If you’re an AT&T customer looking to upgrade your smartphone mid-contract, beware, your upgrade pricing options just got a lot more expensive.
As first noted by Boy Genius Report, AT&T has raised its smartphone early upgrade fee to $200 on top of the new two-year contract price. Before October 3, when the new policy went into effect, it was $75 to upgrade your smartphone before the 18-month mark in a two-year contract.
An internal AT&T store document said that the new policy, which does not affect the iPhone or feature phones, is necessary because of the rising prices of smartphone devices.
Frankly, I’m impressed the early upgrade fee was ever as low as $75 for smartphones. As it stands, the $200 early upgrade fee will still end up costing you less than buying a phone without extending your contract, at least in most circumstances. AT&T used the BlackBerry Torch as an example; the phone, which is $199.99 with a two-year contract, is now $399.99 for customers who agree to early upgrades. The no-commitment price is $499.99, so a customer saves $100 so long as they don’t mind adding more time onto their contract.
Realistically, most consumers are probably fine keeping a phone — especially a smartphone — for 18 months, especially if that means they can upgrade to a new phone for less money. The policy really affects customers who lose a phone or for phones that break after the one-year manufacturer warranty period but before the 18-month mark.
AT&T is sure to be criticized for the new policy, but at least in the U.S., the company isn’t alone with its early upgrade practices. Early upgrade pricing has increased across the board with major carriers. Beyond that, early termination fees are on the rise too. AT&T raised its early-termination fee from $175 to $325 earlier this year. Verizon still “wins” (or loses, depending on how you look at it) that contest; the nation’s largest carrier charges $350 to terminate a contract for an “advanced device.”
While it’s easy to point to European tariff models that combine phone service and device fees into the monthly bill or that sell phones at unsubsidized pricing as a better model, the failure of the Nexus One shows that prospect isn’t necessarily compelling for U.S. consumers. Frankly, we’re not really sure of anyone in the world who is happy with the cost associated with buying or upgrading his or her cellphone. It’s an expensive process that has only become more expensive now that smartphones are essentially pocket computers.
Mashable readers, how often do you upgrade your smartphone? Would a $200 early upgrade fee prevent you from getting a new device, or is it worth it to have the latest and greatest thing?
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