Slashdot Mirror
Do You Buy Extended Warranties?
Stackdump asks: "I am a college student (senior seeking CS BS). I work partime at Best Buy selling computers (arg!). To be truthful I don't really sell computers; I sell what we call 'performance service plans' or PSP's for short. This is the somewhat gimmicky name given to Best Buy's extended warranties. To be fair they do actually provide some service in the store, swapping HDs, CDROMs, and so forth, but most of the hardcore repairs are done elsewhere or by the manufacturer. Prices range from $99 on the cheapest tower to $249 on laptops over $1000. Terms of service are pretty simple everything is covered against power surge, dust contamination, whatever... BUT abuse is not covered: so slam a pencil in your laptop and say byebye, but fry your computer because you don't have a surge protector and you can get a new one. As this is the central pre-occupation of my work day I ask the Slashdot community this: do you feel these warranties are really worth the money?"
No, they aren't worth it. They are a tremendous profit margin for Best Buy, which is why you even get a commission (which you failed to mention) for selling them. The high pressure sales tactics some people employ to push these things thoroughly sours my shopping experience in what should be the equivelant of my toy store. They are much like rebates, they are great for the vendor because people usually don't collect on the value they purchased. It's all a statistical formula at the end of the day. It does appeal to a specific market segment and demand, or else no one would buy them.
They are a scam. Salespeople are under incredible pressure to sell them -- try telling the salesperson you don't want one! They will beg and plead with you and ask you "why" -- they have to put down a reason. Say, "I just don't want one." They will go nuts. The so-called "extended warranty" is way overpriced and full of loopholes and exclusions. They are a major profit center for the big consumer electronics chains of this world. Most products already come with manufacturers' warranties -- the product will either fail within the original mfr's warranty period or it will outlast the "extended" period. And if someone dumb, like your grandma, buys an "extended warranty," good luck finding the sales receipt or other information -- most of us aren't that well organized.
What a load of crap.
Using your sig line to advertise for friends is lame.
You probably don't need one for your TV or stereo system (even though you get free speaker tweaking or whatever). These things are cheap enough and don't move around enough to face actual dangers. Also, if there's going to be a problem, it will be usually right away when those problems crop up, well under the normal 30-day guarantee most shops provide.
But for other things like laptops, cameras, and other things that move around all the time to environments that differ in humidity, pressure, electrical stability, etc. it is a good idea to pay an extra 20 bucks to make sure you can get these things serviced for cheap. You may never need to send it in, but in the odd chance you do, you will be saving hundreds of dollars.
I have been pwned because my
"My" first PC was purchased at best buy and well, it was not that great of a machine. I exercized the warrenty several times, by the time it expired I was working on a machine I had built, which had much less problems, and took much less time to fix...
For example one time the CPU in my Acer (from Best Buy) died as a result of the fan getting too much dust...
I went to best buy with the tower and told them I need a new processor and fan... They sent it to some service shop and I didn't get it back for 3 weeks
By contrast my current machine is an Athlon-based Beast purchased entirely at newegg... I fried the CPU once (it's covered for a year), I shipped them the dead one, they shipped me the new one... less than a week before I was back up.
In short its not that I think the warrenties aren't worthwhile as much as I think the computers at Best Buy aren't worthwhile...
Buttsex.
You are in the business of ripping off dumb people and people who are vulnerable to high-pressure sales tactics and techno-fear pitches.
Your soul is probably in hock already, I advise quiting before you loose it entirely. Honest work can still be had at fast-food joints, even in this economy.
P.S. When you get another job, do not:
- sell cellular phone deals
- insurance
- real estate
- stocks
You are badly in need of some honest job experience so you realize that you can do stuff for people, who pay you money, and you both benefit, no lying or pressure involved; this will stop you from thinking the whole world works like Enron and sying early, bitter, and disillusioned. As a college kid you might look into getting weekend work painting houses or mowing lawns.
However, I did buy the PSP for a Palm M105. After about 8 months though the battery cover clasp broke and they sent me a "gift certificate" for the cost of the Palm when I originally purchased it. WooHoo!!
:(
I used that to purchase a Sharp Zaurus on clearance. I didn't buy a PSP for that though because by that time I hadn't had a real job for over a year and a half and was broke
-Brent
Where I'm located to in Canada I buy a lot of electronics from Futureshop and I love the idea of buying an extended warrenty on expensive hardware. I purchased a mp3 player for my car a year ago and I got an extended warrenty (3 years) for around 50 dollars (taxes in). The fact that no matter what happens to my deck it will be replaced no questions asked with minmial hassle is a good selling feature.
Personally I trust large companies to last the test of time so I can actually use the extended warrentys unlike some small operations that I'm after seeing go under. If you are going to invest say 2-3 grand into a lap top what's an extra 250 to cover it for a few extra years? I know that companies make money off extended warrenties but I frankly don't mind giving them my money. The peace of mind is more than worth it in my opinion
"I believe in everything in moderation. Including moderation." -Dean DeLeo, Stone Temple Pilots
if you know how to use your machine and are reasonably able to maintain it yourself, then no, the warrenty is junk. otoh, if you dont, then the warranty might be needed.
analogy to a car: if you maintain your car correctly (ie, changing oil every 3 months), then a warranty may not be needed. dont change your oil, get tune ups, etc? then buy that warranty!
Best Buy wouldn't sell these if they didn't make money on them. If they're making money on them they pay out less than they collect. Therefore, over the term of the warranty, you're less likely to receive the money you paid for the warranty back in terms of repair cost than not.
;)
So if it's not a good economic proposition to buy a warranty (insurance), why does anybody do it? Well, on a house or a car, you can't afford to cover the cost of a loss, or a lawsuit (auto liability). If your house burns down, you can't afford to just buy a new house, but if you really could it wouldn't make sense to pay homeowners' insurance because the odds that your house will ever burn down are really low.
With a computer, or a TV you can usually afford to cover the cost of a loss, so, the odds are in your favor to not buy the warranty.
That said, Staples offers a nice warranty - any problems whatsoever and you get a Staples cash card for the original purchase price of the item, no questions asked (I even read the fine print). So, on my $89 Palm I paid $10 for the warranty, since it might malfunction by time I need to upgrade.
My God, it's Full of Source!
OUTSIDE_IP=$(dig +short my.ip @outsideip.net)
If you use your brains and don't buy cheap inferior products you generally don't need a warranty in my opinion.. unless your goign to fuck up overclocking it.
warrantys actually piss me off.. i think they are way abused much as returns are. I opened the box and it was broke!!! BULLSHIT you broke it and want another crack at it. Its gotta be raising the prices of the products i buy atleast a lil bit.
This is the stupidest Ask Slashdot I've seen in a while (excluding those posted by timothy).
http://www.archive.org/details/ThePowerOfNightmares
it's an insurance policy for the poorly informed. The original manufacturers warranty will cover 99.9% of all actual product defects. If it's electronic and it's going to fail, it will happen within the first 90 days of use.
As for covering powersurges and the like: Surge units are a much cheaper form of insurance, and a lot of the better companies will replace anything that gets fried while attached to their unit.
Whenever I get one of these pitches, I generally respond with, "If you think it needs that kind of warranty, maybe I shouldn't buy it to begin with. You think maybe I should just put it back?"
Concealed Handgun License Courses in Plano, Texas
I almost bought one on a digital camcorder, particularly because the saleskid said it would be covered if it got dropped, got wet, etc. But when I read the policy before checking out, almost everything he said was wrong. Almost nothing was covered. Now I never buy them.
You're saying a warranty on a $1k laptop costs about $250. Ignoring risk aversion, the warranty price would be fair if you had a 25% probability of completely breaking your laptop (1k*0.25=250), or 50%probability of $500 damage (0.5K*.5=250), and so on..
Factor in some risk aversion and you can somewhat lower those probabilities, but it seems to me that your assessment of the probabilities of breaking your stuff would have to be pretty high in order for the warranty to be worth its money. Or, your risk aversion should be pretty high.
