Free mobile in the US? Why not?

Most of our readers are from the United States or Canada where mobile operators usually ask for about $200 for new smartphones alongside a two-year contract. Even if you get unlimited plan that includes mobile data, you’ll still have to pay separately for the phone. Sure, it’s not the full price, but again it’s few hundred bucks for a high-end smartphone.

In comparison, in the UK you get a comparable phone for free if you sign a two-year contract worth about 30 GBP per month. Once it was released, the Samsung Galaxy S II was available for free on a 36 GBP (about $58) per month plan. Now you could easily end-up paying that money every month with some superphone in the U.S., but you’ll still have to cash out the initial $100-$300, depending on the phone you’re buying. And let me make this clear – iPhone is NOT an exception in Europe, you can also get it for free on a contract.

Why this is the case is beyond me. To be fair, third-party retailers like Walmart, RadioShack, Best Buy and Amazon will offer better deals on popular devices, but that’s still far from what British are paying. The UK mobile market is pretty competitive with 5 major operators, including Vodafone, Orange, T-Mobile, O2 and Three; but there are “enough” (i.e. the market is pretty competitive) carriers in the U.S. as well.

So I’m asking everyone – why can’t you get the new Samsung Galaxy S II in the U.S. for free on a $50-$60 monthly plan? The plan you choose should impact the phone’s price – that’s the way it works all around the world, but it doesn’t in the U.S. What gives? Any ideas?

About The Author

Dusan Belic

Dusan has been using smartphones since their introduction and is now following the latest trends in the industry. The "convergence" is what he's most excited about, and writing about it is the next logical thing to do. He thinks that using a smartphone is what everyone who cares about their time should do. In addition to his interests in mobile phones, Dusan also loves to experiment with the latest web and mobile 2.0 services. The idea of accessing and managing your information from any device no matter where you are simply amazes him. Whether it's an online to-do list, note taking service or a video sharing social network, he's there to try it out. He admits though, he's still searching for the ultimate web-based organizational tool, which "sings" perfectly with the mobile PIM application. Dusan used to run SymbianWatch.com which later became part of IntoMobile. He lives in Serbia, South-East Europe, from where he edits the site on a daily basis.

http://twitter.com/WillieFDiazSF William Diaz ?

I have two reasons in my thoughts why this is in th USA.

1. The market here will still bear that price point which we will buy a phone for the “standard” $199 (Verizon is trying to up that price standard to $299 however). People will still pay the price and not question it. But they should question it, because half the time the phones we buy are defective, cant connect to the network, or flat out become obsolete in 6 months (Why pay $200-300 for that privilage to be locked in a contract with a phone thats outdated).

2. Networks are using that money to pay for “exclusives” that pop up now and again, and what exclusives they arent paying for, its probably going to building out the network in an area that is 2x the size of all Europe combined. The UK is a small place, the size of California minus a few hundred square miles – its easier for a network to offer cheap rate plans and free phones and people are more likely to stay 2 long years simply because the network covers the entire country inside and outside. Cant say that about any company, even Verizon, here in the USA. No state is 100% covered inside and outside, nor do they offer roaming on a competitor like the UK networks might where the coverage inside your house may suck.

So thats why we pay more I think…Although you would think because of these reasons we SHOULD PAY LESS!

Also, unlike Brits that travel through their country regularly and leave home, Americans, while we commute, we on average RARELY venture further than 200 miles from home, so having phones that work in places we are is a big deal, and the networks here cant even do that in most states.
http://twitter.com/silva918 Antonio Silva

Because the U.S. always does things backwards.
http://www.lifeonmymobile.com Troy D. Brown

Let’s not forget, the European networks also collect money when a call is placed to a cell phone. There is huge revenue in that. I don’t think people in North America would go for that. So if we are going to compare we should look at the entire market and charges not what it looks like real fast on the surface.