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'Verizon Wireless Device Payment Plan' for smartphones starts April 21

In an update to a recent announcement of longer upgrade times, Verizon is giving customers who want to upgrade more frequently another option: extending the Device Installment Program to smartphones. Previously only available for tablets costing over $349.99 and the Samsung Galaxy Camera, this plan breaks up the full-price cost of a device into 12 monthly payments (along with a $2.50/month finance charge).

Be careful not to confuse this new move with 'unCarrier' plans. Unlike T-Mobile's new plan model, there is no option for a cheaper monthly plan to go along with Verizon's Device Payment Plan. That means if you're making use of the new installment plan, but have an upgrade you haven't used yet, you're basically making two phone payments for one phone.

If you like having multiple phones to switch between, or you lose or damage your uninsured phone, this plan could be for you. Many people will likely stick to their traditional -- now once every two years -- upgrades. Is this something you can see yourself using? Hit the comments and let us know.

Source: Verizon

 

Reader comments

Verizon to offer smartphone payment plan, but no break on subsidies

58 Comments

This is just wrong. The cell carriers are abusing their power and it is clear something is wrong as in the US our prices are way way out of line compared to the rest of the world. They should follow TMobiles route. I would gladly give up the subsedy hell I would even sign a contract providing they gave me a cheaper plan to go with it.

Agree with you. I left Verizon and ate the expensive ETF fee for a TMobile prepaid with my Nexus 4. Cant beat the price and ill make my money from the etf back in 12 months with this plan just about.

Until people start making changes, companies wont either.

I tried T-Mobile out for a month - my last day was yesterday - and, while I loved paying 2/5 the price I pay Verizon ($31.50 vs. $76 after taxes and fees), Verizon is just so much better. My data speeds on T-Mobile were good enough most of the time but Verizon is still quite a bit faster and I never lose coverage inside buildings with Verizon but I do a lot with T-Mobile.

I'd still leave Verizon and go with T-Mobile if I didn't have unlimited data, but it's worth the extra money for me for the faster speeds, better coverage, and truly unlimited data. The cheapest plan with unlimited, unthrottled data on T-Mobile is the same price I pay Verizon.

This should only be used when your contract is over and you want a new phone, but you don't want another contract. Our when you want a new phone in the middle of your contract.

Now that I have thought about it, this is a good way to let people get a newer device without messing with their contract or paying full price up front.

Except when your contract is up, your monthly plan cost (which includes charges for the phone subsidy) doesn't go down. So you basically pay for the phone twice for the privilege of no longer being under contract with VZW... OUT-STANDING VZW!!

@Jet300,
This is just a way for Verizon to sell more phones to people that won't sign another contract but still stay on Verizon's network. They still have to pay full price for the phone, but they can do it over 12 months.
It's not like Verizon ever had plans to lower your bill. Verizon just wants you to buy another phone that only works on their network.

Yes but the problem is Verizon told the FCC that their phone subsidy was built into the price of their plans. Unlike other companies though once you 'pay off' your phone it doesn't go down so you are still technically paying for your phone even after it is paid off. With this new option unless they lower their plan costs for people who use this program they will not only be continuing to pay for their phone but they'll pay for it twice for the first twelve months. The FCC needs to step in and correct this error because Verizon is charging customers far more for their phones then they said they were.

After my D1 contract was up in 2011, i waited 3 months before getting a phone because the razr, rezound and gnex were all coming out, In those 3 months off contract my bill stayed the same as if I was still paying off subsidies. Greedy ass price gouging verizon. I just hope by Jan 2014 the Dish/ Google carrier will be up and running so I can leave verizon, if not I will wait until they kill my unlimited data

if you pay a subsidy each month for the first year after your contract is up, shouldn't the monthly go up immediately after your contract is up?

How is it wrong? You committed to a contract of 24 months, not 20 - which is essentially what you are getting when they let you upgrade and sign again early. It's wrong for you to be held liable for completion of the contract you agreed to?

The prices are more expensive than overseas - true. However, I think most people can point this to most likely being the absurd licensing fees and taxes the government charges the carriers to use the spectrum. The carriers have to make profit somehow.

