Verizon Defends Doubling of Early Termination Fee 319
I Don't Believe in Imaginary Property writes "Verizon is defending its decision to double its Early Termination Fee from $175 to $350 after being called to account by the FCC. They claim it's because the higher fees allow them to offer more expensive phones with a lower up-front cost (PDF), and they also say that because they pro-rate the fee depending on how much of your contract is left, they still lose money. Apparently doing something about the Verizon customer service horror stories isn't as good a way to retain customers as telling them that they have to pay several hundred dollars to leave."
Federal Trade Commission (Score:2, Insightful)
Maybe consumers would have a better chance at fairness if Verizon had to justify itself to the FTC.
Fairness? (Score:5, Interesting)
Fairness would be selling the phones at standard unlocked prices and letting people buy their contracts ala carte. Of course that would also mean much higher phone prices, how many people would buy the iphone or Droid at $600? In the long run consumers would be better off for it, but many seem to want the latest and greatest but don't want to pay more than a couple hundred bucks to get it.
In Verizon's defense, they are likely looking to stop some of the scamming that goes on with newer phones. I know of a couple local discount cellular stores near me that was having employees buy iphones, keep them 30 days so that the return policy is no longer in effect and then pay the early termination fee, for a 32gb 3gs they nearly double their money. Perhaps a better option would be a tiered ETF?
Re:Fairness? (Score:5, Insightful)
I think a better deal would be to split the discount you get for the phone and the charges for the actual service. Its that simple. On your bill, you get your Phone mortgage and your plan charges.
Then we can discuss further separating the link between the phone and the plan. The phone aspect should be treated like a straight out loan. You pick one of: the monthly payment, interest rate, or duration of loan and the provider picks the other two. Of course you should have a "buy out" option on each statement that tells you how much you need to pay to completely OWN the phone.
THEN we can realistically compare and discuss the discounts that providers give for service contracts. Right now, the system is too hidden and vague. It severely prefers customers who jump providers every 2 years and creates a lot of waste (useless phones). It punishes current and future loyal customers. Customer acquisition is a LOT more expensive than keeping current customers, and the system prefers the former with the later bearing the additional expense burden.
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Furthermore, customers can actually benefit from using their phone beyond the mortgage period! The current system is designed to scam consumers, as you pay the same price for service if you bring your phone or get one subsidized by the carrier.
An early termination clause is reasonable for some non-subsidy costs, but since they already charge you an activation fee, it is pretty hard for me to believe there is residual customer acquisition costs. (Customer retention costs should not be paid by a departing c
Re:Fairness? (Score:4, Insightful)
Of course that would also mean much higher phone prices, how many people would buy the iphone or Droid at $600?
Lots - nothing stops verizon from financing the thing separately and adding the payments to your account. Pay off the phone? Your bill goes down.
Re:Fairness? (Score:5, Insightful)
how many people would buy the iphone or Droid at $600?
As many as buy cars, TV's, or any other consumer item on credit? It wouldn't be much different for cable networks to offer TV's with their subscriptions, or, to have a car analogy, gas companies that give you a car and require you to pay for an amount of gas each month.
But either way it's pretty much a scam; financing baked into the price which makes it easier to trick consumers into non-competitive rates for both the consumable and the financing.
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cost of the droid (build cost) for verizon to obtain them is probably not above $100-150 absolute maximum, and likely under $100. The magic 600$ is a number pulled out their asses to imply value and to rationalize the ETF as they are trying to do. It's a bunch of doublespeak and hopefully people will learn eventually.
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I'm betting that cheap phone doesn't have UMTS or CDMA support. But yes, smartphones should cost way less.
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I mean, the iPod touch is $199
With no camera and no GSM/UMTS radio.
and you can get a cheap throw away phone for $20
TracFone and Virgin Mobile phones are subsidized and provider-locked in the hope that you'll buy more minutes.
Deadcheap phone exist (Score:4, Insightful)
I mean, the iPod touch is $199
With no camera and no GSM/UMTS radio.
Yes, an iPod touch doesn't have GSM/UMTS. But factor in the next piece of information
and you can get a cheap throw away phone for $20
TracFone and Virgin Mobile phones are subsidized and provider-locked in the hope that you'll buy more minutes.
I think the original post wasn't referring to the heavily subsidised smart-/feature- phones, but to the crappy phones that only provide basic voice & SMS. Basically they are only a GMS chipset connected to a speaker/microphone/keypad combination. You can find such in very low price-ranges.
Thus, according to this reasonning, adding GSM/UMTS radio to iPod touch to convert into iPhone, should cost something in the same range as the sum of the above products.
Creating a smartphone out of something which looks like a PDA should raise the cost from the initial ~200$ to ~300$ max.
