All three major Russian carriers dump iPhone(rethink-wireless.com)
rethink-wireless.com
All three major Russian carriers dump iPhone
http://www.rethink-wireless.com/2013/07/16/all-russian-leaders-dump-iphone.htm
15 comments
Well, I think in context, what they mean is:
Russia bans handset subsidies, so customers compare actual handset costs from one handset to the other, and notice that iPhones cost hundreds of dollars more than other smartphones, making them expensive relative to alternative handsets.
Rather than:
iPhones in Russia are expensive relative to iPhones in America.
Russia bans handset subsidies, so customers compare actual handset costs from one handset to the other, and notice that iPhones cost hundreds of dollars more than other smartphones, making them expensive relative to alternative handsets.
Rather than:
iPhones in Russia are expensive relative to iPhones in America.
No man, you don't get it. MOST people in Russia really never buy expensive smartphones with subsidies. They actually pay the full price. My guess is, carriers tried this model, realized it doesn't really work very well and decided to dump it altogether.
No, man, I really do get it. I understand they pay full price. The point is, iPhones are a premium smartphone. They intrinsically cost more than many other smartphones. If you're looking at the (full) price of an iPhone versus the (full) price of a non-flagship Android phone, the (full) price of the non-flagship Android phone is typically hundreds of dollars less than the (full) price of the iPhone.
>They intrinsically cost more than many other smartphones.
that in the eyes of many Russians (like in any status symbol obsessed country) is the main advantage of iPhone :)
that in the eyes of many Russians (like in any status symbol obsessed country) is the main advantage of iPhone :)
Now if only they'd release a diamond-encrusted model...
Hang on, you lost me here - why would we compare the price of the flagship Apple phone to the price of a non-flagship Android phone?
Because there are no non-flagship Apple phones.
What do you call the iPhone 4 or 4S then? Flagship-but-hundreds-of-dollars-less?
Last year's model.
Exactly. And what's the difference between last year's model and non-flagship? Both have old-ish processor, old form factor. But recent software, and all the basic functionality -- just without the bells and whistles.
The problem is that Apple doesn't have (yet) a portfolio strategy, so you still thinking in terms of when this product started to sell. Like cars. Or fashion. Despite if last year's model is better than yesterday's launch.
Once they stop using sequential numbers and migrate to models - e.g., iPhone Pro, iPhone Air, iPhone Lite - you'll clearly understand what is flagship or non-flagship. But that's pure marketing/product positioning, nothing to do with the product itself.
TL;DR: Apple already has a non-flagship product; it's just not clearly positioned as such. This is not a mistake; this is by design [1].
[1] http://www.asymco.com/2013/05/29/tim-cooks-answer-to-my-firs...
The problem is that Apple doesn't have (yet) a portfolio strategy, so you still thinking in terms of when this product started to sell. Like cars. Or fashion. Despite if last year's model is better than yesterday's launch.
Once they stop using sequential numbers and migrate to models - e.g., iPhone Pro, iPhone Air, iPhone Lite - you'll clearly understand what is flagship or non-flagship. But that's pure marketing/product positioning, nothing to do with the product itself.
TL;DR: Apple already has a non-flagship product; it's just not clearly positioned as such. This is not a mistake; this is by design [1].
[1] http://www.asymco.com/2013/05/29/tim-cooks-answer-to-my-firs...
The 3 year old phone 4 still costs $450 off contract while a Nexus 4 is $299.
But Nexus 4 is not an iPhone. No trolling.
The "flagship" iPhone (5) costs between $650-850 + tax. The "non-flagship" is a couple of hundred bucks less, which is reasonable. Apple charges more, simply because they can.
I'm not making a judgement call here. I personally wouldn't pay that much, but I'm not the target. In fact, I don't think any individual person is the target of non-flagship devices for Apple; their strategy has always been to sell locked devices to carriers in bulk, so they can offer "for free" to customers upgrading from a dumb phone -- in exchange of a 2 yr agreement, ETFs, and an outrageously expensive data plan.
That's essentially my reading of Tim Cook's answer in the link above. If they can charge what they charge, why change?
Of course this strategy won't work forever. Eventually they will have to migrate to a portfolio strategy, OR enter the race to the bottom with Samsung, HTC, et al (unlikely).
The only question is when.
The "flagship" iPhone (5) costs between $650-850 + tax. The "non-flagship" is a couple of hundred bucks less, which is reasonable. Apple charges more, simply because they can.
I'm not making a judgement call here. I personally wouldn't pay that much, but I'm not the target. In fact, I don't think any individual person is the target of non-flagship devices for Apple; their strategy has always been to sell locked devices to carriers in bulk, so they can offer "for free" to customers upgrading from a dumb phone -- in exchange of a 2 yr agreement, ETFs, and an outrageously expensive data plan.
That's essentially my reading of Tim Cook's answer in the link above. If they can charge what they charge, why change?
Of course this strategy won't work forever. Eventually they will have to migrate to a portfolio strategy, OR enter the race to the bottom with Samsung, HTC, et al (unlikely).
The only question is when.
"But Nexus 4 is not an iPhone. No trolling."
Complete straw man. This sub-thread is about the price of non-flagship iphones vs alternatives in Russia. I provided two such prices for comparison.
"The "non-flagship" is a couple of hundred bucks less, which is reasonable."
You seem to be under the misconception that I am complaining that the iphone 4 is overpriced. Let me disabuse you of that notion: zonk
"Apple charges more, simply because they can."
Apple charges profit maximizing prices but due to secondary market realities it cannot charge radically different prices in different countries.
One way of looking at the smartphone market is that there are <$100 smartphones, $100-$200 smartphones, $200-$300 smartphones, $300-$400 smartphones, $400-$500 smartphones, $500-$600 smartphones and >$600 smartphones (some overlap yes).
We might observe Android has entries in all of these categories but that Apple has chosen, for profit maximization, focus, brand, whatever reasons not to participate in 4 of those 7 categories as of today. We could use fewer or more categories but the same basic truth will remain: Apple does not compete at the low end of the market.
Another observation is that for many countries, of which Russia may be one, the majority of smartphone consumers don't buy from the top 3 categories that Apple participates in. Regardless of how you structure the categories, some markets cater toward the low or lower-middle end that Apple doesn't participate in.
Complete straw man. This sub-thread is about the price of non-flagship iphones vs alternatives in Russia. I provided two such prices for comparison.
"The "non-flagship" is a couple of hundred bucks less, which is reasonable."
You seem to be under the misconception that I am complaining that the iphone 4 is overpriced. Let me disabuse you of that notion: zonk
"Apple charges more, simply because they can."
Apple charges profit maximizing prices but due to secondary market realities it cannot charge radically different prices in different countries.
