I don't get the US phone carrier system

[erekshun]

I often read how people sign up for 2 year contracts in the USA where they are locked to a specific carrier (e.g. AT&T, Verizon, Rogers etc.) and phone. This seems odd to me because it doesn't seem as a very liberal system in the otherwise liberal America.

Where I live, you just go the store and buy a phone. Done. You can either pay it right away (which I believe most people do, I did with my Lumia 800) or over the course of 6 months if you don't have the money right now. In the process, you sign up for a subscription that fits your needs and you are good to go. Say you want another carrier; you cancel your subscription and sign up for a new subscription at another carrier.

Why do people in USA bind themselves for 2 whole years? It seems crazy that you lock yourself to a store and are forced to buy whatever they want to throw at you without you being able to go somewhere else. In my head, it sounds like the store has all the power over the customer. Most often you'll see the store being there to suit the customer's needs, not the other way around.

I was also wondering why the carriers receive specific handsets. This means that a phone is different depending on where you buy it. Where I live, a Lumia 920 is a Lumia 920 nomatter where you go.

you also forgot the $350 early termination fee

 

[palandri]

The problem with U.S. Wireless Carriers is they don't play free market capitalism; they play follow the leader capitalism. It works like this, If they are getting $50 month, we should be able to $60 a month. If they can get $60 a month, we should be able to get $70 a month. If they get $70 a month, we should be able to get $80 a month. If they get $80 a month, we should be able to $90 a month...and so on... Plus they want everyone locked into a 2 year contract. Plus they don't give discounts on rates if you buy the phone outright.

 

[Dustin Hodges]

This is not really a problem with ATT and Tmo customer.

Actually, it is. I own an unlocked lg quantum that supports the 850 MHz, 900 MHz, 1800MHz, and 1900 MHz bands/frequencies. T-Mobile also supports the 1900 MHz band/frequency for 3G/4G-HSPA+ use. Problem? I only get 2G/EDGE, even when in a 3G area. Why? Because only areas where T-Mobile refarmed their PCS (UMTS frequency band II) Spectrum are using 3G on the 1900 MHz frrequency. Everywhere else, ATT uses 1900 MHz for 3G while T-Mobile gets use of the 1900 MHz frequency for 2G and EDGE.

So even a quadband phone (such as mine, seeing as it supports 4 different frequency bands) doesn't work right, due to carriers using different bands of the same frequency (because 2 carriers cant operate on the same exact band on the same exact frequency)

 

[Huime]

Actually, it is. I own an unlocked lg quantum that supports the 850 MHz, 900 MHz, 1800MHz, and 1900 MHz bands/frequencies. T-Mobile also supports the 1900 MHz band/frequency for 3G/4G-HSPA+ use. Problem? I only get 2G/EDGE, even when in a 3G area. Why? Because only areas where T-Mobile refarmed their PCS (UMTS frequency band II) Spectrum are using 3G on the 1900 MHz frrequency. Everywhere else, ATT uses 1900 MHz for 3G while T-Mobile gets use of the 1900 MHz frequency for 2G and EDGE.

So even a quadband phone (such as mine, seeing as it supports 4 different frequency bands) doesn't work right, due to carriers using different bands of the same frequency (because 2 carriers cant operate on the same exact band on the same exact frequency)

Not sure about contract phones at that time 2006-09 but nokia N series usually comes with 2100 for Tmo's 3G and 850/1900 for ATT's 3G, but of course if you are one of those Tmo 1700 3G area you are probably left out. But at that time even ATT's 3G covers only limited areas and focus on big cites. My place for example we got 3G very late and is about a year later ATT rolled out 4G instead along with those huge ass HTC phones.

 

[AlexRodriguezNY]

I prefer buying the phone full price that getting it for cheap and having to sign a two year contract.Once you sign that contract you are ****ed up.Cause if you break it you have to pay fees and if you stay at the end of the two years you end up paying for the price of your phone like 4 or 5 times. I don't know why people still falling for contracts.If you want a device and don't have the money right away don't sign a contract. Save until you have it to buy it full price. If you can pay $60 or even more for a monthly phone bill then you can save $500 to $700 in no time to buy a phone full price.In the long run you will be saving a lot.

 

[darkoman4]

There is also one thing that should be taken in consideration when talking differences between Europe and US. US is a huge country with not many people living per square mile, and to cover this huge territory with wireless signal, costs a lot. Not many companies are that big and wealthy to be able to do just that, therefore they invest much more money to cover such a country then say Switzerland. They should charge more, no question about it.

 

[Rich White]

The carriers were able to justify 2 year agreements as they were building out the Networks.

