For example I can purchase an iPhone 14 Pro Max from my carrier for $0 upfront and payments of $41.79CAD over 24 months. The retail price of the phone is $1539. $41.79*24 months = $1002.96. How is it possible that the carrier is essentially selling the phone for significantly less than the retail price? Am I missing something?
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Back in the day (I’m talking up until ~5-7 years ago) phones used to be free or very cheap (like $200) with a 2-year contract with your phone provider. They got rid of those plans and switched to trade-in + installment payments for the device. So now in addition to the phone bill you also pay for the device and almost always end up trading it back to them when it is time for an upgrade, so the provider is getting 3 lines of revenue from the same customer. Or even more if they upsell you on device protection or whatever else.
So sometimes they will offer a discount on the phone to get customers to switch.
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