NEW YORK, July 16 AT&T Inc said on Tuesday
it plans to allow its customers to make annual device upgrades
and pay via monthly installment plans to compete with a similar
option by smaller rival T-Mobile US.
AT&T, the No. 2 U.S. mobile provider, said that starting on
July 26, customers could pay monthly installments for their
phones or tablet computers and upgrade every year. This compares
with its previous requirement to stick with the same device for
about two years in exchange for a discount.
No. 4 U.S. mobile provider T-Mobile US recently announced a
plan under which its customers could upgrade their smartphones
as often as twice a year.
The operators, which tried but failed to merge in 2011, are
grappling to filch each others customers in a market where most
people already have smartphones.
AT&T said that under the new plan - branded AT&T Next - it
will not charge an upfront device fee, but will instead charge
customers $15 to $50 per month depending on the device.
For example an AT&T customer buying the Samsung Electronics'
Galaxy S4 would pay $32 per month for the device
along with a monthly service fee and have the option to trade in
the phone after 12 payments.
In comparison, T-Mobile US does charge an upfront fee for
the device on top of $10 per month to sign up for its Jump
upgrade option, and installments of up to $20 per month as well
as its monthly service fee.
AT&T said customers who prefer to stick with the old model
of keeping a phone for two years could still do so.