Not a price jump from ~200$ to ~600$ as its currently the case.
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Nokia E51 Mobile Phone - Silver, $529
$0 Upfront on a $30 Telstra Plan *1.
Minimum payment $720 over 24 months.
BlackBerry® Bold 9000 Smartphone, $999
$0 Upfront on a $100 Telstra Plan *1.
Minimum payment $2400 over 24 months. The BlackBerry® Bold 9000 Smartphone features email compatibility, 2MP camera and video camera.
Re:Fairness? (Score:5, Insightful)
No, it seems like a good deal when it's a good deal.
Because the phone companies are owned by big institutional investors that require big dividends and steadily increasing profits, they have to make it harder on consumers, who basically don't have anywhere else to go.
Phone companies need to be publicly regulated utilities, like they are in countries that have more advanced phone systems than the US.
The "Free Market" has kept us technologically behind much of the world when it comes to wireless phone service.
Re:Fairness? (Score:4, Informative)
I would agree with most of your points, except that I would clarify that 'free market' without regulation (i.e. Competetion) is the cause of the U.S. lackluster performance in telecommunications. Free Market does have obvious benefits, but you can't let the wolves guard the hen-house, except in our case, we have two really big wolves, and a lot of chickens.
I really wish they would separate content from providers.
Re:Fairness? (Score:5, Insightful)
I have traveled a bit and only one country that I have been to had a free-market of any kind. Ghana, West Africa.
Ghana has between 4 and 6 cell phone providers that compete with one and another.
Ghana would not give exclusive rights to any cellular company when they first approached the country before there was cellular technology in the country.
Instead Ghana started it's own government-run cell company because no major provider would agree to anything but a monopoly position.
Strangely enough... 6 competing companies are there now making money hand over fist, and the Ghanaian government just sold their old government phone/internet company to Vodacomm.
Privatization does work, in a real free market. We live in a completely socialized state that pretends it is a free-market driven economy.
Re:Fairness? (Score:5, Insightful)
The moral of your story seems to be: free market works, when the state occasionally intervenes (not necessarily with direct regulation - the case you described is a wonderful example of how else the market can be affected) to keep the competition going.
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You mean a fifty-cent microphone?
It already has WiFi. The only thing keeping you from using your iPod Touch as a really useful VOIP phone is Apple's stranglehold on the software.
It's OK. The day when somebody starts selling a $150 Touch clone that lets you run Skype isn't far off. You can already buy cheap Touch clones in any big South Asian city. Here in the city where there's WiFi everywhere, I make calls all day long from my n
Re:Competition (Score:4, Informative)
Re:Fairness? (Score:4, Informative)
Why are people complaining? Take a basic individual plan and a basic (Moto W755) phone on Verizon:
It's still cheaper after one year to pay the full $175 ETF on-contract than go month-to-month because they inflate the "real" cost of the phone. The month-to-month plan is nothing more than a veiled warm-and-fuzzy to the people who want to "stick it to the phone company."
Meh. (Score:4, Insightful)
Verizon sucks anyway. Their plans are laughable. Try pricing out a smartphone plan with them. Oh, and don't forget the (lol) extra $24 for the data plan. For an average family plan with smartphones they come out to like $40+ more than Verizon for just two lines, and it goes up as you get more lines.
Verizon can rot in hell. Can you hear me now? Yes? Well, what I said was "fuck you, Verizon".
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Re:Meh. (Score:5, Interesting)
And did you also read the 11 "addendums" to your contract that you agreed to when you logged in to your account to pay your bill?
If the phone companies weren't trying to gyp you, they'd tell you exactly what your bill's going to come to every month instead of saying you're buying a "59 dollar unlimited plan" that for some reason comes to $110 every month.
The extent and quality of phone service in the United States grew exponentially when the phone company was basically a government-regulated utility. Then we were sold a bill of goods when we were told that only by creating "competition" could there be any technological advancements, so we end up with a small handful of mobile companies overcharging people for phone service while working to suppress the technological advances that "less free" countries in the rest of the world enjoy.
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I remember twenty years ago that an in-state call to a town 200 miles away cost thirty cents a minute. Calling my parents on a phone card from a ski trip out West was about $1.50 a minute. And those were AFTER competition had started.
There are problems with the American mobile phone market - in particular, the different communication technologies and the different 3G GSM bands fragment the market
They can charge whatever they want (Score:2, Insightful)
If they didn't get you on the back end, they could just charge you more up front to buy the phone, then amortize the up front cost through lower monthly bills, until in the end you pay the same amount. That way, they could even offer "no termination fee!" But I'm sure somebody would still get pissed at call it deceptive business practices. It's a free market, and they can charge anything they like. This is a total non-story.
