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Comment by wjertyj | Hacker News Reader

Most people you know are wealthy then.

The phones are the same price, you know. The carriers don’t literally ‘subsidise’ or give you a ‘free’ phone - it’s built into the contract price. It’s nothing to do with how wealthy you are because it’s the same price!

Yes, and wealthy people are in the position to plunk down that money up front. People who are less privileged frequently have to take advantage of that form of "financing" offered by the carrier.

Remember, by being wealthy, we frequently have to pay a lot less than people who get by month to month. There should be no shock here.

Yes, to your point I was at T Mobile a month or so ago waiting to buy a SIM card in line behind someone who was evaluating their “free” (i.e., carrier-financed) options. They had a choice of a number of Android handsets I’d never heard of.

On the other end of the scale, though, are the subsidies carriers pay to anyone who switches and trades in a quality device. When my partner joined my plan T Mobile paid a $700+ subsidy for his iPhone 11 in exchange for an iPhone 8.

So customers across the entire income scale finance. It’s just a matter of how lucrative that financing is for the customer. At the higher end of the scale where the customer has more choice it’s usually a much better deal.

It absolutely has to do with being wealthy. Where a wealthy person can afford to spend $500 on a phone, someone not as financially comfortable has no other options than to go the "financing" route. Yes, the price ends up being similar, but it is much more possible for modest people to spend $20/mo for 2 years than $500 on the first day.

This is a well studied phenomenon that wealthy people who can afford to pay everything on day 1, buy in bulk and all end up paying less than poorer people.

$500? Top of the line devices in the last few years have crept above $1,000 USD. Not trying to nitpick but the difference there is a sizable chunk of the average person’s annual income.

Nobody over the age of ~20 I know in low income brackets even think about buying a flagship phone. It’s barely on their radar.

Chiming in as a low-income person, yes these Flagship phones have been off of our radar for a very very long time. If I wanted to, I could go into Walmart and buy a perfectly capable locked simple mobile phone for $20 or maybe a bit more than that. There is no possible way that I consider spending multiple weeks worth of paycheck on something that could be broken or stolen easily. If I was going to treat myself to a nicer phone there are tons of great options for me to choose in the 100 or $200 range.

That's an unreasonably low standard for wealth. I do that and I'm below the median salary for my country (western Europe).

No, not really. A reasonable phone can be had for $200 or less, if you're willing to compromise on features. Carriers haven't been carrying good value-for-money phones on good value-for-money plans for at least 10 years in my country, so cutting out the middle man by buying SIM-only with your own phone is the natural thing to do.

You can buy a nice unlocked octo-core on Amazon for like $70.

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