I personally think this is great, what Verizon is introducing. I have broken phones before. It's not fun not having insurance and then having to buy a new device for several hundred dollars to replace YOUR mistake. Sure, I could have had insurance, but $8/10m plus $100/$160 deductibles to get a refurbished device isn't ideal. It's great that VZW is offering the opportunity for people to not only get devices early IF they want them, but also have a route to get a new device in the event of some out of warranty occurrence. Now -- the question is whether or not they let you pay a dollar amount upfront like T-Mobile (say, $200 down) or if you have to spread the full cost of the phone over the 12 months. If you are buying a $600 device and you don't get a down payment option, that's over $50/month. That's not ideal.

More information is definitely needed.

Wrong part is basicly 10-20 dollars a months of your contract goes to paying off your phone they gave you at a discount. After it is paid off you still are paying that fee and they do not reduce your contract rate.

As I said I want to see a deal where we give up the subsidy cost in trade of a lower monthly service price. I would gladly sign a contract if it lock me in at a lower rate and I would buy my phone out right.

HAH! Yeah this is nice for some people I'm sure, but all I know is I'm tired of giving Verizon $1200 a year in order to have a phone. As soon as my contract is up in May, I'm going to patiently wait for whatever Google's next Nexus 4 is to pick that up and go with T-Mobile's $50 plan, or maybe Metro PCS's $40 plan.

What Verizon customers are really waiting for is for the share everything lube plan. for only $29.99 a month plus taxes and a $9.99 surcharge fee Verizon customers and their families can be equally protected and lubricated, Before Verizon Bends them over And lets the red rocket take over.
Some pain and discomfort might be experienced when the red rocket arrives every month in the mail, But for an additional $9.99 a month plus taxes and $3.99 per month for the new greed fees Verizon will provide you with the soothing knowledge that you are bring raped monthly for the privilege of using America's largest 4G network...

This is THE funniest thing I've read all day. I was in stitches laughing over this comment! I was in tears trying to read this for my wife! Well said, sir!

This sounds like a wonderful idea!!! /s

I really hope T-Mobile takes off so they can publicly shame Verizon for this behavior.

+1!!!!!!

Tmo = No finance charge + more than a year to pay off device.

I have a Tmo sim card on the way and am going to do a trial, and possible get an S4 May 1St.
My contract with Verizon is up May 20th.

I have Unlimited Data, either way,...I intend to *KEEP* it!!!!

Good luck! Hope it works out. I am doing a trial now and just got back from a road trip to 2 locations I visit frequently. Unfortunately, T-Mo won't cut it for me. One of the locations had no service at all which is a deal breaker. The points in between on major interstates had Edge data or GPRS. Most of the time phone was on Edge. I had a dropped call too... Haven't seen that in 2 years on VZW. I wanted T-Mo to work but I won't pay anything for subpar service. Maybe their network will be better in a couple years and I can try again. I like the trend they are trying to set.

This fraud, no two ways about it. Can someone teach Verizon how to fix their cranial rectal inversion?

Unfortunately Verizon has mistaken themselves as a "bank"!!!
There is a $2/mo financing charge!!!
Hmm, Best Buy will sell a smartphone with 18mo's with ZERO %
financing, don't very a stupid consumer, get a smartphone from Best Buy.

Verizon sure does a good job at pushing business elsewhere!!!

Not only is there a monthly finance charge with Verizon, but there's no other benefit off the plan!

So you pay:

Up-front cost - $200
Installment cost - $20/mo or more
Finance charge - $2/mo ($48 over two years)

That's $728. If someone does this instead of just buying the phone outright for $500-600 and pays it off of a credit card within a year, they're not very smart.

Maybe if Verizon started their plans lower by even $10 a month or $20 like T-Mobile, it would make sense.

This is an example of capitalism. As long as people are willing to pay for it, Verizon will charge it. Sadly, due to lack of education, people will continue to pay for it. It's up to us to educate our family and friends. I've already caused Verizon to lose 12 different contracts by showing friends how much Verizon is screwing them over for.

I encourage you to do the same.

Good job!!! Now if those 12 you got to leave can talk a few others into leaving each it will add up.

Both Vzn & ATT really, really beed some
comoetition!!!. . .I really don't know what
is so special about ATT, I really don't.

