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Why is the Nexus 5 (16gb) $500 at Koodo, and only $350 at the Google Play Store?


Koodo: https://shop.koodomobile.com/koodo-cell-phones/android/nexus-5/prodKLLGNEXUS5BK.html Google Play: https://play.google.com/store/devices/details?id=nexus_5_black_16gb&hl=en There's a pretty large price difference ($150) between Koodo and the Google Play Store for the same product, the Nexus 5 16gb. What's even crazier is that you can get the 32gb version for $399 on Google Play, which is still less than Koodo's $500 and has more space Can anyone shed some light on this?.

83 replies

Google doesn't really aim to make much of a profit on the nexus phones, so sell it for dirt cheap because they want people to use android and google services, etc. Carriers need to make money on phones and want you to go on contract, so make the off contract prices expensive. Though I'll admit $150 markup is expensive and more than the n4's markup was.
Userlevel 4
There are no subsidies through Google for the phone. If you think about how the tab system works, You can get the N5 for $350 after the Tab Small is applied. Tab Medium, you can get it for $200 and Tab Large you get it with no upfront cost.
Userlevel 7
Badge +4
It's the market retail price in Canada unfortunately. Robelus also have it similarly priced http://www.rogers.com/web/link/wirelessBuyFlow?forwardTo=PhoneThenPlan&productType=normal&productId_Detailed=NEXUS5BLK&N=52+11+4294948709 http://www.bell.ca/Mobility/Products/Nexus-5 http://www.telus.com/wireless/devices/nexus-5/
Userlevel 7
Badge +4
Why is it a problem? If it's cheaper from google, buy it from google.
Koodo: $500 + Tax (on any amount not put on tab), instant gratification, great customer service (and 14 day return policy at store) Google $ 350 +tax + $17 shipping, wait 3-4 weeks, who knows what their return policy is like (not saying it is bad, but at least with Koodo it is set in stone) You need to figure out what the savings vs time are worth to you.
Userlevel 1
Koodo: $500 + Tax (on any amount not put on tab), instant gratification, great customer service (...Anybody who is so impatient that they can't wait a few weeks for a phone (if they truly are not in need of one urgently) in order to save $150 needs to be smacked in the head very hard and probably doesn't have very good priorities.
Userlevel 6
Koodo: $500 + Tax (on any amount not put on tab), instant gratification, great customer service (...[i][...] needs to be smacked in the head very hard [...] I'll admit I lol'ed far too much reading this, lol
Userlevel 1
Koodo: $500 + Tax (on any amount not put on tab), instant gratification, great customer service (...Maybe they have more $ than ¢.
Koodo: $500 + Tax (on any amount not put on tab), instant gratification, great customer service (...spend $150 for "instant gratification"? come on? seriously? The greater issue is that once again the Canadian consumer is getting screwed and especially by ALL the Canadian cell providers who are all in collusion regarding price.
Userlevel 7
Badge +4
Koodo: $500 + Tax (on any amount not put on tab), instant gratification, great customer service (...How exactly is the Canadian consumer being screwed when they have the option to purchase it directly from google for far less? If they choose to buy it from a more expensive source that's their decision.
Userlevel 7
Badge +4
Koodo: $500 + Tax (on any amount not put on tab), instant gratification, great customer service (...The average Canadian consumer seems to have no idea that you can buy the phone directly from Google for $134 less (vs. outright from a carrier) or $166 more (vs. Tab M) but the phone is yours without a contract.
Userlevel 7
Koodo: $500 + Tax (on any amount not put on tab), instant gratification, great customer service (...That's because Canadians are used to being marketed "free" or "cheap" phones and the idea of getting contracts or "a plan" instead of actually buying phones. The problem with this model is we don't understand the value of them until a girl drops her iPhone in the toilet or a guy drops his Galaxy S4 on the concrete and the screen gets smashed. Then, their carrier doesn't want to cut them a deal on a new phone because it's not their problem - how dare they not help me with something they had nothing to do with - they freak out and write nasty things about them on the internet or use it as a topic of conversation with their friends.
Koodo: $500 + Tax (on any amount not put on tab), instant gratification, great customer service (...Google's return policy is just as good, if not better, than Koodo's.
