Getting a high-end device for a relatively cheap price tag is something that we’ve all gotten accustomed to. Sure, you have to sign a hefty two-year contract to get the biggest discount on the phone right off the bat, but many people are willing to do this to save costs right up front. Paying only $200 (or $300, as the new trend seems to be for some phones) is better than paying upwards of $600 to get the best, new shiny device on the market. Some of those new devices aren’t just phones, though, are they? Tablets are a newcomer to the mainstream scene, so why is it that we’re still left without worthwhile subsidized pricing?

As of right now, buying a tablet from a wireless carrier isn’t all that hard. After all, devices like Research In Motion’s BlackBerry PlayBook, Apple’s iPad 2, and Samsung’s Galaxy Tab (in varying sizes) are available directly from wireless carriers. Specifically, these devices feature the ability to connect to a carrier’s data network, providing easy access anywhere you go, without having to look for a WiFi hotspot. There’s obviously plenty of differences between a tablet and a phone, but if we really get right down to it, are there enough differences to warrant such a vast difference in pricing plans between a tablet and a phone?

As of right now, the 16GB iPad 2 from Apple costs $499, WiFi-only. If you want to include 3G-connectivity from either AT&T or Verizon, then you’ll need to throw down an additional $130, equaling $629 for the pleasure of Internet access away from a mobile hotspot. That’s without any subsidized pricing, mind you, as that doesn’t exist for the iPad 2, even if you sign up for a data connection. (No, this doesn’t involve a contract, but you do have to pay a monthly fee for that 3G access, which should count for something.) As for the iPhone 4, which is available for AT&T and Verizon, you’ll be paying only $199 to get your hands on the device if you sign a new, two-year contract. If you decide against the contract and want to just buy the phone out-right? $649. So that’s actually more expensive than the iPad 2, which is a tablet.

And then there’s the recently released Samsung Galaxy Tab 10.1. It’s the latest Galaxy Tab, and the added bonus for this device is that it is indeed 4G LTE-enabled. So, if you want to buy the Galaxy Tab 10.1 with a two-year contract, you’ll be dropping $529.99, which includes 16GB of storage. If you want the 32GB model, then you’ll be putting down $629.99. Full retail pricing for the 16GB model is $699, and $799 for the 32GB model. So, there’s some subsidized pricing here. But, if we look at the Samsung DROID Charge, the latest device from Samsung which is also 4G-connected, and then we’re looking at a $299.99 price tag with a two-year contract. Tossing the contract aside, we’ve got a full retail price of $569.99.

So if we’re taking these two examples, then we can see that a phone’s subsidized pricing with a two-year contract can cut the price of the device down to sometimes more than half. Now, let’s get one thing clear right here and now. If you’re buying a WiFi-only tablet out-right, then this isn’t part of the conversation. You don’t need to spend a monthly recurring fee for data for that device. But with data-connected tablets, whether it is 4G or 3G, then we should be seeing the same subsidized pricing as we do on phones. Sure, tablets may have bigger displays, but that’s just about where the differences end. While quad-core tablets are coming, so are phones. The differences aren’t that vast to make this pricing difference so distinct.

Phones are expensive. Tablets are expensive. In some cases, the phone is more expensive than the tablet. But, we’re still facing this issue where we have to spend (almost) full price on a tablet, just because it’s a tablet. Even if we‘re still paying a data fee every month, then we should be getting a larger discount right off the bat. What do you think? Have you skipped over tablets due to pricing? Would you be more willing to pick one up if the subsidized pricing was better? Let me know in the comments what you think.

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eBay prices for the Samsung Galaxy Tab 10.1 16GB

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22 Reactions to this post

"Should tablets see worthwhile subsidized pricing as well?"

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Jason King No more contracts please ... Give people the option but keep them contract free ...
Wen Francoix My galaxy 10.1 32gb was $675 I love it but I wish they had a way to nock a couple hundreds off
Caesar Mucino is subsidizing tablets brings contrats then they should not do it, just upgrade to cell phone that comes with teathering
Simon Yu @Jordan that's foolish, people will sign up cause they want to have data available directly on their tablet instead of tethering or finding a WiFi source for convenience; and of course subsidized contracts cost more that's how they make up the cost for giving you a 'discounted' item, same goes with smart phones and general cell phones. Unfortunately the different is you can't put a tablet on an off contract plan on most carriers (which save about 1 to 3 hundred dollars).
Jerry Adney No. I don't buy computers with bills attached to them. The only reason I even bother with cell phones is that in the US there is no benefit to not taking a subsidy. I would rather buy my phone outright and have lower cost service plans. Since only TMobile offers anything remotely like that and they will soon be AT&T, there isn't much hope on that front. When I still spend $70/month whether or not I take a subsidy, why bother paying $500 instead of $200 for the handset?
Jordan Mosley No subsidy, because that would mean a contract with a monthly bill. And contracts end up costing more than the unsubsidized price anyway.
Marcus Edwards I don't buy tablets. My smartphone and laptop are just fine
David Hilgendorf No I think it should stay the way it is. I'm more then happy paying the prices to keep os and there manufactures growing. Like I did with the first android device (g1) and my next five devices after that and the next ones in the future. Spend the money and help with the growth.
Brian Kelly Not a fan of data plans for tablets. Just use wifi or tether to your 3G phone if you are out & about
Don Crispens Considering how the economy is you would think that to gain something in this market the retailers would make the pricing more reasonable.
Aaron Su $500 is a lot for a price of toy.
Sami Azeroual Your better off buying phone full price rather than on Contract cause you end up paying more in total rather than just buying it
Christopher Manic Johnson No, because then manufactures would only see money in providing a particular tablet exclusively to a certain carrier, seeing how well they're subsidizing and selling that device. Kinda like when the iPhone first came out. The result might be less wifi only tablets on the market, and at the moment, wifi only tablets are the only logical tablets to buy, unless you like giving your money away to carriers.
Nick Kalman They need to add more memory. Would love to have 128Gb+ in my iPad 2
??? No to subsidized tablets. Android tablets come with enough bloatware as is- Subsidized tablets would have bloat AND be tethered to a carrier or content provider.
Michael Carlson No I bought my iPad 2 when it first came out so, I paid a lot, wouldn't be fair
Noneya Biz iPad is for chumps.
Matt Miletic the problem is innovation. i bought the ipad 1 and a month later the ipad 2 came out
Darryl Cobb I don't think so. I don't see me updating my tablet as fast as I do my phone. My tablet is closer to my computer on the update schedule.
Nathan Kebert Xela Diniz I certainly think they should be reasonably priced, and with the latest features.
Dre Desvignes I would like to see more tablets with a lot more on-board memory and micro sd/usb ports. I think then they would be the ultimate smart devices.

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