The Worst Place to Buy a Mobile Phone?

Category: Mobile

72 year-old Gerry Soubly went to a Verizon store with a friend to buy a new phone. Shortly after they entered, the place was invaded by three armed men who shot out the glass front door. 'I felt helpless,' Soubly said, despite having the presence of mind to shield his friend and dial 911. The suspects were quickly captured, and then the real robbery began...

Where NOT to Buy a Mobile Phone

The retail stores of major carriers are the worst places to buy phones. Their prices are considerably higher than the same phones offered through other outlets with the same service. I experienced this the hard way when my wife’s phone broke and she went to a Verizon store. She wanted the popular Samsung Galaxy S III, with a MSRP of $599. Verizon offered it for $199; that seemed like a great deal, so we bought it.

The next day at the local mall, I found the same phone at Best Buy for $149. I strolled over to Radio Shack and there it was for $99. I returned the phone to Verizon and saved $100 by purchasing it at Radio Shack -- 50 per cent off that “great deal” at the Verizon store.

A few days later, I found the same brand new Samsung Galaxy S III smartphone on Amazon Wireless for $49! That deal required that you add a line to a family account, which I was unable to do. But wow, what a long way from the original price at the "official" store.

Where NOT to Buy a Mobile Phone

The moral of this story is that the obvious place to buy a phone is probably going to be the most expensive. Also, I was under the false impression that resellers could not replace the phone on my existing Verizon contract, so I was stuck buying through Verizon. That isn’t true, I was happy to learn. The third-party resellers can access your AT&T, Sprint, T-Mobile or Verizon account and make any changes necessary.

The Mobile Phone Food Chain

The phone hardware industry has three tiers: manufacturers who set artificially high MSRPs; carriers who give illusory discounts tied to contracts; and resellers who buy hardware and contracts in bulk. The last group is the most numerous, so competition lowers prices most effectively.

Some good places to shop for bargains on the latest smartphones include your local Best Buy, Staples, Radio Shack, Costco, and WalMart stores. Amazon Wireless and Wirefly are two online phone sellers that offer excellent deals. Amazon offers free two-day shipping on phones, and WireFly is currently offering a $50 Google Play credit with the purchase of selected Motorola Android phones.

Popular smartphones such as Samsung's Galaxy S3 and Galaxy Note 2, the HTC Droid DNA, Motorola Droid Razr Maxx, and HTC One X+ are all available at prices much lower than you'll find at the carrier's company storefronts. One exception would be the iPhone 5, and that's because Apple keeps tight control over pricing, even at third-party stores. That'll cost you $200 in the Apple Store, or anywhere else you look. But if you're willing to settle for something other than the latest and greatest, you can find a refurbished iPhone 4S with 16GB Memory for $49.

I'm not trying to say that the carriers' stores are dishonest, they just don't offer the best deals, because they don't really have to. And in fairness, I should mention that the official Verizon, AT&T, Sprint and T-Mobile stores do offer deals on low-priced mobile phones. Sometimes you can find smartphones for $49, $29 or even for free, with a two-year contract. But these are almost never the popular models that everyone wants. They might be last year's model, refurbished units, or just poor sellers they want to move.

If you need a new phone, with or without a new contract, start shopping at the bottom of the food chain. You’ll find better prices and more information about your options than carriers will give you willingly.

Of course, by “bottom” I do not mean some guy selling out of his trunk in a parking lot. If some stranger accosts you with an elaborate tale about having to sell iPhones for $100 to avoid trouble with his boss for ordering too many, do not do him the favor that he requests. You’re likely to get your shrink-wrapped package home, open it, and find a piece of cardboard with the word “iPhone” taped to it.

Craigslist and eBay are risky places to buy phones, too, especially if they are advertised as “new in box.” One of my all-time favorite “Judge Judy” episodes involves an eBay scammer who got her comeuppance as only Her Honor can deliver it.

What's your favorite place to buy a mobile phone? Post your comment or question below...

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Most recent comments on "The Worst Place to Buy a Mobile Phone?"

(See all 32 comments for this article.)

Posted by:

01 Mar 2013

My wife and daughter only use text message and voice service, no web browsing or apps. Previously I waited until we could get deep discount phones if we renewed our contract for 2 years. However, now they charge a $19 "activation" fee for the free or discounted phones. Instead, when their phones wore out, we bought $29 "Go" phones on sale at Target, which were perfect. We simply changed the SIM card to activate them at no additional cost, and without a 2 year commitment.

Posted by:

01 Mar 2013

Consumer Cellular has some nice phones and has Great no contract plans at good prices!

Posted by:

01 Mar 2013

I bought my last two phones at Walmart.

