Boston.com is reporting that AT&T will charge users wishing to terminate their contracts $175 to do so.

Even though AT&T isn’t subsidizing the iPhone’s hefty price — $499 to $599, depending on the storage capacity a customer chooses — the company will charge a $175 termination fee for iPhone users who want to break their two-year contracts.

Th article goes onto write that cancellation fees are in place to prevent the carrier from losing too much money on the subsidies they place on handsets.

Interestingly the iPhone is notably free of subsidies, AT&T spokesman Mark Siegel commented on the situation;

“There are certain fixed costs we incur in serving every customer who establishes service with us.”