Please, Slashdot, can we have a way to filter out stories by submitter? I don't
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I agree that they have the right to run off business due to exorbitant fees/prices, but, if they change any terms DURING your current contract you should have the right to terminate with no fee or other repercussions. And yes, the that section of their TOS allowing them to do that should be struck down as deceptive.
Furthermore, if you don't like the posts from an individual, try this : DONT READ THEM.. geesh. You are whining as much as you claim others are..
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You just made that up. Why do you think it? Obscure down-the-road fees are deceptive; up-front charges are not. They're two different things. That's the whole point.
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but I thought this was for ending the contract early, so they're not exactly obscure charges - most people enter into a phone contract for a fixed amount of time and expect to have to honour that for that time. If they want to leave early, they should expect to either not be allowed at all (ie have to continue to pay the contracted-into bills), or pay a fee to agree to break the contract.
As long as there are no fees to pay once the contract term is up, this is still a somewhat non-story.
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If they did, I'm sure somebody would still get pissed at call it deceptive news reporting. It's a free market, and Slashdot can filter its stories anyway they like. Your whining is a total non-story.
And personally, I've never seen a post
Did you notice... (Score:2)
...that a totally “free” market, is the exact same thing as the law of the jungle?
Which is the opposite of democracy on the “democracyness” scale. (Beware, that I don’t say that that scale can’t have negative numbers too. :)
If you tell that to a fundamentalist “free market” republican, does his head explode? ^^
“We must have a democracy.
But we must also have a completely free market.
But we must have a democracy.
But... aaaaahhhh *BANG*”
Not a 'Free Market' (Score:4, Insightful)
Re:Not a 'Free Market' (Score:5, Insightful)
It's an oligopoly (with a high risk of collusion)...
You think? A couple years back, text message cost 10 cents on AT&T, Sprint, T-Mobile, and Verizon Wireless. Then surprise-- they all go up to 15! Then 20!
500 text messages take up less bandwidth [consumerreports.org] than a minute of conversation.
I'd say there's a high risk of collusion too.
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Oligopolies are perfectly capable of being formed in a free market economy. A free market refers to the lack of governmental intervention except in cases of force or fraud. An oligopoly is a market segment (whether in a free market, a socialist economy, or even anarchy) that is dominated by a small group of entities. The two concepts are not incompatible, or even comparable. Saying "it's not a free market, it's an oligopoly" is a non-sequitur. It's kind of like saying "it's not a car, it's blue".
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Spoken like a true living-in-moms-basement capitalist.
When it comes to cellphones, it's not so much a free market as it is a fiat market. There aren't that many providers, their terms are all more-or-less similarly rapacious (some people might even say collusively rapacious). This is not some some Middle Eastern Bazaar where you can haggle for the deal you want - it's Their Way or the Highway.
Sure, you can opt out entirely, but is that really going to have them trembling about losing market share?
Let me put
Re:Let em charge what they want! (Score:4, Insightful)
No, because the margin on a gift card that is never spent is way better than anything else they could ever sell you with it. Way to go! Down with the man!
Re:Let em charge what they want! (Score:4, Insightful)
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The hard part is getting this information to consumers in a form that's clear and easy to understand, when the providers themselves seem dedicated to obfuscation.
Of course they are. Mobile phones are essentially a commodity. An expensive one, but nevertheless a commodity.
Obfuscating your product in the name of offering choice when there fundamentally isn't much to choose between competing products is a common tactic when you're selling commodity items.
Crippling Early Termination Fee (Score:5, Funny)
Verizon CEO: No matter, every customer signed a contract with more words than the US Constitution which means they either didn't or are unable read it. In that contract, we reserve the right to increase our crippling early termination fee. So we'll juice that up to lock in size and by the time most customers can leave, we'll have an answer to your latest model.
Verizon Shareholder: I approve.
Verizon Customer: Why does my ass hurt?
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Uuum, one question: Here in Germany, no company can change a contract in “mid air”, without asking you for permission. They can send you a letter where they tell you about the changes. But you can then terminate the contract without having to pay anything, if they don’t want to keep your original contract. They can’t do anything about it. I’ve done it some times.
Is’t that the case in the USA too? If Verizon would send me a “change in contract”, with the new te
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I often see threads on slickdeals.net saying something like "Get out of your $wirelessprovider$ account free!". People there look out for changes in the small print (or in the case of termination fees...big print) which opens you up to something like 30 days to break your contract without penalty.
Of course, they like to do this on slickdeals because they can go jump into a new contract for another free/subsidised phone that is however much newe
Don't pay the fee (Score:4, Insightful)
If you don't want to pay the fee, you should avoid it by not signing an agreement with Verizon. If you don't like Verizon's customer service, you should avoid it by not signing an agreement with Verizon. Or sign an agreement and live up to your obligations and avoid the fee that way.
