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Verizon CEO: We can go contract-free if consumers want it

updated 07:04 pm EDT, Sat April 6, 2013

Verizon CEO says it would be 'pretty easy' to switch to no-contract

Verizon CEO Lowell McAdam says it would be "pretty easy" for the nation's largest carrier to switch to a no-contract structure like T-Mobile recently did. Speaking at a New York event this week, McAdam said he was happy to see T-Mobile trying out other pricing structures, and that he would be paying attention to how well T-Mobile's bid goes. McAdam said that it was possible Verizon could put forward such a structure if consumers started asking for it.

"I'm happy when I see something different tried," McAdam said, according to CNet. "We can react quickly to consumers' shifting needs."

McAdam's comments come as T-Mobile attempts to disrupt the current pricing model in the carrier industry. Languishing in fourth place for some time now, T-Mobile has moved to a non-subsidized phone pricing model. The carrier now has customers pay more in the first 20 month after buying their device, but thereafter their bills go down.

Verizon, AT&T, and Sprint -- all ahead of T-Mobile in customer base size -- subsidize the cost of a customer's phone up front, making the money back over the duration of a carrier contract. This sort of arrangement, though, has a negative impact on a carrier's earnings, especially when it involves a more expensive handset like Apple's iPhone.



By Electronista Staff
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Comments

  1. jpellino

    Fresh-Faced Recruit

    Joined: 10-29-99

    We want it.

    So when can we have it?

  1. Lifeisabeach

    Fresh-Faced Recruit

    Joined: 05-25-10

    Of course consumers want it

    Why the &@*% would you jackasses even think we wouldn't want to pay lower prices, especially off-contract? Corporate suits just make me sick.

  1. Stuke

    Junior Member

    Joined: 02-11-05

    Smartphones vs. Old Cell Phones

    I for one find my 2 year old iPhone 4 model completely adequate, stock-full of apps, to meet my daily needs for Internet access, and oh yeah, talking on the phone. So, maybe smartphones have a slightly longer life then old cell phones when the chance to get new (built-in) features made upgrading to a new phone exciting. So, if I invest up front to own my smartphone, of course I want contract-free service, just like most of the rest of the world offers (along side still contract-bound deals). So do it already Verizon, why would you "wait and watch customers leave" you? Start offering it right now if it is so easy to do.

  1. dozx

    Fresh-Faced Recruit

    Joined: 11-09-05

    Greed!!

    Greed is why they don't implement it right away! They would rather charge you a subsidized price for years after the phone has been paid off, it's not hurting them to continue to charge you for something they shouldn't be! I have long wondered why people never questioned that before. They won't stop that practice until lots of people start leaving for it. If your willing to pay it they have no guilt collecting it!it is unfortunate that the wireless carrier with the best network is also the most evil!

  1. makemineamac

    Fresh-Faced Recruit

    Joined: 03-07-08

    How original Mr. Verizon

    Of course you will be 'watching' to see how the T-Mobile experiment works out. Let's be honest here though, you're hoping it won;t work as you really don't want to offer your customers this, or you would do it as others have said here.

    The reality is that T-Mobile have come up with a novel idea here, and you have nothing to compete with it. Good for them, looks like they might be able to create a bit of disruption....

  1. jdsonice@gmail.com

    Fresh-Faced Recruit

    Joined: 10-18-09

    Verizon Reacts?

    So what else is new? Verizon is a sucky company that provides poor service and wow they will react.
    Well let us all bow and die in awe.

  1. iphonerulez

    Dedicated MacNNer

    Joined: 11-28-08

    Apple should finance their iPhones

    Apple should have enough money to offer 2-year financing to consumers for their own iPhones if carriers aren't willing to offer 2-year contracts. I just don't understand why they always say Apple will be hit the hardest if the carrier contract practice goes away.

    I think all carriers should have a choice of offering contracts and PAYG options for all smartphones. I wouldn't have a problem paying $650 upfront for a smartphone for reduced monthly carrier rates although I'm sure it wouldn't suit a lot of consumers. I'd just have to hope that smartphone that I buy would be trouble-free for at least two years. I'd certainly be very careful with it.

  1. aristotles

    Grizzled Veteran

    Joined: 07-16-04

    LOL US Consumers don't want it

    They are too addicted to "free" and subsidized phones. They really do not want to pay more per month in exchange for "freedom". If they go with the unsubsidized model, you will either have a running tab that you slowly pay off over two years or you will have to pay the full price of the phone upfront. Most American consumers are not willing to pay either more per month initially or pay full price upfront.

    They really don't care that their monthly bill would be lower after they paid off the phone and they always want the latest and greatest phones by using "early upgrades".

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