AT&T announced yesterday a new "carrot and stick" pricing plan for early termination fees (ETF) of cellphone contracts, beginning with new contracts starting June 1st. The carrot is that for new two-year agreements or upgrades on what they refer to as "basic and quick messaging phones," the ETF will be reduced from $175 to $150 and be further reduced by $4 for each month of the contract. Well, that's very nice of them, but it probably doesn't affect anyone reading this post.
The stick is that for anyone using higher-end devices such as smartphones, including the iPhone, the ETF will nearly double from $175 to $325 and reduce by $10 for each month the contract ages. Now don't get scared, since this is only for new or upgrade contracts starting June 1st and doesn't apply to anyone with a current contract. That is, unless you're up for renewal and make the mistake of buying a new two-year contract.