AT&T Rolls Out New 'AT&T Next' Smartphone and Tablet Upgrade Program

[MacRumors]

AT&T is following T-Mobile's lead and introducing a new upgrade eligibility program for its customers called 'AT&T Next'. With Next, AT&T customers can purchase a new smartphone or tablet every twelve months with no activation, upgrade or financing fees.

Customers purchase a smartphone or tablet with no money down, making monthly payments equal to 1/20th of the retail cost of the device. After 12 payments, they can trade the device in and upgrade to a new one with no other fees. Or, after 20 payments, they own the device outright.

"With AT&T Next, customers can get the newest smartphone or tablet every year with no down payment. That's hard to beat, and it's an incredible value for customers who want the latest and greatest every year," said Ralph de la Vega, president and chief executive officer of AT&T Mobility.

For customers purchasing a 16GB iPhone 5, they would pay $32.50 per month for 12 months, and could then upgrade to the latest iPhone -- trading in the previous device. They would pay $390 over that time, with the phone being bought back for the equivalent of $260. If the customer makes the 20 monthly payments, they can upgrade to a new phone and keep the old one.

Because there is no activation or upgrade fee, customers save $36 on activating a new line. Depending on the customer's needs, this may be a better option than the old AT&T upgrade system, which requires customers wait 24 months between fully subsidized upgrades.

AT&T customers who still have grandfathered unlimited data plans are fully eligible to participate in this program.

T-Mobile recently announced a similar upgrade plan, and a leak from Verizon today suggested they also had something like it in development.

Article Link: AT&T Rolls Out New 'AT&T Next' Smartphone and Tablet Upgrade Program

 

[Frank Gore]

What a sham

 

[NewAnger]

You knew it would not be a good deal.

 

[mofoliar]

that sounds good deal, better than verizon upcoming "VZ Edge".. i just purchased an iphone 5 yesterday for big red! damn...

 

[braddick]

Excellent news!
For those that like their iPhone new and shiny, this will be the way to go.
Almost like a new vehicle lease.

 

[BruiserB]

Sounds good on the surface, but the main disadvantage is that AT&T's service rates are artificially high to pay for phone subsidies. If AT&T doesn't change their rates, then you are kind of paying twice for your phone....once in your rates and again paying 1/20th of the full cost of the phone each month.

Another company has a new creative way to separate people from their money! The best option is to buy outright and go with T-mobile's (or another discount no contract carrier's) plans.

 

[tascon]

Are they lowering the monthly prices?

If I am still paying the same per month, what is my benefit if they don't subsidize the iPhones anymore?

 

[Squid7085]

What a joke, You end up paying MORE over the course of 12 months then you would have upfront, and then you have to give the device back. You'd be better off opening up another line for a "12 month upgrade cycle" and paying the extra $10 a month. Thats what I have been doing for years, I just bought the AT&T Home Phone Connect thing to throw my other line on, gives me a phone on the wall which is nice and it would STILL be cheaper then doing this. And I get to keep the phones and sell them on my own terms, if I were in to that kind of thing.

The question i would like to ask AT&T, if you are doing this, and I am paying for more of the phone then I would have under the subsidy model, where is the money I am paying in to a subsidy going? This wouldn't be a complete sham if monthly service were cheaper.

 

[rowensiv]

I don't really see how this is such a bad deal... Like in the example for a 16GB iPhone 5 you would end up paying $390. Provided the phone wasn't destroyed you'd get back $260 - Which equals $130 for the phone. Yeah, AT&T has their flaws but I don't think this is such a bad deal.

 

[ladeer]

Well I rather pay $650 up front so my phone will be factory unlocked if I am going to amortize the phone anyway. It's basically an option to finance your phone at 0 interest rate in exchange for the ability to have factory unlocked?

 

[jesusplay]

I haven't paid money for a phone out of pocket since I bought my first iphone.

iphone's don't lose resale value, hell they are worth more than the subsidized price when you sell it 2 years later.

 

[BruiserB]

Well I rather pay $650 up front so my phone will be factory unlocked if I am going to amortize the phone anyway. It's basically an option to finance your phone at 0 interest rate in exchange for the ability to have factory unlocked?