It really depends upon the product you're buying...
Recently, I brought a printer and scanner. The CompUSA salesman convinced me to buy a warranty on the printer, and I must say that I do believe that it was a smart choice, as it was only $25 - $10 rebate with the purchase of ink (which I was going to do anyway). You see, devices such as printers are more prone to failure than others, and a carry-in replacment plan is definitely a plus (and a steal at $15).
However, for more expensive devices such as computers, I'd stay away from store warranties when they range over $200. If you REALLY want a longer warranty, buy from a direct company such as dell or IBM, which offers onsite service (which can be a godsend for small businesses).
So, in summary, only get it if you feel the device is prone to failure, and the price is right.
-- If you try to fail and succeed, which have you done? - Uli's moose
I have had my cell phone "break" about 5 times now over 2 years to get a full replacement each time.
Also these things will cover your laptop battery for years. Consider the cost of a replacement battery (for most laptops this is the same as the cost of the PSP) its an insanely great deal.
Over all, I figure I have cost BestBuy about twice as much as they ever paid me :) Would I buy anything from them with one of these deals without the discount? Hell No!
I bought a four year warranty for my desktop in 1998 and I bought a three year warranty for my laptop that I purchased just last summer. Both include parts and on-site labor for any hardware problem that arises, excluding fire (covered with home owners insurance) and acts of vandalism (for insance, I believe the Dell warranty specifically mentions hammer marks). They have both served me very well.
The first computer I bought a warranty for was an open box HP from Circuit City. The computer itself cost $1200, but because it was open box, I decided to spring for the $200 warranty. It was worth it. Since 1999, Circuit City has sent me a new monitor and a new keyboard. The best part about the new keyboard is that they misdiagnosed the problems on reality my old keyboard still worked (turned out to be a problem with the BIOS, simply requiring me to update it to the most recent version), so I got two free keyboards. But wait! There's more! Once I busted my motherboard by putting a bad card into it and a service guy came within a few days (in a snow storm no less!) and replaced the motherboard. Last year my CPU fan died and they sent a tech to replace that, too. My CPU fan is about to die again and I'm going to try and get them to give me a last one for free just before the warranty expires. All of that on-site service was free, paid for by my warranty. I think I got my money's worth.
My laptop, a Dell, is less than a year old, and the warranty has already worked wonders. A piece of the case started to fall off, so I called them and got them to send a new piece in the mail. It arrived the next day. Additionally, they are coming tomorrow to replace my laptop fan. In addition, whenver I have a stupid question like "why is this laptop about 200 degrees?" (that's when they explain that it's really a "notebook" computer and that putting it on your lap will actually burn your crotch!). All in all, I get my money's worth of out warranties.
Paying $30 for 3 years of protection on a $100 appliance probably doesn't meet the cost/benefit ratio for most people. At the end of the 3 years, you'd probably would have bought a new version of the $100 item.
Paying $300 for 3 years of protection on a $3,000 device could make sense, depending on the device.
Some devices don't hit the obsolecence curve as rapidly as PC's...
I think the extended warranties just recover the profits lost by businesses to smaller profit margins. For customers that want to have a product that is "backed up" by the sellers, they have to cough up the money.
I have gotten the warranty on almost everything i have bought @ circuit City, and it has been worth it every time.
My desktop computer - Warranty cost = $149
Replaced HD - (got a bigger one for free)
Replaced CD drive (got a faster one)
Replaced Monitor (got a better one)
My Laptop - $199
Replaced HD (dropped it)
Replaced DVD
Replaced Monitor Port on back (got bunged up)
still got time left
and the video card is gonna fry soon so... (contact me if u have any exp for why my compaq 1700XL 265 screen would turn white and not go back till it cools off)
My Stereo - $60 for a $500 surround sound package
Replaced Reciever (power surge)
Replaced Center speaker ??
My Minidisc - 40ish
they will send me a check for 149.99 (what i paid) if it breaks
(it may break about a month before 2 years???)
Conscience is the inner voice that warns us somebody is looking - H.L. Mencken
If it's something really pricey (fridge, laptop) I will, but cheaper stuff (TV, stereo, DVD player) no way. If those things crap out they're replaced without too much pain, and if they do the manufacturer's warranty may cover it.
I DID get one for the Sony Clie SJ30 I just bought, one, because I never know what will happen to this thing, two, it gives me an additional avenue of resolution if something craps out with it.
Re: computers, I just build them myself. I tell friends and relatives to not to buy the plans though.
I dont know about best Buy, but Circuit cities CSP (Customer Service Plan) does not cover batteries as they are considered a part that always fails in time
(pissed me off cause mine died like a month after the 1 year warranty that Compaq would cover it during)
but my $149 battery does last twice as long as the first one
Conscience is the inner voice that warns us somebody is looking - H.L. Mencken
You pay for cheap crap now and a warranty too, then later when it all breaks you get to upgrade for free. Everyone wins!
I used to work at Staples when I was 16. I was the top seller of extended warranties. You know why I did it? Social experiment. I wanted to see how many people that seemed like intelligent individuals could be conned into purchasing something that should be given to them for free. Not surprisingly, almost all of them. That's why these stores make such a big deal out of them; they can easily be sold by someone with the right determination and pitch, and they are extremely profitable. They are extrememly profitable in the short-term, while the long-term effect can be written off or modified as they see fit. Read the fine print :)
Secondly, I don't BUY a warranty. A warranty is the promise of protection against product defect. A warranty is something that should be provided. I don't BUY the ability of their product to work beyond a certain date. That's just ass-backwards.
I realize that you can rationalize it away however you want to make the corporations seem less evil for doing this, but the point still stands whether or not you try and figure out cleaver new verbage for it: A warranty is a warranty. You don't buy it; it's provided as a show of good faith and as a promise that the manufacturer will stand behind their products.
Now I'm pissed off just because I thought about this again. I still have the damned award I won for selling the most two months in a row. I keep it as a reminder to myself that people in the grand scheme are stupid, gullible, uninformed, and weak.
This is just my opinion. If you don't agree, ignore it.
For replacement (i.e. destruction or loss) I've yet see an extended warranty that decent homeowner's/renter's insurance wouldn't equal or beat. Sure, insurance plans have deductibles while the extended warranties generally do not, but think of the extended warranty premium as your deductible.
For repair these can be useful for extending the warranty term beyond the original manufacturer's limit, but even then some insurance will help you. Frankly, in our little consumer orgy of an economic system, most items are replaced before their manufacturer warranties run out anyway, so it's moot.
Extended warranties are nearly pure profit for retail chains: they sell you something that you'll likely never use for what is often a premium over what the service (e.g. repair) would cost you anyway.
This isn't as much "normalization" as it is "don't take so many drugs when you're designing tables."
First, let me preface this with a disclaimer: A large part of my family's stock portfolio is in Best Buy, so I'm biased toward the store.
Having said that, of course they're not worth it, and simple math should show you that. If it were worth it for the customer, a product of this type would not make a profit for the store and they wouldn't be pusing them so hard.
If I spend $100 on an extended warranty (whatever it's called), and get $100 in parts for it, the store doesn't make money. They make a profit because the products are generally reliable and only a tiny fraction of these extended warranties. It's the same as insurance -- you pay huge bucks for insurance and if you ever file a claim, they either drop you or up your premium to help pay for what they've spent. In theory, you're paying them to take care of you if you ever need it. As long as you're paying in and not taking out, they make money.
As long as most customers that buy extended warranties don't file claims, the store makes a huge profit. You can bet that if a particular product were unstable and not reliable and everyone who bought an extended warranty on it filed a claim, they'd stop offering the e.w. on that product because it would no longer be profitable.
On the other hand, if you're Joe User and have a life (instead of spending it all mucking w/ 'puters), there is the benefit of not having to worry about replacing parts.
