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The CEO of T-Mobile announced the end of contracts, allowing for more flexibility in phone choices. You can now pay for phones like HTC One, Galaxy S4, and iPhone 5 for only $100 upfront. Bills will be lower without a contract, and you can switch carriers anytime. However, without a contract, the true cost of phones is higher than expected, as carriers subsidize the cost, making the upfront price lower. Buying directly from Apple without a contract would cost $650 for an iPhone 5.
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