Sprint has nixed plans to sell Google's Nexus One smartphone.
The Nexus One was supposed to be revolutionary in that it would be available directly from the manufacturer and users willing to pay the full price for the device could enjoy the benefits of an unlocked, off contract smartphone. Unfortunately, it's looking more and more like neither Verizon and Sprint are getting the device, which means no CDMA Nexus One.
Back in April, Google announced that Verizon would not be getting the Nexus One after all. The search giant had said at launch that the device would hit Verizon 'later in the year.' Instead, the company encouraged Verizon customers who had been waiting for a Nexus One to pre-order a HTC Droid Incredible instead.
Now it looks as though neither of the U.S. CDMA carriers will be selling the Nexus One. Yesterday Sprint announced that it too had canceled plans to sell the Nexus One. Sprint told customers in March that it would support the Nexus One, however, it seems that the upcoming HTC EVO 4G is more than enough for the carrier. Stephanie Vinge-Walsh, a spokeswoman for the third-largest U.S. wireless carrier told Bloomberg, "We really feel that it’s better than Nexus One."
Any disappointed Sprinters out there?
I got modded down heavily last time I said that, but it is the most logical reason for the nixing of the phone. Both carriers will certainly sell phones WORSE than the Nexus1 in their lineup, so their "better phone" excuse makes no sense at all.
If the EVO's retail price is $599 without a contract then Sprint probably paid between $530 and $550 for it. Then by the time they sell it for $200 on a two year contract, they have actually lost money. The average turn around time for profitability on a new customer is about 10 months by the time you factor in marketing, and labor, and regular cost of doing business. So the reason why these companies dont want to support a phone that they user gets from the manufacturer is that they cant bind you to a contract and they then have no guarantee of recurring revenue. Once a customer has made 10 on time payments they start to be profitable to the carrier, hence the reason why a contract is nearly mandatory.
I was a manager of a Sprint store for 3 years and had worked in the industry for 3 years before that, before getting into the IT/ Networking field.
On a side note: I cant wait for the EVO. I will be buying one on July 1st when my contract is up!
If you pay $70 or $80 a month for a phone with data plan that's $1600 to $1900 for a two-year contract. That's where the money is.
geo4it
The EVO 4G has a 1 Ghz Snapdragon processor, I suggest you check up on the new phones coming out.
+1 for contracts being the main source of money, without them a company makes very little, hence why phones have such high prices off or mid contract. If you don't think a cell company makes money on contracts, just take a look at cancellation fees and think about it.
They "make money" each month, but only after the first 10 or 12 months do they break even after selling you a phone for 300-400$ cheaper that it costs for them to make/buy from a manufacturer.
Essentially it's like the bank giving you a loan. They give you say 100$, and they've "lost" that money. You then pay them say 20$ a month until you've payed it off, but since you borrowed their money they make you pay interest, say another 20$ so in the end you payed them 120$. A cell plan is the same way, they make an investment in you by selling you a phone cheaply, and in return they reap in $$$$$(lots) as you pay for the contract over the next 2 years. Contracts last 2 years because this is how long it must go for them to make a decent buck after they break even. Does that make enough sense?
("Decent buck" is used loosely, I would agree with a lot of people that they make a LARGE amount of money in the long run.)
Any CPA's reading this, I realize this is the short, SHORT version (spaceballs reference)
If I can get an HTC EVO 4G using one of the already existing and priced data plans currently offered, then I say this is a win.
Otherwise, it would have been nice to see the Nexus One on the cheaper 3G plans.
That's the thing. I don't want a loan. I want to be able to buy my phone at full price, choose my carrier and have a monthly plan I can get out of whenever I choose. That's a lot more important to me than getting a phone at $100 or $200 and be stuck with a crappy signal and tons of dropped calls for 2 years.
Obviously telcos don't want us to be able to do this. It would open the door to competition from small startups and quickly bring prices down.
Sooner or later though, it will come.