Verizon Wireless (NYSE:VZ) said that starting April 22 it will charge a $30 upgrade fee for existing customers purchasing new mobile equipment at a subsidized price with a two-year contract.
Verizon said the fee will "help us continue to provide customers with the level of service and support they have come to expect which includes Wireless Workshops, online educational tools, and consultations with experts who provide advice and guidance on devices that are more sophisticated than ever."
The fee does not apply to existing customers who upgrade their phones while still under contract. Verizon also added that most devices can be traded in with the carrier's trade-in program at www.verizonwireless.com/tradein "as a way to save money or potentially offset the fee completely."
Verizon ended its "New Every Two" upgrade program in January 2011. The program gave existing customers a credit of $30 to $100 toward the purchase of a new phone on contract every two years.
Despite the new fee, as The Verge pointed out, Verizon is actually the last of the Tier 1 carriers to adopt such a fee. AT&T Mobility (NYSE:T) and Sprint Nextel (NYSE:S) both charge their customers upgrade fees of $36, and T-Mobile has an $18 fee.
The fees are an acknowledgement of the expense carriers incur in subsidizing customers' new phone purchases. Such subsidies can cut into operators' margins.
- see this Verizon site
- see this The Verge article
- see this GigaOM post
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