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Carriers Roll Out Installment Plans To More Indirect Retailers

NEW YORK – Carriers are expanding the number of indirect retailers that sell their installment payment plans, which the carriers are heavily promoting to reduce the cost of subsidizing phones.

The plans, called Edge by Verizon Wireless and EasyPay by Sprint, help consumers pay for unsubsidized smartphones over time and enable them to trade-up to new phones more frequently.

Carriers have been promoting the plans heavily, and AT&T and Verizon in recent months have made the plans more attractive by reducing service costs for customers who opt for the installment plans.

The plans were initially available only through carriers’ direct channels and their online stores.

Analysts see the plans’ popularity growing. Jefferies analysts forecast that 46 percent of eligible AT&T subscribers will sign up for the carrier’s Next program in 2014, and in 2015, 70 percent of subscribers will opt for the plan.

Recently, Verizon Wireless announced that it has begun expanding its Edge installment- payment plan for no-contract unsubsidized cellphones to the indirect channel, and Best Buy launched Verizon Edge installment billing plans at the majority of its stores last week, the retailer told TWICE.

For its part, Sprint rolled out its EasyPay program to independently operated Sprint-branded stores and to other wireless specialists, and on April 4, the carrier rolled the plan out to Best Buy. The national appliance/ electronics chain is the first national retailer and first CE retailer to offer EasyPay and offer Sprint’s Framily rate plan.

For its part, T-Mobile offers its financing plans through many indirect retailers but not yet through national retailers, T-Mobile has said. Best Buy confirmed that it does not offer T-Mobile’s installment plan.

Rival AT&T has rolled out its Next plan to independently operated AT&T-branded stores and to select Wireless Advocates kiosks at military bases, an AT&T spokesman said.

In rolling out its Edge plan to the indirect channel, Verizon Communications chief financial officer Fran Shammo said the company could potentially double the Edge take rate in the second quarter.

Edge expansion to the indirect channel began at the end of the first quarter.

In the first quarter, less than 15 percent of retail postpaid customers activating a postpaid smartphone in the first quarter opted for the Edge plan. The share of retail postpaid smartphone subscribers currently on Edge is less than 2 percent, Shammo said at the end of April.