ROBERT GALBRAITH/Reuters/Corbis
Could it be a sign the coupling of AT&T and Apple is coming to an end?
News that AT&T will sharply increase their early termination fees for smartphones has led to increased speculation that AT&T’s exclusive iPhone contract will soon end. Starting on June 1, the current $175 fee will increase nearly 86% to $325. The fees do not affect existing iPhone customers — only new and renewing subscribers.
The cost is designed to help wireless carriers recoup the subsidy they contribute to each new phone. Upping the fee could be a way of making iPhone users feel the sting if they flee to another service. Rumors hint that Verizon could begin offering the iPhone as soon as this summer.
An AT&T representative told CNET that the hike has “nothing to do with the iPhone or any other device.” Instead, the company notes that rival carrier Verizon doubled their ETF from $175 to 300 last November. Like Verizon’s, the new AT&T ETF would deduct $10 every month of a two year contract. CNET notes that this would mean that a customer leaving AT&T during 23rd month of their contract would still have to pay nearly a third of the original fee, despite the fact that the contract was nearly over. (via CNET)