Apple Inc. Store Will Not Offer iPhone On AT&T’s 2-Year Contract [REPORT]

The Apple Store now will not be able to offer handsets on AT&T’s two-year contract terms. A report from 9to5 Mac, which cites multiple sources, confirms AT&T plans to prohibit third-party retailers, including the Apple Store, from selling handsets on two-year contract terms.

Apple Inc. Store Will Not Offer iPhone On AT&T's 2-Year Contract [REPORT]

Apple prepared for the change

Now it means that users willing to buy an AT&T iPhone from the Apple Store will have to contend with the AT&T Next plan or pay the full price. It must be noted that Apple added AT&T’s Next plan only last August.

As per the report, Apple is already prepared for the change as it had already started offering the iPhone under AT&T Next plans. Accordingly, the iPhone maker also started preparing its retail employees for the change.

A few days ago, there were reports that AT&T is planning to prohibit local dealers and national retail locations from selling smartphones under two-year contracts. Now third-party retailers will only be left with AT&T Next installment plans. The change is only for third-party stores as AT&T will continue to sell the handsets under the contract in its stores and online.

Few third-party retailers still allowed

AT&T’s plan was also confirmed by an internal Walmart document viewed by FierceWireless. As per the document, the retailer will cease selling AT&T’s contract smartphone starting May 28. Though AT&T didn’t directly confirm the news, but a spokesperson said, “Customers love AT&T Next, and we are continuing to focus on it as the preferred way that customers want to shop. We have two-year plans available for those customers who choose them.”

Under the two-year contract plan, a buyer can get the subsidized hardware by paying an upfront fee. However, in the Next plan, the full cost of the hardware is spread over a pre-determined term, i.e., 12, 18 or 24 months. And after the end of the term, a user has the option to trade in the old device for a new one.

Also an earlier report from Droid-Life, which first informed readers of AT&T’s plans, claimed that a few third-party retailers may still be allowed to offer the two-year contract plan, but now they will not able to sell the hardware. Instead the devices will be shipped from AT&T days later. So technically this option is similar to buying hardware from AT&T online. As of now, it is unclear if Apple can sell the AT&T iPhone using this tweaked method. If not, then the AT&T Next monthly installment plans will be the only options for the mobile carrier left at the Apple Store.



About the Author

Aman Jain
Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at amanjain@valuewalk.com