The annual upgrade wan't something that was widely touted- most people didn't know it was out there. From what I have heard, once you are 80% completed with your contract, you can upgrade to a new phone, however, I'm not sure what sort of discounts you get- I think it is just straight up 2 year pricing, without any further discounts.
When I move back to Verizon (when the HTC Vigor lands), I'm going to buy it outright, then when something else comes out that I want, I'll buy it and sell what I have and not be tied into a contract. I'm not happy that Verizon did away with the 1 year contract, however, I realize that the 1 year contracts would have cost them a fortune with the subsidized pricing, epsecially with the phone enthusiasts that want a different phone every month of the year.
That's what Verizon told me when I asked why they were axing 1 year contracts. They said they lose money on every phone they sell. They keep the cost of the phone and the cost of the plan separate, so of course in that case they are losing money on every subsidized phone.
The CSR even went so far to say that they lose money selling them at retail. That's where I call BS. He tried to tell me that Verizon is paying more for the phones than what we are. Really?
Awhile back in either these forums or the ones at And. Central, a Best Buy employee posted a screenshot of the Thunderbolt in their system. It was when we were waiting on the release date for it. In the screenshot it showed Best Buy's full retail price at $750,
BBY's cost at $380, and BBY employee's cost at $420.
I mentioned this to the CSR, and he said that Best Buy must've gotten a better deal. I don't know about you but I find it hard to believe that an electronics retailer that doesn't even offer service gets a better deal than the carrier that contracted for the phone from HTC. With BBY's cost of $380 and Verizon's retail price of $600, that's a $220 difference. And Verizon claims they're cost is higher than their retail price that's even more of a difference. If that is indeed the case, Verizon's getting screwed without any lube.
At this point with ebay and craigslist making it easy to sell phones, I'd be okay if they went to full retail for their phones and dropped the plan prices by around $25. Over a 1 year period you'd save around $310 on the plan, which would put your phone costs around what you pay with subsidies, but would allow you to change phones whenever you want.
Say you pay $500 for the initial phone, save $310 on the plan, now you're at $190, which is what most higher end smartphones currently run subsidized. Three months later another phone catches your eye that's around $550. You sell your 3 month old phone on ebay or craigslist for around $350. The new phone costs you $200 out of pocket, which is like getting another subsidized phone, but again without being locked into a contract.
The reason I know this won't happen is Verizon likes contracts knowing they'll have a steady flow of revenue for the next 2 years. But a guy can dream can't he?