I've got two stories where buying the extended warranty helped. One was an open box receiver from Circuit City. It died and I got it fixed. They sent me a renewel notice but its a little dated so I didn't get it. So far so good. A friend of mine bought a laptop from CompUSA and it died several times before the extended warranty gave out. I think he ended up convincing them to give him a completely new model when it died one last time before the extended warranty was up. So a couple stories where the product was perhaps a little questionable and it helped. On the whole I think I've seen more times when the extended warranty wouldn't have helped.
For the most part though it's a matter of statistics. In general if a product such as a car is going to have a problem it will likely have it sometime during the first (manufacturers) warranty period. Past that period and the odds are in your favor to have a product that will have a normal lifecycle. In other words it will break when the extended warranty would have cut out.
In Republican America phones tap you.
They already have your money in the bank earning interest. So even if you get all of your warranty cost back, they've still got that interest.
I wouldn't buy a warranty for a computer. Of course, I wouldn't buy a computer from Best Buy.
I know how to diagnose and fix a computer. Most of the parts that will go bad are cheap, and a year later when they actually go bad they'll be even cheaper. By buying a warranty, I'm paying for the diagnosis and installation, as well as the parts. It makes no sense.
If you no nothing about computers on the other hand, and you don't know anyone else who does. Well then you're probably the kind of person who will buy a computer from Best Buy.
I purchased one on a few things... sometimes, if you use them, they make sense.
For example, I purchased a handspring visor prism and paid 80$ for a warranty. 1.5 years later, the battery ceased holding a charge. I took it back to my local best buy, and they took it back, and gave me credit for 450$ towards a new handheld. When i picked the sony clie 615c, they rang it up as 450$ instead of 350$, so that I would have the full amount of credit if it ever went bad. I havent had to use that yet, but wouldnt hesitate if i had a problem. It was a completely painless experience.
In fact, it prompted me to spend the money on a plan for my digital camera, because it also covers the batteries and such. So in a year, when the 100$ battery stops charging fully, i can just swap for a new one... all because of a $30 up front plan.
In some cases it doesnt make sense. But in the case of smaller things where some essential component cant be cheaply replaced (i.e. batteries in pdas, digitizers, lenses, etc) it makes a ton of sense... and if you ever need it, they essentially throw in an upgrade for free.
Not a bad deal really.
I have purchased the warranty on a few of my lesser priced, more breakable electronics from Best Buy. I got the three year warranty for my cell phone, and have since had about 6 different handsets. Cell phones break a lot under normal use, and for 40$ I will gladly pay for the peace of mind knowing that I will never be without a cell phone.
On expensive portable items, if you plan to use them a lot. I've already ruined one keyboard on my laptop, and was happy to not pay $300 (or so) to have it fixed. Same thing with my phone. My Motorola V-BOX POS finally busted a few months ago and they were happy to replace it with a Nokia 8390. And then the power button on that busted, so I got a third phone (which I had to unlock manually because Rogers are stupid).
:-)
I doubt I'd get coverage like that without a warranty.
Anything else is probably a waste of money. And while they say the warranty doesn't cover abuse, it takes some really obvious abuse (like running over your laptop with a car [happened to me]) before the customer service guys will care. I'll let you guess how my keyboard broke, just like I let them guess.
If you could be told what you can see or read, then it follows that you could be told what to say or think - BoC
After removing a crayon wedged in his brain, Homer finds himself a genius. A miserable genius. He goes to Moe(moonlighting as a surgeon) to replace the crayon.
... ... [taps once more]
Moe: So what do you want here, uh, appendectomy, lipo, or
the sampler. That's very popular.
Homer: [holds up a blue crayon] I want you to stick this crayon
into my brain.
Moe: No problem -- the ol' Crayola oblongata.
Moe: All right, tell me when I hit the sweet spot.
Homer: Deeper, you pusillanimous pilsner pusher!
Moe: All right, all right. [with a small hammer and chisel,
taps the crayon further up Homer's nose]
Homer: De-fense! [woof-woof] De-fense! [woof-woof]
Moe: Eh, that's pretty dumb. But, uh
Homer: Extended warranty? How can I lose?
Moe: Perfect.
-- Simpsons episode "HOMR" BABF22
My first foray into the IT field was a tech support job at GE's sister corp, National TechTeam. My 'project' was COMPUTER SUPPORT PLUS, basically Circuit CIty's extended warranty support.
Because we don't like replacing 5 year old technology (mainly because that 300MB hdd that came with your HP doesn't exist anymore, so we would have to upgrade you to the smallest thing we could find (at the time 4GB) when you called us it wasn't as much of a tech call as it was an "insurance claim".
Just as the insurance adjustors pour over your house looking for signs you set the fire yourself, we'd pour through your system looking for the easiest out so we didn't have to fix your PC. Since this was a hardware support place, if you upgraded your PC to a new OS, we couldnt help[ you. Put in a new modem? Sorry, youll have to put the old one in. Threw it out? Oh well, no support for you!
If your hard drive wa son the verge of failing, but hasn't actually failed yet, we couldnt help.
Every call we tried to weasel out of as a software issue. EVERY SINGLE ONE.
It took (on the average) of over 30 days to actually get something done, and replacements were almost always inferior.
I'd stay away from em for the most part.
Think of it this way:
If you paid 200$ for an extended warranty on your PC and 3 yearts later your HDD dies, you'd get a replacement close to the size of your old hdd.
Now, if you saved that 200$ and used it to buy a drive 3 years down the road when yours fails, you'd be able to purchase over 10 times the capacity of your old drive!
Looking for hardware (Currently need: Large Etch-a-Sketch) Have one? See my journal!
This is a no-brainer. If you never buy them - EVER! - you can take the money you will save and replace your own stuff when it breaks! Duh!
--- gr8s-n-ppppp
For certain items including Laptops and PDAs, this is not only recommended but necessary; provided, the screen is covered.
I purchased a Visor and broke the screen only hours after purchasing it. The extended warrenty saved my *$$.
I worked at Best Buy for 1 year and we did not make commission on PSP's (this was in 1998-99). We were in fact pressured to sell them. It certainly was a way for Best Buy to increase revenues. Except for a few instances I remember, people were generally happy with the warranty service. Sometimes it might take longer to get the item fixed than the customer might like, but in general, I think they (PSP's) are okay. I'm not sure what they cost now, but I remember that a hard drive replacement would pay for the warranty. Of course this is when the largest drive out was about 10 GB and they cost about $250. I seem to remember that we did not have many people bring items back for repair, except for Packard Hell's. OH the HORROR!!
Co-founder and designer at Music Nearby: http://musicnearby.com
I don't buy extended warranties as a rule. On my $500 (Canadian) purchase of a Radeon 9700, the extended warranty would have been something like $60 and it ALREADY COMES WITH A MANUFACTURER'S WARRANTY good for three years.
However, one product I will buy extended warranties on is laptops. However, the price mentioned here is terrible. Dell will sell me a Complete warranty for three years for about $350 Canadian and that DOES cover abuse. Paying more than that (you list $250 U.S.) and not getting covered if I drop my laptop, that's just a scam. I mean, laptops simply don't break often enough to justify that kind of price unless it also covers abuse.
No, I feel actually quite insulted, generally, when offered an extended warranty. Particularly after seeing the complete incompetance of the technicians at Future Shop (the only place here in Canada that routinely offers to sell me the warranties).
Oceania has always been at war with Eastasia.
I'm a fan of the Toshi warrenties. They're reasonably well prices, give you 3 years of warrenty. It'll cover you for the life of the product, it's just not worth the risk
There are only two things I've ever bought the extended warranty from.
Both I bought from Future Shop (which I think has one of the best warranty plans)
I bought the warranty for my PS2, a 2 year over-the-counter replacement, no questions asked, for about $30. I figured this may come in handy as my last PS2 died in under a year, and the 90day warranty from Sony was long overdue.
The other thing was my Sony FD WEGA TV.
