Verizon is offering the iPhone 6 with nothing down thanks to its Verizon Edge program, but is Verizon Edge really a good deal? In this article, we will compare Verizon Edge and Verizon’s traditional two-year contract to help you decide which way to purchase your iPhone 6 or iPhone 6 Plus.
So what’s better? The Verizon Edge or Verizon Contracts? That answer completely depends on how often you plan on upgrading, how much cash you have on hand and how much data you need. It also depends on if you want to be married to Verizon for the next two years or not. Read on for the full explanation.
Note: Visit Verizon.com’s iPhone 6 order page to experiment with pricing options yourself as pricing and incentives may change.
Update: As of July 2015 Verizon no longer offers the Verizon Edge program. Instead, the carrier now offers a Device Payment plan. While the Verizon Device Payment option is similar in some ways to the Verizon Edge program, there are some key differences. You can read more about the changes here.
Traditionally, wireless carriers have sold iPhones and other devices far below full price. In the case of the iPhone 6, Verizon pays a $450 subsidy to Apple every time it sells an iPhone. That means the $199 iPhone 6 starting price is actually quite a deal, but there’s more to it than that. Obviously, Verizon isn’t paying subsidies out of the kindness of its heart. Instead, it builds the $450 into subscribers’ contracts, though there isn’t a separate line item for it. One problem with this model is that subscribers generally have to pay early termination fees if they chose to switch to another carrier or cancel service. Those who want to upgrade to the latest and greatest phones before their contracts expire generally have to pay full price for new iPhones.
Verizon Edge is an example of a program that separates the iPhone 6 purchase from traditional two-year wireless contracts. Instead, Verizon Edge agreements last for 20 months and allow users more flexibility when upgrading. Rather than offering phones for $199 (subsidized price) or $649 (full price) , Verizon sells the device to you for full price ($649), but spreads the payments out over 20 months. To partially offset the increased cost, Verizon offers a $15 monthly credit for plans that include up to 8GB of data per month. It offers a $25 monthly discount off 10GB and higher everything plans. Verizon also waives its $35 upgrade fee on Verizon Edge plans. Verizon Edge customers can cancel their Verizon service at any time so long as they continue to pay off the device or pay it off in a lump sum.
After 60% of a phone’s price is paid off with the monthly installments, Verizon will allow its customer to turn it in and upgrade to a new phone with no additional fees. The old iPhone does have to be in good working order and customers lose the opportunity to resell it for more than the total of the remaining payments. Users will have to sign up for new 20-month Edge Agreements each time they get a new iPhone.
Verizon really wants to get rid of individual contracts and severely limits individual plan subscribers’ options. In fact, there’s only one option available right now: 2GB of Data with unlimited talk and text for $60 per month. If you want more or less data you need to sign up for a MORE Everything plan. With MORE Everything plans you pay for a shared bucket of data and can add lines for $40 per month. Verizon clearly wants to make it easier to tempt people into adding lines for their kids and relatives so they can sell as many lines as possible.
If you don’t have $199 or more to buy a new iPhone 6 for you or a family member you may be wondering if the Edge program is a good deal or not. Here’s how it breaks down:
Verizon EDGE vs Verizon Contract Pricing
|Verizon Plan||Due at Purchase||Activation Fee||Edge Payments||Monthly Service||Total Cost 1st Year||Total Cost Two Years/ End of Payments|
|Verizon Contract, 1GB Single Line||$199.99||$40||$0||$60||$960||$1,680|
|Verizon Edge, 1GB Single Line||$0||$0||$27.08||$45||$865||$1,730|
|Verizon Contract, 2GB Single Line||$199.99||$40||$0.00||$75||$1,140||$2,040|
|Verizon Edge, 2GB Single Line||$0||$0||$27.08||$60||$1,045||$2,090|
|Verizon Contract, 2GB More Everything||$199.99||$40||$0||$80||$1,200||$2,160|
|Verizon Edge, 2GB More Everything||$0||$0||$27.08||$60||$1,045||$2,090|
|Verizon Contract, 4GB More Everything||$199.99||$40||$0.00||$100||$1,440||$2,640|
|Verizon Edge, 4GB More Everything||$0||$0||$27.08||$85||$1,345||$2,690|
|Verizon Contract, 6GB More Everything||$199.99||$40||$0||$110||$1,560||$2,880|
|Verizon Edge, 6GB More Everything||$0||$0||$27.08||$85||$1,345||$2,690|
|Verizon Contract, 10GB More Everything||$199.99||$40||$0.00||$140||$1,920||$3,600|
|Verizon Edge, 10GB More Everything||$0||$0||$27.08||$115||$1,705||$3,410|
If you’re content with the iPhone 6 and planning to keep it for the full two years of the contract the Verizon Contract is significantly cheaper than the 2GB Verizon Edge plan. It saves $50 over the two year contract. No, that’s not a typo, you will save $50 by paying $199 upfront for your iPhone 6 compared to signing up for Verizon Edge if you’re a sole subscriber that doesn’t need more than 2GB of data per month. With the individual plan you do give up the chance to add more lines and share data.
If you want to upgrade to the iPhone 7 or whatever Apple’s going to call their next iPhone as soon as it launches, you’re basically paying $50 for the option to do so with the Edge program.
Before dismissing the EDGE plan as a bad deal, you should consider that it actually saves money for some people, even if they keep the iPhone 6 for the full two years rather than upgrading after 12 months. For example, those that need more data might sign up for the 10GB More Everything Plan and Edge will spend $3,410 plus tax over two years. Those who chose to pay $199 upfront on the same plan will spend $3,600, or $190 more than if they make Edge installment payments. That’s a bad deal because they don’t have the option to trade up to a new after a year. The reason the difference is so big with the 10GB+ More Everything plans is because Verizon offers that $25 monthly discount for Edge subscribers, rather than the $15 discount for lower data plans.
Another thing to consider when comparing Edge or standard plans is tax. In some states, including California and Nevada, iPhone buyers are responsible for paying tax on the full retail price of the phone up front. That means a tax charge on your first bill based on the $649 retail price, not the $199 advertised price. In San Francisco, for example, the tax comes out to $57. With Edge pricing, that amount is spread out over 20 months, or about $2.85 per month.
The best way to get a good deal on the iPhone 6 from Verizon is to make sure you buy a plan that matches the amount of data you need and to decide now when you’re going to buy your next phone after the iPhone 6.
This article may contain affiliate links. Click here for more details.