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AT&T to Stop Offering Two-Year Phone Contracts Starting January 8

Starting on January 8, 2016, AT&T plans to introduce a "pricing simplification effort" that will see the end of device subsidies and two-year contracts. According to an internal training document shared by Engadget (http://www.engadget.com/2015/12/30/att-ditch-contracts-jan-8/), new and existing AT&T customers will only be able to purchase a smartphone at full price or with an AT&T Next payment plan going forward.





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As outlined in the document, the new rules apply to all of the phones that AT&T sells, including smartphones and more basic devices, which will be paid for using new installment plans. More information on how AT&T will handle corporate accounts and non-smartphone devices like tablets and wearables will become available after an official announcement from AT&T, but it appears certain corporate users will be able to continue making two-year contract purchases.





The shift away from two-year contracts and iPhone subsidies began with T-Mobile in 2013, when the company introduced its Un-carrier payment plans (http://www.macrumors.com/2013/03/26/t-mobile-usa-to-carry-iphone-beginning-april-12th-using-new-uncarrier-payment-plan/) uncoupling device costs from plan costs. Verizon followed suit (http://www.macrumors.com/2015/08/07/verizon-introduces-new-plans/) in August of 2015, debuting new smartphone rate plans and eliminating its subsidized two-year contract option for new users.





Existing Verizon customers can still renew their two-year contracts, but AT&T's no-contract implementation is more extreme and will not offer existing customers the option to keep their contracts once they expire.





<img src="(http://cdn.macrumors.com/article-new/2015/12/atttwoyearcontractsfaq-800x460.jpg)" alt="atttwoyearcontractsfaq" width="800" height="460" class="aligncenter size-large wp-image-480258" />


AT&T has already been working on shifting away from two-year contracts by pushing its Next plans. In June of 2015, AT&T forced Apple and other third-party retailers to remove the option (http://www.macrumors.com/2015/06/05/apple-store-iphone-att-next-only/) to purchase AT&T phones with a two-year contract, leaving customers with AT&T Next or a full-priced smartphone as their only third-party purchase options.





Update: AT&T has confirmed its plans to stop offering two-year contracts in a statement given to Re/code.

"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," AT&T told Re/code. "Starting January 8, AT&T Next will be the primary way to get a new smartphone at AT&T."

<div class="linkback">Tag: <a href="http://www.macrumors.com/roundup/att/"/>AT&amp;T (http://recode.net/2015/12/30/att-confirms-it-is-doing-away-with-two-year-phone-pricing-for-consumers/) </div>
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Source: AT&amp;T to Stop Offering Two-Year Phone Contracts Starting January 8 (http://www.macrumors.com/2015/12/30/att-two-year-contracts-ending-january-8/)