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Thread: Race to the bottom

  1. #1
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    Race to the bottom



    As I see it thanks to the FCC/government we have 4 national carriers.. and that has continued to drive phone costs downward. So it does seem like with this competition it's a race to the bottom..

    So who's doing the best lately towards bringing paid service down? I'm thinking about other plans given ringplus's worried implosion/changes..

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    I don't know the answer in aggregate. You or my individual pricing is determined by our personal, or couple , or family needs / usage.

    Verizon mvno Boom mobile has a pretty good deal with their $20/ month UL T&T, 250MB plan.
    Airvoice's $20/mo UL T&T, 100MB is AT&T , nice as well. Another ATT is Pure Talk USA, etc................
    I'm using tracfone BYOP Verizon now - very low cost combined with Hangouts wifi calling. YMMV

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    Quote Originally Posted by theemaster View Post
    ...So who's doing the best lately towards bringing paid service down? I'm thinking about other plans given ringplus's worried implosion/changes..
    Ringplus is the only cell service provider that I would say is Racing to the Bottom. All the rest are doing more like a low crawl through a snake infested swamp. Ringplus has been revolutionary. The rest are evolutionary. Revolutions don't always turn out well. It worked well for the United States. This ISIS islamic revolution, not so much.

    Google's Fi had the possibility of being revolutionary, but then they put it on Sprint and T-Mobile and priced it such that it is just meh, whatever.

    Overall, service prices have been decreasing, mostly slowly, for years. The trend is good. In a few years we should have 5G for fixed wireless at rates competitive with wired data.

    To paraphrase Mark Twain, the reports of Ringplus' demise have been greatly exaggerated. They are going to go through a major change in system architecture. Unless you follow the R+ news you would never know. It just keeps working for next to nothing $. If they do go belly up, we will probably get about three days notice. I wouldn't buy an expensive phone for R+ or spend much to chase the next promo.

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    I have never really understood why the big four even started selling tower time to MVNOs it is what has driven prices down( certainly good for consumers) but they could have had a quadopolly and raked in billions more!
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    Quote Originally Posted by jonfone View Post
    I have never really understood why the big four even started selling tower time to MVNOs it is what has driven prices down( certainly good for consumers) but they could have had a quadopolly and raked in billions more!
    The 2 weaker carriers at the time Sprint and T Mobile needed money and MVNO's offered a steady stream of cash. The argument can be made that the phone service we have today was made possible by MVNO expanding the market for cell service.

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    Quote Originally Posted by Pastor Marty View Post
    The 2 weaker carriers at the time Sprint and T Mobile needed money and MVNO's offered a steady stream of cash. The argument can be made that the phone service we have today was made possible by MVNO expanding the market for cell service.
    I agree wih you but they reaily shot themselves in the foot in doing so. I also wonder if Tracfone who was pretty much the first MVNO got Verizon and ATT access because those companies need access to Slims Mexican and South American networks .

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    Quote Originally Posted by jonfone View Post
    I have never really understood why the big four even started selling tower time to MVNOs it is what has driven prices down( certainly good for consumers) but they could have had a quadopolly and raked in billions more!
    Not necessarily. In order to maximize profits a seller needs to sell at multiple price levels in order to catch the consumers that would ordinarily go without. The MVNOs help offer the lower price points that the main carriers can't.

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    Quote Originally Posted by 2400zr View Post
    Not necessarily. In order to maximize profits a seller needs to sell at multiple price levels in order to catch the consumers that would ordinarily go without. The MVNOs help offer the lower price points that the main carriers can't.
    You hit the nail on the head, 2400zr. I remember about 7 years ago our family of 5 paid ~$200/mo for modest cell service. Now, we

    could get significantly more service for 50% or less of that price. The Pre Paid options have really been a boon to cell service for the masses.

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    About MVNOs, there is a video on YouTube from the time when John Legere became the CEO: https://youtu.be/ZxwTJYVhIXg

    At about the 3-minute mark, he mentions MVNOs as part of his vision. Why do retailers and manufacturers give coupons? Price-sensitive customers will use the coupon deals, while others are willing to pay a higher price. The penny-pinchers and the affluent are both big groups, the coupons are a gimmick to serve them all, pay the rent, and still make a buck. MVNOs are like coupon deals.

