How Electronics Retailers Make Money

I see this as a form of subsidy. Enough people gamble on the odds that they will need to exercise the warranty and it keeps the prices low for others who gamble on the odds of the product lasting. Both sides get what they want.

I think that's great. It means that I get all my stuff below cost, given that I never buy the extended warranty or neglect to mail my rebate form.

Thanks, nervous and lazy buyers!

How often do you actually have to rely on a warranty for a product? I can understand getting a warranty and even extended warranty on "high dollar items," such as cars and even some home appliances. When it comes to getting a warranty on smaller items such as cell phones, I think it is a waste of money. Salespeople do a great job of convincing consumers that they need these warranties. For those of us who are less concerned with the possible risk involved with not buying the warranty, we can enjoy paying lower prices.