There will be no more subsidized cellphones for AT&T customers in the new year.
The wireless carrier is nixing two-year contracts after Jan. 8, Engadget reports, citing an internal document sent to employees on Wednesday.
As a result, smartphones and other cellphones must be purchased outright via either what AT&T calls its “no-commitment (full retail price),” or via an AT&T Next monthly installment option.
AT&T spokesperson Fletcher Cook tells USA Today in an emailed statement:
“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.”
The internal document describes the new phone purchase options as part of a “pricing simplification effort.” It’s unclear how tablets and wearable devices like smartwatches will be affected.
The decision by AT&T marks the end of a cellphone era. According to USA Today, AT&T was the last major U.S. wireless carrier to still offer two-year contracts.
T-Mobile nixed contracts more than two years ago, and Verizon and Sprint announced in August that they would stop selling them.
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