Sign up to receive 5 free days of our daily summary for tech news.

Read this article for free.

Already a subscriber? Log in here

Telecom

New Wireless Plans Raise Questions for Carriers and Phone Makers

For years, U.S. cellular carriers have helped drive enormous demand for smartphones by heavily subsidizing retail prices of what would otherwise be costly devices. So what could happen to smartphone sales now that carriers are moving away from that approach?

New plans introduced over the past year or so by most of the major carriers change the longstanding wireless pricing model in the U.S. by separating out the cost of devices from the wireless service costs.

Consumers signing up for these plans from AT&T and Verizon Wireless and others can pay less for service if they sign up already owning a phone or if they agree to pay the full cost of a new phone—$600 or so—over time through installment payments.

AT&T and Verizon introduced these plans in response to even more aggressive changes by the fourth biggest operator, T-Mobile USA, which has been trying to grab market share by simplifying its plans and cutting prices. While T-Mobile’s customer growth has sharply improved, investors have been worried about the impact of the new plans on industry revenues, and telecom stocks have been weak over the past year.

What Is The Information?

Notebook b5103017ee163370a1667c9ce59ab0ef023875a17888105d26c185cadf31bb69

Daily news analysis

Every weeknight, we'll send you our reporters’ views on the day’s top tech news—distilled into one email.

Notes bb3aa5069205d702dda37fc71dc6f1c59df2310c4379304e9f1199f052af4884

Exclusive Articles

We broke it first. Receive original reporting, stories, and exclusives you won't read anywhere else from the largest newsroom in tech.

Conference calls c9e664e8b96ee347d3e92b8309938f268422b9db98cfabca5c826fbb75054b23

Conference calls

Go deep into areas like crypto and VC diversity—or get real-time analysis of breaking news—via conference calls with our reporters and other experts.

Events 499acedd16cffc41445edd76bfd302b2836c2a27419890f17130a6b10e2aa3df

Special Events

For no extra fee, subscribers get access to more than a dozen events yearly, from intimate dinners to larger gatherings with marquee speakers.

Access the best reporting on the tech industry read by tens of thousands of global executives.

Become a contributor

Share your views and find other subscribers by completing your profile. You’ll be listed in our contributor directory.

Org Charts

Access the only collection of tech company org charts. Our expanding database includes companies like Amazon, Snap, and Uber.

Slack community

Discuss topics and current events with our subscriber-only Slack group and share news about your company with other subscribers.

Share with your team

Subscribers can unlock any article and share it with friends and co-workers through a special share link.

Stay up to date on Silicon Valley

Sign up for Jessica Lessin’s (The Information’s CEO & Founder) free Saturday newsletter and also receive a complimentary week of our daily afternoon tech commentary email.

Already a subscriber? Log in here

Recent Articles

Media Telecom

AT&T’s Plans for Changing TV

By Martin Peers and Tom Dotan

Media Entertainment

Inside the Hit-or-Miss World of Video Streaming

By Jessica Toonkel

Media Entertainment

Hulu Looks to Make Its Skinny Bundle Skinnier

By Jessica Toonkel

Media Entertainment

Looking to Combat Disney, AT&T’s WarnerMedia Holds Content Talks With NBCU

By Jessica Toonkel

Used smartphones could cannibalize 8 percent of total new smartphone sales by 2018, according to Sanford C. Bernstein analyst Toni Sacconaghi.