Monday, May 17, 2010

ETFs Effective in Preventing Consumers from Switching Carriers

If you've followed this blog, then you'll be familiar with ETF or early termination fees. This penalty is charged to consumers who want to opt out of a wireless contract before its expires.

I recently read a stud showing that a significant number of consumers who are dissatisfied with their carriers chose not to switch to another service provider to avoid paying the heavy early termination fee.

The Government Accountability Office (GAO) recently made a study on cell phone complaints and the ways that the Federal Communications Commission (FCC) deals with those complaints. One of the interesting findings of this GAO study show that 42 percent of consumers who wanted to switch carriers decided not to because they did not want to pay an early termination fee.

The research also show that ETF or early termination fees is one of the one key reasons for consumer dissatisfaction.

This illustrates the restrictive aspects of charging these fees. A representative said that, consumers should not be chained to their wireless provider for years through exorbitant early termination fees.

And I agree with him. Thankfully, congress has responded with legislation like the "Cell Phone Early Termination Fees (EFT) bill" to protect consumers from the unfriendly fees from wireless contracts.

That's it for this post on the crippling effects of wireless contracts. Stay tuned for more on this and other related topics.

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