Posted by:

01 Mar 2013

I'd always bought my phones direct from Sprint, until a few weeks ago. My husband dropped his phone and the glass cracked, and we'd just come into upgrade eligibility, so I started researching through the Sprint website. I had a few questions about certain phones, and googled a few comparisons (like iPhone vs. Galaxy S3, etc.). I am SO glad I did, but not for the reason you'd think. I did learn a lot about the phones, but in the process discovered there are a BERJILLION other options than paying the price Sprint listed.

I've since replaced all our family phones through the Amazon Wireless site, and saved about $500. Hub's phone was $200 cheaper, and the phones I bought for me and my daughter were each about $150 cheaper than Sprint's prices. That's no small savings!

Posted by:

Dan Hammond
01 Mar 2013

Before retirement in 2004, I had an earlier Kyocera Smart Phone, with lots of functionality and access. Then in 2007 and relocating from Tennessee to the NE corner of rural Alabama, it was time to update our two Cell phones and service. Basic connectivity was all we needed. We were mostly concerned about having service and "dead zones" because of our mountain location.

After talking with friends and neighbors about their experiences and service, we bought two Motorola Razr V3m from a local Verizon store. I don't even remember exactly what we paid, but there was a "deal" at that time. We found that our land line was our primary phone access, and our cell phones being used only when making trips to town, or when traveling, or those rare emergenices. We also learned where the dead zones were around us. But pretty quickly, we found our batteries were dropping power more frequently. We had to recharge the point of being a nuisance, even after replacing batteries. We had 4 chargers, 2 in cars, and 2 in the house. We often chose to just leave our Cells at home when running to the store. And we regretted this on occasion when we really could have used them! But the real kicker was after a few years, we noticed that we were spending about $100 per month for phones we were NOT using. Our annual total minutes usage for 2 phones last year (2012) was 138 minutes! Verizon was making a profit from us!
Finally, after "seeing the $$$ light", I seriously began researching other possibilities. I read Bob's articles!! And WOW, I found Tracfone! I went to one of our local Dollar Stores and bought an LG 840G for about $60 from Tracfone which included TRIPLE minutes with every minute I bought and added for the "life of the phone". I then bought a $99 "Card of minutes" which is good for one year and 400 minutes. So because the phone tripled the minutes, I got 1200 minutes good for one year. NO other charges. NO monthly payments. After activating it and using it for a week, we returned and bought a second phone from another Dollar Store. This time we bought the LG 440G for $20, because we wanted a simple flip-style cover. It came with "Unlimited DOUBLE minutes". We purchased a second "Card of 400 minutes" for $99, good for a year. This phone then had a year's worth of 800 minutes. So for a total expense of $280 plus tax, we have 2 new phones that more than meet our requirements. And I only have to re-charge about every two weeks!!!! I'm saving about $1000 a year. What fun. So long Verizon!!

Posted by:

01 Mar 2013

Re the comment in the article that resellers can make changes to your account.

We have had Verizon for a decade and just go to our account at Verizon dot com and change the information ourselves. You just need the new phone serial number and it takes just a couple of minutes. The only caveat, you cannot change to a phone that will do more than your plan allows.

We are both currently using phones purchased at a Yard Sale for a dollar a piece! Just be sure it is going to be compatible. For example, if you have service with Verizon, only Verizon phones will work as they do not use a sim card.

Posted by:

01 Mar 2013

When the Galaxy S111 came out somebody in the family just had to have it. We shopped everywhere, including Radio Shack and Walmart, before we went to the company store. It was the same price everywhere. However, we determined that with a contract we paid twice as much for the phone overall than without a contract, so we bought it outright and made our savings that way.
What,then, is the advantage of a contract?

Posted by:

01 Mar 2013

I buy my unlocked cellphones from Amazon. I never had a problem so far. Amazon has free shipping for products over $25.00. I usually get my merchandise in six to eight days.

Posted by:

01 Mar 2013

I called Radio Shack about the price of samsung galaxy s iii. The $99 price is only with contract with one of the big 3 carriers.

EDITOR'S NOTE: That's correct. Any phone purchased without a carrier contract will cost hundreds of dollars more.

Posted by:

Geezer Tech
01 Mar 2013

In Canada I have been with a number of providers. I bought my LG smart phone from Amazon. The best service I have seen and least expensive is Pay as you Go from 7-11. Twenty five cents a minute, text is ten cents each or $15 a month unlimited, and data is $10 a month. 7-11 Canada uses the Rogers network, which is great. Downside is the phone quits in the USA. My wife and I have USA burner phones for that.

Posted by:

01 Mar 2013

I wish I had read this before I bought my phone from T-Mobile store last year while in Chicago. My old phone broke so I bought a smart phone which was supposed to have a rebate and which never happened but I am stuck with a 2-year contract and the full price of the phone is added into the plan for like 20 months. I have been a T-mobile user for many years but this will be my last contract I am pretty sure. Dealing with these companies has become a nightmare for many. Thank you for your very informative site and newsletter.

