Beginning nationwide on July 26, consumers can get a new AT&T smartphone or tablet every year with no down payment, no activation fee, no upgrade fee and no financing fees through a program called Next, which mirrors rival T-Mobile’s recent move to allow its customers to forgo wireless contracts.
Under the Next plan, customers purchase a smartphone or tablet with no down payment and agree to pay monthly installments for the device. After 12 payments, they can trade it in and upgrade to a brand new device—again with no down payment—or they can keep using their device and have no more payments after 20 months.
Next is available for any current smartphone or tablet in AT&T’s selection of devices. The interest-free monthly device installments range from $15 to $50, depending on the device selected. For example, a customer purchasing a Samsung Galaxy S 4 would have no down payment and pay $32 per month, in addition to the monthly wireless service plan they choose, with the option to trade in their device and upgrade after 12 payments or to keep using the device and pay off the installment plan in full after 20 months. There’s no penalty for paying off the installment plan early, a company release noted.
"With AT&T Next, customers can get the newest smartphone or tablet every year with no down payment," Ralph de la Vega, president and chief executive officer of AT&T Mobility, said in a statement. "That’s hard to beat, and it’s an incredible value for customers who want the latest and greatest every year."
AT&T offers a broad choice of device purchasing options. In addition to Next, customers continue to have their choice of all current options, including getting a discounted device with a two-year service commitment, paying full retail price for a device with no-commitment, getting a partial discount for an early upgrade after six months with a two-year service commitment or bringing their own compatible device.
In comparison, T-Mobile’s plan allows users in many cases to bring their own smartphones, if they're GSM capable and unlocked. For those purchasing new phones, the company offers an Equipment Installment Plan (EIP), which allows qualifying customers to purchase a new phone with an initial down payment and then ongoing payments on the phone for 20 months.
Just last week, T-Mobile unveiled a new program, Jump!, which enables people to upgrade their phones when they want, up to twice a year as soon as six months from enrollment. Customers can upgrade to a new phone, financed through the EIP twice every 12 months after they've been in the JUMP! program for six months. The program also protects against malfunction, damage, loss or theft for an extra $10 per month, per phone, plus taxes and fees.
Users just trade in an eligible T-Mobile phone in good working condition at a participating store location, and any remaining EIP payments will be eliminated. Current customers can purchase new phones for the same upfront pricing as new customers, with device financing and the Simple Choice Plan, a no-annual-service contract.