It was listed @ $999, but I since I got the display model (they were out of stock at the store) the price was $899. Because I told them I couldn't afford more than $1100, they dropped the price of the 6 year warranty to $75 (as opposed to $150). Every 6 months I have techs from Future Shop come to my house, open up, and properly clean my TV as part of the warranty.
I must say I am very pleased, however I would never buy extended warranty from any other store, and I would never buy extended warranty on any computer parts. Both for much the same reasons many others have posted here.
I've dealt with the Future Shop extended warrantee on a few occasions, and I'd say that for pricey (or possibly risky) items it's a good shot.
Anyhow, for my own personal story of happiness, I bought a 12" subwoofer and on a whim, decided to get the extended warrantee (I almost never get them). Well, about 8 months later, as I was screwing it into a new box... my driver slipped and I put a nice crack in the bell. All I did was bring it back... say that "the bell on my sub is cracked", and I got a new one... no questions. I've heard salespeople sell them saying specifically that it will cover speakers if you overcrank and blow them as well, so it's almost idiotproof.
However, I've also heard horror stories where local staff cannot fix a PC, and it bounces from service-station to station before somebody with half a brain can fix it. Personally, it basically comes down to that while extended warrantees are nice... it's also important to have a knowlegable dealer (and in the case of computers, not a no-name parts-monster) when buying a PC etc. In that case, I'd rather have a normal warrantee on a good product... from a deal who knows a bit about what they're selling.
Conclusion: Extended Warrantees can be nice from some stores, but don't use them as a replacement for quality manufacturing or service.
Confession: I'm much smarter than I was at the time of this story, but the principle's the same.
Back in 1994, I worked for 6 weeks at Computer City, a chain of stores owned by Tandy, the same folks who own Radio Shack. I worked there for a number of reasons, one of which was to learn a bit more about computers. (And I actually did: seeing everything that Computer City had, made me realize at the time that I knew a lot less about computers than I thought I did; the store taught me nothing except how to close a sale. I've since learned a bit more about computers, enough to make an honest living at the trade.)
One day I sold a Mac. Like a lot of PC bigots, I knew very little about them, but repeated the usual line of BS that I was given, the guy wanted the item we had in stock, along with a printer & the rest of the stuff needed to make it work. So I grabbed him a cable from the Mac hardware aisle, & sold him a service policy on his purchase.
Then I got a better job, left Computer City & went on with my life. I happened to stop by there to do some shopping, when one of my former cow-orkers stopped & tried to chew me out for that sale: it turned out that I had given the guy a SCSI cable & not a Mac printer cable. Because he had the policy, Computer City had to replace 2 motherboards before they figured out what was wrong.
Personally, I have no guilt about the episode: this was only the most egregrious mistake I made while working there because they failed to offer more than a minimum of technical training. And about the time I learned enough to be competant selling computers, I knew that all of the computers sold at these retail stores were crap, & I was better off (for my sanity & pride) NOT working retail selling them.
Geoff
I think I see a trend here. Maybe for them it really would be easier to muzzle the entire internet than to produce p
Rust-proof undercoating! How can I lose!
</homersimpson>
Comment forecast: Bits of genius surrounded by a sea of mediocrity.
Extended warranty, how can I lose!?
If you have a tendency to blow out speakers sometimes or if you really punish your gamepads/joysticks/whatever by playing too vigorously, or if your mobile regimen is really demanding on your pda or laptop, buying some protection may be worth it. But that's only if it's almost a no-questions-asked warranty. CompUSA's "replacement plan" has been really good to me on parts I use and abuse, even for relatively inexpensive items.
In most circumstances, though, it operates on the general principle of "risk management"- you're really buying psychological security at a steep price. Be good to your equipment and spend some of the money you would have spent on an extended warranty on inspiring books. There are cheaper ways to get a more genuine sense of security.
I bought one from a certain big name store, and, after the power rectification circuits on my machine failed after a good 1.5 years of use & abuse, the opted to give me a new machine, rather than buy replacement components. They're a good deal, especially after you've spend $2500+ on a machine.
Same thing for my car. I bought an extended warranty for my car and, so far, have had approximately $3000 in parts / work done (2400 was the transmission, mind you). Definitely worth it.
Michael C. Hollinger
Overall, they have to collect more than they pay out. If it was a good deal, they wouldn't be selling it, because they'd lose money. Also, the store has to get a good markup on it or they wouldn't push it so hard, so in addition to being a bad deal at wholesale, at retail it must be even worse. You're looking at like 10% in voluntary fees.
They can be hard to collect on. I've had difficulties getting things repaired. In fact, I was told that I was lucky that the (boss's IBM laptop) machine was still under the manufacturer's warranty, because getting it fixed through that was so much easier. This is straight from the extended warranty department at C_ C_. This brings up the next point.
They usually duplicate manufacturer's warranties. IBM provided a good 1 year warranty. You may be told that they're worth more, but make sure (read it) before you sign anything.
At some shops, you can buy them after the sale for some period of time. They want to sell them that badly. That can't be a good sign. That also means that you don't have to decide while the guy is hovering over you.
One clerk pointed out to me that it's a better deal for things that'll be used in a hostile environment. The $500 camcorder that goes to the beach needs it more than my $80 DVD player. That camcorder was actually a gift, and I'm more likely to provide such a thing as a part of a gift.
They could also be good if you're really risking way more than you can afford to lose. A similar example is automotive liability insurance. If you hurt someone with your car, it seems reasonable to do everything you can to be responsible about it.
Buy reputable products, from reputable vendors. I like what one poster said. "If I need the extended warranty so badly, it must be crap. See ya!"
Know your exposure before you buy an extended warranty.
Assembly is the reverse of disassembly.
Sure, $250 for 3 year extended warranty on your new computer or laptop is probably a scam at best, but really. The whole idea is so shaky that a little time put into thought will get you anything.
1. Static kills = plausable deniability = free new stuff.
2. Water damage = you stupid from techs and NO fre stuff.
3. Speak to the sales manager or store manager, don't yell at the sales guy or tech. They can't do anything for you duh!
4. Complain about anything but don't direct it to the manager themself, aim at FutureShop and your experience/inconvience.
5. Computers are the best (3 repairs), new HDD, new mobo + processor, new DVD/CDRW drive then new computer. Can't complain.
Electronics Boutique offers extended service agreements on everything. It's basically insurance, since they cover everything except theft.
But you need to ask yourself what's worth the insurance, and what's not. Is it worth another 50$ to have your PS2 replaced with no questions asked for 2 years? How about little GBA game holders? (A pack is 5$, the ESA is 3$).
On some items it really makes sense, on others it doesn't. I'm glad I paid the extra 100$ on my TV, because I get it fixed for free. I bought an ESA on my Xbox, and am happily on #5 (2 motherboard failures, 2 bad DVD rom drives). The failure rates on the first gen consoles from Sony and Microsoft are scary.
--
Internet Explorer (n): Another bug -- that is, a feature that can't be turned off -- in Windows.
I buy Apple's AppleCare Warranty whenever I buy a new Mac. (I bought a new iBook and a PowerMac just two weeks ago, both with extended warranties.) Like many manufacturers, Apple only provides a one-year warranty with their systems -- you've got to pay extra for a two-year extension for a total of three years. ($169 for an iMac, $249 for an iBook or PowerMac, $349 for a PowerBook.) It always seems expensive at the time, but 30 months after the purchase date, when the AC plug gets all wigggly, the video card becomes mysteriously fried, or the hard drive up and dies, it looks like a pretty good deal.
-Waldo Jaquith
I personally like IBM's (ThinkPad) on-site service (warranty). If your laptop's monitor gets fried, a guy from IBM comes to your office and fix it for you right there. Hard drive, keyboard, same thing.
But whether the price you pay for ($1000.00+?) works for you really depends on your circumstances. If you live in a country side (I don't know, Texas?), it can take hours for tech guy to get your house; on the other hand, if you live in a city like SF, NY, they might be working a couple of blocks away from your office and tech guy can come knock your door within 30 minutes after you call them.
