[po]

It's not about greed as the article states… people are stupid. We overvalue short term savings and undervalue long term savings.

When Apple let AT&T start to subsidize the iPhone the initial price dropped but the total cost over the lifetime of the phone was about the same or even a little higher. Sales went gangbusters! The media even went nuts reporting about how apple finally relented and responded to consumer pressure.

Apple tried to fight it: it didn't work. You can bitch about it: it doesn't matter. This is how consumers are. Collectively, they're "dumb"

[pmjordan]

The iPhone is a great example. People think I'm nuts when I say I bought the 3G for €500 (inc VAT, which I then claimed back). Why the hell would I pay that much? Oh, I say, because it's unlocked, I've only spent about €20 on data & calls so far (10 months), can swap the SIM out when abroad to avoid data roaming, and because the cheapest contract deal at the time worked out to a total of around €900 after the minimum 24 months.

Doesn't matter. They can't get past the fact that I spent €500 on a phone. And proceed to sign up for that contract.

[retube]

one of my big gripes is (in the UK) all these FREE IPHONE! FREE LAPTOP! on a £30 - £40 / month contract. in small print: contract is 24 months. That's 960 quid. The laptop is a shitty bargain-basement dell that you get for £200. And on top of that you got data charges, 0845 numbers etc etc.

[pmjordan]

Yeah, they seem to do those all across Europe. In Austria we're fortunate to have dirt cheap data and voice contracts and prepaid tariffs which are much better alternatives. That doesn't seem to be the case most places, especially for data.

[GrandMasterBirt]

When working in a cellphone store, we used to make more money on the shitty Nokia 8830 phones because they cost us 70 bucks to buy, sell em for free with a $250 spiff. Thats more money than selling a phone for 100 bucks where usually the phone price is $300 - $250 spiff + $50 profit.

Don't forget, when signing up for a contract they also charge you for line activation ($35) so they recoup their price rather quickly. About 5 years ago the standard contract was 1 year. Now 2 year minimum.

Verizon does a "contract-less" deal where you get the SAME plan without a contract. But you have to buy the phone full price... Think about it. That deal is 100x better for verizon. All the profit, none of the cost. And it gets even better!!!!!!! Thats right, verizon phones are USELESS ANYWHERE ELSE. Basically use V phones for V, or throw them out. So DUH its just as good as a contract.

I've yet to meet 1 person who realizes this.

The only "deal" is at 22 months of the 24 month contract, the company will allow you to renew the contract without any activation costs for a 24 month extension starting at the 22 month period (or when u called) and they apply the full "discount". This is perhaps the only place where you get a deal. You may say "but ur in a contract" in the united states there are no real capabilities to take a phone and switch carriers, only in europe does this capability exist (hence the GSM movement).

[pmjordan]

The situation here is extremely different. All phones work on all networks in principle. (except for 3G-only networks like Hutchison/3 which don't allow 2nd gen GSM handsets, and of course SIM locked phones, which are the norm if you buy the phone or modem via a major network operator)

You can get phoneless contracts which are much cheaper - either with no monthly charge (I literally pay nothing if I don't use the phone one month, and when I do it's €0.04/min or per SMS sent) or a very generous deal (1000 free minutes+SMS for €10-20 say). Prepaid is a little more expensive, 7-15 cents/min or /SMS seem to be the norm.

As for data, the rates vary wildly - I'm using prepaid at 2 cents/MB, but you can get €4 per started GB/month, or various contracts between €5 and €20 for some fixed amount of data, or unlimited data at €25+. They fleece you for > €1/MB if you don't have any specific data provisions in your tariff though.

For smartphones or netbooks, add €20-40/month, a minimum run time of 24 months, very inflexible conditions and at least one downside (for example, the most basic iPhone contracts often charge 25 cents per SMS, a rate that's otherwise unheard of).

[retube]

the best deal I've come across in the UK is O2's simplicity, which I've just signed up to (FUCK 24 month contracts). No phone, just a 1 month rolling contract at 15 / month with 300 mins and unlimited texts. Or if you sign up for 12 month contract, same minutes/texts but at 10 / month.

I bought a basic nokia for 30 quid. done.

[pmjordan]

I have a Nokia 2630 for phone use (basic & light, but has bluetooth for syncing contacts) - this frees up the iPhone for pure data & abroad usage. People can still get hold of me on my normal number, but I can take advantage of local SIMs.

[DrSprout]

>Basically use V phones for V, or throw them out.

Sans contract my Droid is still a nice mp3 player / WiFi device. I'm hoping they back up their bluster about switching us all over to per-GB plans before my contract runs out so I can either renegotiate down to $15/month data or just walk with a nice little subsidized touchscreen device.

But yeah, this is bullshit and needs regulation. The entire market is so far beyond price fixing it's not even funny.

[revital9]

People are stupid - but not all of them. Look at the comments around you :)

[po]

How many cognitive biases can you list? Because there are a lot of them:

http://en.wikipedia.org/wiki/List_of_cognitive_biases

They might not get you on this one, but at some point you will be part of the stupid crowd. I don't think about all of these every time I make a decision. When I said people are stupid, I was including myself. :-)

[retube]

I have to say, that's my list of the week, if not the year! awesome.

[oscardelben]

Unfortunately collectively means that if you are the only one intelligent around stupid people, then your group is still considered stupid.

[patio11]

I think most people who believe they are "the only intelligent one around stupid people" are likely mistaken in at least one respect. Probably two. Possibly even three.

[tokenadult]

Yes, the saying of Confucius is "When three men walk together, there is surely my teacher among them." The smartest people recognize that they can learn from anyone, and need to.

[loewenskind]

And they'll all be pointing out how stupid you are.

[stavrianos]

Being smart does not protect you from being stupid.