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The BIG MOBILE CON - 18 & 24 Month Contracts
Comments
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This is why I don't think it'll go a lot higher than two years- there is a big risk that people will default.Bit of a morbid thought - but wonder if the companies work out the odds of a customer being around in 18 or 24 months to offset their losses.
I hate to say this but it would be very easy for the networks to offer the choice of 12 month contracts- a fiver onto the monthly SIM only deals plus a fee of fifty to a hundred quid to cover the costs of the phone (which is being bought by the network for nowhere near the SIM only price- even the top handsets can't cost more than two hundred quid when looking at the components).
The fact is that all mobile networks could easily turn a profit on 12 month contracts but choose not to as there is more to be gained from longer contracts.0 -
This is why I don't think it'll go a lot higher than two years- there is a big risk that people will default.
I hate to say this but it would be very easy for the networks to offer the choice of 12 month contracts- a fiver onto the monthly SIM only deals plus a fee of fifty to a hundred quid to cover the costs of the phone (which is being bought by the network for nowhere near the SIM only price- even the top handsets can't cost more than two hundred quid when looking at the components).
The fact is that all mobile networks could easily turn a profit on 12 month contracts but choose not to as there is more to be gained from longer contracts.
sorry, i don't agree. most networks don't turn profit on a customer untill month 16 or 17 of the contract. 12 month contracts are not viable if you want a free or subsidised phone.
It is better to be thought of as an idiot than to open your mouth and remove all doubt0 -
It's quite possible to get SIM-only contracts for 1 or 12 months, the latter being cheaper or having more calls.
And the 24 month contracts are all a few quid a month cheaper than the 18 month versions.
It's possible to get 12 month retention deals, but mostly these don't have either a discount or a phone.
So there seem to be more optionsd now than ever before, but if people want to have more and more expensive phones included for cheaper monthly rentals, they'll have to accept that the network might offer to amortise the cost over a longer period.
As far as I can see, the customer breaking the phone, or wearing it out, or even merely getting bored with it, surely isn't a matter that can be disputed, as the network can't be held liable for this.
Friends might take the mickey out of the silicone rubber sleeve on my E51, some referring to it as a condom, but the phone is not scratched by keys or money in my pocket nor affected by ingress of dust or water at work.0 -
sorry, i don't agree. most networks don't turn profit on a customer untill month 16 or 17 of the contract. 12 month contracts are not viable if you want a free or subsidised phone.
That is interesting. Presumably this is a fairly recent event as originally 12-month contracts were the norm and mobile companies made money from them in those days.
Wher some MSE members are not doing their maths correctly, of course, is in comparing a 24-month contract with 24 months spread between a 12-month contract followed by a 12 month sim-only deal.
Most networks will give you a deal when your contract ends with more minutes plus a phone than you would get going to them as a new customer. Now the 12-month renewal deal won't be as good as the 24 month deal, I accept. But after carrying the additional cost for the first 12 months, it comes round to renewal time and the networks are keen to retain your business, even on a 12-month sim-free or even a 30-day sim.
This then gives you the protection that a number of MSE members obviously needed as they have either moved to a new area where reception is bad or, unfortunately, they have fallen victim to the recession and are no longer able to pay their bills. Just look at recent posts to see what I mean.
In both scenarios, the mobile has to last 24 months, but the 12+12 option gives you similar costs, plus a degree of security for the 2nd 12 months.
Not suggesting this route for everyone, but might be anyone who may be less than 100% sure that they won't be moving, or redundant or their mobile company won't merge with another!0 -
It is a CARTEL. 18 month contracts will disappear too eventually. Then it will be 24 month contract minimum.0
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sorry, i don't agree. most networks don't turn profit on a customer untill month 16 or 17 of the contract. 12 month contracts are not viable if you want a free or subsidised phone.
Do you have a source for that?
Could you explain why six and 12 month contracts are available with (lower end) handsets?0 -
Do you have a source for that?
Could you explain why six and 12 month contracts are available with (lower end) handsets?
Because once they are a customer, chances are they will stay as a customer.
In my training I believe the figures showed it was well into year 2 before a customer turned into profit once you take into account advertising, staff, hardware and all the little overheads. I think they said something like it costs 4 times as much to get a new customer than it does to retain a customer.
Mobile companies tend to go with slow growth over a long time than quick bursts of revenue for a short time.Work like you don't need money,Love like you've never been hurt,And dance like no one's watchingSave the cheerleader, save the world!0 -
iwanttosave wrote: »Because once they are a customer, chances are they will stay as a customer.
In my training I believe the figures showed it was well into year 2 before a customer turned into profit once you take into account advertising, staff, hardware and all the little overheads. I think they said something like it costs 4 times as much to get a new customer than it does to retain a customer.
Mobile companies tend to go with slow growth over a long time than quick bursts of revenue for a short time.
So it was totally neutral everything you were told then
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It is a CARTEL. 18 month contracts will disappear too eventually. Then it will be 24 month contract minimum.
What makes you say that? there are still plenty of 12 month deals around.
The networks will do what it takes to keep the customers and in this country people do not like paying for the handset and therefore to offer a good price plan they must extend the contract to cover the increasing costs. If you where happy to pay for the handset 1 month deals are to be had.
I think some people are to quick to think we live in Rip of Britain and fail to recognise that we do get a good deal in many areas.The only way of finding the limits of the possible is by going beyond them into the impossible.
Arthur C. Clarke0 -
So it was totally neutral everything you were told then
No they blatantly lied about it, because giving me that tidbit of information really works in their favour.
Work like you don't need money,Love like you've never been hurt,And dance like no one's watchingSave the cheerleader, save the world!0
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