Also this type of service depends on what work you do and how much money you are making. If you are one of super star developer/architect and use computers 60 hrs/wk or more and make 100$/hr plus, money is well worth it. On-site service mitigates your loss to, $200.00 - $300.00? What if you have no warranty and you need to order new computer? You'd lose $1000.00? $2000.00? Maybe more.
You can usually get a good deal on the warranty if you want it. Just ask for a better price/longer period. Often you can get it.
A Multiplayer Strategy Game for Mac OS X, Windows, and Linux
and at officemax, we had MaxAssurance, which we routinely told the customers the plan covered things it obviously didn't.
Let's put it this way. The companies (NWE and GE, among others) make an INCREDIBLE PROFIT off of these plans. If they make a profit, that's proof that these plans aren't worth the money.
Mathematically, there is an x% chance that whatever you will buy will have some sort of problem. If you multiple x% by the cost of the product, this is called the "expected value" in statistics. If they sell the plan for more than the expected value, they make money. Simple as that.
By the virtue that they are still in business, they are selling it for more than the expected value. Which means they are ripping you off.
We got a 10% commission at OfficeMax to sell these, and we would use any dirty trick to sell them. This has been reduced to 5%, I've heard, mostly because I think the customers are wising up. Most of what people tell you are covered in the plan aren't actually covered.
Staples has an Extended Service Plan, but I work in the CopyCenter so I don't really know anything. I just make copies and get paid $10/hr most of the time to do my Physics homework. Its a pretty nice deal, because the other copycenter associate is a hispanic who can't speak English, and I'm super-competent. This is an arrangement that will last a long time.
When I buy a computer from a retail outlet I'm buying the least expensive one there. It's just not worth it for a system that is less than $400.
Go here to create your own Slashdot dis
So insurance is a gamble, right? You bet some money that you're going to get hurt or your stuff will break or your house will burn down, and if you're right you get a big payout. But in traditional economic terms, the odds are against you, because the insurance company chose your premium specifically for that reason. But it can still be reasonable to buy insurance. Here's why:
It all boils down to the fact that the utility of money is not linear. My (hypothetical) millionth dollar is worth less to me than my hundredth. That hundredth dollar is less important than my last dollar.
So paying $10 to elimiate a 1/1500 risk of losing $10,000 doesn't make sense if you have a million bucks (since you can afford to play the odds and accumulate enough samples to make the expected averages show up), but if you have $8,000 it's a whole nother ball game; one 'loss' and you're fucked. The insurance providers have pockets deep enough to play the odds, and as a result it's profitable for them; if it weren't they would raise the premiums until it was. It's economical for them to cover risks you can't afford precisely because they have a fuckload more money than you do. So when you're talking about losing your last dollar, to them it's just another dollar and paying it out to you doesn't hurt them any more than any other dollar.
So what does this mean? Insurance on small items, that you can afford to replace, such as (hopefully) consumer electronics, is probably not worth it. Situations where 'losing' would constitute a larger percentage of your net worth (cars, homes, personal medical fees, liability for hurting other persons) are where insuarance can be quite reasonable, despite what an erroneously linear risk v. reward calculation might suggest.
Basically when considering insurance ask yourself "what happens if I need the insurance and don't have it?" If the answer is something like "I'm out $250" instead of "I'm fucked" you probably don't need the insurance / extended warranty. If it DOES make sense for you to buy the extended warranty on some consumer electronics, that probably means you're buying something you can't really afford, and you should reconsider the original purchase, not pay extra.
Trees can't go dancing
So do them a big favor
Pretend dancing stinks!
Extended warranties, as well as all insurance, are simply a form of gambling against yourself. You're betting that something bad will happen to you or your purchase within the warranty period that will cost more than the price of the warranty or insurance to fix. The fact that insurance and extended warranties are some of the most profitable industries in the world is proof that this is a losing bet. I'll also note that if the manufacturer is the one providing the service on the extended warranty, its in their best interest to make the product as reliable as feasible, to minimize service calls and maximize profit. Just keep your money, the vast majority of the time you'll end up ahead.
When I picked up a laptop a few years back, I decided to get the 3 year, on site, next business day warranty they offered. Only cost an extra couple of hundred dollars on a beefy laptop and, given the thing is my work & my life, I can't afford it not working.
Sure enough, within the first year, the keyboard started acting up. After swapping keyboards, motherboards and pretty much everything except the hard disk and CPU, they finally decided to replace my whole laptop.
Best bit was, they never took back the old one, so while it has keyboard problems, it still works. I now have two sweet laptops for the price of one with the old one used for CD ripping, burning, playing music and watching videos while I work on the main one.
Very handy.
So, given the importance of a laptop, I recommend my clients get a good on-site warranty if they're buying from a "big name" brand. Of course, it pays to check who's backing the warranty, what happens if the original supplier goes out of business, etc - there are some wonky operations out there and warranties that aren't worth the money you pay.
I left my body to science, but I'm afraid they've turned it down...
I worked for a department store in the UK (Currys, to us Brits), and the chain sells warranties like there's no tomorrow. For everything - including water filters and mice.
A warranty on a computers costs between £100-200 last time I checked, and you basically pay this money to promise not to put anything inside the computer, or take the lid off. They don't actually sticker seal it or anything, but you're supposed to go back and pay an extra £30-70 to have anything else fitted by a "professional". Look what happened to Gary Glitter I say (although he deserved it, the paedophile). I wouldn't want to hand my computer in just to let a load of people browse through my computer.
Why not instead just insure? My laptop is insured for everything up to being thrown down the stairs or being left on the bus. It's certainly cheaper than an extended warranty and covers more things.
I used to work for Staples and they had similar plans. We earned a small portion of the value of each plan and were pushed to sell one with every electronic device we sold, the managers using this as an excuse to pay us low wages. At a first glance they seemed to be worth it, especially when devices started shipping with shorter and shorter warranties, but since leaving there I've discovered the other side of the equation...
The warranties themselves suck. You'll spend an extra few hundred dollars on 3 years of "in-house" service, which in reality means that they will cover the shipping costs to have something sent off for repair. Worse still, the customer has to cover the costs first and then they are refunded later, meaning yet more money out of the customer's pocket.
I had a 19" Pixie monitor for several years which I bought at Staples and got a warranty plan on it. One day it stopped working. I called up the 800 number for the warranty plan it was on and was told that they would cover the shipping costs, but that I would have to pay for it first and they would refund me later. Being broke at the time I ended up not doing this - the cost of the warranty plan would have paid for the repair, and then some.
So, though you'll be told by managers that it is the right thing to do, don't believe them, it is a waste of money, just like extended warranties on cars.
I generally don't buy one with new equipment, but I almost always get one with open item equipment. I've purchased several things opened item at best buy (receiver, DVD player, Sony Wega TV). Each item was missing either a manual or a remote. You can usually negotiate a better price. In the case of the TV, it was missing the remote. I asked for a lower price since just about all the advanced features required the remote. They dropped it a further $150 (down $200 total now). I then said that they had a deal if they threw in a ESP. They did so I saved $200 + the cost of the ESP on a $750 TV. BTW, the ESP covered lost remotes so I just ordered a new one. I had it in my hands a week later.
The same thing worked on the receiver. I asked for the ESP to be included and they happily did. I've yet to use it, but I still have it and it didn't cost me anything extra.
Many credit cards will offer buyer protection for upto 5 years. Check out the details on your card since it may be a better than than the extended Warranties.
Well, they sure as hell *can* be worth it. About a year ago a hard-disk in my 2,5 year old Compaq failed. I had an extended warranty and went to back to the store (Dixons). They weren't able to replace the hard-disk, so they gave me about 1500 euro (the original purchasing price) dicount on a new computer of my choice. I don't think it would've been possible to get this service without the 200 euro extension... even if they are legally oblighted to deliver a product that works as expected.
