T-Mobile breaks industry tradition with twice-a-year phone upgrades

By on July 10, 2013, 3:30 PM
t-mobile, wireless carrier, contracts, phone upgrades, subsidized pricing, jump program

T-Mobile on Wednesday revealed a new program that will allow customers to upgrade their handset up to two times a year. Those who sign up for the Jump program will be able to purchase a new phone at the same subsidized price as a new customer without having to wait a full two years as is standard practice in the wireless industry.

John Legere, president and CEO of T-Mobile US, noted that at some point, big wireless companies decided that customers should have to wait two years to get a new phone at a fair price. That’s 730 days of waiting and watching as new phones come out that you can’t have or having to live with a cracked screen or outdated camera. Legere said two years is just too long to wait.

Enrollment in the program will cost $10 per month, per phone, plus all applicable taxes and fees. Depending on how you look at it, $10 per month could sound like a lot of extra money as that would equate to $120 each year but as T-Mobile points out, it’s just $2 more each month than many customers pay for handset protection.

If you’re the type that loves to have the latest and greatest, T-Mobile’s Jump program could be a worthwhile investment but if you don’t plan to use it to its full potential, it’d probably be wise to do some math to see if it’s worth the extra cash.

Regardless of your take on the program, it’s good to see a company continuing to break away from tradition and offer new and innovative programs that put the customer first.

User Comments: 12

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2 people like this | MilwaukeeMike said:

Here's some more info based on the press release from T-mobile. If you enroll in the program they will allow to you finance a new phone 'twice every 12 months' (not every 6 months). The way T-mobile's phone purchasing works is you pay an upfront amount and then finance at 0% the rest of the cost for the phone. So a new Samsung S4 or iPhone 5 will cost you $132 down ($99 down + tax on the whole $580, which is $32 for me in WI @5.5%). Then the remaining $480 is paid at $20/month over two years.

So if you pay $10 a month you'll be allowed to get another phone using their $100 down and 0% financing. If you return your first phone, they'll erase the remaining payments you have to make.

If you get a new top-of-the-line phone every 6 months (assuming there's one that comes out that often) you will end up paying $132 first month + $10/month for 6 months (JUMP membership) + $100 for 5 months of $20 payments for a total of $242 in 6 months for your phone, and that cost for your phone will cost $30 for each additional month you don't get a new phone. If you decide to get a new phone you'll owe another $132 + $30/month if you also give back your own phone.

Compare to Verizon where $200 gets you a new phone every other year. Also to note... T-mobile's 2GB data plan costs $60/month, whereas Verizon's is $100... or $108 if you have a protection plan. So 1 year of Verizon with a new phone will cost $200 + $1296 for the year of service = $1496 for Phone + service and protection plan.

T-mobile will cost you $132 for a new phone + $1080 for the year of service, JUMP membership and phone payments, for a total of $1212. Get a new phone in 6 months and that's another $132 for a total of $1344. (If you want a protection plan that'd be another $96 for the year, but I left it out because being able to get a new phone twice a year means you shouldn't get protection on the first one)

So T-mobile is $152/year cheaper if you drop the protection plan and get a new phone every 6 months. Don't forget Verizon has a bigger network and I obviously left out taxes, fees, and all that other crap they charge us for no apparent reason.

And back in school we thought we'd never use math in real life.

negroplasty negroplasty said:

Nice breakdown Mike. So very, very glad T-Mobile didn't get absorbed into AT&T.... I seem to remember how great everyone said it would have been for competition; interesting how T-Mobile seems to be the only company at least making an effort to do something different the last several years. Very happy with my carrier, and their extremely smooth and quick roll-out of LTE across the USA.

Guest said:

Its called a 6 month lease in the auto industry :)

howzz1854 said:

Whatever Tmobile is doing lately is a welcome move for all the consumers. I recently switched our family celluar plan from AT&T to t-mobile and saved over $20 a month and got more data quota out of the whole thing. I sincerely hope T-mobile keep up what they're doing and don't get absorbed by another big company.

MilwaukeeMike said:

Whatever Tmobile is doing lately is a welcome move for all the consumers. I recently switched our family celluar plan from AT&T to t-mobile and saved over $20 a month and got more data quota out of the whole thing. I sincerely hope T-mobile keep up what they're doing and don't get absorbed by another big company.

Me too... switching from Sprint to T-mobile meant a better phone on a faster network for $30 less a month. I hope their model works for them, I'd hate to see them go under. It seems like their JUMP program could work out well for them too. You have to turn in your old phone or keep making payments on it, and there's a pretty good market for 6 month old flagship phones. T-mobile will probably be able refurbish many of them and sell them again.

Mbloof said:

Being the smallest carrier T-Mobile tends to 'try harder'. Sadly their coverage is not close to where the big two are (AT&T,Verizon) and while even Sprint has a bigger footprint, T-Mobiles network (when you have coverage) performs better.

T-Mobile really needs to work out some roaming agreements with the big guys and/or build out coverage outside of major cities, interstates and highways. They have great pricing but in a group of friends with all major carriers represented, if my phone is the only one that does not work it makes me think I'm with the wrong carrier.

JC713 JC713 said:

Lol. T-Mobile's bite at gaining popularity I guess.

Tygerstrike said:

Nice to see ppl posting positivly about Tmoble. But I hate to be the one that says it, but wait till the other shoe drops. That "Oh I saved XX because I switched from XXXXX" is going to taste awful bitter when you break your phone. See other then just getting a new toy, most ppl have to replace their phone because its broken in some way. Now take that situation to Tmoble and tell them you broke your phone and want to use that jump program. Im betting that Tmoble is going to show its true colors then. THEY WONT TAKE BACK A BROKEN PHONE IF YOU OWE MONEY ON IT STILL!!! So add the remaining value of the phone to that and its no longer as "cheap" as once believed. Yes it SOUNDS like Tmoble is looking out for it customers but Ive been in retail WAAAAAAYYYYYY too long to fall for the stick and carrot. In less then six months we will see so many complaints against Tmoble and their JUMP program. Remember these giant corporations are in this to make money. They would never roll ANYTHING out that is going to COST them money. EVERYTHING THEY DO IS MEANT TO MAXIMIZE PROFITS!! So dont fall for that "Tmoble Cares" line of BS that they are trying to gently shove down our throats. This is going to be a very bad situation for Tmoble customers shortly. I just hope ppl dont fall for this and end up oweing a ton of cash because they assumed Tmoble gave a damn.

mailpup mailpup said:

Tygerstrike, please do not shout.

Guest said:

Why would anyone find a reason to upgrade every few months. Really, technology does improve, but not all that much ever so many months.

Guest said:

As for taking back or replacing broken phones -- just what provider does this - none, unless it is insured. Of course T-Mobile needs your phone in good condition on the trade - up.

Red Nivra said:

Sorry to counter your negative rant, Tygerstrike, but I took my new phone back today because the Wi-Fi wasn't working and they immediately agreed to replace it without any complaints or game playing.

I couldn't be happier with T-Mobile's service.

P.S. - Why wouldn't a customer be responsible for paying the remaining finance cost on their phone if they break it themselves? Is there a carrier that I don't know about that would

replace your phone for free if you break it? Is there any service in the world that will forgive a loan to you if you break whatever it is you financed?

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