Whoever wrote this is an idiot along with all of those consumers who get a $500 phone for free or at a significant discount and then leave their contracts after 6 months. The carriers have not even hit the break even point for bringing on a new customer much less recouped any of the subsidized portion of the handset cost at that point.

So now you are forcing the carriers to return to charging full price for handsets again. Nice trade off! There is a side to every story.

Reply

Yup, I got hornswaggled by the sales guy who told me sprint had no cancellation fee. $150 dollars later my final bill told the real story. After being their customer for YEARS, I switched. Apparently only a couple days short of my most recent 2 year deal...and yeah I got a phone, and then another and I have paid for roaming, and information calls out the wahzoo. Now I am with the new wireless people and don't cha know, I want out and this article gives me hope.

Reply

Yes Rick, very insightful... Did you ever think that the cost of the phones would come down from the "full retail" value if they couldn't stick you for two years? It'll be free market again and we know what that does to prices.. We'll get both; freedom to choose a carrier when and how we want to and we'll still get inexpensive phones. Trust me..

Reply

This is great news, though too late for me. I'm still in battle with my current provider over this--- I was charged for our 2 phones for termination because I hadn't paid the entire bill, prior to my getting very sick, hospitalized, and on complete bedrest. And they had no sympathy for the fact that their remaining payment wasn't on the top of my priority list. And when I explained and tried to pay it over the phone, I was told that I had to pay all of it, and then I would only get to have service for 1 phone! (I simply went online and paid what I owed previous to those lovely fees.) What slays me the most is that I have been with them for at least three full completed 2-year contracts prior... the last one being started 1-3/4 yrs ago only because the phone I had needed to be fixed to work, and they no longer repaired that model, so I had to get another (along with the new contract). What a crock!

Reply

Hi Tracy, if that's your choice to pay full price for a phone, then that's your choice. But when you sign a contract to get the discounted headset, you should stick to it, an not complain when you're charged the ETF. Look at it this way, when you sign a lease on an apartment, or a car lease, a home security system or satilite tv service, you agree to pay an early termanation fee. You do so because the service provider have up front cost that goes alone with providing you with the good or service they are providing you.Now ou already know that if you break that lease on an apartment, you have to pay a fee. If you return that car before that lease is over, you pay a fee to do so. Same thing with the home security system an satilite tv, you pay a fee. That's in the contract, that no one forced you to sign. I recently bought the Samsung instint form Sprint. That phone retails for $479.00. I got mine for $129 for agreeint to a 2 year contract. I saved $350. Not Sprint let me have this new $479 phone for $129 an a $350 committment to me. If I was to break my contract today, all I would have to pay is the $200 dollar ETF. But would still have thier $479 phone, an all i'm out of is $329. Sprint ould still be out of $150. So as you can see as in most cases the Early Termanation fees don't cover the wireless providers losses on the headsets. Sprint made a committment to me, an I made one by signing the contract. That was my choice. If you want your freedom to chose what company you want to use, they you paid full price for your headset, an pay month to month, thats your choice. I happen to like my discount I got on my new Instinct. So now do you really think this judge would tell that apartment lesser or car lesser they didn't have to pay to abandom their apartment, or just drop the car back off at the dealership an not pay tthe early termernation fee. The main ones complaining about these fees, are the ones that don't like paying there bills in the first place. I hope you now see the wirless compaines point of view an my point of view now.

Reply

Wouldn't it make sense to sell a phone independent of the service? That way, you can finance the phone and spread those payments over 12, 18 or 24 months. If you choose to switch to another carrier, simply pay off your phone and be done with it.

That way, everything is above board, and those who choose to keep their phones for an extended period of time no longer help finance the phone purchases of others.

Reply

Everything is above board now. You know exactly what you're getting. Like I said I knew when I bought my Instinct last month, what the phone cost, $479. I knew that they would sell me the phone for $129. if I signed a 2 year contract. Now Sprint would have been happy to sell me that phone for $479. An I would have been free to leave when I chose to. But it was my chose not to do that, an take them up on their offer. An so have millions of others. An they paid there bill, a lived up to the contract they signed. Again that was mine an millions of other choice. But because a few thousand decide they don't want to live up to their oblegatitions, an contract they signed, which no one forced them to do in the first place, sue, thats the american way. This judge is headline grabbing, an for all practical matters, taking away the wireless companies choice, on the way they chose to sell there services. Thank God this lame brain Judge don't have the last word in this matter. FCC, please do the right thing.

Reply

Right on Clint!

Your comments are quite correct. I am a wireless dealer and the fact is the carriers do subsidize the phones, and they do lose money on them if the contract is terminated early. If an individual wants to pay for their phone and go month to month, that's fine. They can already buy unlocked phones, or refurbished phones that are available at cheaper prices on the internet or even e-Bay. There is a huge market for nearly new cell phones. Blaming the carriers for consumer laziness just demonstrates bad faith. Tom's ideas isn't such a good one either. If you make payments over a period of time you'll pay interest. On a two year lease you'll probably pay $700 for that $479 phone. Look around folks, Americans have departed from common sense when it comes to money. That's why millions of people took out loans they should have known they couldn't afford and have collectively a couple of Trillion $$ in credit card debt. And they want to blame others for their decisions. It's like someone who is obese blaming MacDonald's for the fact they eat 4 burgers at a sitting. The status quo in the wireless industry is is good, and fair to consumers!. It keeps the costs of new phones low and new technology flowing, which makes for better handsets and features. Remember, the carrier's don't make the phones, they buy them from companies like Samsung , LG and Motorola. I think some folks have the mistaken idea that if the carriers stop charging early termination fees, that they'll somehow get out of having to actually pay for the phones they use. They already have the option to pay full price with any carrier, do they? And, there are many, many people buying on the secondary market right now.

Reply

Long live the landline!!!!!

Reply

HI all;
Here how it comes down to….. I have been in the business for quite a while. I think both sides have a legitimist argument:

1- On one hand if you really want to shop around and get your equipment at a deep discount (knowing that it cost a whole lot more if you bought outright) I see you are obligated to sign a contract so the provider can recover the cost of discounted equipment.
2- On the other hand if you decide to pay for your equipment the full price then there should be no contract what so ever.

I also agree if the equipment wasn’t discounted by the provider (so they can lock their customer into a two year contract) I think the equipment prices will drop significantly because of completion (after all the Suggested retail prices that the provider put on the hand sets is outrageous) If you do your homework and shop around sometimes you can get the same equipment for less than ½ price.

The cell phones had become a necessity in people’s life just like your electric or water provider for your home. I am of the opinion that you should pay for your equipment upfront the full price and depending on your credit worthiness, you either can be trusted on paying your bill at the end of the month or pay in advance (like Metro PCS) or you have to leave a fully refundable deposit if you decide to quit and your bill is paid. I think all these provider should learn something from Metro PCS even though I am not a Metro PCS dealer.

Reply

And just to add couple of things, you can't compare the early termination with a cell phone company to a leased car or a leased a partement. just look how much the car drops in valuse the minute you drive it off the dealer lot.... and with the a partement situation ( real estate is limited not like having a zillion phones available) and yet you still could rent month to month in alot of places.

Reply