I know this is about to be modded as Flamebait, but if you look at every single thread so far on here, they all basically say:
"I don't buy them because people make money off selling them."
Well, fucking DUH. WHY DO PEOPLE SELL ANYTHING? TO MAKE FUCKING MONEY.
I work for a retailer, that sells things with Service Plans. Virtually everything I buy, I buy the service plan for. Headphones, CD players, telephones (especially WIRELESS phones), you name it. The only things I don't buy service plans on are things that I have no intention of using on a regular basis (sometimes you buy something that you're only gonna need once in a damn lifetime).
Let's see:
24-disc CD changer: replaced when it broke, after repair center deemed "could not reliably repair" Cost of service plan: $60 for 5 years. Would have been repair cost (to get an unreliable repair): $100. Replacement cost at that time: $250.
Laptop computer: 5 year service plan, $249.
Replaced in year 4, after the floppy drive stopped functioning, because the manufacturer no longer made a floppy drive compatible with that unit. Replaced a 486/33 laptop with a Pentium 266. Not bad for $250.
Refrigerator: Bought house, refrigerator in house still had a couple of years left on the service plan the original owners bought on it. Sears replaced refrigerator, with free delivery and taking away of the old one, after their repairman did not have the necessary parts available within 24 hours. Cost of service plan: $100. Cost of refrigerator: about $500. Cost of replacement: about $1000.
Just on those few examples (and these don't count the dozens of times I've replaced my favorite headphones when the cords went bad!) I've probably saved over $2000 just by buying the service plans.
If you're not making $80k/year, can you really afford to replace all the gizmos and gadgets that you like to play with?
"Champagne for my real friends - and real pain for my sham friends!" http://ericblade.postalboard.com/
you can't guarantee anything about the future so its pointless to worry about it :^)
Before adopting WHATWG, read the moonlight.NET EULA [http://www.microsoft.com/interop/msnovellcollab/moonlight.mspx]
http://newssearch.bbc.co.uk/cgi-bin/results.pl?sco pe=newsukfs&tab=news&q=warranty&x=16&y =10
There are a few instances where you'd be a fool to skip the extended warranty. As a customer, you can't always tell when, though.
Two examples, both from Radio Shack: When I worked there, ham radios had a 5-year extended warranty (TSP- Tandy Service Plan), for USD50. Particularly for the handhelds, which get bumped around all the time, you could just bring it in every year and say "it seems to be a bit off-frequency, and get it realigned. At the end of 5 years, it was as good as the day you bought it (which was already pretty good - they were outsourced from Standard Radio), at a cost of USD10/year (+ initial purchace price of about USD250).
The other example was headphones. I used to sell the USD20 headphones for USD45 all the time, adding on a 5-year TSP. Again, headphone cables take a beating. When you start getting that intermittent open (scratchy sound as you move your head), you bring it to the store, give your phone number, they crossreference that with the item number, toss your old one in the trash, and hand you a new one off the shelf.
Other than that, the TSPs were nearly pure profit for the company. We were paid 25% commission on them, at least for a while, as opposed to 7% on regular merch, 10% on forcefeed (the little connectors and stuff in the back), and 3% on computer stuff. If you have the time to look at the costs, benefits, and how the item will be used, you can occasionally find instances where they make sense. Most of the time, just laugh and walk away.
in the return policy == good to go
in the manufacture warranty == pay shipping to and from, outside of 90 days pay labor
outside of the warranty w/o extended warranty == throw it away
i work for staples, and i used to make money on the warranties, 1$ on prp(product replacement plan) and 5% on the cost of a tsp(technical suport plan) however they have stopped doing this and are now moving back to a comission based on your sales...(there a lot of details to this, post a message asking for details and leaving an email addy if you care)
our prp is a one year extension on the manufc. warranty and is definatly worth it on some items. for instance
$200 monitor, plan is $19.99,
$100 after rebate
it "goes bad" in your warranty time, call up, its bad, they walk you through some steps, one in ten has to send the item in shipping PRE PAID.
you get $200+tax back on a gift card to spend in the store even though you only paid $100+tax
our tsp is what we used on pda's and digital cameras but i think its most important role is on things like computers and expensive laser printers
you have the option to buy tsp's with 2 years or 3 years of service, depending on the dollar amount you can get carry-in or onsite/express shipping.
onsite express shipping is the way to go. think something is wrong with it? anything at all, makes a funny noise, change a cartridge still some streaks? double sheet fead? you want them to clean it? ANYTHING. they show up to your place of buisness or home. your out of the area or it might take them a while to get to you? overnight shipping PREPAID. have you ever shipped a computer to a manufacturer? we had a lady ship a gayway computer back with monitor and printer, total cost, $173. the cost of a tsp. not to mention if you plan on shipping a monitor via ups, it has to have the origional box for ups to insure it for any value.
it all comes down to the question of how well you know your technology. everything is going to break, its just a question of when.
in our store if you have a warranty we take care of you if they dont take care of you when you call it in, you put your trust in us to take care of you, so we're going to do everything to take care of you.
i would like to add that this isnt a staples sales pitch, go to whatever store you like, see who offers what when it comes to warranties. i must also say when someone says no i dont push it, they said no. i myself have walked out of bestbuy because it seemed like the sales kid was never going to shut up and sell me the cd player for the car. again he was using the age old time of "it needs to be cleaned every" well it may be, but i'd like to atleast by the darn thing
-- botsex is {grep;touch;strip;unzip;head;mount}
I recommend buying one when you can afford it. I own two iBooks, one of which is fairly new, but on the old one I got an extended warranty for peace of mind. I'll get one on the new powerbook when it's normal year is about up.
If you've ever had to get a screen fixed under a normal warranty or have a hard drive replaced *and* recover the data on it, you'll find the extension invaluable. Heck, I even bought one for my game cube, and wouldn't you know it -- it stopped reading discs after the 90 days were up on the normal one.
However, I'd say on about 90% of the things I buy, when I get an extended warranty I don't use it. On a regular PC it's basically worthless because you can swap out broken parts for a lot cheaper (like my franken redhat box -- it's made from so many pieces you'd never recognize it).
- Cloud
I thought the early Mac's did use a scsi interface to their printer. Maybe wrong, but I seem to remember something along those lines.
Glonoinha the MebiByte Slayer
I agree with you, with one exception : cell phones.
... but I was back up and running by the time I got home.
... the rest of the time you just have a cell to look cool :)
Cell phones are flimsy, cheap plastic fragile toys that are hideously complex and impossible for just about anybody here to repair on their own at home - for all practical purposes they are magic. Expensive magic, if you try to buy one without a year plan with a service provider.
Yes they have a warranty, but you have to mail it to the factory and wait weeks for the repair or replacement - but on a $200 phone (really more like $400 or $500 but you get a price break when you sign for a year - read the fine print) the additional $60 for PSP means that
1. When the battery goes weak (they all do in a year or two) you get a free battery. There is your $60 right there.
2. Instant replacement when the (speaker quits making noise / display freaks out / *it keeps dropping calls)
I had my SprintPCS Samsung 8500 crap out three times in the first 6 months I had it, still under warranty yes but if I had had to be without a cell phone for a month each time it cratered that would have really sucked. With the Best Buy PSP I walked in with a dead phone and walked out with a working phone. Had to reprogram all my contacts phone numbers three times in 6 months which sucked bad enough
And for that kind of turn around, $60 is cheap considering what a cell phone really costs over the course of a year including service. Having your phone that one time you -really- need it is why you pay $700 a year for service plus $200 for the phone
Glonoinha the MebiByte Slayer
I would like to agree with many comments that have been posted here.
I only buy them for laptops. I find that laptops often have a harder life than other devices (more bumps and vibrations) and hinges and such wear out. My plans for Apple, IBM and Dell laptops have more than paid for their costs.
For just about anything else, it's usually not worth it.
