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Too Much Coffee

COULD IT BE? AN END TO THOSE CELL PHONE TERMINATION FEES?

As we reported on News 4 Today this morning, the government is negotiating an end to those termination fees that cell phone providers charge if you want to get out of a contract early and transfer to another provider.

We get so many complaints about those fees from viewers, they are about as popular as the income tax.

The cell phone companies can be absolutely ruthless about those "escape" fees, which usually range from about $150 to $200 per phone.

A couple of years ago I did a story about a San Antonio man who had just lost his wife to cancer.  Obviously, she no longer needed her phone, so he called up the cell phone provider to cancel her contract... and they refused!  He even provided a death certificate for his wife, but they wouldn't let her out of her contract without him paying a termination fee!

Even death can't get them to waive those fees, which must make them a bundle.  Eventually, after we did our TV story, the cell phone company caved in and acted like it was all a "misunderstanding".

Playing devil's advocate for a moment, I realize the companies give you a nice phone for free or at a steep discount when you sign a new contract, and the fee is probably their way of getting paid back for that phone if you don't stick around for the whole contract.

But many of us need to switch to another cell phone company for a legitimate and unforeseen reason.  For example, about a year after I signed a 2 year contract, I moved to a new neighborhood not far from the old one.  In the new house I could not get a cell signal at all.  I had no choice but to switch to someone else's network.   Why should I have to pay an expensive fee?  Why can't I just give the free phone back and go on my way?

Plus, companies are devious about keeping you locked into a "never ending contract".  Every time you call them up and make the slightest little change to your account, they re-set the clock on your contract, starting the 2 year term over from the beginning.

Want a new phone?  A new 2 year contract.  Would you like more minutes on your plan for free?  You must start a new 2 year contract. 

And sometimes they don't tell you making that little change, which seems advantageous to you, re-starts the 2 year window.

Here's hoping they terminate the termination fee!

 

Published Wednesday, May 21, 2008 10:32 AM by Jaie Avila

Comments

 

maadamos said:

The first thing to remember is that there is no such thing as a free lunch.  You will notice that the cost of the phone varies with the length of the contract you sign.  There are usually three prices associated with the phone.  You have outright purchase of the handset, handset + 1 yr contract, handset + 2yr contract.  It is evident that the phone is subsidized.  I do believe that there should be instances when there is a reason for termination, nut it is still sticky what happens to the handset.  I think the problem is in folks asking for subsidized phones.  I think that the sooner the idea of people purchasing thier handsets outright catches on the better it will be.  There are now at least 3 carriers (Metropcs, Cricket, Boost) that do not subsidize their hansets, and the customer prepays for unlimited time and services on a monthly basis.  More companies should be using that model.  It is less of a headache for the phone company and the customer.  The phone companies can then concentrate on installing more equipment.  No payment no service.  Your telephone is your property.  
May 21, 2008 1:10 PM
 

Pedro said:

Try Pocket Wireless, they have no contracts, unlimited everything at a low price.
May 21, 2008 1:34 PM
 

dustbowel said:

Personally I think that the termination fees have always been a rip-off.  Why should any communications format[company, etc] be allowed to profit if they fail to deliver the service you thought you paid for.  Bottom line profit. That is the crux.  The impression the consumer has is that whatever cell phone company they choose, all so has their own transmission facilities.  Not true.  Anyone can open a cell phone business and sell the phones, related equipment and contracts and still not pay a dime for any maintenance or upkeep. Yes, as a business you would pay some telecommunications outfit for the use of their transmission equipment/lines, etc. The early termination fee is a guaranteed source of revenue.  You could be rewarded for providing poor service.  Almost all communication providers do the same thing.  Cable, satellite and so on.  A cable company keeps raising their fees, gives you less than what you first signed up for by taking channels away, telling you that to get them back, you must pay a higher rate and when you say FY, terminate!  They say, OK, $300 early termination fee, please. Since, in todays world you can have a taxpayers paid bailout for making bad, if not stupid, greedy investments, I see no reason to pick on cell phone companies. After all, if they start to go belly-up, we the taxpayers, will only have to bail them out.  Termination fees, in my opinion, would be far cheaper.  But.....IDMSTM in the long run because we have a do nothing, go nowhere, pork barrel, favorite sons, non-functioning congress and senate.  Plus, a few higher ups could also be included. Oh well.............
May 22, 2008 6:45 PM
 

SA said:

FYI Pedro Pocket only works in certain  area's and you can't go out of state with pocket! That's the catch for all that free stuff!!
May 28, 2008 10:56 PM
 

Mobile Rumors said:

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July 1, 2008 10:04 AM
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