One way of looking at the smartphone market is that there are <$100 smartphones, $100-$200 smartphones, $200-$300 smartphones, $300-$400 smartphones, $400-$500 smartphones, $500-$600 smartphones and >$600 smartphones (some overlap yes).
We might observe Android has entries in all of these categories but that Apple has chosen, for profit maximization, focus, brand, whatever reasons not to participate in 4 of those 7 categories as of today. We could use fewer or more categories but the same basic truth will remain: Apple does not compete at the low end of the market.
Another observation is that for many countries, of which Russia may be one, the majority of smartphone consumers don't buy from the top 3 categories that Apple participates in. Regardless of how you structure the categories, some markets cater toward the low or lower-middle end that Apple doesn't participate in.
>>But Nexus 4 is not an iPhone.
You might appreciate this: https://www.youtube.com/watch?v=FL7yD-0pqZg
NSFW ( or as NSFW as foul mouthed teddy bears can be )
You might appreciate this: https://www.youtube.com/watch?v=FL7yD-0pqZg
NSFW ( or as NSFW as foul mouthed teddy bears can be )
He's not trolling. He's just saying that the non-flagship iPhone is still expensive compared to new Android phones. Which explains Apple's poor performance in a market which forces consumers to pay the actual price.
It seems the price point is your only criteria for a 'flagship' phone. N4 beats iPhone x handily, with half the price.
Yes, and they don't buy it because they can compare the full price of the iPhone vs other flagships and see that they're getting much less for more money (i.e. being screwed over).
Russians also seem pretty anti-Apple, thinking Macs and iPhones are a staple of the rich.
People buy iPhones. A lot. iPads too. Macs - not so much.
It's not that russians are anti-Apple, it's Apple that neglected Russian market for a decade. iPhone got very popular anyway from the first days of American phones jailbreaks (even before apps, before that stuff, a lot of American phones were smuggled), iPod too (it's not so expensive anyway), but that's it. No hi-end gear.
It's not that russians are anti-Apple, it's Apple that neglected Russian market for a decade. iPhone got very popular anyway from the first days of American phones jailbreaks (even before apps, before that stuff, a lot of American phones were smuggled), iPod too (it's not so expensive anyway), but that's it. No hi-end gear.
There is a large market in Russia for premium products; large economic inequality means lots of poor people but also a lot very wealthy people in the major cities.
They definitely have a market for full price iPhones, heck, there is a market for multiple companies selling gold-plated jewel-encrusted iPhones.
They definitely have a market for full price iPhones, heck, there is a market for multiple companies selling gold-plated jewel-encrusted iPhones.
Haha, I'm not sure about that one. It's like everywhere: apple fanboys, anti-apple Android enthusiasts, then people who don't really care.
That's very true. I'm in Russia and telecommunications are dirt cheap here. I barely spend $10 in 3 months on my cellphone (that's including occasional internet browsing, although unlimited traffic would cost you more). Broadband internet is also very cheap, my bill is $8/mo for a 30Mbps connection and unlimited traffic.
I buy a new phone every 2 or 3 years. Go ahead and count on your own if I'm better off with this model.
I buy a new phone every 2 or 3 years. Go ahead and count on your own if I'm better off with this model.
That's true for a few major cities maybe, in province prices a not so cheap.
> Carrier subsidized model should be ended to bring down consumer telecommunication costs. It only benefits the carriers.
In the US at least, everyone has to get on LTE before that becomes a reality. Sprint and Verizon 3G and older handsets can't speak the same language, I don't think. AT&T and T-Mobile both use GSM based systems so phone calls are possible using a handset form the other carrier, but their 3G frequencies are different - so you're hosed on mobile data. So, there's a de-facto lock into a carrier with your device even if there isn't one in the contract. (And $600 for a new device just for a different carrier is a hard sell, in a world where subsidies are gone.)
It's happening though. The problem is that companies like HTC charge the same price Apple does for the iPhone for what is a lower quality of product, in my experience. Once again, personal experience, but the number of hardware problems I've had within the walled garden of Apple are few compared to those in my Android days. And those that I've had have been fixed quickly by an Apple store representative, whereas with HTC or Verizon it was a multiple week ordeal.
That's something that makes the product itself even more valuable to me.
In the US at least, everyone has to get on LTE before that becomes a reality. Sprint and Verizon 3G and older handsets can't speak the same language, I don't think. AT&T and T-Mobile both use GSM based systems so phone calls are possible using a handset form the other carrier, but their 3G frequencies are different - so you're hosed on mobile data. So, there's a de-facto lock into a carrier with your device even if there isn't one in the contract. (And $600 for a new device just for a different carrier is a hard sell, in a world where subsidies are gone.)
It's happening though. The problem is that companies like HTC charge the same price Apple does for the iPhone for what is a lower quality of product, in my experience. Once again, personal experience, but the number of hardware problems I've had within the walled garden of Apple are few compared to those in my Android days. And those that I've had have been fixed quickly by an Apple store representative, whereas with HTC or Verizon it was a multiple week ordeal.
That's something that makes the product itself even more valuable to me.
> The problem is that companies like HTC charge the same price Apple does for the iPhone for what is a lower quality of product, in my experience.
HTC charges a similar price for a lower quality phone that has a bigger display, more RAM, higher resolution display, more internal storage, external storage capability, etc, etc.
HTC charges a similar price for a lower quality phone that has a bigger display, more RAM, higher resolution display, more internal storage, external storage capability, etc, etc.
Sure. But it's also a phone that will still have lagging issues and receive maybe 1 or 2 updates before being obsolete.
There is more to phones that just specs.
There is more to phones that just specs.
No other major problem with HTC except their after sales support. My 2 years old HTC Desire Z is still running android 2.3.3.
Well, I've got another phone brand this time with a lot better track record.
Well, I've got another phone brand this time with a lot better track record.
> In the US at least, everyone has to get on LTE before that becomes a reality
Many (most?) Verizon/Sprint phones support GSM already in order to gain worldwide roaming capabilities. If they just allowed R-UIM cards or allowed foreign ESNs to be registered on their networks, handset manufactures would quickly follow suit and ship multi-standard phones that aren't software locked to prefer a certain standard.
> AT&T and T-Mobile both use GSM based systems so phone calls are possible using a handset form the other carrier, but their 3G frequencies are different - so you're hosed on mobile data
High-end phones nowadays (such as the Xperia Z) support both 3G frequencies. Also, T-mobile are refarming their frequency allocations to open up 3G on their 1900 spectrum, same as AT&T. I could use my Euro-model iPhone 5 on T-Mobile 3G this year at WWDC.
