Verizon is ending its yearly service contracts for its wireless phone business. Because of this, high-priced smartphones will have to be purchased in monthly installments or purchased outright, CNET reports.

In the past, customers who wanted an expensive smartphone could sign a two-year contract in exchange for a hefty discount on their phone. For instance, signing a two-year contract meant that the latest iPhone could be purchased for $199. With the new plans from Verizon, customers will be required to purchase these expensive smartphones at the full retail price. The new plans go in effect Aug. 13.

This is a big change for how Verizon operates its business and an overall shift in the wireless industry that is eliminating phone subsidies and contracts. Wireless customers are now paying more for their phones in exchange for cheaper monthly bills. T-Mobile was the first to offer services like these two years ago.

With the elimination of phone subsidies, customers are beginning to see just how expensive a full-priced smartphone actually is.

Verizon will introduce brand new "bucket" plans instead of family or individual plans. Based on how much data a customer needs, they will choose a bigger or smaller bucket. All of these plans will come with unlimited talk and text.

The "small" bucket will cost $30 for 1 GB of data per month, the "medium" will cost $45 for 3 GB of data, the "large" will cost $60 for 6 GB of data and the "extra large" will cost $80 for 12 GB of data. All of these plans will allow for shared data between multiple devices. Since there are no contracts, customers can upgrade or downgrade if they need more or less data. Verizon detailed their plans in an official press release on their website.

Access fees will also be added to the charges for the data. To connect smartphones to the network, a $20 charge will be added to the fee for the data. A $10 access fee will be added for tablets and portable WiFi hotspots.