AT&T's Prorated ETFs Are Now In Effect

Here's some excellent wireless contract news for AT&T subscribers.

The wireless carrier has formally announced that the change ion their wireless contract policy regarding ETFs or early termination fees has been implemented. Customers who have signed up an agreement or wireless contract with AT&T starting on May 25 will be charged with a prorated early termination fee should they choose to end or terminate their contract or agreement before it expires.

Here's the official press release issued by AT&T:

More Flexibility for Wireless Customers

San Antonio, Texas, March 31, 2008

AT&T (NYSE:T) today announced a new approach to early termination fees (ETFs) that provides greater flexibility for wireless customers.

Beginning on May 25, the company's new and renewing wireless customers who enter into one- or two-year service agreements will no longer be required to pay a single, flat early termination fee. Instead, that fee, which is $175, will be progressively lowered by $5 during each month, every month, for the term of the contract. (The single, flat ETF will continue to apply to new and renewing customers who enter into one- or two-year service agreements prior to May 25.)

The company noted that it continues to offer options for those customers who do not want term commitments or ETFs, including:

* Buy a phone at full price and go on a month-to-month service plan.
* Bring your own compatible GSM device. With this option, you can buy a SIM (subscriber identity module), slip it into the back of the phone, and select a month-to-month service plan.
* Choose one of AT&T's GoPhone prepaid wireless plans.

I know that a lot of customers have been waiting for this to happen. I have read countless of complaints about the high cost of these fees. Early termination fees can be a pain especially if you have signed several contracts. This decision by AT&T should make it easier for customers to shift to a different carrier.

You can tune in to the AT&T News Room for more press releases regarding wireless contract and important announcements.

Proposal to Ease ETF's of Wireless Contracts

Here's some more interesting wireless Contract news. CNN.com reported that the government is quietly negotiating to help cell phone customers avoid expensive early termination fees when they decided to cancel their wireless contracts.

Verizon Wireless has submitted a proposal to the FCC after the carrier consulted with other leading mobile phone service providers. The wireless contract proposal to the Federal Communications Commission states that the wireless industry would give consumers the opportunity to cancel service without any penalty. This would only apply up to 30 days after customers sign a cell phone contract or until 10 days after they receive their first mobile phone service bill. The proposal ton the FCC also suggests that the fees should be capped and and be reduce month by month over the course of a contract based on how long customers have left.

The article posted on CNN.Com reports that cell phone companies will be freed from suits filed in state courts by angry customers, in exchange for the government's approval. The proposal ,made by Verizon also request that the authority of states to regulate the charges, known as early termination fees should be taken away. Interestingly, the Federal Communication Commission declined to release any comment on this issue.

However, there have also been reports that the proposal is doomed even before it was filed to the FCC. Those who are close to the issue have suggested that the negotiations are on the verge of collapsing. Key stakeholders are continuing to negotiate on an ETF compromise but there are indications a deal remains an uphill battle. Two consumer groups approached by Verizon Wireless appears not to believe that the concessions offered by industry are adequate when consumers could surrender the ability to take legal action against mobile-phone operators.

I have blogged several times about wireless contract complains arising from ETF's or early termination fees. The wireless industry is currently facing a series of long-running, class-action lawsuits in state courts. If this proposal is unsuccessful, then I don't see the class action suits beign filed against carriers decreasing any time soon.

Sprint May Change Wireless Contract to Limit Data Usage

Here's some bad wireless contract news for Sprint Data subscribers.

According to sources at the Sprintusers. com forum, Sprint will be updating its Terms Of Service or wireless contract in mid-July and will be capping its mobile broadband data usage at 5GB. A sad bit of news for subscribers who enjoyed the unlimited services of "best data" carrier.

Here's the statement that conveyed the decision:

Sprint reserves the right to limit throughput speeds or amount of data transferred and to deny, terminate, modify, or suspend service if usage exceeds 5GB per month in total or 300MB/month while off-network roaming. Check your subscriber agreement rights on Sprint.com

Before this disheartening announcement, Sprint was praised for offered truly unlimited mobile broadband. Remember that once the new Terms Of Service or Cwireless contract policy becomes active, users who go over the 5GB cap, or a 300MB roaming cap will incur extra fees. This policy will be applied to both network cards as well as tethering mobile phones to laptops.

Sad as it may seem this decision is not out of line with other carriers. AT&T and Verizon Wireless also impose the same limitations to subscribers. I guess, it's in Sprint's interest to place the cap on mobile broadband data usage. However, these means that many Sprint subscribers will migrate to other carriers. I thought Sprint was trying to keep their subscribers from migrating to other networks.

Some experts say that the CAP could be rolled out in advance of the QChat introduction. Sprint may have a vested interested in cleaning up their network throughput because QChat will replace the older iDen Direct Connect and requires EVDO Rev A. The impact of the data cap on the widely anticipated WIMAX rollout is an object of interest for those in the know.

Anyway, this is being seen by some as a good opportunity to cancel their Sprint wireless contract due to a material change in the policy. Disappointed subscribers have the normal 30 day window to cancel without paying the ETF or early termination fee fee. If you have been waiting for a good opportunity of getting out of a Sprint wireless contract then this maybe your chance.

