Is AT&T Killing Tablet Subsidies?

AT&T Inc. (NYSE: T) has reportedly stopped subsidizing tablets, adding to the up-front cost to the consumer that wants to buy an Android mobile device.

Engadget has published a document suggesting that AT&T stopped offering subsidies on tablets this weekend and will let users pay as they go for monthly 3G and 4G connectivity on the devices or sign up for a Mobile Share data plan.

AT&T is following Verizon Wireless in stopping the subsidy on its Android tablets. Big Red stopped the practice in June as it moved to shared data buckets.

Neither carrier has ever subsidized the top-selling Apple Inc. (Nasdaq: AAPL) iPad. Customers pay full-price for the Apple device and buy connectivity month-by-month or on its shared data plans. (See AT&T Joins Verizon in the Shared Data Pool.)

Why this matters
The top two carriers in the U.S. appear to be harmonizing on an iPad-like model for all tablet sales. None of the carrier Android tablet launches so far have dented the iPad and the recent devices like the Nexus 7 tablet and the Galaxy Note 10.1 are being offered as Wi-Fi-only gadgets, so the incentive for carriers to put these devices on contract appears to be declining.

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— Dan Jones, Site Editor, Light Reading Mobile

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