8 Ways Your Wireless Carrier is Gouging You
How-To Geek
http://www.howtogeek.com/164490/8-ways-your-wireless-carrier-is-gouging-you/
Wireless carriers are gouging us – particularly in North America, where the
USA and Canada have the most expensive cell phone plans in the world. We’ll
look at the many ways cell phone companies are taking advantage of us.
Carriers don’t stop at just having the most expensive plans in the world.
From long contracts to fees upon fees, carriers have set the system up to
take advantage of customers.
1. SMS Message Costs
Carriers can transmit SMS messages for free (or almost free), but they may
cost ten to twenty cents or more for you to send. Various reports have
pegged the markup on text messages at anywhere from 6,500% to 7,314% –
that’s quite the profit margin and would be unheard of in many other
industries.
Of course, you can opt to save money by paying a monthly fee for an
unlimited texting plan. This seems like a big savings, but the fee you’re
paying is still pure profit for the carriers.
Better yet, carriers will bundle unlimited texting in expensive plans –
unlimited texting, unlimited calls, and a small amount of data for only $80
per month! The texting is free for carriers and they know you’ll use much
more data than cell phone minutes, so they can include it in your monthly
plan to justify a higher price and distract you from the fact that you’ll
be paying more for additional data.
Given such high mark-ups, it’s no surprise that
apps allowing people to text for free are becoming so popular.
http://cdn.howtogeek.com/wp-content/uploads/2013/05/texting.jpg
2. Hidden Fees
Carriers make additional money by adding hidden fees. AT&T recently added a
new $0.61 fee to its customers’ monthly bills. It’s called a “Mobility
Administrative Fee,” and it will bring AT&T hundreds of millions of
additional dollars. AT&T
told The Verge that this fee will “help cover certain expenses, such as
interconnection and cell site rents and maintenance.”
In other industries, this would just be considered the cost of doing
business. When you buy something from a store, you pay what the item is
priced at. There’s no hidden fee to “help cover certain expenses, such as
the cost of shipping the good to the store and the cost of renting the
property.” The additional fee just goes towards AT&T’s bottom line.
3. Contracts That Make Phones More Expensive
Want a new phone? You’ll probably walk into a carrier’s store and buy it
there. Phones are advertised very cheap – often “$99? or “$199? for the
latest smartphone, with some phones even being advertised as “free.”
There’s just one catch: You’ll have to sign on to a long contract to get
that cheap phone, committing to pay a certain amount of dollars every month
for the next two years (or three years in Canada, which has the longest cell
phone contracts in the world.)
Sounds pretty good, right? Sure, you’re committing to pay a certain amount
every month for a few years, but you’re getting the phone cheap up front.
Well, it isn’t a good deal – it’s a terrible deal. Buying a phone
on-contract is a mistake for the same reason buying a television on an
installment plan is a mistake. When you buy any product and pay a monthly
fee for it, you’re paying more than the cost of that product over the long
term – it’s better to put the money down up-front. You’ll pay less in the
long run.
Wireless carriers have trained people to buy phones on-contract and pay
extra for the phones over the long run. People who would never buy
electronics or appliances on installment plans do the equivalent for cell
phones.
4. No Discounts for Bringing Your Own Phone
The only thing worse than buying a phone on-contract is buying a phone
off-contract. Many carriers don’t actually give you a discount if you bring
your own phone – you’ll still be paying the same amount every month. The
carrier hasn’t given you an almost-free phone so it has no reason to charge
you extra, but that charge is bundled into the normal monthly fees so you
can’t avoid it.
5. Long Contracts
But hey, if you’re going to be paying the same amount of money, why not get
one of those cheap new phones and sign on for a two-to-three-year-long
contract? This also gives you a reason to immediately sign up for a new
contract every time their contract expires – you might as well get a new
phone if you’ll be paying the same monthly fees anyway.
When you’re locked into a contract and facing hefty cancellation fees, you
can’t be lured away by cheaper cell phone plans elsewhere. You’d have to
pay an early termination fee to pay back the subsidy and perhaps even pay a
separate cancellation fee.
Long contracts also mean you can’t upgrade as frequently. A customer on a
three-year contract in Canada may only be able to upgrade their phone every
three years – not every two years – or they’ll have to pay additional
upgrade fees.
6. Tethering Fees
Want to use that mobile data you’re already paying for on your laptop?
