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Over the weekend, Verizon confirmed it would be making some major changes to its upgrade policy in several areas. For starters, upgrades will no longer be issued after 20 months on the standard two-year contract. Instead, you’ll have to wait the full 24 months before you can buy a new phone at subsidized cost. This throws a big, nasty wrench into the upgrade plans for many people who have been used to the 20 month cycle, and there is reason for many to be upset.
The first people this change will affect is those whose contracts are set to expire in January 2014. Verizon’s giving users another course to take — buy your next phone off-contract. Many people were already planning on doing this for the sake of keeping grandfathered unlimited data, but those who can’t bear to wait those extra four months might want to take this undesirable approach. Thankfully, Verizon will be allowing users to take advantage of a new device payment plan policy starting April 21st.
According to the company’s blog post on the matter, the payment plan will allow users to buy select devices for full price ahead of their upgrade date by tacking the cost of the phone onto the monthly bill over a 12 month period. Those who decide to go this route won’t get the benefit of a cheaper contract ala T-Mobile’s new UNcarrier plans. This is sensible for those who are still on the hook for their most recently subsidized phone, but those whose two-year contract obligations have expired will obviously have a problem with this.
We’ll be reaching out to Verizon to see if we can get more details about the new payment plan and the list of devices that will be available ahead of the program’s April 21st start date. Those changes aren’t the end of it either. For starters, all new-every-two credits will expire after today. Users lost the ability to earn new credits over two years ago, but were allowed to hold onto existing credits for use whenever they wanted. That means you’d better have an upgrade right now and be willing to buy your new smartphone today or risk losing the credit forever.
Finally, Verizon has tweaked the rules for sharing device upgrades with other users on your line. You can now only use shared upgrades for devices within the same category. For instance, the upgrade for your phone-enabled line can be shared with someone if their device is a phone, but not if it’s a tablet or hotspot device. There isn’t a ton of good to take out of any of this, but Verizon’s heart seems set on the changes and history shows it’s hard to get Big Red to change its mind after it’s made up. Stay tuned for Phandroid as we continue to chase more details regarding the device payment plan.
So now my November 2013 upgrade is going to be March 2014? That stinks, you’d at least think they let current users have their last upgrade as long as it is in 2013. Oh well, will have to watch what phones come out 1Q14 instead 4Q13
How does Verizon think this helps their bottom line. The only benefit here is if they think there is going to be some type of mass exodus, I don’t see that happening. I just don’t get how this is an advantage for them. Aren’t they able to profit more when people upgrade earlier, because it makes sure they stay with Verizon. Now if people have to wait out the full 2 years it leaves them with the opportunity to leave with no ETF. This deal is getting worse all the time!
And you must wear these clown shoes wherever you go! THIS DEAL…..is very fair and I’m happy to be a part of it.
lolwhut? Was that sarcasm?
/taps meter
Sorry, couldn’t resist quoting the Robot Chicken Star Wars episode. Not at all relevant to your main point however, which I very much agree with.
My only guess is that Verizon is actually doing this for money reasons….. As in trying to stop losing money. They pay the full retail for all their devices and if customers are upgrading 4-7 months earlier to a new device then their contact end date, then that’s lost revenue. They make their money back in those 2 years on that contract. And that goes for the non devices upgrade change too. That’s the only thing I can think of. I used to be in the phone business.
I Guaranteee 1 thing Verizon never pays full retail for the devices if it costs 400 they probably pay 200 max
Every carrier pays the full retail for devices…. If they didn’t, then plans would be a lot cheaper. Carriers get no special treatment from manufacturers. That’s how the manufacturers make their money….
That’s bull everything has a retail and whole sale price.if that’s true when you pay full price for a phone they don’t make any money from them
No it’s not. Manufactures give no special wholesale price for devices to the big carriers. The big carriers makes their money from the service they provide not the phone they sell to you. @GavinGG they’re not losing money one bit. It takes them 8-10 months to recover the cost of the phone that they sold at a subsidized price. Those 12+ months are profit until to upgrade again. Verizon is just being greedy and wants more money, which I can’t blame them they are after all a business.
bs show your source. verizon, sprint, and att all get a reduced price
Sure where’s yours though?
Mines ccalled common sense. This is how business works. Ie. Verizon says we will take x number of that model phone and get x reduction per each
Awesome so all of your claims are invalid too. Take your “common sense” elsewhere.
While technically the manufacturers don’t give a “wholesale” price, what the carriers pay for the phones is not what they advertise as the retail price. (so really, it can be easily argued that it is a wholesale price. It’s all semantics at this point, but that’s neither here nor there.)
Verizon does pay more per phone because CDMA handsets are more expensive to produce (due to CDMA being a smaller market) vs a GSM/UMTS/LTE handset as that market is world wide.
That being said, Thomas is more or less correct, the price the carriers pay is much less than what they are posting the full off contract price is. They take a hit for the subsidized price, because they are guaranteed revenue due to your contract.
Needless to say, the longer you are on contract not receiving a subsidized handset, the more money Verizon is making. They are a business and are in it to take your hard earned $$, don’t expect any less.
Oh, and my proof is I used to liaise with the purchasing team, so I have first hand knowledge of carrier practices.
Just thought I’d throw that out there in case you were wondering Jesse. :)
you don’t even have to work at walmart to know this is false.
your living in make believe world.
