Speaking at GeekWire Summit in Seattle, T-Mobile Chief Marketing Officer Cole Brodman said the cheap prices that consumers see when they buy a cellphone don't reflect what the device is actually worth.
“It actually distorts what devices actually cost and it causes OEMs, carriers — everybody to compete on different playing fields,” he said. “And I think it is really difficult, especially from a consumer perspective, because it causes consumers to devalue completely the hardware they are using."
Brodman said the low price of smartphones leads consumers to treat them as "throwaway" devices and pointed out how "unfortunate" it was for a customer to discard a dual-core device with an HD screen after 18 months. He said if he were "king for a day," he'd put an end to device subsidies.
When one of Brodman's fellow panelists pointed out that, as the fourth-largest wireless carrier in the U.S., T-Mobile was far from powerless on the matter, he cited the difficulties in doing so alone.
"“It’s hard when the other three don’t want to play along," said Brodman. "It becomes difficult because consumers vote with their pocketbooks, and they will almost always pick a low device price oftentimes over a low rate plan price or a bundled rate plan price."
Brodman added that T-Mobile had "experimented" with the no-subsidy model more then any other carrier in the country.
What do you think about device subsidies? Would you be willing to pay a higher price for your phone for a smaller phone bill and more freedom to switch carriers? Have your say in the comments.