You’ll probably have to pay an additional fee to add tethering access to
your account. You’ll still use just as much data as before, so it won’t
cost the cellular carrier anything extra, but it’s another opportunity for
them to ding you with a fee. Sure, you could try to tether using third-party
apps, but this traffic could theoretically be detected and your carrier
could ask you to pay up or be disconnected. They could also just helpfully
add the tethering fee to your monthly bill if they notice you’re tethering.
http://cdn.howtogeek.com/wp-content/uploads/2013/02/phone-tethering-to-lapto
p.jpg
7. Making Service Providers Pay to Send You Data
North Americans already pay the most for data service, but that’s not
enough for carriers. Carriers want service providers to pay to send data
over their networks. ESPN is in talks with carriers and proposing that it
will pay them so ESPN’s traffic won’t count towards customers’ data caps.
This is a win-win for carriers: They won’t have to increase data caps as
people want more data. They’ll just keep data caps low and encourage each
service provider to pay them to make their service available. Your bill will
stay high, your data will stay low, and services will have to pay so you can
access them. Pity the poor startups and small companies who can’t afford to
pay off the carriers – people won’t be able to use those services.
This is the sort of reason why people push for net neutrality – greedy
wireless carriers and Internet service providers want to charge service
providers extra so their data becomes privileged.
8. Roaming Fees
When you leave the country, you’ll have to deal with other wireless
carriers gouging you. Be aware of roaming fees or you may become the next
person on the news with
a bill for $22,000 or more
Checkout this article:
http://www.howtogeek.com/163464/bill-shock-how-to-avoid-22000-or-more-in-int
ernational-roaming-fees/
because you dared to use your phone’s data connection outside the country.
Cellular carriers are generally free to add as much mark-up as they want
when negotiating roaming agreements, and they take advantage of this.
You can mitigate many of these problems by opting by purchasing a phone
up-front and opting to go with a prepaid carrier, so it’s not a surprise
that prepaid carriers are becoming more popular in the USA.
+++++++++++++++
Smartphone ‘saturation’ fears hurt device makers
Shares of Samsung, HTC down over worries market can’t grow much more
CBC News, July 5, 2013. 10:50 AM ET Last Updated: Jul 5, 2013 9:35 PM ET
Many analysts are worried sales of Samsung smartphones, like the Galaxy S4,
won’t be able to maintain rapid growth as we approach what they call
‘smartphone saturation.’ (Timothy Neesam/CBC)
Despite registering a 47 per cent jump in profit and selling a large number
of Galaxy S4 smartphones -10 million in the month of May – Samsung saw its
stock fall after the South Korean company warned it won’t be able to grow
sales as quickly as it has in the past. Samsung shares are down 16.75 per
cent this year.
HTC, which makes the popular HTC One smartphone, reported its sales for June
were down 26 per cent from a year ago, citing increased competition. The
Taiwanese company’s stock is down 32 per cent this year on the Taiwan Stock
Exchange.
Fewer wow features
Companies and analysts are increasingly concerned that sales of high-end
smartphones can no longer grow at the rate they have over the past few
years.
It has become harder to impress buyers with new features in upgraded models
as most smartphones offer similar functions. Fewer wow factors in new
smartphones mean people will not upgrade as quickly as they did when the
devices were still a novelty, forcing device makers to spend more on splashy
advertising and marketing.
With year-to-year improvements seen as marginal, it can be difficult to
convince consumers to break a contract early or switch from a phone they’re
comfortable with.
Meanwhile, emerging market sales are increasingly dominated by lower-cost
phones from China’s Huawei and ZTE, as consumers in those markets cannot
afford phones costing hundreds of dollars.
Smartphone makers feel the pinch
All five major smartphone makers – Samsung, Apple, HTC, BlackBerry and Nokia
– have seen their stocks drop this year, while the S&P 500, a broad index of
U.S. companies, is up by nearly 14 per cent.
BlackBerry’s stock has dropped 19.5 per cent on the Nasdaq, as sales of its
new BlackBerry Z10 and Q10 failed to meet expectations. It also expects more
losses in the future.
Apple, long seen as the leader of the smartphone market, has cut the number
of iPhones it intends to make this year from 40 million to 25 million,
according to analyst Peter Misek.
With files from The Associated Press
_________________________
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The hotel that got it just right
By Donna J. Jodhan
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