Science/Tech

January 8, AT&T Will Cease its Two Year Phone Contract

By Kanika Gupta | Update Date: Jan 01, 2016 07:54 PM EST

8th January 2016 is when AT&T plans to bring in their "price simplification effort" that will end the two-year-contract and the subsidies on the devices. As per an internal training document, new and existing AT&T customers will now only be able to buy a smartphone by paying full price or with a Next payment plan offered by AT&T going forward, reported Engadget.

The document outlines that the new rules will be applicable to all the new handsets that wil be sold by AT&T, that not only includes the basic devices but also the smart phones. The customers can use the installment plan to pay for their devices. More information about the corporate accounts and customers will be shared once the company makes the official announcement. However, from the looks of it, it is safe to say that the corporate users will be able to continue their two-year contract, says Mac Rumors. This process of stepping away from the two-year-contract and iPhone subsidies began un 2013 with T-Mobile when the company started the Un-carrier payment plan that separated the cost of the device from that of the plan. In August 2015, Verizon too followed suit when they introduced new rate plans for the smartphones and eliminated the contract for new customers. While Verizon allows the customers to renew their contract after two years, no such option will e offered by AT&T to the users once their contract expires.

Experts say that once the two-year-contracts are over, so will the subsidy on smartphones. The customers will now have to pay the full price of the handset over a certain period of time. All four of the major carriers will offer a 24-month installment plan on the smartphones and will be the only option available to the customers, said West Texas news

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