Don't hire the government to force the people at Verizon to do things against their will -- unless the people at Verizon have truly defrauded you, personally, out of a significant amount of money. Because forcing people to do things against their will is (almost always) morally wrong.
Re:Don't pay the fee (Score:5, Insightful)
I agree with you 100 percent, well almost. Forcing Verizon to do anything that isn't in their corporations best interest is morally wrong. Because we all know that large corporation are only looking out for what is best for the consumer! If you get a "free" phone from Verizon for your aging mother so that she can stay in contact with you more easily, well then you SHOULD have to pay the early termination fee of $350.00 for that $29.99 piece of electronics when she passes away on the 21st month of your contract. And while we are at it, let us remove those other pesky regulations that the goverment has placed upon these large corporations. Let us remove the one where they are required to pay a minimum wage to their employees. We all know that this is just costing us jobs. Hell, my cousin Bruce could be making as much as 50 cents an hour AND have a job if it wasn't for that pesky goverment interference. Shame on you Mr. President (Because we all know that he REALLY makes all the laws, the Congress and Senate are just for show.) Let's remove the regulation that says Verizon must provide access to their lines from other competitors as well. I don't want no stinking Sprint customer to be able to call me. (You and your aging mother are using the SAME provider, aren't you?)
My point is that a truly and totally free market is a farce. There has to be a balancing act performed to keep the market truly competitive and profitable. Unfortunately, one groups idea of fair and balanced differs from another groups idea of fair and balanced. That is why we need regulation. Maybe this particular case isn't one that requires regulation. Maybe this particular case works as it currently is implemented. Obviously not everyone believes that, especially the person who DIDN'T get a DROID and then for whatever reason had to cancel their contract two months early.
Oh and one more thing. Maybe forcing PEOPLE to do something is morally wrong, but corporations are NOT people. People generally have to live with their actions, a corporation can merely disolve itself and start up as a completely different corporation. It is a lot more difficult for a person to simply disolve their identity and reappear under a completely new one free of all legal and moral obligations of their past actions. If the US goverment is going to provide corporations with that type of benefit then they do have a MORAL responsibility to make sure they don't abuse it.
Re:Don't pay the fee (Score:5, Informative)
The only way you would ever have a free market is if the average person always fully understood both the product/service that is being sold AND any contract that goes along with it. Even that wouldn't be enough. You would then need for all people, as individuals, to be willing to boycott a company (even in the absence of a competitor) and bring it to its financial knees and to be willing to do this over even minor abuses. They must do this individually and not as the result of some organization's decision, and nearly all of them must do so. Then if a corporation even remotely looks like maybe it is screwing someone over, it gets faced with its own bankruptcy and made an example of. This will put other corporations on notice, proving to them that anything resembling bad-faith or malfeasance absolutely will not be tolerated and will be punished at all costs.
This model would not result in more bankrupt companies. It would result in companies complying with the wishes of the people in order to make a profit, just like everything they do now is for profit. The only thing that would change are the particular behaviors that lead to profitability. This would radically change the way citizens relate to corporations. It would fundamentally alter the balance of power. Right now that balance of power favors the corporations -- they are the major players in the market, and most customers cannot truly negotiate with them but must instead accept contracts of adhesion. They have the money and the lawyers and the political clout, meaning they can alter laws in their favor RIAA-style.
Until and unless people come to see it this way, we will indeed need government regulation. Government is about the only thing big enough and powerful enough to deal with corporations that are often larger than many nations. Even then we have the problem of well-funded lobbyists that were not sent to Washington by average citizens, but by monied interests. That's why I think this is ultimately only a partial better-than-nothing solution, as it merely relocates the problem from the marketplace to the realm of public policy.
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Who will regulate the government and prevent its corruption? You state,
How is that not similar to the politicians people vote for? You're just treating the government as a benevolent, righteous deity because "IT'S SUPPOSED TO" carry out j
Re:Don't pay the fee (Score:4, Insightful)
But the world doesn't run on wishes. You can't escape the necessity for people to be responsible and informed, first and foremost, and when they are that makes the need for regulation unnecessary.
That just about made me do a double-take.
The world doesn't run on wishes. You can't escape the reality that people won't be responsible and informed. Informed is important here, too, and is part of the job of regulation -- for example, we have laws about food safety, so I can walk into any restaurant with some confidence that the food there is safe to eat. You could have a totally free market, in which independent organizations certify particular restaurants as "safe", but then the customers would have to constantly be checking those certifications.
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But the world doesn't run on wishes. You can't escape the necessity for people to be responsible and informed, first and foremost, and when they are that makes the need for regulation unnecessary.
