Major mobile phone carrier KDDI Corp. plans to stop offering four-year smartphone payment plans after a government watchdog said last month the contract poses antitrust problems, a source close to the matter said Friday.
The plans allow customers who agree to pay for smartphones over 48 months to switch to newer models after two years and get remaining payments for the older handsets waived, provided they sign another four-year payment plan.
The Fair Trade Commission said such four-year contracts, also offered by SoftBank Group Corp., "effectively deprive the consumer of the right to choose" by discouraging subscribers from changing carriers.
It also said that the four-year plans "give an impression to consumers that they can purchase devices at half price."