AT&T, Verizon Push Free iPhones for Long-Term Customers

The wireless contract is staging a comeback.

U.S. cellphone carriers are offering their most generous discounts in years, handing some customers brand-new devices for no money down or small monthly payments stretched over many months. The discounts from AT&T Inc., Verizon Communications Inc. and T-Mobile US Inc. require customers to make long-term commitments that give carriers the stability they need to reassure investors as they increase spending on 5G network upgrades.

AT&T kicked off the trend in October by offering high-end smartphones such as the iPhone 12 free with an eligible trade-in device. Its discount later dropped to $700, which covers the entire price of an iPhone 12 Mini and most of a standard iPhone 12, among other gadgets.

Verizon followed suit on Tuesday, dangling trade-in credits of $700 toward new iPhones and $800 toward high-end Android phones. Both companies’ most generous offers require that customers stick with an unlimited data plan for a set time.

“It’s essentially a contract,” said Jeff Moore, the head of telecom research firm Wave7 Research. “We’re seeing carriers locking in the customer base that they have as opposed to encouraging switchers.”