Many (most?) Verizon/Sprint phones support GSM already in order to gain worldwide roaming capabilities. If they just allowed R-UIM cards or allowed foreign ESNs to be registered on their networks, handset manufactures would quickly follow suit and ship multi-standard phones that aren't software locked to prefer a certain standard.
> AT&T and T-Mobile both use GSM based systems so phone calls are possible using a handset form the other carrier, but their 3G frequencies are different - so you're hosed on mobile data
High-end phones nowadays (such as the Xperia Z) support both 3G frequencies. Also, T-mobile are refarming their frequency allocations to open up 3G on their 1900 spectrum, same as AT&T. I could use my Euro-model iPhone 5 on T-Mobile 3G this year at WWDC.
I've always wondered: can a single phone have radios for all the different carriers? Could they share a single antenna? Could one be activated by the user selecting which network to get on?
> can a single phone have radios for all the different carriers?
All carriers in a single country? Yes, many do. All carriers worldwide? You'd be putting a lot of radios in the thing.
> Could they share a single antenna?
Not a radio expert, but I think each antenna has to be tailored to each wavelength. Maybe you can get away with one per band (one for 800-900, one for 1800-1900, one for 2100-2600)
> Could one be activated by the user selecting which network to get on?
You'd need a SIM card for each carrier you want and swap them out, and for American CDMA carriers you'd have to have your ESN registered with their networks beforehand.
All carriers in a single country? Yes, many do. All carriers worldwide? You'd be putting a lot of radios in the thing.
> Could they share a single antenna?
Not a radio expert, but I think each antenna has to be tailored to each wavelength. Maybe you can get away with one per band (one for 800-900, one for 1800-1900, one for 2100-2600)
> Could one be activated by the user selecting which network to get on?
You'd need a SIM card for each carrier you want and swap them out, and for American CDMA carriers you'd have to have your ESN registered with their networks beforehand.
All carriers worldwide would be tough, but a sufficiently multi-band GSM phone will typically give you pretty much worldwide roaming from a variety of carriers.
I'm in Europe. The last time I had a phone I couldn't effortlessly take to the US or Asia and use roaming was probably about '99.
I'm in Europe. The last time I had a phone I couldn't effortlessly take to the US or Asia and use roaming was probably about '99.
Yeah, most modern phones will work most everywhere, but there'll always be one carrier's 3G or 4G network you'll miss out out. Some phones have really impressive radios in them now. Here's the Sony Xperia Z Ultra:
2G Network: GSM 850 / 900 / 1800 / 1900
3G Network: HSDPA 850 / 900 / 1700 / 1900 / 2100
4G Network (C6833 model): LTE 800 / 850 / 900 / 1700 / 1800 / 1900 / 2100 / 2600
4G Network (C6806 model): LTE 700 / 850 / 900 / 1700 / 1900 / 2100 / 2600
With one of these babies, pretty much all you're missing out on is extended range areas on Docomo Japan (800 MHz)
2G Network: GSM 850 / 900 / 1800 / 1900
3G Network: HSDPA 850 / 900 / 1700 / 1900 / 2100
4G Network (C6833 model): LTE 800 / 850 / 900 / 1700 / 1800 / 1900 / 2100 / 2600
4G Network (C6806 model): LTE 700 / 850 / 900 / 1700 / 1900 / 2100 / 2600
With one of these babies, pretty much all you're missing out on is extended range areas on Docomo Japan (800 MHz)
> You'd need a SIM card for each carrier you want and swap them out
There are phone models that support 2-3 SIM's , very useful when travelling so you don't have to swap anything but can call from different networks seamlessly.
There are phone models that support 2-3 SIM's , very useful when travelling so you don't have to swap anything but can call from different networks seamlessly.
I don't know about CDMA vs GSM, though I think it might work (there definitely are two-GSM-SIM phones, and GSM-and-CDMA doesn't seem philosophically different). Having a phone work on both AT&T and T-Mo, though, is easy, Galaxy Nexus or Nexus 4 can do that, just to name a couple of popular ones.
"All" I don't know about, but got to Aliexpress.com and search for "GSM CDMA" - you'll get a bunch of phones supporting multiple standards.
Many Chinese phones even sell with from two and up to 4 GSM SIM slots (that can be active simultaneously), so I wouldn't be surprised if you could even use both at the same time.
Many Chinese phones even sell with from two and up to 4 GSM SIM slots (that can be active simultaneously), so I wouldn't be surprised if you could even use both at the same time.
If the wireless situation doesn't resolve itself in the next few years, I suspect that it will drive software defined radio deployment to the masses. One phone with one antenna and chunk of silicon that can speak on any network, software permitting.
It's about the culture of using prepaid vs contract phones, ie it's not like carriers don't understand ARPU, it's subscribers who stay away from contracts.
Not a single Russian iPhone user I know bought it in carrier store. Mostly they've got it from Europe trips, others in non-official stores where prices 15-20% lower.
So, despite official sales numbers are low, there is a remarkable iPhone user base here.
So, despite official sales numbers are low, there is a remarkable iPhone user base here.
People around me link this to official Apple Store opening.
You can now order iPhone there over the internet, carriers can't realistically compete with this because they'll lose money selling for less that Apple Store and sell zero phones selling for more.
(I've never owned nor bought anything from Apple)
You can now order iPhone there over the internet, carriers can't realistically compete with this because they'll lose money selling for less that Apple Store and sell zero phones selling for more.
(I've never owned nor bought anything from Apple)
The carriers sell the phones for less and make money back through the service plan. That's the basic model for carriers offering phone subsidies.
In a proper free market they can't really do that, as I can buy a handset through operator A and immediately switch (with no penalties allowed) to a cheaper operator B.
If there is no legal/monopolistic lock-in like in USA (where the phone is locked to a certain operator), but instead operator B can jailbreak&unlock your phone for you when you switch, then you can't extract huge monthly prices just because you sold a phone 9 months ago.
If there is no legal/monopolistic lock-in like in USA (where the phone is locked to a certain operator), but instead operator B can jailbreak&unlock your phone for you when you switch, then you can't extract huge monthly prices just because you sold a phone 9 months ago.
Pretty sure free markets are supposed to allow for contracts. "No penalties allowed" is clearly government regulation (one I happen to appreciate).
I think the issue of contracts is somewhat orthogonal to a market. Of course you need to be able to deal, but the details of that aren't somehow fundamental to a market.
The point of a market is to allow sufficient flexibility so that lots of individual actors can by trial and error find an efficient solution to a hard problem without requiring a benevolent genius at the center. How much flexibility is enough? How much is too much? I don't think there's a one-size fits all solution here, and the size discrepancy between the cellular provider and the individual user only makes it harder.
Personally, I think that in most markets, but particular these kind of highly asymmetric ones, we'd see more innovation and progress if the market were more fluid; which suggests to me that the carrier (and handset provider) lock-in is not a good thing.
