A Verizon $20 upgrade fee will begin April 4 and applied every time a customer wants a new phone, even if customers buy the phone outright, or sign up for the carrier’s device payment plans or purchase the phone through Apple’s upgrade program.
The new change may seem extremely, but previously Verizon had only charged upgrade fees to customers still under a two-year contract (a $40 fee, which remains in place), according to PC Magazine. The only way for customers to avoid the upgrade fee is if they buy the phone from someplace else, such as Amazon, Best Buy or an Apple Store and activate the phone at a Verizon location.
“People are switching devices more frequently,” a Verizon spokeswoman said on Thursday. As a result, the company needs to cover the costs of processing higher device turnover, she said. “Customers can pay the [$20] charge when they upgrade, bill it to their account or trade in an old device to offset the cost,” she added.
Some major carriers charge an activation fee for upgrades and new agreements too. AT&T, for example, charges $15 if customers bring their own device. Sprint may charge $36 per device for a lease agreement or installment plan. T-Mobile does not charge an upgrade fee.
As carriers do away with two-year contracts, they do have to deal with the possibility of more turnover. But new fees only make it harder for customers to figure out which company has the lowest cost for the best level of service.
Verizon also charges $20 activation fees for new lines of service. The “upgrade fee” has always been one of the shadiest aspects of the wireless industry.
“We are implementing an upgrade fee to help cover our increasing support costs associated with customers switching their devices,” reads the Verizon memo. Many customers wish to see the numbers on just how much of an inconvenience device switching is for Verizon, the most successful mobile provider in the United States. Experts agree that T-Mobile CEO John Legere will latch onto this as yet another reason to slam his company’s larger rival.
Verizon’s new upgrade fee comes after several high-profile phone announcements, including Apple’s iPhone SE and Samsung’s Galaxy S7. The only two unchanged items is the $40 fee for a two-year upgrade, and no fees for a customer’s own provided hardware.