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Mobilizing the Business and Business of Mobile

Rentobile offers hot phones for rent

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Here is a nifty service from a company called Rentobile. It offers hot phones like the Blackberry Storm, Nokia N96 and others for rent on a monthly basis for as long as you like for a monthly fee. This is a cool idea especially for those of us who like to play with multiple phones but don’t want to be locked into long-term contracts or pay high fees for contract-fee or unlocked phones. However, there is a down side to this. There is a break-even point for each phone beyond which you might be better off just purchasing the phone at retail price. For example, the Blackberry Storm costs $30/month to rent with membership. So, if you rented it for 12 months, you would end up paying $430 + monthly insurance (varies by phone and type of coverage you opt for). At this price, you might be better off shelling a little bit more and buying the phone outright. So, from a consumer perspective, this would only work if you are planning to keep the phone for fewer than 12 months.

From the business perspective, I am not sure if this will work in the long run. Sure, the company will have takers for its service, but I am not sure, if it will be viable in the long term. I see two problems with this service. First, the company will see heavy turnover of devices, possibly with returned devices in unusable conditions. In which case, the insurance coverage might not be enough to cover it. This will lead to increased insurance premiums which the consumers will have to pay and which in turn would shrink the customer base. Second would be its ability to stock new phones that are in demand quickly. Shortages in high-demand phones will turn a lot of people away from this service. It remains to be seen whether Rentobile is able to successfully negotiate these issues. However, it is definitely a promising service and of great interest to several mobile phone users.

[Via Boy Genius Report]

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Written by dvdand

December 31, 2008 at 10:45 am

Posted in Handsets, Others

Tagged with , ,

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