The point of a market is to allow sufficient flexibility so that lots of individual actors can by trial and error find an efficient solution to a hard problem without requiring a benevolent genius at the center. How much flexibility is enough? How much is too much? I don't think there's a one-size fits all solution here, and the size discrepancy between the cellular provider and the individual user only makes it harder.
Personally, I think that in most markets, but particular these kind of highly asymmetric ones, we'd see more innovation and progress if the market were more fluid; which suggests to me that the carrier (and handset provider) lock-in is not a good thing.
Yes, true. However, even with no regulation at all, you might owe some contract penalty, but you still be able to use that phone with any operator after contract expiry or breaking.
The "zero point" of regulation would mean that any and all device restrictions can be freely legally broken and removed, which currently isn't the case in USA; in unregulated markets there are thriving legal businesses that do, for example, jailbreaks of phones that people bring in from USA, and which were subsidised there.
The "zero point" of regulation would mean that any and all device restrictions can be freely legally broken and removed, which currently isn't the case in USA; in unregulated markets there are thriving legal businesses that do, for example, jailbreaks of phones that people bring in from USA, and which were subsidised there.
Not sure about Russia, but in other countries there are tight regulations for phone subsidies (treating them for what they are: dumping of retail price with the purpose of locking in users - a blatantly anticompetitive practice that would be illegal in most industries).
Strong competition has a similar effect. If the SIM free contracts are good enough, people are not going to get into lengthy, expensive contracts. This doesn't happen in places like the US because there's a very strong cartel/oligopoly there that affords them the right to simply deny you a terminal if it's not under the carrier's conditions.
If Apple is selling for cheaper than the carriers can afford to sell, then they will simply do what they are doing: stop selling it.
Strong competition has a similar effect. If the SIM free contracts are good enough, people are not going to get into lengthy, expensive contracts. This doesn't happen in places like the US because there's a very strong cartel/oligopoly there that affords them the right to simply deny you a terminal if it's not under the carrier's conditions.
If Apple is selling for cheaper than the carriers can afford to sell, then they will simply do what they are doing: stop selling it.
> dumping of retail price with the purpose of locking in users - a blatantly anticompetitive practice that would be illegal in most industries
What? There are scores of industries that use loss-leaders to get customers to commit to long-term contracts. Razors, satellite/cable TV, etc.
> This doesn't happen in places like the US because there's a very strong cartel/oligopoly there that affords them the right to simply deny you a terminal if it's not under the carrier's conditions.
This isn't true at all, and I don't know why you would think it was. Here's a counterexample: https://ting.com/
What? There are scores of industries that use loss-leaders to get customers to commit to long-term contracts. Razors, satellite/cable TV, etc.
> This doesn't happen in places like the US because there's a very strong cartel/oligopoly there that affords them the right to simply deny you a terminal if it's not under the carrier's conditions.
This isn't true at all, and I don't know why you would think it was. Here's a counterexample: https://ting.com/
Exactly, forcing a lock-in is illegal in all those industries as well.
For razors: you are allowed to manufacture and market blades that are compatible with competitors; so people are (both legally and practically) allowed to buy a loss-leader razor from company A, and cheaper razorblades from company B.
For satellite/cable TV: in places with decent consumer rights laws there are practical, massively used ways to get out of long-term lock-ins; so such deals work only as long as consumers like the deal. If customer walks away, there may be a contract-breaking fee involved, but as soon as you want to change the contract the slightest bit not to customer's favor (increase price by a dollar or drop a TV channel, which you may need to do) - bam; the customer can walk away with no fees.
For razors: you are allowed to manufacture and market blades that are compatible with competitors; so people are (both legally and practically) allowed to buy a loss-leader razor from company A, and cheaper razorblades from company B.
For satellite/cable TV: in places with decent consumer rights laws there are practical, massively used ways to get out of long-term lock-ins; so such deals work only as long as consumers like the deal. If customer walks away, there may be a contract-breaking fee involved, but as soon as you want to change the contract the slightest bit not to customer's favor (increase price by a dollar or drop a TV channel, which you may need to do) - bam; the customer can walk away with no fees.
Loss leading may actually be harmful to consumers. See http://afinetheorem.wordpress.com/2013/07/12/loss-leading-as... for one readable explanation.
How is selling you something on credit 'anticompetitive'?
Danish (and I believe EU) regulation has a comprise. Subsidized phones are legal, but 1) the longest time you can be bound by a "plan" is 6 month, and 2) all advertising must include the total cost of ownership in the binding period.
This makes it blatantly obvious to the consumer that the unsubsidized phones are cheaper.
This makes it blatantly obvious to the consumer that the unsubsidized phones are cheaper.
Selling on credit is different than offering a loss leader and making it up elsewhere.
If they are "selling you the phone on credit", then it would be obvious to require (a) in bill, separate items for the telecommunications and for the phone payment; (b) in advertising, note the full price of the phone, including the all monthly payments+interest; (c) when the phone is paid in full (24 months?), then stop charging for it... rather than continuing the same bill forever.
If they are "selling you the phone on credit", then it would be obvious to require (a) in bill, separate items for the telecommunications and for the phone payment; (b) in advertising, note the full price of the phone, including the all monthly payments+interest; (c) when the phone is paid in full (24 months?), then stop charging for it... rather than continuing the same bill forever.
Because that's not what they're doing? I can buy a car on credit, and it has nothing to do with my wireless service. I don't have to commit for the next two years to only buying gasoline from a particular type of station, either.
In the USA this is the predominant model. In Europe and Russia customers prefer to buy a SIM unlocked phone and not have a contract. These carriers were getting killed selling subsidized iPhones because it is far cheaper to import an unlocked one and pay less monthly. T-Mobile is doing this in the USA now and eventually people will learn that that "$199" iPhone is not 199 when you are paying $30-40 more a month over T-Mobile unsubsidized cost forever.
mobile contracts are very rare in Russia, almost everyone is on a prepaid plan
Russian market is primarily prepaid.
It varies country to country. That was the norm for Spain but has since changed, now you get two contracts, one for the service and another for the phone financing.
I pay 25/mo for my iPhone plus an 8/mo data plan. I don't do much calls but they're 8/c minute IIRC. I can move from a plan to another or cancel the data but the 25/mo will stay there until the phone it's paid.
It was 50€ cheaper to buy it this way than to pay full retail price.
I pay 25/mo for my iPhone plus an 8/mo data plan. I don't do much calls but they're 8/c minute IIRC. I can move from a plan to another or cancel the data but the 25/mo will stay there until the phone it's paid.
It was 50€ cheaper to buy it this way than to pay full retail price.