Think about all the money you could have spent on extended warranties over the years if you fell for the sales pitches. For me, that could easily be thousands of dollars (including the ones they push for cars). A thousand or thousands of dollars is plenty to replace the odd thing that breaks.
My point: don't buy extended warranties, because you are self-insured! The money saved over time more than covers anything that would actually need servicing or replacement.
Healthcare article at Kuro5hin
I normally don't either, but when I recently bought a new machine at CompUSA, the salesman, because he only needed to attain a certain margin on the deal, was able to reduce the price of the hardware more than the cost of the extended warranty. I saved about $50 and I get the privilege of getting onsite replacement of the parts I fry when I'm, uh, experimenting with my own upgrades.
1) Ex-Radio Shack employee. Big time (relative to base pay) commission on service plans. The most popular was selling a 3-yr $20 plan for $20 (on sale from $40) headphones. Someone bought three headphones and one plan. She would come in once every few weeks or so and replace the headphone du jour her kids beat up.
2) After having issues with a 36" TV just after the warranty ran out, I decided to buy a new set and *wanted* a service plan. In response to my questions, the droid at PC Richard (NY chain, like CC and BB) told me that 1) They never use refurb parts in repair, 2) They will come to my place to pickup/dropoff, 3) The extended warranty will begin after the manufacturers ends. As I walked out the door, I read the details on the extended warranty info card. Amongst other disappointments, it said they reserve the right to use refurbished parts, they expect delivery of the product to their service center, and the warranty begins immediately - and you must take advantage of the manufacturer's warranty before you use extended one. I turned around and got my money back on that IMMEDIATELY. The best part was when everyone in the store thought I was crazy, and the manager telling me "we have a lot of problems with these sets".
3) I must have been on crack when I paid for an extended warranty on my portable minidisc player a few years ago. But when the thing died about a month ago, I brought it to the repair center. They told me it was unfixable and wrote me a check for the original purchase price. Go figure.
Note that many states have laws requiring stores to give you back a pro-rated amount on your warranty plan if you decide to cancel it down the road.
Lastly, if you have home or renters insurance, you should call your agent and find out if the item you're thinking of buying is covered in case of damage or theft. You should also find out your deductable. If you don't have home/renters insurance, THIS IS WHAT YOU SHOULD BE BUYING INSTEAD OF THAT WARRANTY! After an apt. caught fire a few floors under ours, no fire damage occurred to ours, but plenty of smoke went through our place. The insurance company paid for a week at a hotel, including meals, while we were out of our place. They also paid for cleaning of the apartment, dry-cleaning ALL of our clothes, towels, sheets, pillows, etc., and internal cleaning of all electronic equipment. We were paying about $160/yr for this coverage. WELL WORTH IT.
To me, it all has to do with what the product cost vs. what they charge. Example: I bought a home theater receiver that was literally hot off the presses (it had been released less than a month before I bought it) with a retail price tag of $500. The receiver came with a 24 month warranty from the factory, and let's be honest, most solid state stuff is going to fail immediately or never. The 3-year warranty (which essentially extended the coverage from 2 to 3 years, and threw in the standard "power surge, wear, etc." additional coverage) was $40. I bought it. Why?
I'm a college student. I'm by no means poor (the ol' home (apartment) theater recently surpassed $5,000 in equipment, and is due for a few more add-ons soon), but I'm also not overflowing with money. And it tends to come in spurts. I work in addition to school to pay rent and bills and such, but over summer, spring break, and around christmas I tend to generate a little extra money because of more hours availabale to work or gifts and such. So for me, an extra $40 to hedge my bets on not having $500 available at a moment's notice to replace the receiver is worth it, especially when I consider that that $40 is just going to get spent on beer, or some videogame I forget after 2 weeks.
One other thing to always consider on these deals: shipping and repairs. Most manufacturers will make you pay to ship the product in for repairs. Now, you can get around that if you argue with them and so forth, but it's not the standard policy. Consider the cost to ship and insure a 30 pound receiver to California (and youd better damned well insure that pckage) vs. being able to drive to the local store, and you're starting to see a bit of the worth in it.
On the flip side, I didnt buy it on the last television I bought (32" Tube). It was over $160 for the warranty coverage, and tube TVs seem to me like solid state electronics: die immediately or never. If that warranty cost was, say, $80, then we're talking, but $160 doesn't make it worthwhile to me. Of course, I also never buy them on game consoles, and I'm on my second PS2 and my third PS1.
I bought an expensive $400 100-cd changer. It had video out that would display the disc you are listening to.
(And before you ask, no, it was not CDDB enabled, in fact it named the slot, not the disc, so you would have to key in 16 character for 100 slots and make sure to always keep the same disc in the same slot, sucky.)
Of course all 100 discs must be removed to transport it. And put back in in the same order. It takes a good 30-45 minutes to do so each time you took it in for repair.
I bought the 4-year extended warrantee. Supposedly this means at the end of the 4 years I would have a perfectly working cd player.
NOT SO. About 2 years in it started skipping on cds. More and more cds. Every week, a new disc would start skipping horribly. I took it in for repair. They "repaired" it. It still skipped.
Now they have a policy that after 3 repairs, you get a replacement one. So after the 2nd time I said "only 2 more times right?" Right. After the 3rd time I said "only 1 more time, right?" Right.
Finally I was coming in to replace it, and they pulled their shit on me. The policy only replaces your cd player if they actually REPAIR it 3 times and the same part is malfunctioning a 4th time. It turns out they did not repair mine. Everytime I brought it in, they had simply cleaned the lens.
So I told them to repair it. They looked me in the face and told me it was not broken so they would not repair it. I went as far as to bring in a box of malfunctioning cds and have them LISTEN to the cds skipping and they still looked me in the eye and told me that there was nothing wrong with it and it was not going to be repaired.
Finally my warrantee expired during all of this, so I had no options. I have a $400 piece of shit cd player that is no damn good.
I had taken my cd player into best buy a total of 6 times. I had unloaded and reloaded 100 discs 6 times (that's 1200 cd operations). I had kept track of all the discs in my changer and what date they started skipping. The total amount of time spent was well over 12 hours, plus I had insane skipping for almost a year. (Imagine a 4 minute song taking 8 minutes to play, while you are trying to snooze.)
I now only play mp3s. My computer controls the sound for the whole house thanks to long RCA cable runs and shitty $70 X10 transmitters that barely work across 20 feet of air. (And of course you can only by 1 receiver per transmitter, I don't know why they don't sell receivers alone so I could add the 1 missing room to the mix.)
I am now against all standalone players in the home.
I will never buy another cd player.
I will never buy another VCR.
I will never buy a DVD player. (Playstation2 is enough.)
Standalone players are a thing of the past. Your computer can play music. Your computer can play video. Your computer can do anything. We will always have computers until the day we die, of course, because we are slashdot readers.
There is no reason to subsidize such a crooked industry. I am not participating anymore and I encourage everyone else to STOP BUYING STANDALONE MEDIA PLAYERS RIGHT AWAY. It is just not worth it. They belong in the car, not in the home.
And BOYCOTT BEST BUY. Circuit City does price matching, and has (Barely) better customer service. And they aren't fucking pricks.
So to answer the question, in this case, NO, the extended warrantee is not worth it. I would still purchase one for a $1200 36-inch tv like the one I am using as a monitor right now. I would still purchase one in many situations, but NEVER from Best Buy.
-Clio
Karma: Bad (mostly from not giving a fuck)
Blog: http://clintjcl.wordpress.com
I've never needed to replace something in one of my desktop machines (at home and at work) that would've been worth the price of a ~$200 warranty, but laptops are another story. Dell CompleteCare for laptops gives excellent service - next-day, on-site techs and it even covers abuse. $250 or so for the warranty is a lot better than paying parts and labor for a new LCD.
