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Thread: Verizon Edge vs Subsidized phone

  1. #1
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    Verizon Edge vs Subsidized phone

    Guys. I know the ripoff in taking edge vs buying a subsidized phone but is it that much of a difference assuming I upgrade every year as I have thus far?

    For example

    5S 64 GB
    Subsidized $400 or $850/24 payments.


    Subsidized scenario:

    Day 1: $400+$32 tax. (Say 8%)

    Month 12: sell the used 5S (assume $550 for a prior year's 64 GB model)

    Buy new 6 64Gb for $850+68=918- $550 from 5S = $368


    Edge Scenario

    Day 1: $68 tax + $35 first month payment

    After 12 months you paid $425 in lease payments and don't own the phone.


    You then "edge up" and pay tax on the new 6 and start the monthly plan.

    You could also buy out your edge plan for $425 remaining and your phone would be worth $125-150 more than that on secondary market.


    Thoughts? $400 for a phone upfront is not chump change for me so i would take edge if it isn't overly more expensive vs buying subsidized.


    (Also considering that get out of an edge contact you need to make verizon whole on $850 phone cost vs $350-$10/month passed ECF otherwise


    Thanks for any input.


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  2. #2
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    This is the way I see it.

    $400 for 2 year contract plus upgrade fee ($30) plus sales taxes

    After 12 months sell it for $550. Use $550 to buy full price $850 64gb iPhone (so roughly $300 more to get new phone).


    Your total spending in 12 months is $700 plus $30 plus taxes (and you own a new iPhone 2014 model).

    Edge $35 x12 months equals $425 and you will still be paying $35 per month for new iPhone 2014.

    So in theory it's "cheaper" to do EDGE if you upgrade all the time and don't care if you own a phone but leasing it.

    But after 24 months. You would have pad $850 in edge payments (2015) but to get out of contract u will have to pay off Verizon the remainder of the payment on iPhone 2014 (roughly $450)

    And with 2 year subsidized model you are out of contract by 2015 with ownership of iPhone 2014. Total cost is still $700 plus $30 upgrade fee u paid initially.

    Do the math. 2 year contract but selling iPhone 2013 model and getting money and applying it to iPhone 2014 and being out of contract by 2015 cost of ownership is $700 plus $30 plus taxes over 24 months.


    EDGE will cost you $850 in just edge payments alone plus cost you an additional $450 to pay off iPhone 2014 after 2015. That's $1300 in total cost.

    Verizon just ripped you off over $500 over 24 months with edge.

    And remember after 24 months the person under subsidy contract model is out of contract so eligible for another subsidized phone. Edge u keep paying month installments until full price of phone is paid off.


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  3. #3
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    When you have an upgrade elligible, of course you take the subsidized phone. This is a no-brainer. You're talking about buying for $400, use it for a year, then sell for $550. So it's basically free use of a phone. If you don't have $400 upfront, use a credit card, it would cost $60 in interest to borrow the $400 at 15% APR for a year. So you're still money ahead.

    The question is what to do the next year when you can't get a subsidized price-- whether leasing is better than buying Full Retail and then reselling after using for a year. If iStuff really holds value that well, if the value drops by less than the $493 you pay for a year's Edge, the decision is to buy outright and resell later. Even if you borrow the money it's still going to be a better deal.

    American consumers tend to ba adverse to spending their money upfront, so there are a lot of "pay little now, but a LOT later" deals in the marketplace. This Edge thing being one of them.

  4. #4
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    Quote Originally Posted by HF305 View Post
    When you have an upgrade elligible, of course you take the subsidized phone. This is a no-brainer. You're talking about buying for $400, use it for a year, then sell for $550. So it's basically free use of a phone. If you don't have $400 upfront, use a credit card, it would cost $60 in interest to borrow the $400 at 15% APR for a year. So you're still money ahead.

    The question is what to do the next year when you can't get a subsidized price-- whether leasing is better than buying Full Retail and then reselling after using for a year. If iStuff really holds value that well, if the value drops by less than the $493 you pay for a year's Edge, the decision is to buy outright and resell later. Even if you borrow the money it's still going to be a better deal.

    American consumers tend to ba adverse to spending their money upfront, so there are a lot of "pay little now, but a LOT later" deals in the marketplace. This Edge thing being one of them.
    I agree. Americans for the most part are dumb at simple math. Or just want to see the lowest cost to obtain any thing despite it costing much more in the long run.

    ATT/Verizon aren't stupid since they have highly paid bean counters. Notice the requirements of EDGE and Next. They both require you to be either upgrade eligible or a new customer (which is essentially the same as upgrade eligible).

    The goal of EDGE and Next is to trick people into paying full price for a phone or lease a phone at a rate that favors the carriers 100% of the time.

    If auto makers presented this leasing deal to savvy car buyers/lease people. They would be laughed out of the building. There are lease calculators available that shows whether leasing or buying makes sense including depreciation.

    But in 100% of the case with these EDGE and Next plans, there is no real value to forgoing the subsidy. Even if you are lazy and don't want to spend anytime trying to sell off the 64GB iPhone. Most 12 month 64GB iPhones can be traded in for at least $400 credit no hassle (vs trying to sell it for $500-550 on ebay/craigslist). So even selling it for $150 less than true market value, you will still come out ahead with the subsidy model.

  5. #5
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    Guys thanks a lot for your feedback. Well put.
    Just hope that verizon doesn't give me flack to put me to normal plan. I'm within the 14 days but one store said they wanna do a SECOND credit check now despite doing a check when I originally got Edge on the new account.


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  6. #6
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    I would not do the EDGE program, monthly payments are expensive enough without paying sales tax on the phone PLUS another $25+ a month for a phone you don't own. And have fun if you nick or dent or mess up your phone by accident and want to upgrade "anytime" and they tell you no because your phone is not mint. Yes you can sell it but with these new plans there will be a GLUT of people trying to do the same damn thing and prices will tank. These "Edge" and "Next" plans are, as mentioned, for ppl who can't do simple math or are just too carried away in keeping up with the Joneses. Except if you don't have a mint phone like I mentioned good luck getting to upgrade "anytime". I will be laughing at all the irate ppl in 6 months who try to upgrade but can't because they didn't read the fine print.

    Honestly if you HAVE to upgrade every year I'd just buy a Nexus outright. Google already subsidizes them and every year around this time they'll have a fire sale. They were just selling 8GB modesl for $199 and 16GB models for $249. That's a flagship phone off contract for those prices... I know you couldn't have the last Nexus 4 on VZW but maybe with the new one they'll carry it. If not you have to decide whether you stay with VZW or not. I know the ONLY thing keeping me on VZW is my grandfathered unlimited and the coverage they have. If I was kicked off the plan I' be gone for T-Mo so fast I'd leave skid marks. And they DO carry the Nexus.

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