By Alexandra Burlacu | Jul 23, 2013 09:01 AM EDT
Following in T-Mobile's footsteps, AT&T plans on offering no-contract phones and tablets on monthly installments, allowing for an annual upgrade.
Starting on July 26, U.S. consumers on AT&T will be able to get a new smartphone or tablet every year from the carrier, without having to make any down payments or worry about activation, upgrade and financing fees.
The new program is called AT&T Next and aims to introduce "what's next in wireless," making it easier and more convenient for customers to upgrade.
"With AT&T Next, customers can get the newest smartphone or tablet every year with no down payment," touted Ralph de la Vega, AT&T Mobility President and CEO. "That's hard to beat, and it's an incredible value for customers who want the latest and greatest every year."
After 12 monthly payments AT&T customers will be able to trade in their device and upgrade to a new one, again without any down payments. Another option, meanwhile, allows customers to continue using their earlier device and stop making further payments after 20 months. After the upgrade, AT&T will waive the remaining unbilled installment payments.
In other words, AT&T Next is a no-contract plan designed to help the carrier cut the expense of large subsidies typically applied on smartphones to make them more affordable for customers. Carriers generally try to make up for those subsidies through service contracts, usually two-year agreements.
The new AT&T Next plan is open to both new subscribers and existing customers who are eligible for an upgrade. This way, customers will be able to upgrade to newer smartphone and tablet models without having to commit to a two-year contract.
T-Mobile also launched an upgrade offer last week, allowing customers to trade in their older phones for a new model at a T-Mobile store twice a year, for a $10 fee. To benefit from this offer, however, subscribers must first be on T-Mobile's Jump plan for at least six months.
Instead of waiting for a two-year contract to expire or to finish paying the monthly installments for a device, T-Mobile customers will be able to upgrade phones without having to pay the remaining installments for the previous one. New phones are also available at the same price for both new and existing customers. The $10 fee, meanwhile, will also serve as protection against damage, malfunction, loss or theft of the device.
T-Mobile launched plans its new plans back in March, allowing consumers to pay for no-contract phones in installments rather than committing to a two-year agreement with the carrier. T-Mobile branded itself as "America's Uncarrier" and now AT&T is ready to adopt a similar no-contract strategy.
AT&T Next will be available starting on July 26 for any current smartphone or tablet the carrier has to offer. Monthly installments range between $15 and $50.
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