New AT&T policy may restrict Apple Stores from selling iPhone with two-year contract, reports say

Posted:
in iPhone edited June 2015
According to multiple unconfirmed reports, AT&T is on the verge of making a major change to its smartphone sales model that will prohibit third-party retailers, like the Apple Store, from selling handsets under two-year contract terms.


Current options for purchasing an AT&T iPhone from the Apple Store. | Source: Apple


Earlier this week, Droid-Life reported AT&T is planning to restrict local dealer and national retail locations from offering two-year contracts for smartphones, leaving only the AT&T Next installment program as a sales option. The change only applies to non-company stores, according to The Verge, as AT&T will continue to offer contract sales in its own stores and online.

An internal Walmart document viewed by FierceWireless purportedly confirms the plan, with the big-box retailer scheduled to stop on-contract AT&T smartphone sales on May 28.

Following up on the Apple angle, 9to5Mac on Thursday cited sources as saying the change in policy will indeed affect Apple Store options, meaning customers looking for an AT&T iPhone can sign up for an AT&T Next plan or pay full price. Apple added Next as a purchase option last August.

An AT&T spokesman declined to comment on the matter.

Unlike two-year contracts, which come with an up front fee for subsidized hardware, Next's installment program spreads the full unsubsidized cost over a term of 12, 18 or 24 months, at the end of which customers can trade in the device for a new one. Consumers get the benefit of not having a fixed service contract, but risk having to pay off the device cost in full if they leave prematurely.
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Comments

  • Reply 1 of 75
    razormaidrazormaid Posts: 299member
    The problem with this is AT&T never get enough models to sell. I tried buying through them on the first three iPhones. Waited in line for hours only to find out they only got two of the (first ever) 32GB or three of the (then) new white model, etc. it's only gotten worse over the years so I guess it's time to switch carriers. Hopefully the carriers will continue their "buy you out" of your contract offers after May 28th

    Anyone have recommendations on which carriers to switch to? I'd like to hear from people who were with ATT for years then switched to...??
  • Reply 2 of 75
    So instead of competing, they just monopolize this for themselves. Sounds like AT&T's reaching for a page from it's old Ma Bell playbook.
  • Reply 3 of 75
    Switched ATT to TMobile never looked back. ATT was arrogant and penny pinching for me and my pops. In Los Angeles TM coverage is good, customer service as weLl, though not had a reason to use it often. I don't know ATT"'s current policy, but TM only has surcharge until phone is paid off,, then it's only your plan. ATT and most other carriers kept the higher charge for ever. Maybe others have now stopped the. Inflated fee once the phone is paid off. They have forced change in other carriers..
    Also went to Europe on a film shoot and called TM to unlock my phone, which they set up within five minutes or less.
  • Reply 4 of 75
    This is the carriers trying to stop their inevitable relegation to dumb pipe status.
  • Reply 5 of 75
    captain jcaptain j Posts: 313member
    I'm thinking Apple should only sell 8gb iPhone 3G's to start AT&T stores. What's good for the goose......
  • Reply 6 of 75
    tundraboytundraboy Posts: 1,844member

    Apple should just buy AT&T.

  • Reply 7 of 75
    john.bjohn.b Posts: 2,740member

    That's one way to reduce demand on their crappy network, drive new customers to the competition...

  • Reply 8 of 75
    formosaformosa Posts: 261member
    Quote:
    Originally Posted by razormaid View Post



    Anyone have recommendations on which carriers to switch to? I'd like to hear from people who were with ATT for years then switched to...??

     

    I switched from AT&T to T-Mobile and never looked back. My bill was cut nearly in half, even more so with international roaming. Coverage is slightly better with AT&T (YMMV). I did catch AT&T "cramming" an extra $9.99 unsolicited monthly charge on my bill; luckily, they removed it when I confronted them.

     

    And to avoid issues with carrier lock (when you switch around, especially for international SIM's), I buy unlocked from Apple, although new policies make unlocking a lot easier today than a few years ago.

  • Reply 9 of 75
    snovasnova Posts: 1,281member

    no love for AT&T right now.  errrr..    