Yes that is true, but what isn’t known is how much of that subsidy is in your bill. For all we know our phones could be paid off in a years time. There is no way to know how much of the bill is going towards the phone and how much towards the usage. I feel this deal drives the loyal customers away because we have no reason to stay anymore. Currently if we stay with Verizon we have the ability to upgrade early, a loyalty perk. Now nothing, well other than coverage.
No big deal for me. VZW is losing my business after this contract anyways since I won’t get to keep my unlimited data.
of course you can keep unlimited when your contract is up. You just can’t get a subsidized price on a phone and keep it. If you want unlimited data you pay the upfront cost for the phone, if you want a subsidized phone price, you get a structured data plan. Pretty obvious choice if you ask me. And you’re not stuck going into a Verizon store and shelling out 600-700 bucks to them for your new device. Personally I buy and sell my phones on swappa. I recently sold my old phone for 200 on there and then bought a GSIII for 350. So my net out of pocket was relatively painless for a like new device.
The only problem with this is at any given moment Verizon can choose to eliminate the unlimited option in full.
But you still pay the monthly price for a subsidized phone
it really seems like they are pushing us away.
OK wait. So my wife and I are due for an upgrade right now. Have been a little over a month. And after today our upgrades will be expired and can’t be used?
No, after today those who had new-every-two credits won’t be able to use those credits on upgrades — they will vanish into oblivion. Those with upgrades right now will still be in line for upgrades. The new 24-month cycle won’t affect those whose upgrades will come before January 2014.
I wouldn’t think so. I’d think you can still upgrade.
I wonder if this move on their part voids out the ETF/contract..would be nice if one of our legally knowledgeable android friends touched on the issue :) oh and Verizon blows for this change!!!
I’ve reached out to Verizon for more clarification on the new policy and I will let you know what I find out.
It doesn’t…. The contract says nothing about the 20 month upgrade. It’s more like a leisure. I already called them about it and looked over the contract terms.
It doesn’t void the contract since it’s not stated anywhere in there about early upgrades.
Oh wow, so we get to pay full price, which at verizon is more than retail, and don’t get a contract discount? How, would I not want that sort of deal?
I think this is Verizon’s way of trying to trick some existing customers who may have heard about T-mobile’s new device payment plans, but not quite understand them. Verizon is probably counting on the fact that many customers are generally too stupid to realize that T-Mobile’s version is much different — and much better.
how is it different?
All other carriers include a universal phone subsidy that is built into their monthly rates — regardless of whether or not you’re using a device that is paid off.
T-Mobile’s contract-free rates are much lower than others because they do not include that phone subsidy. If you bring your own phone, or completely pay off the one you buy from them, your monthly cost becomes much lower.
While the other major carriers hide the cost of your phone within their monthly rates over a 24-month period, you know right up front the EXACT cost for any phone on T-Mobile; and, you are free to pay off that fixed and known amount at your own pace. (Example: I think the iPhone 5 is $579)
Make sense?
Dang I was hoping you guys would have told me yes I needed to use my upgrade now that way I could have told my wife that I needed to buy the Note 2 today:) Lol OK well good. Had me worried a bit. If it does change tho I’ll be checking on here cuz then I’ll have to go get my new phone today. Dang I don’t want a new awesome phone yet…SAID NO ONE EVER!!!
Honestly at this point you’re better off waiting for the note 3 in a few months. Unless your current device is about to fizzle out and die.
The only way this would make sense to me if they are going to let you pay for the devices on your own, Then they give you a discount on the service price seeing they don’t have to put money out front.
Sarcasm it was :)
When my handcuffs are unshackled from big red thay can kiss my big red ass I will never go with Verizon ever again I let my wife talk me into this Co.3 years or so,I was cellular one back in mid 90’s,then Cingular, and then ma bell and they did what they’re said,no welchers, u no what after 20 months i probably not have upgraded but now I don’t have that’s option, 24 months is the end 4 me,sh@@t heads!
Verizon seems to think their a bank, there’s a $2/mo finance charge with this device payment plan, Verizon is a wireless carrier, not a bank. But yet Best Buy offers 18 months ZERO interest when buying a smartphone from them using their Best Buy card.
cost of money over time… Best Buy card thru HSBC and now Capital One accrues interest thru the entire zero interest period, and if you owe 1 red cent at the end of that period, you’re on the hook for the full interest charges.
F#@& the best buy credit card through hsbc I had one years ago F#@&ing dirty ass creditor. Pay your bill on time on line they pourpously take a week to process the payment then charge a late payment fee. This $#!+ would happen almost every month I’m glad I don’t have that card anymore.
Just wondering….does this mean I can buy a phone through Verizon while still on my 2 years and pay FULL price for the phone(via the payment plan) AND keep my unlimited data??? If that’s the case I know what I am doin….
I’ll take this as long as the 12-month payment plan is unaffiliated with signing a new contract. I’ll pay an extra $50 a month for a new phone if it means I can keep my Unlimited Data. Silly? Yeah sort of, but I use the hell out of some data.
This is a dumb move. The only reason that I’m still with Verizon is because I keep upgrading phones at the 20 month mark. Now that I have to wait until the contract expires Ill probably go to another carrier.
just buy your hardware on EBAY.
I like how Verizon waited long enough for those of us who couldn’t wait and had to jump off the Unlimited plans.
That’s right emajem, that’s the phone I’m waiting for is the Note 3
these guys are making the wireless market so ripe for disruption. They’re too comfortable and taking advantage of everyone. As soon as another viable option arrives people will leave.