AT&T will stop offering a 2-year contracts starting Jan.8 to new and existing customers. Customers planning to be on the carrier will have to purchase a new phone or through its Next installment plan.
AT&T has been offering this kind of contract for the longest time. Other top U.S. carriers have stopped offering similar service years ago and have shifted to installment plans wherein the amount of the phone unit is subdivided into specific months and added to the customer's desired phone plan. T-Mobile was the first to offer such plan and was followed by Verizon and Sprint.
An internal document from AT&T surfaced not too long ago stating that all phones will either be purchased outright or via the installment plan. This move will also include flip phones and non-smartphones or as AT&T puts it, "Quick Messaging Devices. In addition, the document stated that this move is for "aligning... service offerings with customer and industry trends," Engadget reported.
The AT&T's offering is also said to aid in simplifying customer's device purchasing options. However, corporate accounts will not be affected by the latest changes. "With $0 down for well-qualified customers, the ability to upgrade early and down payment options available with even lower monthly installments, our customers are overwhelmingly choosing AT&T Next. Starting January 8, AT&T Next will be the primary way to get a new smartphone at AT&T. This does not apply to business customers under a qualified wireless service agreement," Mashable reported.
The AT&T's new and existing customers who are interested in getting the wearables, like the Samsung Gear S2, it is not yet clear if it is affected by this change. They are currently advertised to come with a two-year contract and the carrier might clear this subject up within the next few days.
AT&T is the second largest carrier in the United States with 126.4 million subscribers.