Verizon Removes 10 Phones from $350 ETF Advanced Devices List

It appears that Verizon Wireless has felt the pressure from consumers, the FCC and other government officials. The carrier has covertly removed ten mobile phones from the list of phones that require its new $350 early termination fee.

The carrier has recently imposed a bold wireless contract policy that required a $350 ETF (early termination fee) for a select group of smartphones and “advanced devices.” Naturally, this action was met by stiff resistance from consumer groups, the FCC and a few senators headed by Amy Klobuchar.

I posted the complete list of "advanced" or multimedia phones several weeks ago. Well, that list has to be updated now that Verizon has chopped off ten devices. The devices taken off the list include the Motorola Krave, Samsung Rogue and five LG devices.

But why did Verizon remove ten devices from its $350 ETF advanced devices list? Well, a Verizon spokesman was unable to answer queries about the change. Some experts say that pressure from the FCC, who criticized Verizon's $350 ETF explanation and from other groups has moved the carrier into removing the devices from the list.

That's it fro this post on Verizon's controversial wireless contract policy. Tune in to this blog form more news and updates on wireless contracts and related topics.

iPhone Reponsible for Two-Year Wireless Contract Surge?

It appears that the number of consumers that are signing two-year mobile phone contracts are on the rise. A study conducted by the folks at Ofcom.org indicated that more than two in five mobile phone users have signed up to a two-year wireless contract. This number has reportedly increased significantly in the last few months due to the popularity of the Apple iPhone.

The iPhone 3GS has recently become widely available to mobile phone consumers throughout the globe. Apple's hit mobile phone was released in the U.S., Canada and six European countries on June 19, 2009, in Australia and Japan on June 26, and in other international markets in July and August, 2009.

The subsidized price that come with a two-year cell phone contract has made the iPhone more accessible to consumers. Customers also recognize that they can reduce their monthly bills since phone companies reserve the best rates for customers willing be tied in for a long time.

However, signing a two-year agreement also comes with some disadvantages.

For instance, the contract may restrict a consumer's choice for two years. This means that a user may not be able to keep track of the latest technologies to hit the market while being committed to a two-year agreement.

There are also some stiff penalties for consumers who decide to terminate an agreement. Verizon Wireless has recently taken heat for imposing a $350 early termination fee or ETF on its advanced devices.

Consumers should weigh the advantages and disadvantages of signing- a long term contract before they sign on the dotted line.

That's it for this post. Tune in to this blog for more news and updates on the wireless contracts industry.

FCC Demands Improved Increased ETF Explanation from Verizon

In my last post for this wireless contract blog, I posted about FCC member, Mignon Clyburn's comments on Verizon Wireless explanation for raising the ETF on advanced devices.

Clyburn expressed that Verizon's 77 page statement in defense of its new wireless contract policy is "unsatisfying" and "troubling." This time Federal Communications Commissioner Julius Genachowski has spoken out against the carrier's ETF increase explanation.

The commissioner was clearly unsatisfied with the carrier's explanation. Genachowski said, "I thought that response raised more questions than it answered. The bureau is looking into that... There's a very real level of consumer confusion around these areas"

However, Genachowski declined to say what the FCC's next move to mend this problem.

I guess we'll have to wait and see if the government exerts pressure to turn back the Verizon's ETF from $350 to $175.

Tune in to this wireless contract blog to keep tracks of developments in this story.

FCC on Verizon ETF Explanation: "Unsatisfying" and "Troubling"

A few weeks ago, Verizon Wireless released a 77 page statement in defense of its decision to increase the early termination fee or ETF for its "advanced devices" at the request of the FCC. This time, the commission has released its response to the carrier's defense of its increased ETF.

Well,. it appears that the 77 page statement did not impress the FCC. Mignon Clyburn, a Federal Communications Commission of the, described Verizon's official response to the FCC's query as "unsatisfying" and "troubling."

Here's more from Clyburn:

"Consumers already pay high monthly fees for voice and data designed to cover the costs of doing business. It is hard for me to believe that the public interest is being well served."

Those are some pretty scalding words for the Verizon Wireless. Let's see if they respond to these comments.

The FCC plans to investigate the matter further when it reconvenes in 2010 so tune in to this mobile phone contract blog to get the updates to this wireless contract news.

