AT&T is the first carrier to charge an admin fee for its prepaid plans

Administrative & Regulatory Cost Recovery Fees are a bit of a dirty word when it comes to wireless service in the US. First introduced by Verizon in 2005, every major postpaid carrier now has a vaguely worded fee like this. The prepaid world has been mostly safe from this practice up until now, but, as first reported by GSMarena, it seems AT&T wasn’t content with that arrangement.

Starting June 22, AT&T prepaid accounts will be charged an additional $2.63 per service payment. This is a bit cheaper than the $3.99 fee that AT&T charges for postpaid, but I’m sure that won’t be much of a comfort to any current AT&T prepaid subscribers.

If you’re wondering exactly what these fees cover, good question. In theory, it’s meant to help with government regulation fees, network investments, and other costs associated with delivering and maintaining a wireless network. That said, many feel like it’s a junk fee that is used to raise pricing slowly and more stealthily than directly changing plan pricing.

These fees allow AT&T and other carriers to advertise the same price as always on the surface, which they know will lead to customers changing plans or making upgrades without really understanding what they are getting into until it’s too late to easily reverse. While an extra $2.63 a month probably won’t bankrupt anyone, the bigger deal is that the door is now open. Now that AT&T has a fee like this, it can continually tweak its fee pricing going forward, while advertising the same plan prices as ever.

It also means we can almost certainly expect Verizon and T-Mobile to follow suit eventually. After all, the same thing happened with the telco and admin fee system for postpaid. Verizon introduced it first, then between 2013 and 2016, both AT&T and T-Mobile followed suit. It’s likely just a matter of when, not if.