The “up to” has its own fine-print qualifications, and the value of the buyback drops steeply over time. The customer receives only “up to 10 percent” if the television is sold back between 25 and 49 months. For other products — mobile phones, laptops, netbooks and tablet computers — the offer ends 25 months after purchase.  There is a risk, however, that new, improved versions of technology won’t arrive as quickly as the commercials suggest. You may end up without a compelling reason to buy a new TV within months of spending that initial $2,179.  In the buyback plan’s terms and conditions, Best Buy explains that “time is of the essence.” If the buyback option isn’t exercised by the deadline, it loses all value. That’s not the case with a conventional trade-in arrangement, which Best Buy also offers and doesn’t entail buying a sell-back option in advance.  If the customer has the company buy back the product, Best Buy pays not with cash but with the gift card. If the customer never redeems the option, all the better for the retailer. “Collecting a fee for a service that isn’t used is a wonderful business,” says Matthew Fassler, an analyst at Goldman Sachs.  In the fiscal quarter ended Nov. 27, Best Buy reported a 5 percent decline in comparable-store sales in the United States and Puerto Rico, versus the year-earlier quarter. A category with a large drop was consumer electronics, down 10.6 percent. Best Buy’s services, which include extended warranties, proved more durable, down only 1.5 percent.  Mr. Fassler says Best Buy has not disclosed for many years how much extended warranties contribute to its profits. Consumer electronics retailing is “historically a low-margin business that is dependent on extended warranties for profitability,” he says. “Perhaps extended warranties have become even more valuable to Best Buy recently, as its content businesses — like movies and music — have shrunk.”  Consumers who elect the buyback option must hope they have a clearer view of the future — and the new technology it will bring — than those who buy extended warranties to guard against unexpected problems. Mark Kotkin, director of survey research at Consumer Reports, says, “The salesperson often tells you, ‘This will give you peace of mind in case you need an expensive repair. I would get it.’ But the odds of a product breaking down during a typical extended warranty period are low.”  Even if the product does break, the cost of repair is not much more, on average, than the cost of the warranty, he says. He concludes that extended warranties “are a bad bet.”  AJAY KALRA, a marketing professor at Rice University, agrees. “All the statistics are compelling: in almost all cases, you shouldn’t buy the extended warranty,” he says.  Professor Kalra was co-author of a 2009 article published in the Journal of Consumer Research that examined purchase records from the electronics department of an unidentified retailer.  An extended service contract was bought in about 3 of every 10 transactions. The authors noticed subjective considerations: customers were more likely to add the warranty if the product was to be used mostly for fun. Such products, the authors hypothesized, “elicit feelings of guilt and heighten risk aversion.”  I’d like to know that Best Buy is not making ridiculously higher margins on extended warranties and other services, compared with those on the sales of the products themselves. Here’s a picture of a better future: Best Buy again breaks out the margins earned by each add-on service.  It may be long past the day Ozzy gets his bloody 6G.  Randall Stross is an author based in Silicon Valley and a professor of business at San Jose State University. E-mail: stross@nytimes.com.  A version of this article appears in print on February 20, 2011, on Page BU3 of the New York edition with the headline: A Chance to Keep Up With New Technology (for a Price). Order Reprints| Today's Paper|Subscribe
A look at Best Buy’s buyback plan, in which customers pay for the option to sell new products back to the retailer later.