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Introduction

In this report, Ovum aims to examine how the US market shifted so rapidly from a traditional model of 24-month contracts and handset subsidies to device financing and open-ended contracts, as well as examining changes to each operator’s financing strategy since launch.

Highlights

  • When T-Mobile shifted to EIP, operators in other developed markets were also experimenting with EIP, but didn’t have the same success T-Mobile did.
  • The shift to EIP eventually led to the almost total elimination of the two-year contract option (Sprint being the exception).
  • Even though Sprint and T-Mobile offer leasing, the option isn’t expected to develop much further in the US market.

Features and Benefits

  • Learn about the timeline of the evolution to EIP in the US.
  • Identify the advantages of an EIP model for customers and operators.
  • Learn the success factors for EIP.

Key questions answered

  • How did the US market shift from a traditional 24-month-contract and subsidy model to one with device financing and open-ended contracts?
  • How has each operator’s financing strategy changed since launch?

Table of contents

Ovum view

  • Summary
  • How a two-year contract market shifted to an EIP market
  • EIP is still evolving in the US market
  • Service providers can tailor the EIP model to best fit their needs

Appendix

  • Further reading
  • Authors

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