T-Mobile is now "European". Buy your phone, choose a finance contract term for the phone, and choose a subscription plan separately. They bought MetroPCS and will do well with the model of bring your own phone and either subscription or prepaid monthly,

ATT and T-Mobile phones work on the same network protocols. I expect to see more willingness on ATT to support unlocking of prepaid purchased phones..

Denmark is about the size of Southern New England (Mass, Rhode Island and CT) in total land mass. We are talking about US states where carriers have different deals in each state of the US for erecting towers, etc. It's a complex decentralized mess that somehow passes as a national network. This was one of President Obama's initiatives that died a death--streamlining the system and guaranteeing rural access. Usually a state forces the carrier to build out in rural areas each time they go to the board to make improvements. Otherwise they cherry pick the most profitable and densely populated areas of the state to host cell towers.

If you want to talk about cell access in Northern Greenland and compare that to some rural areas of Maine or Texas then we get some different comparisons. Occasionally in the US the government and carriers need to sit down and do some central planning. OTOH the US is adopting 4G by leaps and bounds and remains in the top 10 for penetration and speed and that's with minimal Federal involvement. In 10 years the issue will still be data limits unless the government mandates WiFI hotspot penetration for the carriers. That's next.

 

[Huime]

I prefer buying the phone full price that getting it for cheap and having to sign a two year contract.Once you sign that contract you are ****ed up.Cause if you break it you have to pay fees and if you stay at the end of the two years you end up paying for the price of your phone like 4 or 5 times. I don't know why people still falling for contracts.If you want a device and don't have the money right away don't sign a contract. Save until you have it to buy it full price. If you can pay $60 or even more for a monthly phone bill then you can save $500 to $700 in no time to buy a phone full price.In the long run you will be saving a lot.

Not sure how you see it as 4-5 times, take Iphone for example, within 6 months of the release market price is around 750-700. Say 60/mo with that 40 for the market value of service and 20 for the phone monthly. You put down $199 down payment and take a loan of $550. After a standard 24 mo you paid around $560 for the phone, which is about 2% apr, not that bad as 4-5 times.

 

[mrmdj31675]

Also have in mind that CDMA counts for nearly 2/3 of the total cellphone lines in the US when combining all lines on prepaid and postpaid carriers (regional and national, GSM and CDMA).

 

[Laura Knotek]

They do it cos they don't really have much options.

They get the phones for cheap. What you and me pay 600? for, they pay 0-200$, but have to make that 2 year contract. Now, they could just buy the phone unlocked, but they would still be stuck with the crazy carrier prices. I dunno where you are from, but what the average US customer pays 100$/month for, I pay 10-15?/month. The carriers totally rip off people around there and since they all do it, buying unlocked hardly helps cos you still pay your ass off for one of the carriers. So to minimize their losses with the crazy carrier prices, better get the phone cheap through the 2 year contract.

The main reason is that we don't save any money whether we pay full retail or get a contract if we use a major carrier like AT&T, VZW or Sprint. The monthly fees are the same whether one has a contract or not. For instance, I went 11 months without a contract, since my contract expired and I waited until I upgraded to a new device. During those 11 months, my bill wasn't any cheaper. The monthly bill also stayed the same once I started a new contract.

 

[Mystictrust]

The main reason is that we don't save any money whether we pay full retail or get a contract if we use a major carrier like AT&T, VZW or Sprint. The monthly fees are the same whether one has a contract or not. For instance, I went 11 months without a contract, since my contract expired and I waited until I upgraded to a new device. During those 11 months, my bill wasn't any cheaper. The monthly bill also stayed the same once I started a new contract.

Except for with T-Mobile and their value plans, which seem to be $20/month cheaper than subsidized phone Classic plans if you're not adding in the monthly phone payments (or you paid full price up front). With the substantial rumor that T-Mobile is doing away with phone subsidies and turning to the "low money down (under $99) + monthly payments" model for everything (including cheap plans), they might change the face of wireless in the US for everyone. Sprint is said to be watching to see how well T-Mobile's no subsidy thing goes.

Then again, knowing US carriers, I wouldn't be surprised if AT&T and Verizon mucked it up by eliminating subsidies but keeping high priced rate plans with no change. *sigh*

 

[Laura Knotek]

Except for with T-Mobile and their value plans, which seem to be $20/month cheaper than subsidized phone Classic plans if you're not adding in the monthly phone payments (or you paid full price up front). With the substantial rumor that T-Mobile is doing away with phone subsidies and turning to the "low money down under $99 + monthly payments" model for everything (including cheap plans), they might change the face of wireless in the US for everyone. Sprint is said to be watching to see how well T-Mobile's no subsidy thing goes.

Then again, knowing US carriers, I wouldn't be surprised if AT&T and Verizon mucked it up by eliminating subsidies but keeping high priced rate plans with no change. *sigh*

That's true. T-Mobile is not an option for me, since they have crummy coverage where I live. If I want fast speeds, AT&T or VZW are my only options.

