Yep, that will lock them in now! They will not even consider another carrier. AT&T has made them happy loyal customers now, for life. /s
Dumped AT&T well over a decade ago for the poor quality on their signal margins. Won't say Voicestream/T-Mobile is perfect, but they are WAY above anything else we've seen in meeting our needs. (We don't travel in hinterlands much; coverage seems to be their weakest point, but it's improving hugely year-to-year.)
It doesn’t matter whether one likes AT&T or not they are following good business principles. They subsidize the cost of the phone for the customer’s benefit with the expectation of recouping that cost over the two year contract period. If someone accepts the deal and then breaks it that leaves AT&T with a losing proposition.
If someone is going to steal, and that is what the customer is doing, then they should pay the fine.