Two-year contracts fall to monthly cellphone plans

Two-year cellphone contracts may soon be history, as carriers have found a new way to make having a cellphone less expensive.

These two-year plans often trap consumers by forcing them to stick with a particular carrier for two years without the ability to receive any upgrades or break the contract during that time.

Month-to-month plans have become the newest way for consumers to pay for their cell service. Month-to-month plans are super flexible, allowing consumers to leave the carrier at any time without being held in an agreement. The plans also allows consumers get a new cellphone within 12 to 18 months without having to pay a deductible or $200 to $400 out of pocket for a new phone.

The new payment plan also allows consumers to trade in their phones early for another one, such as the newest iPhone or Samsung Galaxy, depending on the type of month-to-month agreement they have.

“I think it’s smart,” said accounting sophomore Nathan Platt. “People are always looking for something cheaper (and) more affordable.”

“Cell phone are really expensive, plus (you have to pay for) the service… I still think with the new plan, companies are ripping (consumers) off. They know we need cellphones, so of course the prices are going to be outrageous no matter what because of the demand.”

Month-to-month plans have become popular over the past year. Top cellphone carriers such as Verizon and AT&T now offer the month-to-month plan, and many consumers are considering it a better deal.

Carriers such as T-Mobile are even offering to help buy people out of their current two-year contracts.

When one looks closer at the numbers, however, the prices all begin to event out, no matter what contract you’re under.

According to Time, “The two-year contract lets you buy an expensive phone (say, the $649 iPhone 6) for a seemingly inexpensive, subsidized price ($199). Naturally, however, the cost of the phone is baked into your monthly fee, and by the time two years have passed, you’ve paid the full price for the device.”

The idea of cellphone carriers continuing to add options for consumers may one day lead to reasonable plans. Right now carriers offer four types of plans: a payment plan, a two-year contract, a pay-as-you-go plan and now the month-to-month plan.

The month-to-month plan gives consumers a more-bang-for-your-buck incentive and allows them to have more freedom within their plan. This plan will probably put two-year contracts to rest after their long run over the past years.

While the price is remains the same in the long run, under a month-to-month plan, people are getting the chance to do more and have more freedom.

Cellphone carriers are listening to consumers, which is important. Hopefully, carriers will continue to offer cheap and flexible options. And with all the buzz about the month-to-month plan, the end of cellphone contracts may be closer than many anticipated.

Opinion columnist Faith Alford is a journalism sophomore and may be reached at [email protected].

1 Comment

  • More and more cellphone users are
    avoiding locking themselves into two-year contracts. GIV Mobile, which utilizes
    T-Mobile’s fast 4G network, now offers no-contract monthly cellphone plans for
    as little as $20/month that comes with unlimited talk and text and 150 MB of
    data. Every month, 8% of each customer’s monthly plan amount is donated to up
    to three charities of their choice including the Children’s Scholarship Fund,
    Mercy Housing and the American Cancer Society.

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