> It was 50€ cheaper to buy it this way than to pay full retail price.
What's the reasoning behind that for the phone vendor? That seems odd.
What's the reasoning behind that for the phone vendor? That seems odd.
1) There is some "lock-in" even without lock-in - some phone subsidies work even if people can leave because they don't leave that much anyways; think of it as advertising expense for customer acquisition.
2) There are economies of scale (order size) and synergies (sell phones at the same office you already have for contract sales) that can mean that $RANDOM_TELECOMPANY has significantly lower costs than $RANDOM_PHONE_RETAILER and can simply outcompete them on price.
2) There are economies of scale (order size) and synergies (sell phones at the same office you already have for contract sales) that can mean that $RANDOM_TELECOMPANY has significantly lower costs than $RANDOM_PHONE_RETAILER and can simply outcompete them on price.
>There is some "lock-in" even without lock-in - some phone subsidies work even if people can leave because they don't leave that much anyways; think of it as advertising expense for customer acquisition.
Yes. Carriers in the US lose, literally, billions of dollars on the iPhone because they've calculated the cost of acquiring a customer is a few hundred bucks, on average, so if subsidizing a phone buys you customers it's worth it.
Personally, I think they've gone overboard, but then again I'm not in the front office.
http://www.latimes.com/business/money/la-fi-tn-verizon-on-ho...
Yes. Carriers in the US lose, literally, billions of dollars on the iPhone because they've calculated the cost of acquiring a customer is a few hundred bucks, on average, so if subsidizing a phone buys you customers it's worth it.
Personally, I think they've gone overboard, but then again I'm not in the front office.
http://www.latimes.com/business/money/la-fi-tn-verizon-on-ho...
FTA: "notably, Russia bans handset subsidies"
Ex-russian here.
This might be counter-intuitive to many people who never lived in Russia, but: mobile phone service contracts in Russia almost do not exist, entire market model for carriers is quite different.
Carriers don't sell SIM-locked phones for over decade now in Russia. Most common contract features are implemented as pay-as-you-go with extra packs (quite similar to what giffgaff does in the UK). This is probably due to the fact that CRA and other similar financial institutions in Russia are currently in their earliest stages of development.
Mobile phones are usually purchased absolutely independently from the mobile service contract, and almost never purchased from carriers: electronics stores usually offer better prices, and all Russian carriers are happy to sell SIM-only prepaid contracts (also see PAYG model notice above).
So overall you should read this news as: "major russian mobile companies decided that long-term contract model required to sell 'cheap' iPhones in russia is still too risky and not feasible", no conspiracies.
This might be counter-intuitive to many people who never lived in Russia, but: mobile phone service contracts in Russia almost do not exist, entire market model for carriers is quite different.
Carriers don't sell SIM-locked phones for over decade now in Russia. Most common contract features are implemented as pay-as-you-go with extra packs (quite similar to what giffgaff does in the UK). This is probably due to the fact that CRA and other similar financial institutions in Russia are currently in their earliest stages of development.
Mobile phones are usually purchased absolutely independently from the mobile service contract, and almost never purchased from carriers: electronics stores usually offer better prices, and all Russian carriers are happy to sell SIM-only prepaid contracts (also see PAYG model notice above).
So overall you should read this news as: "major russian mobile companies decided that long-term contract model required to sell 'cheap' iPhones in russia is still too risky and not feasible", no conspiracies.
This is not Russia specific... it's like that in most countries of the world.
"Apple dumps all three major Russian carriers" is how I would read this heading. Everyone I know in Russia has or wants an iPhone, Apple isn't losing any market share there, because you can get an iPhone from Apple directly.
Yep, we have our share of Apple funboys here in Russia)
>> Russia has over 180m mobile subscribers
The whole population is 143M (2011) including infants and very old people. How is it possible? Multiple phones per person?
The whole population is 143M (2011) including infants and very old people. How is it possible? Multiple phones per person?
Brazil has around 190 million people[1] with about 249 million mobile phone lines enabled [2].
People that have more than one line usually buy one line from each provider so they can talk "for free" between the same providers. It is not uncommon for people to ask you what is your provider so they will mark it and call from a phone that uses that provider when trying to reach you.
We also have a high number of people with phones that allow multiple providers with one device.
Business and personal cellphones are not uncommon either.
[1] http://www.ibge.gov.br/home/estatistica/populacao/censo2010/... [2] http://extra.globo.com/noticias/celular-e-tecnologia/quinto-...
People that have more than one line usually buy one line from each provider so they can talk "for free" between the same providers. It is not uncommon for people to ask you what is your provider so they will mark it and call from a phone that uses that provider when trying to reach you.
We also have a high number of people with phones that allow multiple providers with one device.
Business and personal cellphones are not uncommon either.
[1] http://www.ibge.gov.br/home/estatistica/populacao/censo2010/... [2] http://extra.globo.com/noticias/celular-e-tecnologia/quinto-...
To make a example as brazillian:
My close family is 4 people (my dad, mom, me, sister).
We have 6 lines from one carrier (we got it in a special package, we use 1 line per person + 2 backup lines for whatever we need, since those lines can call very cheap each other, one use for backup line for example is borrow it to extended family)
Also my dad has one workplace line with another carrier, and a Nextel Android.
And I had for a while a extra line to communicate cheaply with people of the same carrier, thus in total we have 9 mobile phone lines for 4 people.
Sometimes you see particularly important business people (like a CEO) here walking with 4 or 5 phones on his belt (one of each carrier + 1 for strictly personal stuff)
My close family is 4 people (my dad, mom, me, sister).
We have 6 lines from one carrier (we got it in a special package, we use 1 line per person + 2 backup lines for whatever we need, since those lines can call very cheap each other, one use for backup line for example is borrow it to extended family)
Also my dad has one workplace line with another carrier, and a Nextel Android.
And I had for a while a extra line to communicate cheaply with people of the same carrier, thus in total we have 9 mobile phone lines for 4 people.
Sometimes you see particularly important business people (like a CEO) here walking with 4 or 5 phones on his belt (one of each carrier + 1 for strictly personal stuff)
A CEO is carrying 5 phones on his belt so he can save a few pennies using same-carrier free calling? What, does he have those 5 numbers also printed on his business card?
In most countries the caller pays, not the callee. So he is saving his callers money, not himself.
Depends.
First, there is the issue that here in Brazil previously we had a government monopoly on telephony, and the breakup was made along geographic lines, those are not strictly enforced anymore, but carriers sometimes still don't work at all in certain states, while other carriers work in those states (And don't work in other states), thus people that travel a lot have no choice but to own multiple lines.
Also, carriers here tend to have wildly different packages, that are advantageous in different situations.