For me, that's what it boils down to. I paid like $5 on a $60 multimeter at Radio Shack for the extended warranty, because it's a "if it isn't working, bring it back and we'll replace it, no problem" warranty and the DMM has an unfused current (amp) measurement mode rated for 10A max. I figure that there's a good chance I'll manage to blow it up at some point by forgetting to switch the probes back to the voltage ports and voltage mode on the DMM at some point, so the $5 will probably be worth it...
When BestBuy wanted to sell me a $10 extended warranty on my wireless keyboard and mouse, I said no. If the thing doesn't fail in the manufacturer's warranty, I don't expect it to unless I do something stupid (that, IIRC, wouldn't have been covered).
CBC market place (a consumer-affairs type TV program) had an interesting show on just this topic a while back. Their conclusion was that extended warranties are great if you're selling them, but are a waste of time and money for the actual consumer. You'd be much better off putting the money you'd spend on them in a high-interest savings account as your "fix-it/replace-it" fund.
Here's the link to the web site. The page also has a link to the video, but alas, it's in Quicktime format.
It's only software!
I guess it all depends on your ethics. I know a guy that returns his home cordless phone to Ultimate Electronics every 11.5 months and purchases a new service plan for $10.
I, who swore I would never buy a service agreement for the obvious reasons listed above, bought a $15 service plan on my Archos mp3 player because Comp USA has a satisfaction guarantee. If I decide that I'm unhappy then I can return it within the service agreement period. I think that I'll be unhappy right about the time the next generation players start shipping. Then again I also think that something like an mp3 player has a pretty high failure rate. Laptops are the same way. I don't think I have ever had a laptop that didn't fail somehow within 2 years.
Overall, they have to collect more than they pay out. If it was a good deal, they wouldn't be selling it, because they'd lose money.
Bingo!
On the flip side of this, if you're a repair depot, try collecting on this..
I worked at a shop that (for a total of 3 months) was a "warranty repair centre" for a national chain... they got a reduced rate on labour, in exchange for the 'extra business' we'd get..
Procedure went something like this:
Customer brings product in,
Technician examines it (1/2 hour labour), provides estimate for repair to store's "warranty" department.
Store's "warranty" department decides to replace the unit, gets us to send the old one to them.
_OR_
Store's "warranty" department gives us go-ahead to do the work.
Once everything is said and done (a month later), store's "warranty" department refuses to pay the invoice, sicking us with the cost of repair.
IANAL (yet!) but I'm in 3rd year law and I'm actually working on a project re: consumer goods. Take a look at your local Sale of Goods Act and/or Consumer Protection Act. Take a look at whether the Act implies condition of quality or fitness or merchantable quality into the contract. If it does, then what the store is selling you is literally nothing. There's this great little Manitoban case that I found for my project (Citation is: Loewen v. Best Sleep Centre Inc. [2003] M.J. No. 11) - basically the plaintiff bought a bed, wasn't satisfied with it from the beginning but slept on it anyways for TWO YEARS before taking it back. The judge found that since the bed wasn't of merchantable quality from the start, the plaintiffs were entitled to damages. So basically when those salesmen are pressuring you to take the extended warranty, ask them what it covers. If it covers stuff that's already included in statute then tell 'em no.
I had to mail it out to the manufacturer, if i ever get it back in working order maybe in the future the compusa warranty will be helpful but i'm doubtful. My suggestion is: If you are considering one of these warranties ask WHEN the coverage starts, make sure to read the fine print. Also check out the extended plans you can get from the manufacturers and 3rd party places. You have more choice than you realize.
Like attractive Pete, I too worked at Best Buy, though for a longer period. I was NOT payed a commission for selling these service plans, but it was kind of an unspoken rule that we needed to try to "attatch" (sell) them with qualifying products (mainly videogame systems). I no longer work for them, so I feel I can offer a fair assessment as to their value. I think, in general, service plans and their ilk are worth the price if they are no more than 10% the price of the item they cover. I'd bump this number up to no more than 15% for certain technology-intense items (HDTVs, LCD Monitors, possibly computers), or items that break a lot (videogame systems, computers). Anything more than this is a ripoff, IMHO. As somone stated, these things ARE essentially pure profit for retail stores, which is why they want to cram them down your throat so much. Most of the time, they aren't worth the extra cost. If you DO experience a problem, though, it can be a blessing, and it can sometimes pay for itself. It's a tradeoff either way.
It's only worth it if the loss is financially unbearable. In all other cases, you are better off being your own insurer. The only item I consider worthy of an extended warantee is my laptop : I can't work without it and I know from experience that critical laptop parts _always_ fail at some point. Three year laptop warantees have always proven worth their cost so far. But for any other piece of home hardware I always do without it.
I spent $1800 on an extended warranty for my car. The warranty lasts for 6 years or 100,000 miles, which is pretty much the length of time I want to keep the car (98 Audi A4). In the few months since I've purchased it, I've already had more than $1800 worth of work done, total cost to me was $100 (2x$50 deductible).
I don't think that extended warranties make sense for devices that rapidly obselete, or that have a fairly short useable life. The exception would be extended warranties that let you bring in the now-obselete device and receive a significant credit back. For larger purchases, and purchases whose useable life is longer, or purchases where the cost to repair would be high, I think it makes a great deal of sense.
It's all a numbers game. If you think the odds are in your favor, jump on it. If not, you have to manage to convince the saleskid that you don't want it, no matter how many off-the-wall promises they make about either the product or the warranty.
For something hideously expensive like a car, maybe. But never buy one for home elenctronics (unless maybe you're buying one of those $6000 plasma TVs or whatever).
a nties.html
Clark Howard puts it into his "Ripoffs" category:
http://clarkhoward.com/library/tips/extended_warr
Clark says:
Don't buy an extended warranty on electronic devices such as a computer or VCR. The value of a new computer will drop to nearly nothing in just a few years, and a VCR can be replaced very inexpensively if it breaks.
A TV or DVD player can be replaced very inexpensively if it breaks. Update!
An extended warranty for an appliance is a bad deal because they rarely pay off.
People often lose the contracts, they move, or they forget they purchased the contract in the first place. The usage rate is even lower than the breakdown rate of the appliance.
You're better off taking the money you would have spent on service contracts and putting it into a repair fund.
Government IS the problem.
I've bought one of these only once. I used to work at compusa (blech) and purchased one on a machine. Now, this computer was an old old compaq with a cyrix processor for 200$ out the door with a 249$ service plan on it. This computer was already out of the manufacturer warranty and i purchased a 5 year replacement plan (which they no longer have). I was told that when it breaks, just bring it back in and they'll replace it.
4years later the machine still worked, but not for long. A 9v battery did the trick. They ended up being able to replace the mb/cpu albeit it cost them 419 and some change.
2 weeks before the warranty was up, 9v to the rescue again.
Im waiting to hear back from them on what machine theyre going to replace it with. We all know the slowest machine you can purchase at a store (compusa anyways) is around a 1.6ghz celeron which isnt bad for a free upgrade.
So all in all, from spending 450$, ive got comp to:
1) take a loss on the machine originally
2) spend 420$ on replacing the mb/cpu
3) either spend another 420$ on a new mb, or between 400-500 on a new box.
Doesnt seem that this purchase was very beneficial to them.
Only buy them if they last a long time and they will replace with something newer if they are unable to fix it.
I wanted to buy a new laptop and I specifically asked the sales monkey, "If I don't like it, can I take it back no questions asked?" Him: "Sure!"
So I bought a compaq 2100s and after checking it out (they didn't have any in store, I had to go to another store to pick it up) I didn't like it.
So I took it back the next day and they tried to charge me a 15% restocking fee. Sales monkey never mentioned that.
They wouldn't upgrade to the nicer laptop or return it without a restock fee unless it was defective.
So... I went home, screwed around with boot.ini and told bios the primary drive was atapi.
It wouldn't go back into bios after that! So it was defective. Next day they upgraded me to the vpr matrix 175b4. Turns out the previous day, they SHOULD have been able to do that without it being defective.
Unethical? Maybe. But I sure like my new laptop.