    The OP sees "a race to the bottom." Yes, the price competition is real. I have a feeling that the carriers expected it more or less. A kind of Moore's law based on optical inventions has brought down the cost of data transport over fiber. Bandwidth is limited and expensive, but smaller cells can increase capacity, and that includes some use of Wi-Fi.

    One reality of name brand cell service is that all the company stores and exclusive franchise stores are paying a ton of rent. TV ads are expensive. MVNOs sell to alert tightwads who will seek out a cheap service that meets their needs. Low overhead leads to lower prices, which is super for us fans of prepaid service.

    As for the race to the bottom, I think the bottom is PAYGO. I was a customer and fan of Platinum Tel when they folded up. In principle I was paying a high price for data, $100 per gigabyte. But I used very little data at that price. My total monthly cost was $5 to $10. Customers like that must be the bottom. The big users get other plans, leaving the shy non-talkers hoarding their nickels at the PAYGO service. Paygo is a great idea, but the carrier needs some steady revenue. Google Project Fi is offering true PAYGO for data, one penny per megabyte, but there's a flat fee for talk and messaging, $20 plus taxes and miscellaneous.

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    Quote Originally Posted by jonfone View Post
    I have never really understood why the big four even started selling tower time to MVNOs it is what has driven prices down( certainly good for consumers) but they could have had a quadopolly and raked in billions more!
    MVNOs can actually be MORE PROFITABLE for carriers in some cases. No cost to the carriers for credit checks, collections of unpaid bills, costs of roaming onto other carriers, maintaining expensive customer support call centers, brick and mortar retail stores, heavily subsidized phones, etc., etc. Quicker return on the network investments by getting a quick flood of customers whose prices can be raised later when the network capacity is getting exhausted, plus they can deprioritize the MVNO customers rather than their more profitable ones (if the FCC doesn't stop them). And sometimes being able to sell cheap service on their antiquated networks (2G or 3G-only MVNOs) may be the difference between making any money on old infrastructure, versus losing money maintaining it for few users.

    Having the big four competing for a no-longer growing base of users is really what drove prices down, and would happen with or without MVNOs. Boost and Cricket (owned by the carriers) are increasingly price-competitive with MVNOs, forcing prices further downward. The exceptions being RingPlus and FreedomPop on the low-allowance end, who are really changing the landscape.

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    Quote Originally Posted by bobdevnul View Post
    Google's Fi had the possibility of being revolutionary, but then they put it on Sprint and T-Mobile and priced it such that it is just meh, whatever.
    I agree that it is revolutionary, and I would love to try it. But I'm not going to buy an expensive new phone just to see how I like the service. I'll stick with my $30 Moto E that I can use with any GSM MVNO.
    My smartphone is a lot smarter than I am.

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    Whatever one's household budget, for some of us, it's just a blast to try to pay as little as possible for some things, as long as the option

    to do so exists. Not a budget buster whether we spend $ 40 or $ 80 / month for phone service - but why not spend less?

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    My youngest noticed a pay phone at the ferry terminal in Seattle and asked "Why would you need a pay phone?" I tried to explain to him that in 1974 my parents were finally able to have the party line replaced with a private line.

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    Quote Originally Posted by Pastor Marty View Post
    My youngest noticed a pay phone at the ferry terminal in Seattle and asked "Why would you need a pay phone?" I tried to explain to him that in 1974 my parents were finally able to have the party line replaced with a private line.
    Huh? What does the quesion about the need for a payphone have to do with your parents doing away with the party line? Two different topics lol

    Sent from my galaxy S4
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    Quote Originally Posted by Netboy76 View Post
    Huh? What does the quesion about the need for a payphone have to do with your parents doing away with the party line? Two different topics lol

    Sent from my galaxy S4
    Nothing. My son was not aware of either old phone technology. He didn't realize that texting and email from a cell phone was not always possible.

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