But you're not really financing it at 0 interest rate. You make 20 monthly payments equal to the the full amount, plus you still pay around $20 per month of your service that would have gone to the subsidy under the traditional contract plan. So you're actually paying about $400 extra for your phone.

Best to get it unlocked up front and go to a carrier that doesn't have subsidies built into their rate plans.

 

[Small White Car]

I don't really see how this is such a bad deal... Like in the example for a 16GB iPhone 5 you would end up paying $390. Provided the phone wasn't destroyed you'd get back $260 - Which equals $130 for the phone. Yeah, AT&T has their flaws but I don't think this is such a bad deal.

The bad deal is that the AT&T rate ALREADY includes the money they need to buy you the iPhone every 2 years. When you sign up for this your monthly rate doesn't go down. So, sure, it's a perfectly good deal except that you are also paying AT&T for half an iPhone every year that you'll never see.

 

[Squid7085]

I don't really see how this is such a bad deal... Like in the example for a 16GB iPhone 5 you would end up paying $390. Provided the phone wasn't destroyed you'd get back $260 - Which equals $130 for the phone. Yeah, AT&T has their flaws but I don't think this is such a bad deal.

If I am reading it right, you wouldn't get anything back. You return the phone which "covers" the part you didn't pay, and you just start on a new payment plan. It's like renting the phone, you never build any equity in it.

 

[tbrand7]

Well, it seems T-Mobile is a lot like Apple in this situation. They disrupted the status quo and are changing the phone buisness as we know it. Now here come the copycats running so they don't get left behind.

 

[Klae17]

This is why T-Mobile was kept its own entity. This is good.

ATT+Tmobile = bad.

 

[BruiserB]

I haven't paid money for a phone out of pocket since I bought my first iphone.

iphone's don't lose resale value, hell they are worth more than the subsidized price when you sell it 2 years later.

But you have lost money....because each month of your service you are paying around $20 more than you would have to if your phone wasn't subsidized. So take whatever you paid upfront for your phone, then add $480 to that (the extra amount you paid for it over the 24 months) and then tell me you sold your used phone for more than that total.

This plan basically amounts to a $20 a month rate increase for AT&T.

 

[T.Smith4]

Rubbish

Garbage program. If they do this they need to lower their rateplans. I hope people don't fall for this crap otherwise this will become the new standard for stealing peoples money.

 

[tascon]

Looks like they are keeping the subsidies

In addition to AT&T 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.

 

[liavman]

you still pay around $20 per month of your service that would have gone to the subsidy under the traditional contract plan.

Can someone post a reference to where this is stated? That does not make any sense to pay extra $30.00 without a reduced monthly service plan. I do not even see how AT&T will sell this idea to a customer.

 

[BruiserB]

In addition to AT&T 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.

Yea the subsidies still exist, but most people won't realize that they are actually the better deal here. All they will see is "get a new iPhone for $0 up front" and think they have found a fantastic deal.

 

[T.Smith4]

Can someone post a reference to where this is stated? That does not make any sense to pay extra $30.00 without a reduced monthly service plan. I do not even see how AT&T will sell this idea to a customer.

I don't know if it is stated anywhere I think it is just common knowledge. Its why there are 2 year contracts, companies need to recoup the cost of discounting the phones.

 

[jason2811]

After one year, do you have to pay any money for the new upgrade?

Also, after one year, are you required to sign a new 2-year agreement?

Can someone explain how this is a bad deal economically?

 

[crashlander]

T-mobile: try cutting price

T-mobile should reduce their plans. $50 for only $250MB is nowhere near good enough. Unlimited voice or text? Who needs that when you can easily make calls and SMS through data. What t-mobile should do is increase data to 3GB or unlimited, reduce voice and SMS and reduce the plan price to their earlier Pre-paid plans. Imagine 300 minutes, 3GB, 100 SMS for $35. I'd switch over in a heartbeat.

 

[LoloBond]

This deal is complete crap... still better to buy the phone and resell after a year.