 

[Dustin Hodges]

Also have in mind that CDMA counts for nearly 2/3 of the total cellphone lines in the US when combining all lines on prepaid and postpaid carriers (regional and national, GSM and CDMA).

This is mainly due to signal. In more rural areas (such as where I live) ive had friends and family on both T-Mobile AND Att (Me myself am on a prepaid Tmo plan.), and they didn't get jack didly squat as far as speed and coverage is concerned, Now there is 4G and im getting 2G in a number of places. But where im getting minimal 2G coverage, my father on Verizon is getting a full 5 bars of 4G data.

CDMA accounts for most because of signal. From what ive both read and heard, Tmobile is the best on the coasts (east, west) and in your "major us cities", but get into central usa (which is a big chunk of usa) and rural areas, and then you don't see gsm holding out as much. Sure, att is better than TMobile in that department, but that's because they own most the spectrum that those 2 use, leaving T-Mobile with measly bands only fit for 2G/EDGE.

 

[mrmdj31675]

That is in great part, but also being much easier to maintain a CDMA network compared to a GSM network here in the US.

 

[Robinsonmac]

That was the case for CDMA but the last few years all Verizons smartphones are "world Phones" that have GSM radios also. This is all for 3G data + CDMA for voice. Their LTE network is not CDMA based & they plan on having all their phones on LTE with voice & data by 2014.

See info here;

Verizon plans to drop CDMA from phones in 2014 in favor of pure LTE | ExtremeTech

 

[freestaterocker]

Actually, it is. I own an unlocked lg quantum that supports the 850 MHz, 900 MHz, 1800MHz, and 1900 MHz bands/frequencies. T-Mobile also supports the 1900 MHz band/frequency for 3G/4G-HSPA+ use. Problem? I only get 2G/EDGE, even when in a 3G area. Why? Because only areas where T-Mobile refarmed their PCS (UMTS frequency band II) Spectrum are using 3G on the 1900 MHz frrequency. Everywhere else, ATT uses 1900 MHz for 3G while T-Mobile gets use of the 1900 MHz frequency for 2G and EDGE.

So even a quadband phone (such as mine, seeing as it supports 4 different frequency bands) doesn't work right, due to carriers using different bands of the same frequency (because 2 carriers cant operate on the same exact band on the same exact frequency)

This is actually not true. All three of the major carriers here in Canada operate on the same GSM frequency bands, 850/1900 and 1700 for LTE, with 700mhz LTE spectrum soon to be or possibly already auctioned off to the highest bidder by the Government. But instead of competition, we have collusion, with carriers continually raising prices in virtual unison. And those damnable 3-year contracts.

 

[Daniel Ratcliffe]

This is actually not true. All three of the major carriers here in Canada operate on the same GSM frequency bands, 850/1900 and 1700 for LTE, with 700mhz LTE spectrum soon to be or possibly already auctioned off to the highest bidder by the Government. But instead of competition, we have collusion, with carriers continually raising prices in virtual unison. And those damnable 3-year contracts.

Yeah, we're fortunate in the UK in that we have four GSM carriers all using the same spectrum, plus several MVNOs. Three do the best deals (but their customer service makes you want to suicide... try asking for a PAC code to move networks like I did to get my Lumia 920! They tried EVERY excuse in the book!), with their signature plan being ?25/mth SIM-only on a 30-day rolling contract. This nets you 2000 any network minutes, 5000 3-2-3 minutes, 5000 texts, and all you can eat 3G data with unlimited tethering included. Rumour is that contract will automatically upgrade itself at no extra cost, keeping all the same stuff, but just adding in unlimited 4G data.

 

[Flagz]

Tmobile starting to do the same as the countries now. All we need is now penta band phones that work on all spectrums. Tmobile I'm paying unlimited everything $40 with choice to buy out phone in Full or make monthly installments for $20 for 20 months after down payment.

 

[drankurn]

ok, I am from US and this is my situation, draw your own conclusions. I have a family plan with 2 smartphones on ATT - more than enough minutes with rollover and 2 gb data per month per line for about $85/month - so it's about $42.50 per line per month. and I paid $100 for my Lumia 920 and received more than $150 in rewards and giftcards from Bestbuy for signing 2 year contract. also, I called ATT after the upgrade and they waived the upgrade fee. another thing to keep in mind, although the contract is for 2 years, you can get the discounted prices on the new phones after 18 months. so basically think of them as 18 month contracts. so, if you ask me I think it's a pretty good deal.

 

[The ZennyBoy]

The US telecom system really is a joke and a fraud. Almost depressing really.

I just want to thank everyone for persuading me to leave this country . . . hahahaha . . .