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Old July 21st, 2013, 11:09 AM   #1 (permalink)
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Default Early upgrades - Comparing T-Mobile JUMP, AT&T NEXT, and Verizon EDGE.

This post will be divided into several posts for the sake of reading cimplicity.

Contents
  1. Contents
  2. Introduction
  3. AT&T breakdown
  4. T-Mobile and Verizon breakdowns
  5. Conclusion
  6. Alternatives for $$$-savvy consumers

Since AT&T announced their NEXT program (and Verizon subsequently their Edge program), I've wanted to do a comparison, but long hours at work have gotten in the way.

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Old July 21st, 2013, 11:10 AM   #2 (permalink)
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Last week, T-Mobile announced their JUMP program (just upgrade my phone), which allows two upgrades in a 12-month period. Since then, AT&T and Verizon have followed suit in announcing their own plans that allow a 12-month upgrade path. So, which is cheaper and how do they compare?

On the surface, AT&T and Verizon have designed their plans to look cheaper. They're actually more expensive as you now pay a double-subsidy. For this comparison, I'm going to use the 16GB iPhone 5 (the best selling phone in the US), and I'm going to compare plans that offer unlimited talk, text, and approximately 2GB of data on an individual line.

AT&T: There are two plans which meet the criteria. We'll be comparing 3 plans (one alternative)
  • Voice/Data/Messaging - unlimited talk is $69.99, text is $30, and 3GB data is $30, bringing this to a total of $129.99/month. There was no 2GB option, and using the $20/300mb option would incur too many overages. Alternatively, you could use the 450 minute plan + rollover minutes for $30 less per month.
  • Mobile Share - $45 for smartphone unlim talk/txt, $40 for 1GB of data, and $15 for a 1GB overage brings us to $100/mo.

T-Mobile: T-Mobile has one plan
  • $60/mo for unlim talk/txt, 2.5GB of high-speed data (unlimited thereafter, no overages).

Verizon: Only one plan, and it meets our criteria exactly.
  • Unlimited talk/txt on a smartphone for $40, plus $60 for 2GB of data, $100mo total.
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Old July 21st, 2013, 11:11 AM   #3 (permalink)
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AT&T has two plans that I wanted to focus on, with one alternative plan with lower minutes. The alternative isn't an apples to apples comparison, but it's not AT&T's fault that Verizon and T-Mobile don't offer more flexibility with their minutes.

Under AT&T's next program, you pay $0 down when you get a new phone, but you pay the full cost of the phone over 20 months. This would be a great deal on its own if they would remove the subsidy from the calling plan, but they don't. You still pay the phone subsidy, and then you pay for the phone. The perk here is that after 12 months (paying for 60% of the phone), you can trade in your phone for another $0 upgrade.

Using our iPhone 5 16GB example, you pay $0 down and an additional $32.50/month on your bill. Here's how the AT&T plans compare over 12 months with this method.

Voice, Messaging, and Data (unlimited minutes):
  • $0 down, $32.50/mo for the phone ($390)
  • $69.99/mo for voice ($839.88)
  • $30/mo for unlimited text ($360)
  • $30/mo for 3GB data ($360)
  • $162.49/mo
  • Grand total of $1,949.88 over 12 months with an initial phone and one subsequent upgrade

ALTERNATIVE - Voice, Messaging, and Data (450 minutes):
  • $0 down, $32.50/mo for the phone ($390)
  • $39.99/mo for voice ($479.88)
  • $30/mo for unlimited text ($360)
  • $30/mo for 3GB data ($360)
  • $132.49/mo
  • Grand total of $1,589.88 over 12 months with an initial phone and one subsequent upgrade

Mobile Share:
  • $0 down, $32.50/mo for the phone ($390)
  • $45/mo for unlimited voice and text ($540)
  • $40/mo for 1GB data ($480)
  • $15/mo for 1GB data overage ($180)
  • $132.50/mo
  • Grand total of $1,590 over 12 months with an initial phone and one subsequent upgrade
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Old July 21st, 2013, 11:12 AM   #4 (permalink)
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T-Mobile and Verizon each have one plan that truly fits into this comparison, so I'm combining them into one post. One again, we'll be using the 16GB iPhone 5 for this comparison.

T-Mobile separates the subsidy from the plan, which means that you'll be paying less for the monthly service plan, and you'll pay the full price of the phone, up-front or through a 24 month 0% financing program. As part of JUMP, you can upgrade twice at any time within a 12-month period by simply trading in your phone and paying the down payment for the new phone. Participation in this program requires a $10 monthly fee that includes their otherwise $8 insurance program.

T-Mobile Simple Choice Individual Plan:
  • $145.99 down, $20/mo for the phone (385.99)
  • $10/mo for JUMP participation ($120)
  • $50/mo for unlimited talk/text, 500MB high-speed data ($600)
  • $10/mo for additional 2GB high-speed data ($120)
  • $90/mo
  • $145.99 down for next similar upgrade
  • Grand total of $1,225.99 over 12 months with an initial phone and one subsequent upgrade

Verizon's Edge program is close to AT&T's in similarity, in that you're paying a double-subsidy. However, unlike AT&T, who requires at least 12 months and 60% paid off before your upgrade, Verizon requires 6 months and 50%. Their phone payments are spread over 24 months instead of 20. It seems (unsure) that you can actually pay your choice of $0 down, or the normal subsidy rate, which would get you the upgrade at 6 months as opposed to 12. We'll go with $0 and 12 months for this example.

