The answer is obvious, but nevertheless I’m kept being asked this question. And I am suprised a lot that such a simple question cannot be answered by some people who have these “one-dollar” cell phones. So,

Question: Why telecoms are selling phones for losses?

• with this 1 dollar phone you not only get a phone, but also a contract signed for a certain period of time. Lets say, that one year you will be using a service fom a particular cell operator and will pay for his services and generating profits to him. So buying cell phone for one dollar is nothing but like buying a cell phone in installements. So, free cheese is only in…you know where.