New Class Action Suits Filed Against Sprint and Verizon

Here we go again. It seems that class action suits are once again targeting wireless carriers. I have made several post that documented the disputes between carriers and customers over wireless contracts and other aspect of consumer-seller relationship. Let's take a look at the case filed against Sprint.

Sprint has been the subject of numerous class action suits and this time the mobile phone carrier has been accused of charging subscribers for unauthorized mobile content. A similar complaint was hurled against Alltel more than a month ago in Illinois federal court.

Subscribers have accused Sprint of billing customers of unauthorized charges that are caused by collaboration between wireless carriers and aggregators that represent premium mobile content providers. The lawsuit that began in state court before being moved to federal court in Kansas states:

“Sprint has for years been systematically, repeatedly and without authorization, billing its customers for purchases of products and services not agreed to by those customers. Sprint and third-party service providers have, on information and belief, profited significantly through this practice.”

In response to this accusation, Sprint emphasized that they are adhering to standard industry practices. A spokesman commented that "we adhere to the Mobile Marketing Association guidelines which emphasize the need for subscriber consent before third-party content is delivered to a handset.”

Sprint's wireless contract devotes a paragraph to third party-content. Here is a part of that paragraph

To protect our network, Services, or for other reasons, we may place restrictions on accessing certain Data Content (such as certain websites, applications, etc.), impose separate charges, limit throughput or the amount of data you can transfer, or otherwise limit or terminate Services. If we provide you storage for Data Content you have purchased, we may delete the Data Content with notice or place restrictions/limits on the use of storage areas. You may not be able to make or receive voice calls while using data Services.

Let's now look at the class action suit launched against Verizon Wireless. The wireless carrier is once again being accused of violating the Fair Credit Reporting Act. The complaint filed inn Alabama federal court claims that TransUnion L.L.C. and Verizon are ruining the credit of a wireless subscriber. Verizon Wireless and Alltel Communications L.L.C.. were also accused of violating FCRA laws in Pennsylvania and Georgia federal courts because of alleged breaches of credit privacy.

According to the plaintiff, Verizon Wireless is continuously trying to collect more than $1,000 from him. He feels that this is unlawful because The carrier falsely reported the disputed debt on his credit reports. The plaintiff claims to have followed Verizon Wireless’ instructions with regards to dealing with possible identity theft by filing l out a police report and sending a copy to the carrier.

Unfortunately, the problem remained even though, a collection agency later received the police report. The plaintiff was forced to contact TransUnion L.L.C. and Equifax because the overdue account remained on his credit reports. Equifax responded by removing the account but TransUnion allegedly did not do the same.

Verizon declined to release any statements in response to this accusations. Here is a part of Verizon's wireless contract statements on credit information,

You’ve authorized us to investigate your credit history at any time and to share credit information about you with credit reporting agencies and our affiliates. If you ask, we’ll tell you the name and address of any credit agency that gives us a credit report about you. It’s illegal for unauthorized people to intercept your calls, but such interceptions can occur. For training or quality assurance, we may also monitor or record our calls with you.

I hope that both parties can sort out their differences and reach a settlement. Of course, it would be naive to think that wireless contract disputes and other problems will cease.The mobile phone industry is among the leader at customer complaints so it's unlikely that customers will stop filing complaints against their service providers.

Deceived into Signing Unneeded Wireless Contracts

I stumbled upon an interesting wireless contract article as I was surfing the web today.

I found an article that reports on the finding of an investigation into mobile phone contracts or agreements. The investigation discovered that consumers are wasting a lot of money by signing up for wireless contracts they do not need. Another interesting finding derived from the mobile phone contract investigation points that customers are allegedly being hit by hidden charges that make profit for mobile phone networks.

The investigators who made these discoveries were also able to gather claims of shady techniques used by mobile phone salesmen to convince consumers to sign up for wireless contracts. For example, they may persuade parents to switch a child's pay-as-you-go service to a more costly monthly subscription. Senior customers were also targeted by these techniques.

A few of the sales man confided to the investigators that they were paid extra to lure consumers into signing wireless contracts. Here's a statement by a former mobile phone salesman:

"I'd say that that was the number one thing that they were trying to do - get people off pre-pay and get them onto contract almost regardless of their usage. If you could get them on to contract, that was a result for you, your store and the company."

The head of the investigation on wireless contracts expressed that the result requires action. The people in charge also emphasized that actions should be taken to control or manage the mobile phone industry to keep it from making fortunes by deceiving customers.

The mobile phone industry is among the highest when it comes to customer complaints. And complaints about mobile phone contracts are abundant. I have made a few posts on wireless contract disputes and complaints. And I have read a few complaints from customers claiming that they were deceived. This investigation supports consumers who claim they have been deceived into signing up for a contract.

This also made me realize why so many people want to opt out or terminate their mobile phone contracts. If they were deceived into signing them, then I can't blame them for wanting to be released from a contract. Some of these consumers may have realized that their contracts are costing them more so naturally they would want to end the agreement.

Before you sign any agreements, you should first do a bit of research. People should read, articles, advices and tips before committing to a contract. Consumers usually turn to reviews, phone advisors and forums before they purchase handsets and the process should be the same with mobile phone contracts. Doing your home work always pays off.