AT&T is limiting two-year contracts, why won’t it just kill them?

Retailers like Walmart will stop offering the lengthy commitments

by TC Sottek

May 19, 2015, 7:12 PM UTC

TC Sottek is a senior editor who has obsessed over headlines and internet speeds since 2011. He previously worked as an advocate for the National Park System.

The Verge has learned that national, third-party AT&T retailers will stop offering two-year contracts at the end of the month and will instead only offer smartphones with the AT&T Next program or at full retail price. The move was originally reported by Droid-Life, and comes just a little more than two years after T-Mobile declared it had become the "uncarrier," becoming the first major US wireless carrier to kill all mobile contracts.

AT&T isn’t really going that far though, at least not yet. Industry sources tell The Verge that AT&T will continue to offer two-year contracts in its own stores and online, so it’s not a coup de grâce for consumers. And even if AT&T killed contracts, programs like AT&T Next are sort of like contracts by a different name — they’re still expensive commitments.

Even if AT&T plans on dragging its feet, competition has been getting better in the mobile industry. T-Mobile has largely been leading the way, even if the prickly and occasionally uncouth demeanor from CEO John Legere is off-putting. AT&T has already followed T-Mobile’s aggressive moves with discounted data plans and cash incentives for people who switch carriers. Hopefully the company’s ripple will soon turn into a wave.

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