Verizon Forced You Into 3-Year Phone Payments, Now It’s Shocked You’re Not Upgrading

Verizon is concerned about how often you upgrade your phone. Despite the fact Verizon was the one that moved from 24-month financing to 36-months, a couple years ago. Essentially forcing customers to keep their phones for another year.

The company’s Chief Financial Officer, Tony Skiadas, was speaking at the Morgan Stanley Technology, Media & Telecom conference last week and stated that Verizon is seeing year-over-year declines in phone upgrades. Stating that “the average upgrade cycle for us is up over 40 months, it’s like 42 months right now. So the phones are made better. And from our standpoint, we’ll continue to be disciplined in our approach to retention.”

But this has nothing to do with Verizon moving financing to 36-month plans, right? Right.

Of course, Americans are currently tightening their belts on spending amid inflation and raises in the cost of living. Buying a new phone isn’t a necessity for most people, and therefore, they are not upgrading as often. This hits carriers like Verizon particularly hard, since the majority of their profit and growth comes from smartphone and other device sales. Not so much from their monthly rate plans, which did see an increase at the end of 2024.

Moving to longer payment plans is screwing themselves, but helping T-Mobile

T-Mobile, despite raising prices today for its loyal customers, is still growing quite a bit. And it’s largely thanks to their aggressive buyouts of Verizon and AT&T customers phones. This is because both AT&T and Verizon love thee 36-month payment plans, as it keeps you with their carrier longer, especially if you have bill credits from a trade-in or promotion. Because if you leave before those bill credits are finished, you forfeit the remaining credits.

However, in 2024, for every customer that Verizon added, T-Mobile added 40. That’s pretty stunning, for a carrier that is still the third-largest in the US. And of course, those aggressive buyouts are helping T-Mobile grow.

Verizon is complaining that people are taking 3.5 years to upgrade now because Verizon pushed everyone to 3-year payment plans, is pretty rich. Customers are doing exactly what Verizon pushed them to do. It’s not like Verizon is struggling, having brought in $27.6 billion in total customer revenue for Q4 2024, which was a 2.2% increase over the same period in 2023.

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