  • Reply 10 of 75
    chadbagchadbag Posts: 1,800member

    Depending on your data plan, the 2 year contract price can end up costing you a lot more than the AT&T Next plan total prices (HW plus service for 24 months).   Once you pay the device off on AT&T Next your bill goes down as well (in answer to someone earlier who posted about T-Mobile).

     

    I moved from T-Mobile to AT&T when the original iPhone came out and have not had a problem.  Never had cramming from AT&T and never had an issue with their Customer Service (CS).   Had my sister and her husband on my family plan and they went overseas for a year, the first month of which was his military duty, and got them on military deferal the whole year thanks to helpful AT&T CS.

     

    All the service providers can do bad and good.  They all have their warts as well as the good things they do.  Since Dec 2007 my AT&T service has been good without issues and the CS has always been responsive.

     

    I realize there are people who have had bad experiences with AT&T.  Same goes for all the carriers.   I had more issues with T-Mobile CS when I was with them beforehand for many years (I had various accounts with them since they were Voicestream and Omnipoint [read T-Mobile USA history -- I moved form Utah with a Voicestream account, to New England, where Omnipoint had the GSM service, where I also kept the Voicestream account active for a long while, and Voicestream became T-Mobile USA and eventually bought out Omnipoint) but overall the experience there was not that bad and was pre-John Legere.

     

    But, to follow up with this, if you are still buying phones on a 2 year contract with the subsidized phone price, do the math to see if the cost is really better.   Depending on your data plan you can actually pay less over 24 months using AT&T Next since the per month charge for service is less if you own your device (or paying an installment contract on it with AT&T Next) than if you get a contract subsidized phone.

  • Reply 11 of 75
    chadbagchadbag Posts: 1,800member
    Quote:

    Originally Posted by John.B View Post

     

    That's one way to reduce demand on their crappy network, drive new customers to the competition...




    Whether their network is "crappy" or not probably depends on where you are.  Where I am at AT&T network is generally pretty good, with fast good coverage.   Our music teacher is on T-Mobile and is forever complaining about their "crappy" network.   I don't know how he defines it.  But the point is that this is probably subjective, "grass is greener" type of situation, and also location dependent.

  • Reply 12 of 75
    Quote:

    Originally Posted by razormaid View Post



    The problem with this is AT&T never get enough models to sell. I tried buying through them on the first three iPhones. Waited in line for hours only to find out they only got two of the (first ever) 32GB or three of the (then) new white model, etc. it's only gotten worse over the years so I guess it's time to switch carriers. Hopefully the carriers will continue their "buy you out" of your contract offers after May 28th



    Anyone have recommendations on which carriers to switch to? I'd like to hear from people who were with ATT for years then switched to...??



    This isn't AT&T's fault.  This is ENTIRELY on Apple.  Apple has been doing this for probably about 15-20 years, even before they had physical stores.  They will keep inventory for themselves and only give resellers a very small amount of product, particularly for newly updated hardware.

     

    It's why lots of independent Apple resellers have gone out of business, because anybody walking into their store could get the hardware they wanted faster on their own than if they tried to buy it from the store.

  • Reply 13 of 75
    genovellegenovelle Posts: 1,415member

    This isn't AT&T's fault.  This is ENTIRELY on Apple.  Apple has been doing this for probably about 15-20 years, even before they had physical stores.  They will keep inventory for themselves and only give resellers a very small amount of product, particularly for newly updated hardware.

    It's why lots of independent Apple resellers have gone out of business, because anybody walking into their store could get the hardware they wanted faster on their own than if they tried to buy it from the store.
    As they should. They opened stores to control the consumer experience. When resellers were primary, they nearly died.
  • Reply 14 of 75
    danielswdanielsw Posts: 906member
    I've been a happy AT&T customer since Ameritech Mobile in Chicago in the late '80s.

    We bought our Apple iPhone 6's on the Next plan at our Apple Store and have received good service and reasonable data plans since.

    We'll have them paid off and be able to turn them in around the time the 6s's come out this year.

