This article is from the Credit cards and Consumer Credit FAQ, by firstname.lastname@example.org (Steve Adams) with numerous contributions by others.
The annual fee is, well, a fee that the card issuer bills to your
account annually. Every year, on the anniversary of the date your
account was opened, the fee for the coming year is billed to your
account. Typical charges are $18-$20 for regular bank cards (about
$40 for gold bank cards) and anywhere from $35 on up for various
flavors of T&E cards. House cards are typically free.
Many lenders waive the fee the first year to get you to sign up,
then depend on you to forget a year later that you'll be charged an
annual renewal fee. There's nothing shady about this as long as
it's disclosed up front.
The AT&T Universal Card no-annual-fee offer has expired. If you
don't have an AT&T Universal Card now, you can apply for one but you
may have to pay an annual fee. However, AT&T is still inviting some
people to apply for a no-fee card.
AT&T Universal Card Services will waive annual fees if:
a) You transfer a balance of thousand dollars or above from
another credit card when you receive the AT&T card.
b) You use the card at least once every year.