And yes, sometimes people DO put several phones on their cards, usually whoever deals directly with sales (ie: salesmen, marketing, or CEO of small companies)
First, there is the issue that here in Brazil previously we had a government monopoly on telephony, and the breakup was made along geographic lines, those are not strictly enforced anymore, but carriers sometimes still don't work at all in certain states, while other carriers work in those states (And don't work in other states), thus people that travel a lot have no choice but to own multiple lines.
Also, carriers here tend to have wildly different packages, that are advantageous in different situations.
And yes, sometimes people DO put several phones on their cards, usually whoever deals directly with sales (ie: salesmen, marketing, or CEO of small companies)
I have seen it in another Eastern European country - the sum of all mobile subscribers each operator claimed to have, exceeded the population by 50%. I attribute it mostly to marketing tricks like counting pre-paid cards that have not been explicitly canceled towards the general tally of active users. In general the operators try to appear to have more subscribers in order to entice more new subscribers to choose them.
I seriously doubt that the telecom regulatory bodies in these parts of Europe pay much attention to the coverage/subscription rates claimed by the mobile operators' marketing departments.
Of course some of the people have more than one SIM card, but with at least 3 major operators this simply doesn't add up.
EDIT: added the sentence about the lack of regulation
I seriously doubt that the telecom regulatory bodies in these parts of Europe pay much attention to the coverage/subscription rates claimed by the mobile operators' marketing departments.
Of course some of the people have more than one SIM card, but with at least 3 major operators this simply doesn't add up.
EDIT: added the sentence about the lack of regulation
Here in Portugal, we have 124 active cellphone plans per 100 people, and the numbers are published by a governmental agency, not the carriers.
It's not that odd: even I, who barely makes calls, have two SIM cards (on a dual-SIM phone), for personal and work related calls. My teenage brother has three (one for each carrier).
Almost everyone uses prepaid, so there's really no cost associated with getting another SIM card - you just pay for what you use.
It's not that odd: even I, who barely makes calls, have two SIM cards (on a dual-SIM phone), for personal and work related calls. My teenage brother has three (one for each carrier).
Almost everyone uses prepaid, so there's really no cost associated with getting another SIM card - you just pay for what you use.
Several factors: people use separate phones for business (paid by employer usually) and personal calls, often people have phones from different operators, because of significant discount for calls within the same network, illegal immigrants that do not get counted in the census also own mobile phones (sometimes several phones, like I mentioned)
http://www.wolframalpha.com/input/?i=scatter+plot+of+number+...
many countries fall above the y=x line in this plot for example
http://www.wolframalpha.com/input/?i=mobile+phone+users%2Fpo...
many countries fall above the y=x line in this plot for example
http://www.wolframalpha.com/input/?i=mobile+phone+users%2Fpo...
I currently have 2 SIMs for 2 different Russian regions. Calls via local SIM are cheaper. Even for the same operator. And I think I have 5 or more abandoned SIMs for more regions I've been to. And this is a norm. I'm surprised the number is not higher.
I think the definition of subscriber could do with some definition - presumably it means the number of sims as this thread suggests prepaid is the majority of the market. If this was applied to me, I'd count as about 8.
Business and personal phones? Lots of 'Russian Business' around the web.
Montenegro has population of ~600.000 people and ~1.200.000 mobile subscribers.
FTA "which has helped enable the Microsoft OS to overtake iOS, gaining 8.3% of smartphone sales compared to 8.2% for Apple"
So maybe windows phone will actually become a competitor to android in russia?
So maybe windows phone will actually become a competitor to android in russia?
Unless they have a very loose definition of smartphone or I'm missing something, it doesn't sound like anything is competitive with Android in Russia?
Not yet. The most popular shop Svyaznoy seems like promoting however.
Any one care to tell us how good/bad is a market that outlaws phone subsidies?
Is there better competition on service quality and cost or does it end up being just the same?
Is there better competition on service quality and cost or does it end up being just the same?
In three words: it is great! Not sure what lack of phone subsidies has to do with it though, or even if there is such a thing.
I lived in Russia and now live in Canada, and I would take Russian mobile market over Canadian any day. Dirt cheap, fierce competition between operators, over-abundant coverage, hidden fees are much less prevalent, there are contracts but pretty much everyone is on prepaid, buying new SIM card is a breeze.
I do not know if subsidized phones are forbidden, but much more likely the tradition of buying own phones is historical. Back in 90s owning a phone was a status symbol, there were no credit bureaus, no credit histories, inflation was rampant and ruble FX rate was very volatile. Everyone trusted only cold hard cash (preferably USD).
Later the country was swamped with lots and lots of cheap phones. So-called "grey" phones (euphemism for "smuggled") were brought in circumvention already lax or non-existent import regulations.
So I guess it is just not in the Russian tradition to sell subsidized phones.
I lived in Russia and now live in Canada, and I would take Russian mobile market over Canadian any day. Dirt cheap, fierce competition between operators, over-abundant coverage, hidden fees are much less prevalent, there are contracts but pretty much everyone is on prepaid, buying new SIM card is a breeze.
I do not know if subsidized phones are forbidden, but much more likely the tradition of buying own phones is historical. Back in 90s owning a phone was a status symbol, there were no credit bureaus, no credit histories, inflation was rampant and ruble FX rate was very volatile. Everyone trusted only cold hard cash (preferably USD).
Later the country was swamped with lots and lots of cheap phones. So-called "grey" phones (euphemism for "smuggled") were brought in circumvention already lax or non-existent import regulations.
So I guess it is just not in the Russian tradition to sell subsidized phones.
> buying new SIM card is a breeze
The situation is similar in Ukraine with one exception: in Russia, you'll have to let the store scan your passport to buy a SIM card. In Ukraine, you can buy SIM "starter packs" in bulk if you please, completely anonymously.
The situation is similar in Ukraine with one exception: in Russia, you'll have to let the store scan your passport to buy a SIM card. In Ukraine, you can buy SIM "starter packs" in bulk if you please, completely anonymously.
I completely disagree. Passport information is collected upon purchasing a SIM-card diminishing all hopes of privacy. Furthermore, there is roaming between states/provinces in Russia, so a SIM bought in one state is extremely expensive to use in another. I know for a fact that this isn't the case in the US and Canada. But, yes, generally prices are lower in Russia.
> Passport information is collected upon purchasing a SIM-card
Not always. You can purchase anonymous SIM too. I did it two years ago on a train station. Price for calls is a little higher this way though.
Not always. You can purchase anonymous SIM too. I did it two years ago on a train station. Price for calls is a little higher this way though.
My impression from visiting there a couple of times is that there is much more healthy competition among phone companies. It is very easy just to buy whatever SIM card you want--I could just walk into one of many phone stores and get one for my trip. There was also quite a bit more advertising for the bigger brands, which leads me to believe they have to work harder to acquire and keep customers.