That just about made me do a double-take.
The world doesn't run on wishes. You can't escape the reality that people won't be responsible and informed. Informed is important here, too, and is part of the job of regulation -- for example, we have laws about food safety, so I can walk into any restaurant with some confidence that the food there is safe to eat. You could have a totally free market, in which independent organizations certify particular restaurants as "safe", but then the customers would have to constantly be checking those certifications.
That's one area where the argument for regulation is unusually strong. If you get screwed over when you buy a car, you can always decide not to do business with that company again. If you go to a restaurant, eat the food, and die of food poisoning, it's going to be pretty hard to vote with your feet and take your business to a competitor when you're dead.
I'm not a fan of regulation, but this is one of its more benign forms. There's not a lot of political power to be had by verifying food safety. It's
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Informed? I have a few words for you: Confusopoly [wiktionary.org]. Shrink wrap contract [wikipedia.org]. "Doubt is our product."
That's right, these businesses are actively trying to prevent us from informing ourselves, sowing confusion. When called to account, they often try to weasel out with disclaimers about no real harm having been done, that they didn't intend to keep people in the dark, that it was all an innocent mistake. Inexcusable, and very evil. Be careful about implying it's all the customer's fault with that "won't"
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Who will regulate the government and prevent its corruption? You state,
How is that not similar to the politicians people vote for? You're just treating the government as a benevolent, righteous deity because "IT'S SUPPOSED TO" carry out justice. But the world doesn't run on wishes. You can't escape the necessity for people to be responsible and informed, first and foremost, and when they are that makes the need for regulation unnecessary.
I don't know how you managed to do it, but you somehow interpreted my words in the exact opposite way in which they were intended. I straight up said that what you need are people who are responsible and informed -- you quoted the very line in which I said it ("The only way you would ever have a free market...").
To me, government regulation is a sorry substitute for a fully informed, savvy public who makes good rational decisions in the marketplace. I said as much, when I stated that government regulat
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People rationalize. "Not enough people will do it, so it won't have any effect, so it's pointless for me boycott ACME Paper Co." The only thing in our culture that needs to change is for most of us to decide to patronize or boycott a company for the sake of claiming integrity, and not because we think our one dollar will make a difference.
This is why some individuals sort their garbage or buy a hybrid car, or refuse to buy dvd's. They (we) want feel like we have some integrity.
Verizon has a phone I reall
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I've heard the essential difference explained this way. You can act because you wish to engineer a particular outcome, in which case all of your thoughts and actions are
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Shouldn't that be you?
Everywhere I go people claim we need some great authority to keep a smaller "authority" in check. We need a city government to rule over people, because people might do bad things. We need county governments to rule over the cities, in case the city does something wrong. We need a state government to watch over the county governments. We need a federal government to make sure the states do
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You could have said that in a shorter form:
1. A totally free market has no rules at all.
2. When there are no rules at all, that is called “the law of the jungle”.
3. On a scale of how democratic something is, a perfect democracy is at 1.0, and the law of the jungle is at 0.0. (And 1984 is somewhere down the negative values. Hence that quote, that fascism should be called corporatism.)
4. Therefore, the free market and proper democracy are natural opposites.
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That's my main trouble with service from the cell companies.
Let's say I wanted to buy a phone - like my current Fuze/touch pro. So I buy it in full, up front for say 600$ (not sure what they were initially, but this is a good starting point.) There is no way I can go month to month with them without getting one of their packages ($30 data, xx for xx minutes of voice etc.) And - this package is at the exact same price point that the people whose phones are subsidized are paying.
If I bring the phone to the
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Oh please . Can I sign up, get service, and not sign and agreement? NO. Now exactly would I know how good their customer service, the network, or coverage is without signing up with them?
You're right, there is absolutely no way to research this information.
While I'm no fan of the telcos and know that their math is skewed, it's not like you can't do a little googling before making a two-year commitment to something. Or ask some friends / coworkers; more than likely at least a couple of them are going to have verizon.
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Oh please . Can I sign up, get service, and not sign and agreement? NO. Now exactly would I know how good their customer service, the network, or coverage is without signing up with them? Then once I find out how crappy the service for -my- needs I am stuck? Then they can charge -ANY- amount of $$$ to release me from crappy service?
If only there was some sort of short term period [verizonwireless.com] wherein you could return the phone for a small "restock" fee (ie: the non return of the activation charge and pay only for your actual usage and have the contract null and void. SIGH!
Re:Don't pay the fee (Score:5, Insightful)
Don't hire the government to force the people at Verizon to do things against their will -- unless the people at Verizon have truly defrauded you, personally, out of a significant amount of money. Because forcing people to do things against their will is (almost always) morally wrong.
