Is the 2-year smartphone contract dead yet? Not technically, but it probably won't hang on much longer. Sprint is the latest carrier to announce it's done with the contract approach to selling phones. This comes just days after Verizon made the same announcement. T-Mobile, of course, has been doing this for several years.
This news comes by way of Sprint CEO Marcelo Claure, who said the carrier plans to transition completely to a leasing model by the end of the year. Sprint has already been offering leases alongside contracts, and they've proven pretty popular. Instead of paying $200 for a phone and being tied to the contract for 24 months, customers pay a few bucks per month for a 24 month lease. The contract option will go away, so it'll be leases and full price devices only.
So all good news, right? Well, maybe not entirely. You might notice I'm talking about a lease, not a payment plan. Sprint's fine print explains that you're signing up for a month-to-month lease, then at the end of that period, you can choose to "continue to pay monthly lease amount, purchase or return the device." Presumably you'll be able to purchase it cheap, but how cheap? You've already been paying for it monthly that whole time, even though you didn't own it.
Sprint's leasing differs from monthly phone payments on other carriers where you're actually paying off the value of the device until you own it free and clear (an exception being Tmo's Jump on-demand). So I guess it's basically like leasing a car. I imagine there will be some very confused Sprint customers in 24 months if this isn't explained well enough.
This leaves AT&T as the lone holdout of the 2-year contract. but even Ma Bell seems to be tiring of subsidizing phones. Third-party AT&T retailers can only sell devices at full price or on the Next payment plan.