In response to a new, similar option by T-Mobile, AT&T is introducing a new plan later this month that will allow customers to upgrade their smartphone once a year.
AT&T Next, as the plan is called, lets customers get a new device without paying any fees or a down payment. Instead, users pay for their device through monthly installments ranging from $15 to $50, depending on the device. A Galaxy S 4, for example, would cost $32 per month.
After users pay 12 of the monthly payments, they can trade their device in and pick a new one. Users can also choose to keep paying for their phone, which they own after 20 payments. And of course, users must also pay for their cellular plan.
AT&T Next is to be available to customers starting on July 26.
Earlier this month, T-Mobile introduced a similar plan called Jump, which allows customers to upgrade their phones as often as twice a year.
With Jump, T-Mobile customers make a down payment for their phone (normally $100), pay their device's monthly payment (normally $20 or $25) and an extra $10 per month for the upgrade plan.
After six months, Jump customers can trade in their device and get a new one (they'll have to make the down payment for the second device as well).
AT&T Next and T-Mobile Jump are the first such plans adopted by the four major U.S. cell carriers. Verizon and Sprint have not yet rolled out anything similar.