[cookiecaper]

Americans allow this because in general it's much cheaper to buy a phone subsidized over contract. Only one carrier here (T-Mobile) provides a monthly discount for unsubsidized phones. Most people don't just have $500+ to drop when they want or need a new phone, so it's much easier for people to go on contract and spread out that cost, even if it costs more in the long run (which it usually doesn't since most networks don't make any distinction in monthly cost).

The carrier exclusivity, restrictions, and crapware are annoying, but in most cases it's not irritating enough to convince someone to pay $300 more for the same thing.

[RK]

I think you understand how it works, but phrased it wrong.

T-mobile is the only one who doesn't markup its prices for contracts used with unsubsidized phones. Where, "subsidized", means subsidized by the customer. The other carriers charge you the same extra phone subsidy fee (in effect), regardless of whether you bought the phone at full or "discounted" price, so there is no incentive to buy a phone at full price.

I agree that this is a consumer hostile model. T-mobile seems to have the best offer, where they let you make multiple payments on a full price phone (at no markup I believe).

[bad_user]

> Americans allow this because in general it's much cheaper to buy a phone subsidized over contract

Subsidized phones are very popular in Europe, but the phone doesn't really enter the equation when choosing a network.

I actually think Europeans are cheaper than Americans ... over here people choose networks based on reliability and monthly bill, which is influenced by included minutes or bandwidth / area or demographic popularity (since voice minutes in the same network are cheaper).

I also have an iPhone, and in my country iPhones are still exclusive to a single carrier. But I did what every one of my acquaintances did ... bought one with a cheap monthly contract for 199 EUR; then unlocked it. And I didn't even pay my last 2 monthly bill (haven't used it, so I felt like it was unneeded); so they can sue me, but I don't really care because lock-in is not seen favorably in Europe and they've got customers with actual debts to worry about.

Of course, I wouldn't give this advice to other people ... just saying that the phone doesn't enter the equation; and the marketing campaigns are reflecting that.

[McP]

My brother skipped paying a tiny amount like that - he received a letter from a debt collection agency demanding payment of the £20 bill, plus £100 payment for the cost of hiring a debt collection agency. He then payed immediately before it got any worse but his credit rating is still poor many years on.

[StavrosK]

I'm not sure if the iPhone is sold locked here in Greece, but I would be surprised if it did; it would be the only one. You can get a subsidised phone with any carrier, and they don't lock it or otherwise restrict you. The basic view is "you promise to pay us X money per month, we give you a roughly X12[1] subsidy on your phone now". They don't even care what phone, if any, you decide to get with the subsidy.

Also, this happens every year. Once a year passes, you're eligible for a new subsidy of X12 euros.

[1] I'm not at all sure if the multiplier is as much as 12, but it's at least 6. The main point, anyway, is that they don't care what phone you get.