04/05/2013 02:24 pm ET

Verizon CEO Says He Will Consider Dropping Traditional Cell Phone Contracts, Like T-Mobile

Verizon may follow in T-Mobile's footsteps and end cell phone contracts... someday. At an event on Thursday, Verizon's CEO Lowell McAdam said that he would consider killing cell phone contracts if consumers demanded it, CNET reports. "We can react quickly to consumers' shifting needs," McAdam said.

In March, Verizon competitor T-Mobile announced that it would end traditional contracts and cell phone plans. The New York Times' David Pogue argued that T-Mobile's contract free system will be a huge improvement for customers. Pogue calls the way cell phone contracts currently work a "conspiracy" and a "rip-off." He writes that T-Mobile's new plan will save customers a whole lot of money and allows users to bow out without penalty. Pogue did the math and decided that if you went with a comparable plan from Verizon instead of T-Mobile, you would pay $960 more over two years.

While Pogue has been praising T-Mobile's new plans, Rebecca Greenfield of The Atlantic Wire did some different calculations and is not convinced that contract free cell phones are worth it. She writes that "T-Mobile isn't saving you money, it's just changing when you pay them. It's an accounting change more than a value play."

One thing that everyone can seem to agree on is that if all cell phone companies stopped locking their customers in for two-year contracts, there would be much more competition between the top companies, which could eventually benefit consumers. If you were able to switch mobile providers at your whim, who knows how these companies would try to woo you? As T-Mobile CEO John Legere put it when he introduced his contract free plan: "If we suck this month, drop us. Go somewhere else."


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