Buying a new cellphone, round 2

So, Rogers (and the other providers) has a new promo out for the Black Friday shopping bonanza. The most eye-catching part is the following:

Get a Samsung device (such as the Galaxy S4) for $0, and you can get the new Galaxy Gear watch for only $50 as a bonus.

The watch normally goes for $320, and the S4 $700 (according to their website). There is a catch, however. The minimum monthly plans start at $70 per month (I went into a store and asked a sales associate). This $70 plan is utter and total crap. It includes 250MB of data per month. I currently have a plan with 6GB of data that costs $50 per month. If you read my previous post, you know you can get a plan from Koodo/Fido that includes unlimited Canada-wide calling/texting and 2GB of data for $60 per month. The same plan costs $85 at Rogers.

The difference in cost over a 2-year period is $822. Gee, that figure looks awfully like the price you'd pay to buy the S4 and the Galaxy Gear watch outright, doesn't it? Except that you have a much cheaper plan with Koodo/Fido. Think about it: you could get the Koodo plan, go and buy $800 worth of new phones, and two years later, you'd be in the exact same position financially.

So, now you know why the phones are "free" at Rogers/Bell/Telus. They "give" you the phones for free (or cheap) and then utterly gouge you on the plans.

There's no such thing as "free" in life people, especially when it comes to private companies. Only a dumbass would assume those phones are really free, and that the company is giving you a good deal. It's quite the opposite: YOU'RE giving the company a good deal - a good deal of your money.

Now,  just to make you feel really bad about the lousy deals us Canadians get,  check out this website used for comparing UK phone plans and deals.  It'll make you sick. FYI, the exchange rate is around 1.75, so whatever the price in £ is,  multiply it by 1.75 to get the Canadian equivalent.

http://phonestore.techradar.com/phones

Do you want an iPhone?

Do you love your iPhone? Does it make you feel special to own such a nice, polished, over-priced piece of hardware?

Well, you're probably not alone. A ton of people buy the iPhone not because it's the best phone out there (it isn't), not because it's the best value (it isn't), not because it's the cheapest (it REALLY isn't), but simply because it's the iPhone. It has this aura around it, this intangible thing that makes people want it. Much like other status symbols (driving a very rare and expensive car, wearing designer clothes), many people think that owning an iPhone makes you cool, hip, unique, different...the list goes on.

But does it really? What is the definition of cool, unique? You would think that only by possessing an item that few other people have would you qualify as cool and unique, right? Yet if you own an iPhone, you own a piece of hardware that is EXACTLY THE SAME as, what, several hundred million other people? Not only the hardware, but even the software is EXACTLY THE SAME. You use the same mail client, the same messaging app, your icons look exactly the same.

So no, owning an iPhone doesn't make you cool, hip or unique. Not anymore. Not when everybody else around you owns the same phone, and uses the exact same apps with the exact same look. Heck, you're even all typing on the exact same keyboard.

Boring.

Now, buy an Android phone, install a custom ROM, swap out the stock messaging and email apps, download a new theme for it, change your keyboard, install custom icons...NOW you have a unique phone that nobody else has.

Don't get me wrong, the iPhone is a good piece of hardware/software. It functions well. And if you buy it for <insert valid reason here> then that's fine. Just don't go pretending to do it because it's the best phone, or the best value, or because it's cool and unique (owning something everybody else owns is the very antithesis of unique and cool). Because none of those are true.

Now, some may say "well the iPhone just works". This implies other phones don't, which is silly. In the early days of Android and Windows Phone, they had a few hiccups. But these days, top devices from all manufacturers all "just work". They're all polished and smooth.

Some food for thought:

https://www.youtube.com/watch?v=DaxU0ut5tUw&list=FLE73CfEmx_sy8OrSiqmT5Ug&index=33

https://www.youtube.com/watch?v=kS5sal5wN1c&list=FLE73CfEmx_sy8OrSiqmT5Ug&index=31

This is what you folks are like. I'm not joking.

Wind power - the great money pit

Wind power in Ontario has been a major component of the Liberal's agenda, especially under Dalton McGuinty. Tree-huggers claim it's the best thing since sliced bread, manufacturers of wind-power related equipment claim additional environmental benefits. Basically, everybody thinks wind power is just super.

Is it?

Short anwer: no.

Long answer: it depends on how it is managed and integrated into the system. There are some green benefits, of that there is no doubt. Once built, wind generators don't consume anything meaningful other than wind. This means virtually zero input costs, and little to no emissions. Wow, great huh?

However, these benefits have been more than lost in Ontario due to the stupidly generous contracts handed out to the wind generation companies. Did you know, for example, that if a wind generator is producing electricty, this power is guaranteed to be purchased, regardless of whether or not it is needed? Did you also know that the rates being paid for this power are about FIVE times what hydro power gets in this province?