Verizon Share Everything Plan:
  • $0 down, $27.08/$27.08 fluctuating per month for the phone ($325)
  • $40/mo for unlimited talk and text ($480)
  • $60/mo for 2GB of data ($720)
  • $127.08/$127.09 fluctuating monthly total
  • Grand total of $1,525 over 12 months with an initial phone and one subsequent upgrade
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Old July 21st, 2013, 11:12 AM   #5 (permalink)
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So, as a conclusion, here's the 12-month ranking from cheapest to most expensive.
  1. T-Mobile Simple Choice Plan - $1,225.99
  2. Verizon Share Everything Plan - $1,525
  3. AT&T Voice, Messaging, and Data Plan (450 Minutes) - $1,589.88
  4. AT&T Mobile Share Plan - $1,590
  5. AT&T Voice, Messaging, and Data Plan (unlimited Minutes) - $1,949.88

Across the board, AT&T seems the worst, but to be fair, they give the most flexibility. They do not have a NEXT compatibile plan that offers unlimited talk and text with 2GB of data. So, I had to fudge their plans to give more data, or fewer minutes. Verizon and T-Mobile offer plans that fit the criteria almost exactly (2.5GB on TMO's plan), which is why they came out "ahead".

You can alter all of these plans to some degree. For T-Mobile, reducing the total cost by $120 ($10/mo) brings your data down to 500Mb of high-speed. I'm currently using this, and they are VERY generous with their post-500MB throttling. I've had no problems with basic tasks and web browsing, and even Pandora works with rarely a hiccup (while driving, no less). Or, you can go $120 in the other direction for truly unlimited data, and still come out cheaper than the plans from other carriers.

But for some, T-Mobile isn't an option. Verizon and AT&T are about the same in price between their Mobile Share and Share Everything Plans. Verizon's EDGE program requires a lower monthly fee for the phone to participate, so they will always be cheaper than AT&T in this regard. However, AT&T still offers their older plans, listed as Voice, Messaging, and Data. You can reduce the minutes as low as 450 + rollover, switch to pay as you go texting if you're not a big texter, and/or go down to 300Mb of data. Doing so will STILL cost more than T-Mobile's offering (unless you literally never send/receive a single text message outside of messaging apps). But, it will beat anything that Verizon offers.
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Old July 21st, 2013, 11:13 AM   #6 (permalink)
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So, what are the alternatives if you want to upgrade more quickly, but save some money? For AT&T and Verizon, the option is simple. Buy their phone on contract on subsidy, and when it's time to upgrade, sell the phone and buy a new one full price.

For Verizon, this is more costly when compared to AT&T, as CDMA phones have much lower resale value. For example, let's say that you bought the Galaxy S3 when it came out for $199.99, and now you want to upgrade to the Galaxy S4 ($649.99). Used SGS3s on Verizon are currently trading around the $200 mark. So, you'd sell it for about what you paid for it, bringing your 12-month cost to $1,849 after the cost of your new phone. The next year, though, you're upgrade would be at subsidy price, bringing your second year cost down to $1,200. You'd average an annual price of approximately $1,525, or, exactly what Verizon offers without having to go through the hassle of finding a buyer for your phone. So in this case, Verizon's plan is a fair deal. If you're an iPhone user, you'll get more money on your resale, making it worthwhile to sell and upgrade on your own.

For AT&T, you have the option of using branded handsets and unlocked handsets that have higher resale. You could sell an AT&T branded SGS3 for about $300. When you upgrade, you could opt for a lower-priced Nexus handset for $350. Alternatively, you can use AT&T's excellent new prepaid plan, which is $60/mo for unlimited talk, text, and 2GB of data. This brings them roughly on par with T-Mobile, except that you have to pay full price for the handset, and you have to sell it on its own. If you like T-Mobiles costs, don't mind paying up front, but need better nationwide coverage, this is the best plan out right now (among the big 4 carriers).

With T-Mobile, there's not much flexibility, but you're already at the bottom in price. As mentioned in the Conclusion post, you can move the annual cost $120 in either direction based on your high-speed data needs. You could forego the $10/mo JUMP program and just resell your old handset, buying a new phone either full-priced or financed through T-Mobile. Or, you could switch from their Simple Choice to their prepaid plan. They cost exactly the same on paper, but there is a cost difference. Simple Choice supports corporate discounts, while prepaid does not. Simple Choice carries the usual unfees, IE, fake taxes and fake regulatory charges, whereas prepaid only charges the sales tax associated with the seller (you can buy online refills from many sites with no sales tax). Our $80 Simple Choice 2-line plan costs $80 on paper, but after a 15% corporate discount and numerous unfees, it's $87.22. To get the same from prepaid, it's $80/mo flat from some places, or $87.60/mo with local sales tax. Prepaid doesn't carry the option of financing the phone, so it should only be considered if you always buy outright, and you have no eligible corporate discounts.
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