Sadly not everyone can leave. I had my family all ready to jump to Sprint and ordering phones when we found out that in our area there is not service but Verizon service (Its roaming Sprint. They would have canceled us for how much we were roaming).

This is the perfect opportunity for AT&T to over take Verizon by offering similar plans as T-Mobile. People would switch in a heart beat. I know I would but paying $65 for 450 mins with unlimited data and messaging can't be beat on Verizon...for now.

If you still have that plan, then it makes no sense to switch to another carrier. That's a great plan to be grandfathered into, especially considering Verizon's coverage.

More than likely, At&t will mirror Verizon's stance, just like they did with the "Share Everything" plans.

T-Mobile seems to be the only carrier thinking outside of the box; arguably, because they need the business.

Wow and yet big red is still consistently rated the top carrier. Coverage is good but with the raping they give everywhere else it's easy to see that most people are just dumb. :-)

It's called Stockholm Syndrome, whereby kidnap victims become sympathetic towards their captors over time. In my four years with Verizon, I've found them to be an abusive company with piss poor customer service, over-hyped network quality and an arrogance second only to maybe Microsoft.

Our family plan contracts are all up, and as soon as I have some time, I'm planning on switching to T-Mobile. Good riddance Big Red.

I've sold and used all 4 major carriesr in the US, and (Sadly) VZW does have a clear advantage in coverage where I use it, and their customer service has always been good to me. With the exception of their prices (and occasionally phone selection), I genuinely can't complain.

This seems to be one thing where it's really an individual experience that separates the group.

Verizon becomes more and more pathetic all the time. I am counting down my last year of contract and will end 20 years plus as their customer. In the meantime, I am enjoying my T-Mobile and the $50 monthly no-contract plan.

I am not quite sure why people are up in arms over this. This is just for upgrading your phone before your contract is over. It is just a finance option. Other good options would be ebay or Craigslist. I wouldn't take this route but VZW isn't forcing you to.

This is how is works: 1) there is no contract attached to the Device Installment Plan, and, 2) as long as you pay the base installment (more or less, like a deposit on an apartment), after the first month, you can pay off the device whenever you want (and the $2.50/month falls off as soon as you pay off the device). And like the article says, it's geared toward people who didn't get insurance and are in a pinch, or age wanting the latest and greatest (much like myself), but can't afford the single, insane payment that you'd make to Google, Samsung or LG for a device, all at once.

dam, imagine your phone bill for each month with this on verizon. first it's gonna be $100 + taxes and fees for 2gb of data and the phone minutes and messages, then atleast another $40 a month for the phone payment plan (+ $2.50 for verizons nom nom money tax.) thats $142.50 + taxes and fees, so it will be atleast $160 a month for 1 cell phone after all taxes and fees. but ofcourse some nubs will do this and regret it when they get there first monthly bill

"Finance charge"? I do not believe that will pass the smell test with Federal regulators. This is another one of those Verizon attempts to throw something out there and, "let's see how far we can get with this." Of course, Verizon can always twist it and say "it's a maintenance fee." Either way, Verizon is the epitome of gross capitalism.

Why not? Companies are allowed to charge finance charges and any other charges they want if you agree to them in contract.

Here's my scenario: I still have a VZW Unlimited Data plan... I've been eligible for an upgrade for 6 months now, but don't want to sign a new contract because doing so would eliminate my Unlimited Data plan... I was planning on just buying a new phone (SGS4) paying full price when in comes out at the end of May. Would getting this payment plan on a new phone allow me to keep my Unlimited Data plan? On should I stick with the original plan of paying full price for a new phone??

So many of you say Tmo is the deal... Go, have fun not having service. I am a truck driver. Let me explain why att and Verizon keep their customers and sprint and tmo cannot. In most cases once you leave the interstate you will lose service with tmo and sprint. And in the rural area sprint does work in you can only text and call since the data service is soooo slow. My Verizon phone hardly ever has no service. The number 1 reason people have cell phones is for travel. If you can't use your phone when traveling then why have one. You honestly think tmo can build out a better network with such cheap prices? Verizon an att are what they are because they charge what they charge... The real networks.

