Death and Taxes (or Here’s to the Egg Heads)
“Our new Constitution is now established, and has an appearance that promises permanency; but in this world nothing can be said to be certain, except death and taxes.” —Benjamin Franklin to Jean-Baptiste Leroy, 1789.
Right now, on Verizon Wireless, you can get any of eight smartphones for FREE! Now, I’m no Steve Jobs, but a guy selling sand at the Great Pyramid of Khufu charges something, so how is it that a wireless phone company can afford to give away the phone? Of course, the answer is that it is the 2 year contract comprising of a line cost and data package that earns the company their money. As far as they guy selling sand in the desert, I can only suppose it is marketing, charm or preying on tourists that earns him his money.
This business model, the loss leader, is not unique to cell phones. Inkjet printers…
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