Flagship smartphones have continued to get expensive over the past few years. One would easily cost you north of $1,000 now and if you opt for one of those fancy upcoming foldable smartphones, be prepared to spend over $2,000 on a phone that will be outdated in a couple of years. No wonder people are waiting to upgrade their phones longer than ever before.
Verizon says that the upgrade rate for customers on its network fell to a record low in the previous quarter. Since phones receive incremental upgrades each year, most consumers don’t feel the need to upgrade the very next year. They may also wait and see how long it takes for 5G to be properly rolled out before buying a new handset that supports the network technology.
Verizon Chief Financial Officer Matt Ellis expects that the replacement rates will continue to be down throughout the rest of this year. This trend started a few years ago when carried discontinued their deep discounts on handsets in return for two year contracts. As devices got more expensive, they started offering installment plans for phones.
That being said, companies like Apple, Samsung, Huawei, and other continue to pump out multiple new models every year as they refuse to concede any ground to their rivals. The question is, whether there are enough customers out there to actually make it worth the effort.