Best Buy’s “Buy Back” Program… Good Deal or Ripoff?

It seems that the technology for smartphones changes every 6 months or so, with people desiring the latest and greatest devices. I’m no different, in that I am a gadget admirer and often become an early adopter of new technology. But, I’m not such a fanatic where I wait in line the night before to get the next Apple iPhone, or fret when I can’t get a product on the release day.

With smartphone technology advancing so quickly, waiting for your 2-year cell phone contract to expire (so you can get a new subsidized phone) seems like an eternity. Some people buy a new phone at full retail price and try to sell their old one (often only 6 months old) on eBay or Craig’s List to offset some of the cost. With smartphones listing at $700, this can be a very costly venture to have the latest phone technology. As such, I often read on various forums that using the Best Buy Buy Back Program is the way to go if you want upgrade your smartphone frequently. I’ve read forum postings where people throw out numbers showing how they are upgrading their phones for only $10 using this program, and that really doesn’t make sense to me. Why would Best Buy implement a program that gives them very little profit margin?

Upon further investigating, it seems that the Buy Back Program isn’t as great as some people make it out. When you consider the price of program, the amount they credit you over time, and cost of a new phone at list price, you’re actually getting a bad deal. It’s only a good deal when you’re close to your cell phone provider’s contract expiration and when you initiate the buy back program for the first time. I know some people swear by the Best Buy Program and think they are getting a really good deal, but if you do a Google search you’ll see that sites like Consumer Reports indicate that this is not so. Here’s one such link to examine.

Time for a new Smartphone

About 11 months ago I accepted a new job with a company in the Seattle area, and as such I had to give up my Apple iPhone 4 which was provided by my previous employer. So, I needed to get a new phone to use for my personal use, and what made the most sense was to add a 2nd line to my wife’s existing Sprint account (which she’s had for over 10 years). At that time I got what was the latest-and-greatest smartphone available on Sprint, the Samsung Nexus S 4G. This was indeed a good phone, with a great screen, reasonable battery life, and running the Gingerbread Android OS. Over time, I discovered that the cell phone signal strength was very poor with my phone, as well as for others based on what I read on several forum postings. Also, the GPS receiver on my Nexus S had trouble finding GPS satellites and when it did it was slow to respond. So, I’m driving around with the navigation app giving me directions to turn here and there being off by nearly 500 ft at times. Not very good.

So, I’ve decided to check what my options are to resolve my smartphone issues. Here’s what I’ve determined:

1. Exchange my Nexus S for another refurbished one at Sprint. From what I’ve read, it seems that this is known issue with the Nexus S 4G model and getting a different one may not resolve my issue.
2. Pay the Early Termination Fee (ETF) for my Sprint line and switch to a different cell provider. This is a potential option if my real issue is with the cell tower proximity and power, rather than my Nexus phone. Going this route means I would be able to get a new phone at the subsidized price.
3. Pay an, “upgrade buyout” fee to Sprint which will allow me to move my upgrade date forward to now instead of 1 year from now. Apparently, this is available in select regions of the country. This would allow me to buy a phone at the subsidized price.
4. Bite the bullet and pay the full list price for a new phone on Sprint. Going this route can be expensive, since smartphones are going for up to $700.
5. Stay with my Nexus S phone for another year, when my 2-year contract expires. At that point, I can get a new phone from Sprint at the subsidized price or go with a different cell phone carrier.

The best thing Sprint has to offer is it’s unlimited data and great family plan price, so there’s lots of reasons why I should stay with Sprint. However, it seems that the latest phones always are released on the AT&T network, so moving to that cell carrier does seem to have some advantages. After some debate, I decided that I would stay with Sprint and try to do option 3 from above. Apparently I can pay an upgrade fee (about $100 I believe) when I’m within 12 months of my contract renewal which will move my upgrade up to now, and I can get a new smartphone at the subsidized price. So my cost would be $100 + $199 (for a typical smartphone) = $299. That’s much better than spending $700 buying a smartphone at list price.

In looking at available phones, the one that catches my eye is the HTC EVO LTE, which is due to be released on May 18th. It’s HTC’s latest technology, and has received very good reviews by the media. The real test will be when users get their hands on this new smartphone and report their findings due to daily usage. I’m hoping the Cell Radio, GPS, and WiFI receiver in this new HTC device works better than my current Samsung product. If not, then I may waiting until something better comes along, or I might try option 2 and go with AT&T for a few years.