AT&TAT&T this morning introduced a new pricing structure that reduces the monthly fee for its no-contract customers — attempting to fix what was viewed as a bad deal for people who pay the full price of their device up front or in installments.

The company says that customers who pay for their phone through the AT&T Next installment program, purchase their phone at full price, or otherwise aren’t under contract will pay a flat $25/month service fee (in addition to data and device costs) as opposed to the higher rate of $40/month for customers who get a device subsidy when they sign up for a two-year contract with the company.

T-Mobile CEO John Legere, whose company was the first to make these types of moves, ridiculed AT&T’s Next program when it was announced earlier this year: Legere tweeted at the time, “Did AT&T really just start charging full price for devices without discounting their rate plans? OMG. Really?”

In the meantime, Bellevue-based T-Mobile has been adding customers at a rate of more than 1 million a quarter. But in a statement released to AllThingsD this morning, an AT&T spokesman said T-Mobile wasn’t a factor in its latest changes.

“We look to our left and to our right and are aware of what our competitors are doing,” the spokesman said. “But our primary focus is right in front of us — on our customers. They’ve told us they want even more choice and flexibility … when they buy services and devices. And, they want to get a great price.”

See this CNet story for a detailed breakdown of the changes and implications for AT&T customers.

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  • Guest

    Sorry, but this still isn’t a deal. I bought iPhone 5 earlier this year with a 2-year contract and I pay $80/mo for 450 rollover minutes (which, at my usage level, is effectively unlimited), 3 GB of data, and unlimited text. Under this new pricing structure I’d pay $55 for 2 GB of data plus $25 for a “service fee,” for a total of … Siri? What’s 55 plus 25?

    Oh, right. $80 for less data.

    Now I’m not about to switch back to T-Mobile — I had them for two years and I was amazed how poor their service coverage was even in Seattle — but AT&T isn’t even trying to compete on price.

    • Wishboom

      T-Mobile’s service with the new gen network is much improved. I had them for a while, switched to AT&T and just switched back with an iPhone 5S. Where I need it, their coverage is now markedly better than AT&T’s was.

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