Thinking of upgrading your phone with Verizon? Better do it fast.
On April 22, Verizon Wireless will institute a $30 upgrade fee for existing customers who purchase new phones with a two-year contract.
The fee would hit any Verizon customer signing up for a new two-year plan and receiving a discounted device. Early upgraders who pay the full price of a new phone would not be impacted.
“This fee will help us continue to provide customers with the level of service and support they have come to expect,” said Brenda Raney, spokeswoman for Verizon Wireless.
Verizon is actually the last national carrier to charge an upgrade fee. T-Mobile charges $18 for upgrades. Sprint and AT&T recently doubled their fees to $36.
The announcement comes at a time when carriers’ profit margins are getting squeezed by hefty smartphone subsidies — particularly from Apple’s iPhone.
At the same time, voice minutes are dropping, sending average revenue per smartphone user down $10 in two years, according to a recent PricewaterhouseCoopers’ survey. Customers are also less loyal than ever before, switching their carriers an average of every four years.
Meanwhile, the growing number of smartphone customers are using increasing amounts of data on their devices, prompting carriers to spend tens of billions of dollars each year building out new network infrastructure to handle the growing traffic load.
All of that means carriers are scrounging around for new revenue, raising prices for all manner of services.
AT&T instituted a $5 across-the-board price hike in January for new contracts, and Sprint raised its monthly smartphone rates by $10 a year ago.
Early termination fees have doubled at AT&T, Verizon and Sprint over the past two years. Verizon ditched its New Every Two discount plan last year, and AT&T cancelled its lower-tier texting plans in August.