
Originally Posted by
silentjudge
The way I see it:
1. They lose money on the ST Nokia smartphones. So if your just going to buy the phone for the SIM, why not just sell you the SIM card and make a profit instead of a loss.
And when I say loss, I mean overall loss. Lets say they break even on the phone itself, but factor in the 1 year warranty, returns, etc and they will take a loss. With this SIM only, they don't have to worry about the phone at all. The SIMs are cheap to replace.
2. They are facing fiercer competition because people want real smartphones. Thus they need to respond to this new and growing market of smartphone users.
3. This ST SIM $45/mo strategy will increase their average revenue per user (how much they make per subscriber).
The thing is, there is increasingly more and more MVNOs offering $50 Unlimited Talk/Text and some data. This is no longer rare.
ST says unlimited data and we know this isn't true. I think the bottom line with data is most people use very little and the ones who abuse it, ST can just kick them off. They get very good wholesale pricing from AT&T and T-Mobile, theres no doubt about it; so they can offer that Unlimited Talk/Text and some Data for less than $50 thanks to their lower wholesale price.
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