Device manufacturers weigh in on T-Mobile's decision to ditch subsidies, ZTE exec calls it 'brave'Alex Wagner - Editorial Director of News and Content
Members of the mobile industry are continuing to weigh in on T-Mobile's decision to cease offering subsidies and go all-in with Value plans in 2013. The latest remarks come from executives of several manufacturers, including RIM and Microsoft. RIM CMO Frank Boulben told FierceWireless that he's seen several kinds of pricing models during his time in the industry and that companies "can live with all the models because fundamentally it's driven by what the end user wants." Greg Sullivan, Microsoft's senior product manager for Windows Phone, said that his company is "encouraged" by T-Mobile's move and described it as an acknowledgement that there's room for different business models.
As we saw with the remarks from the CEOs of AT&T Mobility and Verizon Communications earlier this week, some execs may like the idea of ending subsidies, but they're unsure if T-Mobile's plan will work. Zhao Wei, who serves as VP of ZTE's U.S. handset division, said that T-Mobile's move is "brave," but he's also not sure if it'll gain popularity because the public "is familiar with subsidies."
Wei's sentiment seems to be a popular one, and it makes sense considering that the majority of cellphone customers are accustomed to paying anywhere from $0 to $200 for a new handset every couple of years and are unaware of the actual price of such a product. In killing off its subsidies, T-Mobile will expose these consumers to the full prices of phones, and they'll have to explain how the customers can save money with them before those folks get scared off. It'll definitely be interesting to see how T-Mobile plans to accomplish all of this. The good news is that with the carrier expected to make the switch in the next "three to four months," we may not have to wait long to see how it all goes down.