a favour to the carriers, at least in the US. After that period passes, you can walk into any Apple Store, buy an iPhone straight up, and then activate it with any GSM carrier you want -- or not.

 

[V6Pony]

AT&T wants you to be there customer for the term of the contract. There locking you in. This really does not surprise me.

 

[vacageo]

Thanks Chas_m and V6Pony. Yes, I've now "educated myself" on this whole game. I'm just going to wait until they start selling the darn phones unlocked. I still owe AT&T a few months based on their subsidy of my 5S from last year. That's the end of it for me. No more service contract commitments. I'll just buy the device if I can afford it, and if not, do without. I always knew I was paying for the phone anyway, but that was how the world seemed to roll. Not so much any more for me.

 

[chas_m]

You might want to take another look at the changing programs from various carriers. If you're old enough to remember the "installment plan" system, that's essentially what's going on now. Sprint even has an outright "rent" program for the iphone now (or is about to, read about it here: Sprint announces new 'iPhone for Life' rental option | Electronista), and the other carriers now offer interest-free "installment" buying of the iPhone across a two-year period, with relatively painless options for upgrading more often if you want.

I'm not saying buying out right and then customizing a plan to your needs might not work out cheaper, particularly in the long term, but some of these new options are bringing the difference in overall cost between owning outright and a traditional contract plan down quite considerably.

 

[chscag]

That's the end of it for me. No more service contract commitments. I'll just buy the device if I can afford it, and if not, do without. I always knew I was paying for the phone anyway, but that was how the world seemed to roll. Not so much any more for me.

As I told someone else today who asked about the "great deal" Sprint was giving... no carrier is going to give you a "free lunch". AT&T is no worse or better than the others. As you stated above, you're going to wind up paying for the phone anyway. I received my iPhone 5c as a gift from my son otherwise I probably would have done without.

My only problem now is that my wife wants a new iPhone 6. I'm sunk!

 

[vacageo]

You're right Chas_m and I guess I'm heading in that direction, but perhaps in a little different way. After all, the cost of the iPhone is a relative constant. No matter who you get the new iPhone, you're going to pay the same price, or very close. You can pay it all at once, or in an installment plan, or through some new rental plan, but somehow that sales price will be recouped by the seller. AT&T is offering to forgive the last few payments on their installment plan, but then they want you to give them the phone back. They win because the aggregate of the forgiven payments is less than the value of the phone you give back to them. If I simply buy device I want and pay for it up front every time, I'm free to shop around for the best plan price and thereby obtain the best overall deal possible. The only catch will be device compatibility, and I'll just have to live with that. If some carrier comes through with a deal too good to be true and my device isn't compatible at that particular moment, I can just wait until I'm ready for a new phone and switch at that point. For the iPhone 6, I'm going to wait for the unlocked version, walk in to the Apple Store and buy it. I'll be out from under any obligation to AT&T within a year. By then Apple will probably have some new stuff I "can't live without."

 

[vacageo]

LOL Chscag. We're both sunk. My wife has already given me the old, "If you're getting one, I want one too!" This is why Apple is still one of the most valuable corporations in the universe. In spite of the nay-sayers, they keep making really cool stuff that people want to buy and buy and buy. Maybe it will end some day, but I see no evidence of that at this point.

 

[RadDave]

.........

My only problem now is that my wife wants a new iPhone 6. I'm sunk!

Well, I'd like to join this thread just to hear about the iPhone 6 and its carrier options. Wife and I have 'dumb' phones at the moment (GreatCall using Verizon) - she is comfortable w/ her iPad Mini so iOS on an iPhone is now catching her attention but we looked @ the 5s and the screen was just too small, SO w/ the newer models, I'll likely get her a new bigger iPhone.

Now for myself, I hardly use my phone but I DO use my old 2G iPod w/ about 100 hrs of music - I was thinking of getting a new iPod w/ a camera but why not just go to an iPhone? I'd probably not use the phone much so paying for 2 data plans would kind of be a waste of money for me unless there are some 'family' plans - don't know? My son is an IT person and can get us 20% off by putting us on his plan (not sure about the details yet) - will see what pops up in this thread - Dave

 

[johnodd4]

thats bull garbage you sign up for the next plan then you wait until your first bill and then pay it off the phone i mean not your contract

 

[vacageo]

Well, Rad, if you haven't gotten the iPhone bug up until now, you might be better off without. On the other hand, I'm really looking forward to the larger screen. My eyes are bad and the little screen is really difficult for me, not to mention that I have trouble typing because my fingers are too big for the teeny keyboard. As for carriers, I'm satisfied with the AT&T Family Share Plan, for now anyway. My wife and I each have an iPhone and iPad and I pay under $140 for unlimited talk and text, and 10 gigs of shared data. Compared to last year, that's a bargain. I also use ALL the data, or close to it. The price reduction is because AT&T switch from subsidizing the phones to installment sales. At least partially. There's also the competition angle.

 

[RadDave]

Well, Rad, if you haven't gotten the iPhone bug up until now, you might be better off without. On the other hand, I'm really looking forward to the larger screen. My eyes are bad and the little screen is really difficult for me, not to mention that I have trouble typing because my fingers are too big for the teeny keyboard. As for carriers, I'm satisfied with the AT&T Family Share Plan, for now anyway. My wife and I each have an iPhone and iPad and I pay under $140 for unlimited talk and text, and 10 gigs of shared data. Compared to last year, that's a bargain. I also use ALL the data, or close to it. The price reduction is because AT&T switch from subsidizing the phones to installment sales. At least partially. There's also the competition angle.

Hi Vacageo - thanks for the information - I'm going to start exploring my options, esp. the monthly rates if I get just one iPhone for my wife (can put my music on it for our travel needs) or possibly 2 iPhones - son will help us - he's an IT guy who has used iPhones for years and is responsible for their purchase at his job - Dave

 

[pigoo3]

Wife and I have 'dumb' phones at the moment...

Ha ha...that's exactly what I have (and what I call it as well)...a "dumb phone".

My wife has two iPhone 5's (one personal, and one she got from work). Only one has "service" at the moment. I could in theory use the second one. But at a minimum of $50-$60/month...it costs wayyy more than my current "dumb" cell phone (which I hardly use).

- Nick

 

[pigoo3]

My only problem now is that my wife wants a new iPhone 6. I'm sunk!

What does she have at the moment? What size iPhone 6 does she want?

- Nick