Posted by:

Joe M.
01 Mar 2013

I still love my palm centro. :-). Got it reprogrammed to boost mobile for $20 and I have an unlimited plan, including international land-lines (which I use every week to call family). Phone breaks? $20 replacement on ebay. Can't beat it.

Posted by:

02 Mar 2013

My wife and I decided to "Upgrade" our Samsung Galaxy phones which we usually do at a Verizon Store. Normally free of charge, we found we would have to pay $199 @ for two with NO data and NO net service. The high dollar "Smart Phones" were free but you had to pay the $30 per month 4G Fee. We were told to go to Target for a better deal on our no frills phones, which we did.
We got two Samsung Convoy phones for about $40 each, When we got our Verizon Bill they had charged us ANOTHER $40 each for an "UPGRADE CHARGE". I called Verizon to tell them we had renewed our contracts for two years but they told us that because we bought from Target and not Verizon we were charged the fee. The best they would do was drop one of the phone fees when I complained. Probably because our home phone is also with Verizon.
I hate to think what we will have to do the next time we need new phones.

Posted by:

Brummagem Flash
02 Mar 2013

No problems for this UK PAYG phone user. I think I'm getting my money's worth: I have topped up the PAYG with only about £30 total($40?) in last five years or so!
And I recently bought this used-but-perfectly-working Nokia 6303i for £30 from a eBay-UK seller.
I usually only do texts using free sms online; and I call family members' VirginMobile phones from our VirginMedia house-phone: their cheap evening+weekend calls package covers calls to all landlines and any VirginMobile.
Other calls from this mobile(cell-phone) are mostly free to VirginMobile. Otherwise it has to be a real emergency: like when the car broke down in 2008, or was it 2007?
So, all my mobile needs covered for say £20/year?
If you don't do idle chat; why pay for a monthly tariff? Especially when, having paid the monthly fee, you're likely to be encouraged to carry on using the phone to make use of all those "paid-for" minutes.... yak-yak-yak!
The worst deals I've seen in UK are in mail-order catalogues; and their online equivalents. These are often at full-mrsp; include last year's more expensive tariffs, and are paid for on the "never-never" (hire-purchase) at 30% per annum interest. With instant price comparisons so easy these days; it is amazing how many folk still buy electrical and electronic goods through these rip-off companies!

Posted by:

02 Mar 2013

What is meant by "locked" and "unlocked" phones?

Posted by:

02 Mar 2013

Thank you for the info!
Very interesting reading and a few good laughs.

Posted by:

Delton C Baker
03 Mar 2013

Dear Bob Rankin,
I have been reading your web news letter for years. I recently open a news letter that had a picture box with some steps to download a picture handler. I am assuming it is the "Adobe flash player", but the their is no mention of just what it is I am downloading. I think you should bother to at least tell us what virus we are down loading. I have "Windows 8" and I thing you should also be telling me and people like me to use a right click, then select the "Open in a Bowser" Menu option. This will turn on the "Adobe Flash Player" in the "Windows 8" launch by the "IE 10" App Icon. You should try to warn us at least before we waist our time down loading "Adobe flash player" we already have installed. Web surfing in "Windows 8" has two separate "IE 10's": 1) one if launched from the "IE" app on the "Start Menu Page" 2)another one if launched from the "Desktop Page". the first one has no flash players and no way to install one either. (God knows I have tried!) The second one on the "Desktop Page" works just like my "IE 9" on my "Windows 7" Laptop, accept without the slow-ness. Happy Computing!

Posted by:

14 Mar 2013

WOW!!! This topic certainly generated a large response. Good article, Bob.

When, I started using wireless phone service, again ... I went to AT&T/BellSouth. I had their service before and was pleased with it. I am still using this service, one main reason, my phone, Long Distance and wireless service are "combined" into one bill. For me, this is a good solution and works well with my budget.

The last 2 upgrades that I have had, I have gone to Walmart. Walmart's price, beat the online price for the phones, that I purchased. Plus, I didn't have to wait days, because of mailing. I got my phone, while in the store. While, I can setup and activate my own phone, it was a pleasure to have the Walmart personnel do this for me.

In my mind, those that are not as "technical", it really would be best, to have another person do it, for them. Even Walmart has personnel that is knowledgeable about wireless phone sales, setups and activations. Yes, there is caution in everything you purchase ... But, when you do some good research, for your needs, the results can be very beneficial and rewarding.

Posted by:

Stephanie Isom
21 Apr 2013

I bought a Samsung Rush from Radio Shack to use on Boost network, which is a prepaid monthly plan. They offered a 2yr warranty that covers everything for 17.99.

Posted by:

02 Sep 2013

Why do you and others never discuss Straighttalk?

EDITOR'S NOTE: It's a vast conspiracy. THEY (you know who THEY are, right?) frown upon it, and WE quake in fear. Actually, that's not the reason. The reason is that Straight Talk is actually owned and operated by Tracfone. And as I mentioned in the article, Tracfone does not offer 4G service.

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