Dealing with phones and SIM cards there was much nicer than in the US, but that isn't saying very much! The US phone market is a complete mess.
That said, I have no idea how much the law about phone subsidies helps this.
Dealing with phones and SIM cards there was much nicer than in the US, but that isn't saying very much! The US phone market is a complete mess.
That said, I have no idea how much the law about phone subsidies helps this.
> There was also quite a bit more advertising for the bigger brands, which leads me to believe they have to work harder to acquire and keep customers
Nah, don't be fooled. Most of the time, The Big Three (MTS, Beeline, Megafon) have almost identical pricing. They have been under regulatory scrutiny for price fixing more than once. Besides, there are several ridiculous features here (like inter-regional roaming, when you pay significantly more in different cities). However, it's really easy to buy a sim card, and that's what many people do, they have a Moscow SIM card and a Saint Petersburg SIM card.
Quality of data connection is usually about average, could be better, could be worse. FWIW, I live in a small city (<300k pop).
Nah, don't be fooled. Most of the time, The Big Three (MTS, Beeline, Megafon) have almost identical pricing. They have been under regulatory scrutiny for price fixing more than once. Besides, there are several ridiculous features here (like inter-regional roaming, when you pay significantly more in different cities). However, it's really easy to buy a sim card, and that's what many people do, they have a Moscow SIM card and a Saint Petersburg SIM card.
Quality of data connection is usually about average, could be better, could be worse. FWIW, I live in a small city (<300k pop).
It doesn't actually outlaw phone subsidies. There were a Beeline booth selling simple phone with contract for 200 roubles (~$7) at the musical fest I've visited last week.
(Carrier can lock phone; carrier would have to unlock it after the contract ends; but nobody does that on any scale)
It's just the marked shaped itself that everyone first buys phone then decides on carrier; everyone is on prepaid; thus no long-term contracts.
You just dump money into a terminal once or twice per month and use that credit for calls/data/options.
(Carrier can lock phone; carrier would have to unlock it after the contract ends; but nobody does that on any scale)
It's just the marked shaped itself that everyone first buys phone then decides on carrier; everyone is on prepaid; thus no long-term contracts.
You just dump money into a terminal once or twice per month and use that credit for calls/data/options.
Yes, much better when there are none or very little phone subsidies. They actually compete on services.
Unfortunately, since the iPhone, carriers in many countries have started adopting a very similar subsidy program to the one in US, and the value/buck has done downhill since then. But the pre-paid market is still alive and well at least, and you can get a ton of minutes and data for small prices.
Unfortunately, since the iPhone, carriers in many countries have started adopting a very similar subsidy program to the one in US, and the value/buck has done downhill since then. But the pre-paid market is still alive and well at least, and you can get a ton of minutes and data for small prices.
It's not that they compete on services in Russia (the only service they compete on is ripping you off) but you can always change your SIM card and get full service, data included.
You can buy a SIM card for $5 and have it working in a matter of minutes on any phone.
You can buy a SIM card for $5 and have it working in a matter of minutes on any phone.
You get cutthroat competition both on price and availability.
If any operator is ignoring poor service in some countryside region, competition will put up a few towers, make a local advertising campaign, and people can switch immediately.
Midsize companies (a few hundred employees) have enough negotiating power to ask for perfect coverage in a freshly built office building in the middle of nowhere, as they can trivially switch all their business phones overnight to a different operator otherwise.
And the cost, well, in my place are teenager plans for ~$5/mth that cover unlimited minutes/sms. I'm paying ~$10/mth to get data as well (speedcapped after 2gb, unlimited is a bit more).
If any operator is ignoring poor service in some countryside region, competition will put up a few towers, make a local advertising campaign, and people can switch immediately.
Midsize companies (a few hundred employees) have enough negotiating power to ask for perfect coverage in a freshly built office building in the middle of nowhere, as they can trivially switch all their business phones overnight to a different operator otherwise.
And the cost, well, in my place are teenager plans for ~$5/mth that cover unlimited minutes/sms. I'm paying ~$10/mth to get data as well (speedcapped after 2gb, unlimited is a bit more).
Finland had also a ban for phone subsidies for a long time, and I guess now they're allowed in some limits.
For a customer, it's great. You use whatever phone you want, you buy it where ever you want, change operators easily, and pay way way less than in US.
My plan, with unlimited data & 3/4G speed, with 2-simcards (so I can use the plan in two devices), costs 15 euros a month. Compared that to ATT & T-mobile, $60+ a month and get an abysmal coverage which doesn't even work inside a house most of the time.
For a customer, it's great. You use whatever phone you want, you buy it where ever you want, change operators easily, and pay way way less than in US.
My plan, with unlimited data & 3/4G speed, with 2-simcards (so I can use the plan in two devices), costs 15 euros a month. Compared that to ATT & T-mobile, $60+ a month and get an abysmal coverage which doesn't even work inside a house most of the time.
Unlimited mobile internet is $13(Beeline) — $20 (MTS) per month in Moscow region. Quality is far from good, can't compare to other countries though.
I wonder how much of it's related to fears that every iPhone is a secret NSA listening device?
I mean if you knew the KGB could possibly listen in on your phones, how likely would US carriers keep it?
I've been thinking an overseas consumer and business/government backlash against US technology products is inevitable now that the NSA being in bed with every major US technology company is public knowledge.
I mean if you knew the KGB could possibly listen in on your phones, how likely would US carriers keep it?
I've been thinking an overseas consumer and business/government backlash against US technology products is inevitable now that the NSA being in bed with every major US technology company is public knowledge.
If that were the case then why are Russians buying Microsoft phones too? Sorry doesn't pan out as an acceptable reasoning.
Seriously, unlike 99% of hackernews users, if the average smartphone user even knows what PRISM is, he/she probably doesn't give a damn.
And carriers go where the money is. This sounds like a purely economics driven decision.
And carriers go where the money is. This sounds like a purely economics driven decision.
Well, if people over hear heard something like the KGB can spy on people who use Russian tech company products, people would avoid them even if it isn't necessarily true. Supposedly, the encryption iOS implements is supposed to be NSA proof. But public perception and consumer confidence in a product is everything. Reddit talks about it as much if not more so then Hacker News on the common front page reddits and I've seen quite a bit of griping about it from non-techie friends on FB.
I think its very likely the contractual disagreement, but I'd be very interested to know if sales for US-based technology products have fallen since recent revelations came to light.
I think its very likely the contractual disagreement, but I'd be very interested to know if sales for US-based technology products have fallen since recent revelations came to light.