Not the "real" networks....the abusive, anti-competitive networks. Verizon has been hording spectrum for years...UNUSED spectrum...and trying to lease even more from Clearwire, just to keep other carriers from using it. AT&T tried to buy T-Mobile to essentially do the same exact thing, luckily the failed "merger" forced them to give T-Mobile enough spectrum to actually compete now. Do you think there is no reason why the Dept. of Justice is starting to weigh in on this very issue? It has nothing to do with how much it costs to build the network, and everything with how much it costs to build a network with spectrum in a given frequency range. Verizon and AT&T have most of it in the low frequency ranges that travel far. That means they need fewer towers to do the same job, and that T-Mobile and Sprint have to spend a lot more for the same coverage.

This is nothing but an attempt at FUD by Verizon. It sounds similar to T-Mobile's plan to many uneducated customers. They don't understand that T-Mobile provides this service interest free, and breaks out the payments over twice the time. They don't understand that they are already paying for the price of their phone in their Verizon plan cost, so they essentially will be paying twice for a phone using this. Verizon wants people to say that "well, this is just like what T-Mobile is doing, so why leave?" when it's really not at all, because make no mistake about it....people ARE leaving for T-Mobile. Traffic has definitely picked up at the local T-Mobile store!

This artical just proves mentioning the name Verizon brings up hate.
If the carrier's name was not mentioned you all would be singing a different tune altogether. This is a good option to buy a new phone without signing a new contract or adding another line. For those of us with responsibilities and pay for things in cash, this gives a great set of options when the new hotness hits the stores. I can upgrade with contract if available or if i dont want to sign a new contract I can buy the phone outright full price, or make payments that may take up to 12 months. Wow..how dare Verizon give their customers options.

How about this for a finance plan: Buy the phone straight out from the cheapest place you can find with a credit card. The one I have has a 0% introductory rate for a year. If a new phone comes out that I just have to have then I use my card. I'm not renewing any more contracts.

So I am currently eligible for upgrades on 2 of my lines in October of the this year. Does this mean that Verizon will now be changing this date and pushing my upgrade to 4 months later? Is this something they can do while in contract? I know people say they can do what they want but how can they just change an upgrade date. When you sign a contract you sign knowing you will get a new phone in 20 months. You see the upgrade date clear as day on your account. Now a few months before your can upgrade they can just say screw you? I can understand for new contracts but for people who are already in contract?
I had no intention of leaving Verizon before this but if that is the case I will fight them to let me out of contract without an ETF. I am getting sick and tired of these companies bullying around the 1 thing that keeps them in business, their customers!

a lot of these cell phone contracts basically say they can change certain things at anytime for any reason. you are signing the contract agreeing to it. you need to actually read the contract, and not just listen to them while they are explaining what you are signing.

I think it is interesting to note that too many believes that the high price of Verizon is just because of the coverage. It is true that network expansion is an expensive undertaking but a simple look at where the US carriers spend their energy shows a different picture.

The US carriers are obviously more concerned with devices and exclusive deals of heavily branded and modified products rather than service quality. The device subsidies and the cost of creating special models instead of just selling standard versions are what pushes the plan prices up.

Pair that with the cost of customer service for the devices rather than the plans and it becomes even more obvious. Removing the device subsidies, switching to standard models and learn the customers that the carrier support the plan, the manufacturer support the device would remove a lot of costs. Introducing device installment plans and then provide lower monthly fee for BYOD etc would give much lower rates EVEN if the carrier investment in their network stays the same. The lowering of the cost base would even mean that the revenue can stay the same even if the monthly plans are cheaper.

The problem with Verizon is that they view themselves as a device provider rather than a service provider. They should change that and just provide service and hand over the devices to other companies - both the manufacturers (unbranded and unlocked) and third party retailers. They can sell devices to some extent - on installment plans.

This mean a switch to the European model - a better working model.

T-Mobile has got the point and it is time for the rest to follow. Spend money on service and NOT on devices. If they want to sell devices alongside with the service plans, sell standard products and avoid the hassle of specially designed ones with a lot of bloatware that demands extra testing, development effort, certification etc. A mobile carrier should not work with that kind of stuff. They should just provide service and compete on service quality (coverage etc).

This is something I am definitely going consider using. I'm grandfathered with the unlimited data plan and don't want to lose it with an upgrade. Instead of browsing the forums or ebay for someone selling a better device model I might just use this plan to get a new, unused smartphone. Maybe the S4.