Even better: did you know that often times, we are spilling water at our hydro plants (meaning that instead of using the water flowing down the river and through the power plant, we're just spilling it around/over the plant, essentially wasting that water) in order to be able to accomodate this (very expensive) wind power? So in a nutshell, we are not generating hydro power (even worse, spilling water), which would have cost around $0.03 per kWh, in order to run wind power, which costs an estimated $0.15 per kWh. Man, what a bargain. What a great deal McGuinty got us.

Now, to be fair, this doesn't always happen. There are times when we are running as much hydro power as we can (not spilling water) while also running all the wind power that is being produced. But the majority of the time, wind power is generated overnight (when we least need it), which is, coincidentally, the time when power on the open market is generally cheapest. So, at the time of day when power should normally be cheapest, we are not only not running cheap hydro power, we're spilling water, all to accomodate very expensive wind power (that we don't need).

I don't know about you, but I'm extremely excited and pleased about this. Who wouldn't want to pay five times the going rate for electricity? Especially when you replace cheap green power with expensive wind power, the deal seems just THAT much better. Really folks, why would you pay $0.03 for green hydro power when, thanks to the Liberals and McGuinty, you get to pay $0.15 for green wind power?

Have you ever looked at your power bill and wondered what the "global adjustment" charge is? It's basically what you pay the wind generators to make up for the difference between what their generation actually costs and what the market rate of power is (as well as other fees that need to be collected). For example, there are times when wind is generating and the current hourly price of electricity in Ontario is hovering around $0. Yes, that's right, while you're paying $0.07 + charges for power at 2am, the market price is $0.00. Well, during this time, wind is producing power and getting $0.00 from the market for it. But they've gotten a contract from the government that guarantees them $0.15, so the diffrence has to come from somewhere and someone. That someone is you, and that somewhere is the "global adjustment" charge on your bill. Are you pleased yet?

You'll often hear wind proponents state things like "last year, wind power in Ontario generated X amount of power". True, but what they don't tell you is this power was useless and not needed. They don't tell you that in order to generate that power, hydro power (that would otherwise have been generated) was scaled back. In other words, instead of generating power with hydro, we're using wind. Wind power was supposed to replace coal generation, according to the McGuinty Liberals. What's ACTUALLY happened is that wind power has replaced hydro power and nuclear power. Are we any greener? Not really. Poorer? You bet.

So the next time you see McGuinty, or any Liberal for that matter, be sure to thank them. Thanks to them, our power bills are amongst the highest in North America, we've spent billions of dollars in subsidies and guaranteed contracts, and all we've really managed to do is replace green, cheap hydro with green, expensive wind.

Like I said, a great deal!

The economics of buying a cell phone

Most people I know tend to buy their cell phones on a contract, and therefore pay a subsidized price for their shiny new toy. They think it’s a good deal, because their new phone “only” cost them $129. What they don’t realize is that these days, the major cell phone carriers have come up with a stratified pricing scheme. In other words, if you go in and sign up for a contract with a hot new phone (the Samsung Galaxy S4, the newest iPhone 5s, for example) you’ll only be eligible for a certain selection of plans, which will cost a minimum of, say, $65. If, on the other hand, you purchase a less expensive model (maybe last year’s Galaxy S3 or iPhone 5), you’ll be able to get a better/cheaper plan. In addition to this, the older phone also costs less. You’ll often find them offered at $0. So not only do you get a better/cheaper plan, your phone costs you less too. It’s a double-whammy. It gets even better if you shop around a bit at the “discount” carriers (Fido, Koodo, Virgin).

 Let’s take Bell, for example. A 16GB iPhone 5s will cost you $230 on a 2 year contract. You can get an $85 plan that includes unlimited Canada-wide talk + text and 2GB of data. The exact same plan at Koodo is currently on promotion for $60. You could get the new Nexus 5 for $200, and that will only add an extra $5 to your monthly bill. So, for $200 at Koodo, you get the Nexus 5 and the plan for $65. At Bell, for $230, you get the iPhone 5s and the plan for $85. Your total cost over the next two years at Bell (after tax) will be $2,565. At Koodo, it will be $1,989. That’s a $576 difference, just so you can get your stupid iPhone 5s, which is not any “better” than the Nexus 5.

Now, let’s think even further outside the box. What if, instead of buying a phone on contract, you went to Koodo and bought the new Moto G from Motorola outright, with no 24-month contract. This will set you back $200 + tax. That’s right: you can buy a brand-new phone for $200. And this isn’t one of those cheap, discount phones: the Moto G is just as good, if not better, than phones like the Galaxy S3. Additionally, if you bring your own phone (or buy one outright), most carriers, including Koodo, will give you a 10% discount on your monthly bill. So, in the case of the Moto G, your total two-year cost will be $1,833 – that’s $732 less than buying the iPhone 5s with Bell for the same plan and a phone that, while not quite as powerful and top-notch as the iPhone, is still very good.

So ask yourself this – is getting that shiny new iPhone 5s worth spending an extra $732 (in addition to being tied to a two-year contract)?