Obviously, you missed the part about "the agreement" being intentionally and maliciously complex, to the point that it is indecipherable to the average customer. Said customer, having been assured by the friendly sales rep, "It just says [insert standard salesman bullshit rap here]", signs anyway, in the mistaken belief that he's dealing with a fair and honorable business.
There are laws against trying to cheat customers. Hiding your draconian terms in an indecipherable "agreement" is anything but fair and honest. It should be illegal.
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Said customer, having been assured by the friendly sales rep, "It just says [insert standard salesman bullshit rap here]", signs anyway, in the mistaken belief that he's dealing with a fair and honorable business.
If you believe what the salesman tells you then you are already a lost cause. His job isn't to look out for your best interest. His job is to sell.
Hiding your draconian terms in an indecipherable "agreement" is anything but fair and honest. It should be illegal.
The reason that businesses in the United States have such agreements is because of the ease with which you can sue people in this country. Because of this lawyers have an outsized amount of influence and insist on covering every possible base in any account agreement. It has less to do with "Let's screw our customers!" and more to do with "Let's try not to g
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If you believe what the salesman tells you then you are already a lost cause. His job isn't to look out for your best interest. His job is to sell.
Shortsighted at best. His job may well be to sell to you, personally, and he may get a commission from you. But ripping you off with a bullshit story is detrimental to the company as a whole, at least in theory.
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I let salesmen really feel the pain, by sloowly reading the whole contract and terms... twice... asking for any and all the tiniest unclarities, until I perfectly and fully understand it. And if he loses his patience, I call the police and tell them some criminal want so pull a con job on me, and now started to threaten me.
Then when I’m done, sometimes I simply say: Sorry, that thing is criminal, offensive and not acceptable. And drop it on the floor like it’s a piece of cloth used for cleaning
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I couldn't say it better; the contract people sign with Verizon is voluntary...nobody is holding a gun to your head, so go to a competitor. The market will sort things out in the end.
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so go to a competitor. The market will sort things out in the end.
What's interesting here is that those competitors have similar contracts, setups, fees, etc. At what point does regulation step in and say, "You aren't playing by the rules?"
Suppose the major vendors decide that when one of them raises prices, rather than compete with an advantage, they raise their own prices to match? At what point does it become collusion and price gouging?
I ask because it appears to me like the market is nearly impossible for new players to jump into.
Re:Don't pay the fee (Score:4, Insightful)
The frustrating fact is that if you actually avoid every market that's either regulated or in massive collusion, you'll find yourself giving up many modern conveniences. Not just cell phones, but the telephone in general -- just why do you think land lines are reasonable now?
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the problem in the US market anyway is that *all* of the providers are pirates. you can go to a competitor, but you get screwed there as well, albeit in a different manner probably. i guarantee that at&t is just waiting to see what the FTC does with verizon's ETF. if it stands, they'll bump their own shortly.
the fact of the matter is that lower ETF's aren't something that providers can effectively use for marketing against their competitor. consequently all the providers will have similar ETFs in the lo
Re:Don't pay the fee (Score:5, Insightful)
Forcing kids to do homework or eat vegetables or stopping drunk drivers, rapists, murders, thieves, genocidal dictators, slave owners/traders, and so on is all morally wrong? To say "almost always" is a little overboard, not that I disagree with the notion you are trying to get across. I just think the situations in which it is not morally wrong to stop someone happen a lot more often than you imply.
In this case...the trouble is that the government is giving verizon special permission in order for them to operate their service (frequency usage, tower locations, etc). Additionally, the whole notion of contracts that one side can unilaterally change at any given time is pretty stupid too.
That said, fraud is one of those things that should be stopped. There are plenty of conmen that tell "the truth" but do it with so much smoke and mirror tapdancing that people still sign up. What you are attempting to do is blame the victim by letting verizon totally of the hook. So...they say it is to help subsidize the phone. Why is it that I would get subjected to the termination fee if I brought my own phone? This also adds to the issue that they claim they recoup the cost of the phone through their rates and the ETF makes up for the people who leave early. Well...why don't I get a lower rate for bringing my own phone? Or why don't I get my rate reduced after I have paid back the subsidized portion of the phone? I am guessing you haven't seen the leaked meetings where they talk about how many billions they make using various fraudulent billing tactics. They force people to burn minutes as they sit through the ever growing "welcome to your verizon voice mail and blah blah blah and blah and blah blah blah pres blah blah blah" messages.
