T- Mobile USA has decided to bite the hand that feeds it, moving away from offering its customers smartphone subsidies.
Carriers and phone manufacturers have for many years worked hand in hand scratching each others backs in a bid to make cash, offering deals on smartphone handsets when customers sign up to specific contracts.
However, it seems T-Mobile has tired of these deals becoming the first company to make the split and shunning mobile subsidy deals.
It means that new and upgrading customers will have to pay a lot more for their handset.
The WSJ explained that for example a standard issue iPhone 5, sells for $199 with the subsidy and a two-year contract, but it costs consumers $650 if bought without carrier support.
The paper pointed out that the split could drive consumers to opt for a smartphone cheaper than Apple’s and Samsung’s offerings, just like the trend seen in countries that don’t offer subsidised deals. Of course this could end up damaging the big brands with cheaper handsets filtering into the market and forcing prices to drop.
However, savvy consumers could end up saving money as part of the plans, snapping up the Samsung Galaxy Note II for around $20 a month for two years with a $200 downpayment as opposed to a subsidised deal which could see a two year contract costing on average $680.
The company is currently teaching staff how to explain the new deals, investing in around 20 hours of training per person.
Facebook is expanding its location-based service, Places Deals, to five countries in Europe, setting up some major competition for the likes of Foursquare and Groupon.
The the big five Zuckerberg’s gang is targeting are: the UK, Germany, France, Spain and Italy. Others will have to wait a bit longer before the service is available for them.
Two names that will be offering deals through the European service at launch are Starbucks and telecommunications operator O2, but this list is likely to expand rapidly over the coming weeks and months.
Foursquare already has a large presence in Europe, as does Groupon. In fact, they service many more European countries than Facebook is today – but the hybrid model and Facebook’s dominance as the social networking medium of choice for most means the new European service could really give rivals a run for their money.
Foursquare has previously claimed that Facebook Places was “boring” and not a threat, but when we look at the figures involved it paints a different picture. According to Bloomberg, around 200 million of Facebook’s half a billion members use Places Deals, suggesting that it is doing reasonably well. The fact that it was previously only available in the US means that this figure is likely to jump with the move into Europe.
Facebook claims that its service is very different to that of group buying website Groupon, because the location-aware element means that deals are offered based on the current location of the shopper.
Groupon has found itself in trouble with the UK’s Advertising Standards Association (ASA), after three of its ads were found to be “misleading.”
The advertising watchdog ruled that the three ads gave customers the wrong impression about how much they could save with the company’s deals.
One email ad claimed a saving of 60 percent on a meal for two at a South American restaurant. However the ASA pointed out that this was misleading because one person had to pay for a full price meal in order for the discount to be valid.
A second advert was also criticised after it promised a 60 percent discount on a Segway Safari experience. However, what it failed to mention was that the deal was only available at the weekend for an additional £10.
It also told a few porkies with a sales promotion offering a meal with an original price tag of £83.50 for £29. However one foodie complained stating that if two people were to pick the most expensive items on the menu the total sum wouldn’t amount to £83.50.
Groupon told the ASA that it disagreed that this ad was misleading and said the offer was calculated on the basis of the restaurant’s most expensive menu items at the time the agreement was signed. That broke down per person as £6.25 for a starter, £22 for a main course, £10.50 for a cheeseboard and £3 for tea or coffee. It said those prices were available at the time the contract was signed but that there were some fluctuations in pricing due to seasonal variations. Groupon nevertheless pointed out that specials were regularly available priced in excess of £22. It sent a copy of the contract with the restaurant and copies of e-mail exchanges with the restaurant manager in support.
Generally the company added that it Groupon had no commercial interest in misleading its customers. This was because if an offer was poorly described on its website, it detrimentally affected their relationship with customers and business partners, undermining the investment they made in acquiring both. It said in presenting in excess of 50 deals per day, there was a likelihood of some degree of human error. However, it sought to address that through extensive staff training and by incorporating quality control safeguards.
The three ads have been banned in their current form.
Billpay deals for the HTC Wildfire were released for Vodafone today, reports mobile phone news blog Omio.com
Vodafone will reportedly be offering the smartphone for free to billpay customers who get a contract for as little as £15 per month, which is a mind-bogglingly cheap HTC Wildfire deal compared to other deals in the smartphone market.
The two deals you can choose from are Vodafone 100 and Vodafone 300. The first offers you 100 minutes and 500 texts a month. The second offers 300 minutes and unlimited texts per month. Both contracts are for two years, however, which may be a little long for some people to sign up for. What doesn’t make sense is why anyone would pick the Vodafone 100 deal over the Vodafone 300, as both give the phone for free, but the 300 gives you a better monthly deal for the same price.
Of course, the Wildfire isn’t as powerful as other smartphones HTC has released, such as the Desire, which has double the processor speed and RAM. The Wildfire has a reasonable 528MHz processor, which is just under the iPhone 3GS’s 600MHz. It has 384MB of RAM compared to the 256MB of the iPhone, and it features a 3.2-inch 240 x 320 QVGA multitouch screen. All the standard trappings of the Android 2.1 OS with HTC Sense overlay are there, but the focus is much more on social networking, like the rival ones in the youth smartphone market. Omio called it a “baby Desire”, which is a fitting description, as it can do pretty much everything a Desire can at a lesser capacity.
It is clear that Vodafone is keen to work with HTC on making the Wildfire a major contender for the youth market, with rivals like the Microsoft Kin and Motorola FlipOut to contend with. The phone itself is unlikely to be overly expensive, which is why Vodafone can offer it completely free, and a small contract means more whippersnappers will be able to afford it. And that means more revenue long term. Indeed, if the rival phones don’t have a similar affordable deal people may be flocking to Vodafone very soon.
It’s funny, of course, because Vodafone hasn’t even said it’s going to stock the phone yet. Someone forgot to tell them.
We asked for confirmation, and Vodafone told TechEye: “We can’t comment on speculation around future additions to our range, but I can tell you we already offer an extensive range of Android devices and are planning to add more to provide great choice for our customers.”
So that’s a yes, then.