    I only had to pay $67 sales tax initially for my $1K 128GB Plus. It's the best iPhone ever, and Next helped me get it sooner than later.
  • Reply 15 of 75
    addicted44addicted44 Posts: 826member
    Quote:

    Originally Posted by whatisgoingon View Post

     



    This isn't AT&T's fault.  This is ENTIRELY on Apple.  Apple has been doing this for probably about 15-20 years, even before they had physical stores.  They will keep inventory for themselves and only give resellers a very small amount of product, particularly for newly updated hardware.


    I agree that right after a launch, Apple keeps stock to sell directly.

     

    However, AT&T continues to lack Apple (and other manufacturers) models well after the initial launch, while other stores, including T-Mobile, Verizon, and independent sellers like Best Buy have all models in stock.

     

    It's clear that AT&T is either poor at managing their inventory, or decides to only stock 1-2 models of iPhones in their stores.

     

    I switched from AT&T to TMobile recently, and more than the money savings, not being nickel and dimed for something on the other on every bill has been a huge relief. AT&T had an amazing habit of sneaking in $5-$10 dollars extra charges on nearly every other bill, which they would remove as soon as I would dial in to contest them. Considering I had been an AT&T customer for ~10 years, with a 4 line family plan, this was pretty despicable behavior on their part.

     

    Admittedly I've only been with TMobile for 3 billing cycles so far, but as of now it's been excellent. And with the iPhone 6 being able to make calls over WiFi on TMobile, I get service in places where no networks have decent coverage (like my office!).

  • Reply 16 of 75
    tbelltbell Posts: 3,146member
    razormaid wrote: »
    The problem with this is AT&T never get enough models to sell. I tried buying through them on the first three iPhones. Waited in line for hours only to find out they only got two of the (first ever) 32GB or three of the (then) new white model, etc. it's only gotten worse over the years so I guess it's time to switch carriers. Hopefully the carriers will continue their "buy you out" of your contract offers after May 28th

    Anyone have recommendations on which carriers to switch to? I'd like to hear from people who were with ATT for years then switched to...??

    It depends on your area, but I live in Ann Arbor Michigan. I switched to T-Mobile years ago (from AT&T). I have experienced zero problems with voice or text coverage. Sometimes if I am really in the boonies (eg vacation in the wilderness), data might not be available, or I might be switched to roaming where there is a cap. Data speed by me, however, is phenomenal. Better than some friends who are on AT&T.

    What I like about T-Mobile is 1) my plan cost $50 a month, 2) I have unlimited data (my plan tethers LTE after 2 GBs - but for twenty dollars more it would be unlimited LTE as well), 3) there is no additional cost for using your phone as a hot spot (I do this with my Mac all the time), 3) there is no contract for the service, 4) no roaming costs for many international locations, 5) customer service over the phone seems to be based in the U.S. and is pretty good (you have to be careful in some stores where the sales people will try to up sell you).
  • Reply 17 of 75
    idreyidrey Posts: 647member
    I've never had att but all of my friends complain about att service and coverage, some have switched already. I have Verizon and they treat me very good, coverage is great not perfect but get it most every where and I only pay $70 a month per line
  • Reply 18 of 75
    vmarksvmarks Posts: 760editor
    Quote:

    Originally Posted by razormaid View Post



    The problem with this is AT&T never get enough models to sell. I tried buying through them on the first three iPhones. Waited in line for hours only to find out they only got two of the (first ever) 32GB or three of the (then) new white model, etc. it's only gotten worse over the years so I guess it's time to switch carriers. Hopefully the carriers will continue their "buy you out" of your contract offers after May 28th



    Anyone have recommendations on which carriers to switch to? I'd like to hear from people who were with ATT for years then switched to...??

     

    Sprint from 2000-2002

    AT&T 2002-2012

    Verizon 2012-present

    Currently considering TMO

  • Reply 19 of 75
    vmarksvmarks Posts: 760editor
    Quote:

    Originally Posted by whatisgoingon View Post

     



    This isn't AT&T's fault.  This is ENTIRELY on Apple.  Apple has been doing this for probably about 15-20 years, even before they had physical stores.  They will keep inventory for themselves and only give resellers a very small amount of product, particularly for newly updated hardware.