Userlevel 7
Badge +4
Koodo: $500 + Tax (on any amount not put on tab), instant gratification, great customer service (...I disagree. Even if they are more forgiving in regards to what can be returned, as long as I need to ship it out, it's not better for me.
Userlevel 2
Google pretty much sells the N5 at cost. The carriers can not compete with that because they also have additional carrying costs with selling the phone (warranty, support, inventory, etc...).
Google pretty much sells the N5 at cost. The carriers can not compete with that because they a...No they don't. Google has all the same costs, plus the production risk, and warranty risk on phones sold to the carriers. In fact you know that if Google is selling the phones for $350 / $399 then the carriers are paying less because they are buying in bulk. This is just a cash grab for when people are forced to buy unsubsidized. The Carriers are trying to take advantage of customers in need of a quick replacement, and they are trying to make the promotional price look good. Who wants to sign a 2 year contract when you only get $250 off. But it looks better if you are getting "$400 off" Remember that built into the plan price is $20 a month for hardware cost. So a 2 year contract costs you $480. Unless you are getting at least a $500 discount you are being ripped off. (as usual from Canadian telcos)
Userlevel 5
Nevertheless, just buy the device from Google.
Userlevel 6
Nevertheless, just buy the device from Google.And the BYOD discount makes it a lil bit more appealing too!
Userlevel 5
While I don't know the exact numbers, I can pretty much guarantee that google is selling the Nexus 5 either at or below cost. But they are just trying to drive their marketshare and the new OS. They make their money in other ways. Whereas carriers need to cover a lot of costs which usually mean higher prices. As Marcel said, your paying more with Koodo but you get award winning customer service, great rate plans, and you get your phone right then and there.
Userlevel 1
While I don't know the exact numbers, I can pretty much guarantee that google is selling the Nexu...Despite what some people think, they aren't selling it below cost, they just aren't selling it for the kind of markup that carriers charge, especially since carriers need to give people a reason to sign contracts or use a tab system, so they artificially jack up the retail price to make their discounted price seem like a deal. As mentioned above, buy it from Play, apply the BYOD and you are much better off.
Userlevel 5
While I don't know the exact numbers, I can pretty much guarantee that google is selling the Nexu...The LG rep I talked to would probably disagree.
Userlevel 1
While I don't know the exact numbers, I can pretty much guarantee that google is selling the Nexu...The newest iPhone costs less than $250 for the most expensive model. Of course there are other costs that must be factored, marketing is a big one. The Nexus 5 has no real significant marketing, and I very much doubt it costs more to manufacture than the Aluminum iPhone (the 5c costs significantly less since it has a plastic casing, this would be more in line with the Nexus 5). I'd be shocked if the Nexus 5 cost anywhere near $250 to produce. Now, that doesn't mean LG will sell it to Google for that price, but they sell it at a price below what Google charges. Google's margin on the phone is thin, no doubt, but they don't sell at a loss. Carriers get charged more for the phone than Google does, so there is justification to their pricing it higher, but I think $150 higher is a bit unreasonable, although I get their pricing strategy completely.
Userlevel 7
Badge +4
While I don't know the exact numbers, I can pretty much guarantee that google is selling the Nexu...I have no idea where this "selling at a loss" belief came from. The only reason cell phones are so expensive is because of carrier subsidies. If people stop getting their phones subsidized, prices will be driven down. Most people don't actually go out and buy a $700 phone. They pay $200 and get locked in to a contract.
Userlevel 1
While I don't know the exact numbers, I can pretty much guarantee that google is selling the Nexu...Big +1
While I don't know the exact numbers, I can pretty much guarantee that google is selling the Nexu...IFIXIT rips apart all sorts of devices and prices the components out and its is very, very clear that the manufacturers of cell phones are not losing money on their prices, including the Nexus 5

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