Verizon Debuts New Device Payment Plan

Following in the footsteps of T-Mobile, the team at Verizon Wireless has announced a new payment plan that might make it easier for cash strapped customers to purchase the smartphone they have always wanted.

The nation’s largest carrier has announced a one-year payment option that spreads a users smartphone payments across 12-equal monthly bills.

The Device Payment Plan was announced at the same time that Verizon extended its upgrade policy from 20 months to 24 months. That means customers can not receive discounts off the full price of a new smartphone until they have waited a full two years from their last payment cycle.

Verizon is rushing to extend the number of devices available for its Device Payment Plan, likely in response to T-Mobile’s newly announced “UnCarrier” plans. T-Mobile will allow unlocked iPhone purchases for $99 down and $20 per month over two years. The company waves the fee for new customers or customers who trade in their old smartphones. T-Mobile has promised to usher in a new way of thinking in the American cell phone industry. Apparently that promise was right on the money.

Speaking to Engadget, the company said those monthly segments will “sit on top of existing service plans, not inside them — the base service rate won’t go down in year two.”

Verizon recently said it would go contract free if customers wanted that option. The United States is odd in its cellular setup. For example, countries in Europe routinely sell smartphones at full price to customers and then offer deep discounts for off contract cellular service. Go to almost any carrier in the UK and you get more minutes, free incoming calls, and cheaper text messaging for a fraction of the cost in the United States.

It’s too early to tell if Verizon Wireless’ Device Payment Plan and T-Mobile’s Uncarrier moves will make a difference, but they appear to be headed in the right direction.