Contract plans are agreements between a service provider and a customer that outline the terms of service, pricing, and duration. These plans often include specific features, such as data limits or call minutes, and may require a commitment for a set period, typically ranging from one to two years. Customers usually benefit from lower monthly rates or promotional offers when they sign a contract plan. However, early termination fees may apply if the customer decides to cancel the plan before the agreed-upon period ends. This structure is common in industries like telecommunications, where companies like Verizon and AT&T offer various contract options.