I agree that we shouldn't hire the government to force Verizon to do things against their will. However, calling them out for deceptive and fraudulent bullshit is not the same. (Their argument for why they hide the ETF is that it is 'not important' and they got busted on that when it was decided that big ETFs qualify as materially important pieces of a contract). I think the best solution would actually to slap "users of any service provided using these frequencies cannot be subject to early termination fees or have their service terminated for excessive roaming" in the fine print of the agreements they have with the FCC to even operate. I bet they would scream bloody murder at such a one sided contract change...and then we can tell them "Well you shouldn't have signed anything with the FCC, you could have started your service in the Sahara where there is no FCC."
That's not all they do (Score:3, Informative)
Verizon's guilty of a lot more than merely doubling their early termination fees. They've also tried to pin about 300$ in botgus charges to a friend of mine's account when she tried to leave them. I hope the FTC nails them to the nearest cross.
Where is government now that we need them? (Score:5, Insightful)
The FCC and FTC definitely need to step in the the wireless market. Policies like this promote stagnation and high prices.
Why should the customer be bound to a wireless contract when this doesn't apply to landlines? I've said before that wireless contracts are keeping prices artifically high, allowing providers to charge quite similar rates for similar plans, because it is so difficult to switch. If customers were not tied to contracts, the ensuing price war might bring wireless rates down closer to prices that I have seen outside the USA.
Speaking of other countries - Why is the USA one of few countries where I can't just pop the SIM or UICC card out of my handset and put it into a new one? Why did it take intervention by the Chinese government to force device manufacturers to standardize chargers to minimize electronic waste?
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well to start with we don't have just GSM networking. Verizon uses CDMA, and sprint uses a different type of CDMA. So gsm only work with AT&T and tmobile. So you can SIM swap however swapping to other carriers is useless as tmobile has shitty coverage in the USA.
Good news as it stands now both Verizon and AT&T are going to support LTE for their 4G cell phone tech so in about 10 years sim swapping will be semi practical. sprint is going the wi-max route.
Chargers are a different problem and your to
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The phone companies in the US are a lot more varied in their policies because they are not under Socialistic (Fascist) regulatory regimes.
If you were to use T-Mobile as your carrier in the US you would find the ability to do everything you described in your post.
Verizon not so much, but then again their business model allows you to get an expensive smart phone without shelling out the full cost up front in exchange for a contract commitment.
Your choice.
It's a problem with the whole industry (Score:4, Interesting)
The total lack of customer service, the terrible coverage, and the relatively subpar implementation of cellular service in the US compared to other countries is not just a problem with Verizon. It is a problem industry-wide, and it is only getting worse.
With the economy in the toilet, these companies are losing customers like the Bucs lose football games. This means they don't have the financial wherewithal to build out the necessary networks. And due to this, customer service continues to decline.
Maybe it is time to nationalize the whole wireless carrier system and slowly parcel out contracts to private companies for the day-to-day operations. If we can punish these carriers by taking away their networks, we will see real change in customer service and subsequently real competition and improvements across the board.
As long as private companies run these networks, we're stuck with the worst possible system for cellular phone users. It may be a cultural thing because Asian and European companies don't seem to screw over their customers so badly, but it's our culture and we should (as a nation) take it back.
Umm... (Score:2)
they also say that because they pro-rate the fee depending on how much of your contract is left, they still lose money.
...So, they claim to be losing money on all the subscribers who don't cancel their contracts early?
That can't possibly be right, maybe I should go RTFA to see if it really says the same thing...
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Oh boo, friggen, hoo... (Score:5, Insightful)
"they also say that because they pro-rate the fee depending on how much of your contract is left, they still lose money"
Wow... that's the biggest load of BS I think I might have seen all week.
They don't lose money off of the pro-rated fee... at absolute worst they lose money because they lost a customer, and even that's unlikely unless the company is teetering on the edge of bankruptcy. Heck, if a customer terminates early and the company collects that fee, they can actually earn interest on the whole termination fee sooner instead of collecting it over a period of several years.
I'm not sure in what sort of reality they think saying something like this would be likely to make anybody feel even slightly sorry for them.
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The only reason the cellular companies play this subsidized phone and early termination fee charade is to take
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additionally, the idea that they pay $600 for a droid phone is BS. they are the single distribution channel for the droid in the US. that means that motorola is bending over to have them push their phone. they are getting droids at a massive discount over what a normal consumer would pay for the unlocked phone.
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It doesn't have to do with loss of a customer, but rather the loss of a customer before they've held the contract long enough that they pay back the phone that they got at a steep discount with the contract.
The discounts are so steep because smart phones are so expensive, that's why they require smart phone plans and other BS to increase service costs to cover those phones, and also why they have a higher cancellation fee to cover the difference that the service plan w
$350? (Score:2)
Wow. My early cancellation fee is $500. And contracts are three years, not two.