Come on - people overhearing that "KGB can spy on people using X" would not change anything, it is expected and well known that KGB/FSB can spy on you no matter what equipment you use; heck, if you're a political activist or interesting to the politically connected megacompanies, then you may have microphones in your house (no matter if your phone is "safe") and physical keyloggers in your keyboard cable (no matter if your software is "safe").
In that environment, you aren't surprised by backdoors, you treat them as a natural part of life.
ALL things have backdoors, no matter who made them, so for individuals (not army/gov't purchases) that isn't a factor, you just choose whichever device you like. If they're not spying on you, then backdoors don't matter; and if they're spying on you, then they'll get the backdoor in anyways.
If it didn't have backdoors at manufacturing time then it may have backdoors by the time it's sold to you. If the device didn't have backdoors when arriving at your house, well, it might have been installed yesterday.
Americans could/should be surprised, but not Russians.
In that environment, you aren't surprised by backdoors, you treat them as a natural part of life.
ALL things have backdoors, no matter who made them, so for individuals (not army/gov't purchases) that isn't a factor, you just choose whichever device you like. If they're not spying on you, then backdoors don't matter; and if they're spying on you, then they'll get the backdoor in anyways.
If it didn't have backdoors at manufacturing time then it may have backdoors by the time it's sold to you. If the device didn't have backdoors when arriving at your house, well, it might have been installed yesterday.
Americans could/should be surprised, but not Russians.
What phone isn't? Is even cyanogenmod safe from the NSA?
I think so, since it's fully community made, and beyond the "official" CyanogenMod team, there are hundreds more developers making "unofficial" CM ROMs for other phones, and they get to see the code, too.
Plus, the CyanogenMod team is now working on encrypted end-to-end messaging that is built-in:
https://plus.google.com/+CyanogenMod/posts/23vfN2qdZTu
Plus, the CyanogenMod team is now working on encrypted end-to-end messaging that is built-in:
https://plus.google.com/+CyanogenMod/posts/23vfN2qdZTu
Perhaps, but voice calls, and SMS all go through the carrier. While russian carriers don't have to provide data to the NSA, the probably do to the FSB. Yes you can make apps the communicate via encrypted channels, but that requires the same app at both ends, and ultimately I suspect apps are secondary for most people. Voice and SMS are the primary function of phones still.
No, it's not, because everything useful that happens with your phone happens over a carrier network or the internet, both of which are available to the NSA.
End-to-end encrypted messaging is a good sign, but it doesn't matter how "community made" your endpoints are - the NSA has the network.
End-to-end encrypted messaging is a good sign, but it doesn't matter how "community made" your endpoints are - the NSA has the network.
Yes, but if the communication is encrypted it doesn't really matter. So these text messages should be by and large safe.
I agree about the voice calling, though, which is why I'd like them to use RedPhone as the default dial app, too, so at least you can have encrypted voice conversations when connected to the Internet.
I agree about the voice calling, though, which is why I'd like them to use RedPhone as the default dial app, too, so at least you can have encrypted voice conversations when connected to the Internet.
Well, if you don't use Google Apps with it, then yeah probably.
You still have the radio firmware, which is closed source and can't be changed. That's where I'd expect snooping back doors to be located.
Well most of the firmware is written by an Asian company, doesn't put it outside the realm of possibility.
So, none of the operators were angry about possible (likely) NSA leaks?
Why would they bother? There is a local version of PRISM named <a href="http://en.wikipedia.org/wiki/SORM">SORM</a> deployed at every provider.
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http://shop.beeline.ru/msk/iphones this is weird. Maybe they haven't updated their site though.
"draconian contracts" for me this means unlimeted Data Plans, some carriers only offer that for iPhone - at least this is valid for Romania (last time I checked).
If the iPhone is considered "expensive" due "high import taxes" at $920, how is it selling on the black market for $3500?
$3500 is a price for a iPhone on a next day after it is released in US. After that price gradually decreases.
Distributing iPhones at scale for $920 is a different beast than selling a couple of them for $3500. In the latter case, the costs per iPhone for the seller are much higher.
The game for selling $920 iPhones is "find a price point were demand times price minus cost is maximized".
The game in the black market is "find the highest price point at which the inventory sells out quickly enough".
The game for selling $920 iPhones is "find a price point were demand times price minus cost is maximized".
The game in the black market is "find the highest price point at which the inventory sells out quickly enough".
But who would buy them for $3500?
If the price of a black market iPhone is higher than that of the legal-market iPhone, with any regularity, it suggests that $920 isn't a problem, let alone the import tax portion of that: supply must be the problem.
And if the price only hit $3500 in a couple rare situations (errors, morons), I'm not sure why they even brought it up as if it were common, as that fact completely undercuts the argument about the iPhone being too expensive.
If the price of a black market iPhone is higher than that of the legal-market iPhone, with any regularity, it suggests that $920 isn't a problem, let alone the import tax portion of that: supply must be the problem.
And if the price only hit $3500 in a couple rare situations (errors, morons), I'm not sure why they even brought it up as if it were common, as that fact completely undercuts the argument about the iPhone being too expensive.
On the black market, iPhone 5s have even been reported reaching over $3.500
That's "iPhone 5s", the plural of "iPhone 5". "iPhone 5S" is the unreleased product.
That's a written language problem Apple didn't see coming. It not as bad as the situation you get when you try to discuss the new New iPad though. The Le Ferrari has managed a similar achievement too.
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Perhaps they weren't officially available right at launch and that high price was seen then. I can't imagine that kind of disparity persisting.
Unless there's something special about them, maybe jail-broken with a few grand worth of apps on it? (Not really buying that, just noodling).
Unless there's something special about them, maybe jail-broken with a few grand worth of apps on it? (Not really buying that, just noodling).
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Traditional well-regulated customer-supporting carriers don't have the margins that black market dealers do?
But if you can buy it from the carriers more cheaply than the black market, who would pay more than triple that to the black market?
They're not carrier-locked, when purchased direct from Apple for $920, are they?
And if they're selling for $3500 on the black market, exactly how "expensive" can they be, at $920, let alone how could they be "expensive" due the import taxes that result in an official product that's less than one-third the price of the illegal product that skirts those taxes?
They're not carrier-locked, when purchased direct from Apple for $920, are they?
And if they're selling for $3500 on the black market, exactly how "expensive" can they be, at $920, let alone how could they be "expensive" due the import taxes that result in an official product that's less than one-third the price of the illegal product that skirts those taxes?
Russia leading the way once again.
The effect is exactly the opposite; those countries where phones are mainly subsidized have also the highest total cost of ownership and ARPU (average revenue per user). The subsidized phones aren't cheap, quite the opposite.
Carrier subsidized model should be ended to bring down consumer telecommunication costs. It only benefits the carriers.