Verizon Just Killed Smartphone Contracts

Verizon Wireless said today that, effective Aug. 13, it will no longer offer traditional two-year contracts to new customers. Instead, new customers will be able to choose between one of four different data plans (that all come with unlimited voice minutes and text messages) that range in price from $30 per month to $80 per month. Current customers will be offered the new plans as well, but they may also keep their current plans "with some restrictions."

The new plans, whose names are cozy and familiar, are:

• Small ($30 per month for 1GB of data)

• Medium ($45 per month for 3GB of data)

• Large ($60 per month for 6GB of data)

• X-Large ($80 per month for 12GB of data)

On top of this, customers would need to pay for the cost of the device (which is broken into monthly installments), plus an "access fee" of $20 for a smartphone and $10 for a tablet. And because there are no contracts, customers are free to switch between the different plans from month to month.

The prices are… OK, but Verizon has never claimed to compete on pricing. In fact, a company representative told Re/code that it's "never going to be a price leader." OK!

As for why all of this is happening, you can thank T-Mobile for getting the ball rolling by dropping traditional contracts way back in December 2012, pushing fellow US wireless carriers to do the same.