Verizon Wireless Defends Increased ETF for Advanced Devices

Verizon's decision to increase the ETF for it's advanced devices have attracted a lot of attention including US senators like Amy Klobuchar. Recently, the FCC has requested the carrier to explain the reasoning behind the increase in early termination fees from $175 to $350 for "advanced devices" (Click here to see the list of Verizon's Advanced Devices).

Well, Verizon Wireless has released a statement in defense of its decision to increase the controversial fees for some of its products. Unfortunately, the carrier released a 77 page response which would be impossible to post here in its entirety.

So let me just give a brief summary of the highlight points of Verizon's defense of the $350 early termination fee for advanced devices.

• the increased ETF allows the carrier to provide more capable handsets at lower upfront costs, and to reduce its losses if/when a customer chooses to leave their contract early.
• Verizon claims that the new rules causes the company to lose money when customers who choose to cancel their contracts during the 23rd month, during which time they would still owe $120 ETF.
• Advertising and marketing collateral are sufficient to make sure customers are informed of these new wireless contract policies.
• In 2003, the FCC stated that it doesn't support the concept of customers breaking contracts and that carriers have a right to recoup those fees.
• the additional cost it incurs to procure the devices on its advanced list is greater than the difference between the two ETFs ($175) on average.
• Advanced devices strains the broadband network up and extra guaranteed revenue is needed to keep the network at optimum performance.

Well, this has certainly turned interesting. I didn't expect the change in wireless contract policy would trigger such reaction from the government. Perhaps the tough economic atmosphere is making the government more aware of possible consumer abuse.

That's it for this wireless contract update. Tune in to this blog for more developments on this important mobile phone contract issue.

Sprint Settles Wireless Contract Dispute in Minnesota

Here's an important wireless contract update that happened last month. Consumers at the state of Minnesota filed a lawsuit against Sprint for having their commitments extended without their consent. This wireless contract dispute has been resolved since Sprint decided to settle with the complainants.

Let's dig deeper into this cell phone contract news.

The consumers, represented by State Attorney General Lori Swanson, filed a complaint against Sprint Nextel in September 2007. The lawsuit claimed that the company extended the contracts of thousands of customers when they made small changes. The extension was enforced without their informed consent.

Consumers who violated the extended contract were forced to pay as much as $200 per line as an early termination fee.

The complaint seeks for restitution and civil penalties of up to $25,000 per incident. More than 439,000 Minnesota residents were asked to pay cancellation penalties between July 1999 and December 2008. Consumers from Minnesota are eligible to file claims if their contracts were extended without their permission.

This time it appears that consumers have gained the upper hand.

Sprint Nextel has decided to settle the mobile phone contract dispute. The carrier has agreed to review claims of improper cancellation penalties and reverse or refunds some of the fees.

The office of State Attorney General Lori Swanson are accepting claims through March 15. Estimates indicate that more than 400,000 Minnesota customers who signed contracts with Sprint Nextel since Sept. 26, 2001 are potentially eligible to benefit from this wireless contract settlement.

Click here to go to the Sprint Settlement Claim Form.

That's it for this post on the wireless contract settlement. Tune in to this blog for the latest news and udpates on cell phone contracts and related matters.

Senators Introduce the Wireless Contract Early Termination Fees Bill

Lat month, I posted about Senator Amy Klobuchar opposing the recent Verizon Wireless ETF increase. She talked about her plan to introduce legislation to oppose this decision and to discourage wireless carriers from unfairly raising penalties on costumers who cancel their contracts early. Well, Klobochar and three of her colleagues have introduced the Cell Phone Early Termination Fees (EFT) bill.

This legislation aims to limit the early termination fees on wireless contracts charged by mobile phone service providers. The Cell Phone Early Termination Fees (EFT) bill would also enforce prorated ETFs

Klobochar's bill also forces carriers to notify customers in a clear way about the fees. Carriers will be required to spell out the EFT instructions at time of purchase and at various times during the duration of contracts.

This new wireless contract bill also prevents cell phone service providers from charging an ETF that is higher than the discount on the cell phone.

Here is Sen. Klobuchar on the introduction of the Cell Phone Early Termination Fees (EFT) bill:

"Changing your wireless provider shouldn't break the bank. "Forcing consumers to pay outrageous fees bearing little to no relation to the cost of their handset devices is anti-consumer and anti-competitive."

The senators who support this wireless contract legislation also include Mark Begich of Alaska, Russ Feingold of Wisconsin, and Jim Webb of Virginia.

That's it for this post. We'll see if this bill can p[ass through congress and be enacted into law. Tune in to this blog for more mobile phone contract news and updates.