Sprint set to join other major US carriers in killing two-year contracts for smartphones, according to leaked internal document
Dan Thorp-Lancaster / Android Central :
Context & Ripple Effects
Sprint had already signaled this move in August, when it said it would abandon two-year contracts by year-end and launched its iPhone Forever leasing plan from $22/month. The leaked internal document reported here confirms the follow-through, arriving days after AT&T stopped offering two-year contracts on January 8 — leaving the subsidy model effectively dead at three of the four national carriers.
The timing matters because Sprint has spent the past year buying growth rather than locking customers in: its $200 minimum trade-in offer was aimed squarely at poaching T-Mobile switchers, and leases like iPhone Forever lower the up-front price barrier in the same way.
First-order effects
- Sprint customers can no longer get a subsidized phone in exchange for a two-year commitment — new devices arrive via iPhone Forever-style leases, installment plans, or full up-front purchase.
- Sprint's retail and upgrade conversations shift from contract renewal dates to monthly lease and trade-in terms, putting its $22/month iPhone pricing front and center.
Second-order effects
- Verizon is left as the last major US carrier still offering two-year contracts, facing pressure to follow AT&T and Sprint or defend subsidies as a differentiator.
- Competition among the carriers migrates from device discounts to financing sweeteners — lease rates, trade-in guarantees, and switcher credits like Sprint's $200 offer become the battleground.
Third-order effects
- If all four carriers converge on leasing and installment plans, the decades-old US model of carrier-subsidized handsets ends, and phone pricing transparency shifts toward equipment costs being visible separately from service.
- Carriers' control of the upgrade cycle weakens: without contract lock-ins, churn decisions hinge on lease terms and trade-in value, which favors aggressive financiers over incumbent subscriber bases.
The trend: US wireless carriers are dismantling the two-year contract subsidy model in favor of leasing and installment financing, with each defection pressuring the remaining holdouts.