Much like many of us enveloped in the tech world, I have cell phone A.D.D. Generally, I get bored with a phone or tablet after just a few weeks with it. I use it religiously for a month or so. After that, it begins collecting more and more dust and, most of the time, will eventually find its way out of my daily bag and into a drawer in the miniature filing cabinet beneath my desk.
Sure, constantly switching phones can be fun. It has its moments. But it's a hobby that can also empty your wallet faster than you might imagine. It's addictive, yet at $450 to upwards of $600 a pop, smartphones aren't cheap. After just a couple months it can seriously begin to take its toll on your funds.
Considering I don't keep the same phone (or tablet) for the entirety of my contract like most of my friends and family, I am constantly asked how I can possibly afford all the phones and tablets I go through. They say, "Your work must pay for them, right? You know, since you work for a phone company and all …" (For one, that just goes to show how little the general public understands what I do for a living.) Unfortunately, that's a common misconception. I do receive a review unit from time to time, but considering I don't write a large amount of reviews, I estimate about 95 percent of the phones and tablets that pass through my hands are bought using my own personal funds.
So how do I do it? It's no secret and thousands of people do the exact same thing. Buy then sell or trade. You only keep a phone as long as you can minimize your losses. Buy one for $500, use it for a few months and sell it for as close to $500 as possible. Or trade it for another phone plus some cash, then sell that phone for as close to $500 as possible. I've been doing this for the better part of three years now and have done so rather successfully, only taking significant losses on a few devices.
Great deals are to be had on sites like Craigslist and eBay all the time.
However, even for those that are weathered in online classifieds and exchanging devices, it's hard to ignore the elephant in the room. Resale values are plummeting within weeks after phones hit the market. No thanks to deep subsidies, two-year agreements and ever-shortening production cycles from OEMs, the face value of smartphones is largely skewed. Low-ball offers and underpriced used handsets are bringing down the asking prices of devices being resold.
New devices become old or outdated within months – even weeks – of their release and people just aren't willing to put as much money into used devices as they once were.
A perfect example of such is what I just went through with my ASUS Eee Pad Transformer Prime. The Prime was, by a wide margin, the best Android tablet from the time it released in December 2011. After waiting several months through short supply, I finally tracked down a Prime at a local Best Buy in early March for $499 for the tablet and $150 for the keyboard dock. With taxes, the tablet and dock ran me right around $700.
Since then, however, ASUS has released two updated versions of their netbook-tablet hybrids, the Transformer Pad 300 and Transformer Pad Infinity. The lower-end model 300 comes with the exact same specifications as the Transformer Prime with a plastic chassis instead of the very solid metal body of the Prime. But it also starts at $399, making the total package (read: with the keyboard dock) a little over $550 with taxes. That's an easy $150 less than what I paid. The Transformer Pad Infinity comes with identical specs as the Prime, too, save for the high-resolution display and it sells for the same price that the Prime did at its launch.
So what am I left with? What does all of this mean?
Well, for starters, I have tried selling the Transformer Prime for months now to no avail. Whether it was because nobody really wanted the Prime or because they knew there were updated models on the horizon, my Prime sat, even with a respectable $450 price tag for the tablet and keyboard. Yesterday, my close friend finally got a bite on the listing he posted for me and ended up selling the seven-month-old Transformer Prime (in nearly mint condition) for $300 less than the original retail value, $400 cash.
Ouch. That's just shy of 60 percent of the original value … in only seven months.
Tablets have always been that way, though. (Excluding the iPad, of course.) They have never been able to maintain their value well. But smartphones are increasingly that way, too. Since the Samsung Galaxy S III launched, the resale (and retail) value of the HTC One X has plummeted. Originally, the retail value was set at $549.99 and the contracted price was $199, as most current high-end smartphones are. Just three months later, the contract price has been dropped to $99 and no-contract to $449.99.
Ouch again. But it gets worse. Just by perusing the local classifieds on Craigslist today, there was a "few-weeks-old" HTC One X in perfect condition listed for $240. Another was listed for $390. And another for $365. There were some listed for $400 and above, but the majority of the listings were $399 and below. I can remember a time when phones would stay at or above the $400 or even $500 mark for several months following release. But now, it's as if their value slowly trickles downward every day following its launch. The HTC One X has only been available for three months (to the day) and it has held its value very poorly.
The moral of the story is that deep subsidies and the rate at which new phones hit the market are killing the resale value of phones. So much so, that I've almost completely quit buying, selling and trading devices entirely. People keep asking me why I haven't sold my HTC One X and bought a Galaxy S III yet. The main reason is because I'm happy with the One X and prefer it over the S III. But there is also the fact that its resale value cannot be ignored.
Have you had trouble selling any of your devices lately? Have your devices' values plummeted, too? Has this made you rethink switching devices so often, or do you still flip and try to profit from your constant device switching regardless of values dropping?