AT&T, you didn't have to do that...no, really

Anna Scantlin
Contributing Editor from Kansas City, MO
Published: July 17, 2013

Okay, so let's take a moment to reflect on what we're looking at when it comes to "The Big Four" carriers in the United States and what they're doing when it comes to staying competitive with each other. Honestly, I can't think of a time when competition has been so intense. Verizon has a significantly stronger network than the rest, Sprint has unlimited data, T-Mobile is absolutely shattering the mold it was once a part of, and AT&T has... well, it has bundles. And decent coverage. Regardless, we're looking at a very fragile framework that once seemed very solid of where each carrier stood in regards to placement. For a long time, in regards to number of subscribers, it's been Verizon at the top followed by AT&T, Sprint and finally T-Mobile.

Then T-Mobile decided to be a little rebel and branch out a bit, and now it's stirring up quite a commotion in the industry.

Ah, little T-Mobile. Started off so young, so sweet and so innocent. Now their CEO is cursing like a sailor and slashing prices and stigmas with his loyal band of mobile buccaneers. I have to admit, it's been a very interesting show to watch since they announced their UNcarrier plans back in March. I'm not sure if it's because I can relate to cursing like a sailor too or because the plans and prices just make sense, but I have a lot of newfound admiration for T-Mobile lately for what they're trying to do for the industry.

I cannot say the same for AT&T, who is actually starting to follow suit by offering what they call "AT&T Next" to compete with T-Mobile's Jump plans, which offers customers the option to upgrade earlier than the standard 20 or 24 so months. Normally I could see this as a good thing, except for AT&T made one huge mistake with theirs.

In both carrier's options to upgrade early, if you want to upgrade early you're going to have to make the sacrifice of trading in your old phone for the new one. That's about where the similarities end. Now let's look at some of the differences.

At face value, it does seem like AT&T is really giving you the benefit of the doubt when it comes to upgrading early. You can take an upgrade at 12 months after the purchase of your first phone. AT&T sweetens the deal by cutting out activation fees and don't even make you pay a down payment for a device. You could go into AT&T and walk out the door with a brand new device without having to pay a penny if you wanted to. Did I mention the option to upgrade early doesn't cost any extra money? That's right, you can opt right in to the plan without an added monthly fee. Pretty sweet, right?

Kinda. I guess. No, not really.

Let's say you go into AT&T and you purchase one of those shiny new Samsung Galaxy S 4s and you opted in to AT&T Next. You didn't have to pay a down payment, and you don't have an extra monthly fee tacked on in order to be able to upgrade 12 months from now. Sweet and awesome. You're paying $32.50 extra each month for the device though, which doesn't seem so bad at first until you realize your plan on AT&T actually still has a fee included in it that pays for a phone that would otherwise be subsidized. In other words, you don't have an extra fee to be part of the club, but you are paying twice for the same phone. A phone that you're going to have to give up in 12 months if you want to take advantage of an early upgrade. You do have the option of paying the phone off in 20 months, at which point technically you own the phone and you won't have to trade it in to get an upgrade, but again, you're still paying twice for the same phone. If you took the traditional route with AT&T you're only paying for the phone once and you only have to wait four more months before you're eligible for a contract renewal and an upgrade anyway.

So yeah, it's cool that you don't have to pay anything up front, but you're making up for it by paying double over the next several months for something that seemed like a nice gesture from the phone company.

Now let's take a look at T-Mobile. With T-Mobile's Jump plan you can purchase a Galaxy S 4 for $150 down payment and $10 each month thereafter to be a part of the Jump plan, plus $20 extra a month to pay off the rest of the Galaxy S 4. In just 6 months you have the option to trade up your Galaxy S 4 for a new phone. Yes, you are spending more money up front to T-Mobile in order to be able to upgrade early, but T-Mobile's Jump plan actually has more benefits than meets the eye. First and foremost, you're only paying for the phone once. T-Mobile's plans are already laid out plainly for you, and your monthly plan only includes the price of the phone once. Also, your $10 a month membership plan to Jump also includes insurance, so if something should happen to your phone you're covered. T-Mobile's insurance otherwise costs $8 a month, so if you're the type of person who gets insurance on their phone anyway (something I highly recommend) you're only paying $2 extra than you normally would to have this option. Adding that in with the fact that you only have to wait half as long as AT&T's Next plan, the T-Mobile Jump plan seems a lot more beneficial than AT&T's Next plan.

Here's my thing about all of this: AT&T didn't have to pull this move yet. AT&T still has a pretty big advantage in terms of coverage over T-Mobile. The Metro PCS merger with T-Mobile may have been approved, but T-Mobile is still a far cry behind what AT&T already has to offer in the coverage department, and what's a new phone worth if it gets no service? I'm not saying that I don't want AT&T to come out with a plan similar to T-Mobile's, because having an early upgrade is a great option for people who want it, but not if it comes at double the price of what a plan like this should cost. AT&T should have taken the time to work on their version of an early upgrade system a little longer in order to get it right, in my opinion.

Rumor also has it that Verizon Wireless plans to make a similar move in late August, but since I have no details on the plan all I can say is I hope they come out with a more enticing plan than AT&T has.

Readers, what are your thoughts on all of these early upgrade plans? Do you think it's better to offer the option than no option at all? Share your opinions with me in the comments below!