Mad Charles Stross took a stab at buying a cell phone in the UK, armed with a spreadsheet and a hankering to sodomize his calm, and discovered the total cost of ownership doesn’t vary wildly when you start all of Vodaphone’s plans out in neat boxes:
The first obvious conclusion I reached is that if you look at the total cost of ownership (TCO) of a phone, including both the phone cost and the monthly tariff cost multiplied by the term of the contract, there’s surprisingly little elasticity in the bottom line until you get into the eye-wateringly high usage tariffs. The TCO for a sample phone on 18 month contract varied by only £102 between the Talk 75 and Talk 500 tariffs (75 included minutes and 100 included texts per month, versus 500 minutes and 1000 texts per month). The same pattern held on 12 month contracts, with a £60 spread. Which is, frankly, ridiculous, because you get so few minutes and texts on Talk 75 that the actual cost per minute is nine times higher, and the cost per text is eight time higher than on Talk 500.
Cost for a Nokia E90 with Vodafone, 12 month contract, Anytime 500: £187.23. Cost per month: £34.04. Cost of phone plus twelve months: £595.71.
Cost for a Nokia E90 with Vodafone, 18 month contract, Anytime 500: £127.66. Cost per month: £29.79. Cost of phone plus eighteen months: £663.88.
I don’t believe the monthly rates typically vary on contract length here in the U.S. Then again, contract lengths rarely vary here, either. It’s two years more often than it’s not.
Marketing Musings [Antipope.org]