The latest AT&T
They wind up at an AT&T store, pitching the $29 price.
"I can afford that," the jealous friend realizes -- and the commercial ends.
Can he, though? Once again, the myth of cheap smartphones is beginning to permeate the airwaves.
Free? Well, not exactly. The $29 Impulse 4G and the "free" iPhone 3GS are tied to two-year contracts. An early termination fee of $325 -- minus $10 for every month already completed -- applies to AT&T buyers that suddenly realize that they may be in over their heads with these "cheap" devices.
It's a fair fee, since wireless carriers are subsidizing these smartphones to the tune of hundreds of dollars apiece. However, shouldn't this all be disclosed more prominently?
Between voice, data, and messaging plans, don't be surprised if these buyers wind up forking over close to $2,000 over the course of a two-year contract. AT&T and Verizon
Smartphones have become the record clubs of the new generation. You remember those clubs where you would get a dozen CDs for a penny, but then were saddled with months of unwanted discs at list prices?
Don't get me wrong. Smartphones are great. They're not some cheesy scam. However, allowing the marketing emphasis to rest on the low entry price instead of the actual cost of ownership is as wrong as it is deceiving. My critique is genuinely free, and you won't have to put up with me for the next two years if you don't want to.
The Motley Fool owns shares of Apple. Motley Fool newsletter services have recommended buying shares of AT&T and Apple, as well as creating a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.Longtime Fool contributor Rick Munarriz calls them as he sees them. He does not own shares in any of the stocks in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.