Managing mobile phone purchases

April 09, 2004

To maintain my gadget problem I've had to come up with various ways of getting the "latest and greatest" without having to spend too much money. The first method that I mention below has worked well for the past few years, but there is another way (which dawned on me a few days ago), that, when the conditions are just right, can make even more economic sense.

The Old Way

I buy the newest/best thing available, keep it in mint condition (the product of my anal-retentiveness and the knowledge that I will be trying to sell it rather soon), buy the next best thing available, sell the previous gadget on eBay (though I now try Craigslist first), and then begin the process anew. Most of the time I don't lose too much money, and sometimes I actually turn a profit, all while keeping up with the latest devices.

The New [better] Way

The newest way I've come up with for minimizing the cost that accompanies new gadgets is Amazon. You see, Amazon is giving away phones (with service plans). For example, my current phone (still one of the best phones available in the US, which I explain here) is available on Amazon for -$50 — they pay you $50 to take the phone if you sign up for a service plan with T-Mobile (some phones actually offer $100 back; this might be the route I take this time around given that all I want is a new/better plan — I can just swap the SIM card out of the new phone and put it into my current phone and then sell/trash the new phone). Now, I understand that all providers hit you with a heavy fee when you break the contract. Believe me. The thing is, you now have $50 (or $100) that you can put toward breaking the plan you had with your previous provider. There is a good chance that this amount will be less than $150 with the $50 (or more) payout. Couple that with the fact that you can now keep your number (instructions if getting phone through Amazon) when you move between carriers and you've got a fairly cheap way of getting new [smart]phones and/or service plans.

Possible Problems With The New Way

The biggest problem that you run into with this method is that you are limited not only by the providers that Amazon works with, but also by the phones that they are willing to submit to this program (read: discount). Cingular and Verizon do not participate at all (they're the two biggest providers in the country), but more to the point, the providers that are involved do not give all of their phones over to the program, and let's face it, a lot of times the providers themselves (I'm speaking directly to GSM providers here) don't offer the best phones anyway and so you are left to order them from overseas or through eBay. So, your choices with this method are severely limited, but, if it does turn out that a phone you actually want is available, it offers a relatively cheap way get it.

Another possible problem is the fact that the phones will be locked and will carry the carrier's logo. It's been my experience that those looking for phones on eBay/Craigslist generally want them to be unlocked and free of any logo (for obvious reasons on both counts). I'm one of those people. So, you are limited on the other end when you try to sell this phone and must restrict yourself to only those people who want a particular phone from a particular provider, substantially narrowing your market. You could obviously have your phone unlocked and might even be able to get the logo removed, but both of those remedies require time and money, two things I'm trying to avoid. Fortunately or unfortunately, depending how you look at it, there is really only one way to get around this: the first method I outlined above. But then we're right back to the money dilemma, because unlocked, logoless phones carry a hefty premium, especially when we are talking about the newest models which are garnering the most attention on eBay/Craigslist.

At any particular time, it all boils down to what's available through Amazon, what you are trying to sell, and how much you are willing to spend to move up to the 'next level.' If all of these factors militate in your favor (as they currently do for me), you can probably walk away with a great deal.


It used to be the case that you could get out of service plans rather easily with enough huffing and puffing on the phone, but those days are pretty much gone. I know. I remember thinking how ridiculous service plans were when they first started surfacing. I think Sprint is the only provider left who actually let's you pay month-to-month, though it's an extra $10/month for the "privilege!" How great would it be if we could just hop around from network to network without contracts?

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