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These "free phone" deals . . . (Score:2, Informative)
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Mod parent up. Don't fix the symptoms, fix the problem. Make them clearly state the fact that you are entering a finance deal on the phone as well as entering a contract. It's not a free phone, it's not a phone that you are renting, it's a phone that you are buying with a loan from the phone company. You should be able to see what the interest rate is (much higher than most banks will offer for an unsecured personal loan) and have it billed as a separate line item to the cost of connection (if there is
Just say it. (Score:2)
Since this is the crux of it...
Verizon Wireless said Friday that it doubled the fees for customers to break service contracts for smart phones because those devices cost much more.
and other companies have not raised their ETF incredibly (including AT&T, who just so happens to have rights to the most smartphones, including iPhone), it basically comes down to maximizing profit with the added benefit of increasing retention rate. In other words, they want more money.
However, it's not completely bleak, since they do decrease the ETF like other carriers do:
Verizon, like several other carriers, lowers the price of the early termination fee over the length of the contract. A Verizon customer who canceled a two-year contract after 23 months would still be charged $120, though.
It must suck if Verizon Wireless is one's only option. If it isn't, it makes zero sense to switch (
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it makes zero sense to switch (except for network coverage, but AT&T is practically right there with them).
For one thing, there's a map for that. For another, Verizon has been known to lock out features that the handset manufacturer has advertised.
Lower Cost Phones? (Score:3, Insightful)
How much does the radio chip cost? (Score:2)
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Er, "losing" money? Bullshit. (Score:2)
"...they also say that because they pro-rate the fee depending on how much of your contract is left, they still lose money.
Er, somehow I seriously doubt that the .01% of customers that terminate a contract early somehow equates to them "losing" money. Their extortionist texting rates alone could probably keep the entire division afloat. What a crock of shit.
Any company that is sitting back reaping the benefits of tens of millions of people calling in "every week to cast your vote for the next one-hit-wonder Idol" can STFU about "losing" money. They're enjoying profit streams no one even imagined 10 years ago.
bye-bye, Verizon! (Score:2)
I picked up his-and-her iPhones yesterday. (Was scheduled for today, but we're getting all the snow they promised, 14" and coming down at 1"/hour). Verizon coverage is very good, but ATT cannot be any worse than Verizon on customer service and in particular on corporate policies. I got a call a couple of days ago from some Verizon sales rep trying to get me to replace/upgrade my phone. I said "I don't want any of your new phones."
A friend has a Droid and is pretty happy.
Even if you're not an Apple fan
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Even if you're not an Apple fan, you have to give them credit for recasting the cellphone world and removing the chokehold the carriers had on costs, phones, customer service, etc, etc.
Sorry, what? No I don't.
What, exactly, has Apple done to help that situation?
In other News (Score:2)
My pay as I go Virgin Mobile phone works just great. See if I wanna visit a web page, I wait til I'm at a computer. Call me old skool.
Any Jarhead can tell you.... (Score:4, Insightful)
USMC applies here too: U Signed the Muthafuckin' Contract.
Don't like it? Don't buy a Verizon phone. Or better still, don't buy a phone with a contract.
Re:Customer care (Score:5, Funny)
Verizon will go any lengths to protect their customers, even if it means killing them.
"This is an automated message notifying you that on the ... two five of ... November of ... 2009 your husband did conspire to change carriers with willful and malicious intent. Regarding this matter, he has been terminated in order to assure you continuous service. We apologize if you experienced any problems with your service during this technical adjustment. You will receive an invoice shortly for the professional handling of your husband and his disposal. Please remit payment by the end of ... December of ... 2009 to avoid further late charges and fees. To return to the main menu please press star, to talk to a Verizon funeral representative please stay on the line ... "
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It's called nationalization, and it's a shame that Americans shy away from such a pro-consumer action because it stinks of "socialism".
No, nationalization is when the government assumes control of something. The GP was not talking about that. He was talking about private citizens purchasing shares of an existing corporation on the open market in order to own a controlling interest. That controlling interest can then be used to determine how that corporation runs. His idea is to use that to set up a truly customer-friendly cell-phone company. In a way it's a good idea. The barriers to entry in this market are rather high; better to le
Re: (Score:2, Insightful)
Good, now they can give back all the federal funding they have recived to roll out the networks. Those should be the terms of the federal money. Really just like the internet the service provider, and the owner of the actual infrastructure need to be separated.
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The federal government gives money to (and takes money from) practically everyone. If that's your standard for judging if someone should be subject to force by the state, we'd all be slaves. The fact that the government gives out money to everyone makes it necessary to take that money whenever it is offered to you lest you lose out to a competitor that took it. If you don't want to be in this sort of moral quandary, have the state stop redistributing your wealth to everyone else.
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Anyway, what you do when the wife/girlfriend decides to leave you is this: