Verizon will drop phone contracts, end discounted phones

NEW YORK (AP) — Verizon, the nation’s largest wireless provider, will stop offering phones at discounted prices when customers sign two-year service contracts.

The move was made in the name of simplification, but it could result in some customers paying more.

All wireless carriers have been trying to wean customers off subsidies, in which a $649 iPhone 6 goes for $200 with a two-year contract. Instead, carriers have been encouraging people to buy phones outright by paying the full retail price in monthly installments. A few carriers, namely Sprint, also offer leasing options for a lower monthly fee, but the customer doesn’t get to keep and resell the phone without additional payments. Verizon is the second national carrier, after T-Mobile, to end subsidies entirely for new customers.

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