     

    It's why lots of independent Apple resellers have gone out of business, because anybody walking into their store could get the hardware they wanted faster on their own than if they tried to buy it from the store.




    Independent Apple Resellers is a different story than carriers.

     

    AARs / AASPs are meant to service business customers and rural customers the way Apple Retail can't. They should be focusing on after-sales support and maintaining relationships with customers that differentiates them from Apple Retail. Apple Retail has been around for almost 13 years at this point, and their model shouldn't be trying to do what Apple Retail does.

     

    Carrier stores are meant to do exactly the same thing, and they generally do it less well. Anecdotally, no one I know likes going to a carrier store to browse or hang out. AT&T has a history of imposing customer-hostile policies. (Capping unlimited data, limiting usage types for unlimited data, refusing to unlock out-of-contract phones, there's a list.) Yes, they were the first iPhone partner, but ask - has Apple been a good partner for AT&T? Has AT&T been a good partner for Apple?

     

    My 2¢.

  • Reply 20 of 75
    redgeminiparedgeminipa Posts: 554member
    Quote:

    Originally Posted by razormaid View Post



    The problem with this is AT&T never get enough models to sell. I tried buying through them on the first three iPhones. Waited in line for hours only to find out they only got two of the (first ever) 32GB or three of the (then) new white model, etc. it's only gotten worse over the years so I guess it's time to switch carriers. Hopefully the carriers will continue their "buy you out" of your contract offers after May 28th



    Anyone have recommendations on which carriers to switch to? I'd like to hear from people who were with ATT for years then switched to...??



    I was with AT&T for several years. When they stopped giving me annual upgrades due to being the account holder with 5 lines of all iPhones, it was time to switch carriers. AT&T is great at giving then taking away. Enough was enough. 

     

    I considered T-Mobile, but they're horrid in many rural areas, which is mostly where I'm at. They still have nothing better than EDGE in my city, the largest city between Pittsburgh and Harrisburg, and there are too many holes in between. I'll have nothing to do with Verizon, so Sprint was who I strongly looked at, especially since they were the 2nd carrier behind Verizon to have LTE in my area. No, Sprint's LTE isn't screaming fast, but that isn't what I wanted or needed. 

     

    I've been with Sprint for almost a year and a half. I ended up switching to the Framily Plan after they introduced it. I now have a total of 10, which means everyone (from 7 members on) on mine is now paying $25 for unlimited talk, text and 1GB of data, or $45 with unlimited Sprint data and annual upgrades on the device installment plan. The unlimited is great with no throttling, no matter how much you use. My ex was frequently using over 12GB per month. The kicker is, it's only on Sprint. You get practically zero roaming data, which is roaming on Verizon. It isn't often I run into that anymore, but it's worth noting. 

     

    Call quality and reliability are about average. Sprint released WiFi calling with the iOS 8.3 update, and it's a blessing in disguise at times. It works great, but you have to end the call before you leave the WiFi area, or you'll lose the call. It takes a little getting used to.

     

    If needed, Sprint is great at working with people with subpar credit. They don't usually require a ton of money up front, and will, instead, charge $7.99 per month credit fee unless you switch to paperless billing and auto-pay. Not a bad deal. Once you've been with Sprint for a while, you can request to have the credit fee lifted, which also gives you the best financing deals they're currently offering. $0 down required instead of the customary $100+. You still have the option to put whatever amount down you want to lower your monthly DIP payments.

     

    As for the annual upgrades with the Device Installment Plans, you have to turn in your phone when you upgrade, or pay it off early and keep it - sell it. I'm thinking I'm going to pay off early and sell it, since I'd make back a good bit of that money, instead of giving it to Sprint. I'll still make out. 

     

    Sprint also seems to be working pretty well with upgrading the network, definitely better and faster than AT&T. I'm anxious to get Sprint Spark where I live. I've heard very good things about it. 

     

    In total, I have 5 devices on my account: 2 phones, 1 Galaxy Tab and 2 iPad Air 2s. One unlimited phone ($45), 2 phone payments, 3 $15 tablet data plans (1GB each) and 2 iPad for Life lease payments ($20 each). My total bill is around $215 per month. It isn't too bad for what I have.

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