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AT&T raises phone activation fee another $5, now charges $25

Jon Brodkin
AT&T has raised its non-contract phone activation and upgrade fee from $20 to $25, the latest increase for a fee that didn't even exist until July 2015.
As the mobile carrier switched from contracts to device payment plans, AT&T initially did not charge an activation and upgrade fee for customers who brought their own phone or bought one from AT&T on an installment plan. But in July 2015, AT&T started charging a $15 activation fee to customers who don't sign two-year contracts. (AT&T also raised the activation/upgrade fee for contract customers from $40 to $45 in July 2015.)
The activation fee for non-contract customers was raised from $15 to $20 in April 2016 and was just raised again to $25, PhoneScoop reported today. The $25 fee is charged for new activations or upgrades when customers purchase devices on installment agreements, AT&T says. Customers who bring their own phone to the network are charged the $25 fee when they activate a new line of service, but not when they upgrade phones on an existing line.
"We are making a minor adjustment to our activation and upgrade fees. The change is effective today," AT&T told Ars.
AT&T also still charges the $45 activation and upgrade fee on two-year contracts, but those contracts are "available only on select devices."
AT&T added 1.5 million wireless subscribers in Q3 2016 for a total of 133 million. The carrier did lose 268,000 postpaid phone subscribers, but the majority of those losses were customers with cheaper feature phones. AT&T posted a US wireless operating margin of 29.6 percent "and a best-ever US wireless service EBITDA margin of 50.1 percent," it said. Even so, the total wireless revenue of $18.2 billion was down 0.7 percent year-over-year "due to decreases in service and equipment revenues." Raising the activation fee will  help AT&T get a little more from each customer.
Verizon Wireless recently increased its phone upgrade fee from $20 to $30, claiming it was needed to "cover increased cost," even though its wireless network infrastructure costs actually decreased. Verizon's smartphone activation fee is also $30. Sprint charges a $30 activation and upgrade fee. T-Mobile USA says it doesn't charge an activation fee but it does charge $20 for a SIM card starter kit and a $20 "assisted service" upgrade fee that can be avoided if customers use self-service options.
AT&T raises phone activation fee another $5, now charges $25 Reviewed by Chidinma C Amadi on 7:57 PM Rating: 5

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