If every year you break your phone and extend your contract by two years, it is effectively perpetual. I don't know how often this happens in reality, though.<p><i>And what's stopping people from always buying the phones full-price and refusing to bind their contracts?</i><p>You can't buy a full-priced phone in any US store, and you have to go looking for them on the Internet. And if you do buy an unsubsidized phone, your service plan won't be any cheaper (except, very recently, T-Mobile).