A member of the FCC's five-person commission, Mignon Clyburn, has sent out a letter today in response to
Verizon's earlier reply regarding questions surrounding its gargantuan $350 early termination fee on so-called "advanced devices," and in brief, it looks like this issue is far from tied off. Her choicest quote is that she found Verizon's answers "unsatisfying and, in some cases, troubling," noting that customers are already paying "high" monthly fees and suggesting that the public interest isn't being served when someone gets slammed with a three-digit cancellation charge mid-contract. She also straight-up calls the company out on its claim that customers aren't being inadvertently charged when the press the web button on their phone without an appropriate plan, saying that "press reports and consumer complaints strongly suggest otherwise." Commissioner Clyburn's conclusion? "I look forward to exploring this issue in greater depth with my colleagues in the New Year."
Dum dum dummmmm. Follow the break for the full text of the letter.
[Thanks, Daniel P.]
posted December 23rd 2009 5:30PM
someones got some splainin to do
@Jake Smith
Verizon to FCC: Hey I got a MAP for that.
FCC to Verizon: Hey I got a FINE for that.
THEN, Verizon logo goes black....a heavy breathing can be heard close.... closer....
**** plays Imperial March ****
Darth Ivan Seidenberg: The Republic is against us. Assemble and attack my Droids!!!!
*** Darth Ivan gets on his ships, flies into the AT&T galaxy and makes his home in the Logo, now called the Death Star (heavily criticized by his horrible indoor 3G connection :S ) ****
@Jake Smith
I can attest to being charged for data on AT&T when my non-smartphone got the web button pressed in my jeans. It was only 30 cents at that time but I learnt my lesson and immediately called them up and told them to cancel any chance of my phone connecting to the web.
AT&T could totally capitalize on this juicy tidbit of information that masses are certain to be unaware of...quick, someone get Luke Wilson out of that hyperbaric chamber he's got a commercial to shoot!
@(Unverified)
Verizon's current fee for data is $1.99.
@Jake Smith A bit absurd, and now they are poking verizon after at&t has been announced as the 2009 dead last carrier, and Red V on top 1 spot? http://bit.ly/att-going-down-verizon-is-laughing
consumers are already speaking...
As much as I don't like it (i.e. higher termination fee), here is the choice - a phone that has ALL the features we want, dream about, and long for:
(1) Pay $100 for the phone with additional $100 early termination fee
or
(2) Pay $200 for the phone and NO early termination fee.
Common guys, I prefer option (1). But with one exception - after the first year, there should be no additional termination fee, and the user gets to keep the phone.
If the FCC forces Verizon to eliminate those fees, we may not get those high-end phones for $100, we may end up paying $200 or more for them. And if you keep your contract for the full 2 year term, then you lose, because you paid more for your phone!!! Most people don't terminate their contract mid-term. But, adding to my statement above, the maximum additional free should not exceed $100 - and no additional fee after the first year of the contract is fulfilled.
@Thinker
What high-end phone cost $100?
Those would fall in the half-assed smart phone scatergory me thinks
@ThreeDee912 There's "data" and then there's "3G". I'm pretty sure Verizon's 3G isn't much cheaper than AT&T's
@ThreeDee912 ouch!
@00shitz
I own the Palm Pre phone. It is now selling for $150 (after rebates at Sprint), and for $99 at other retail channels. Because I bought it when it was first released, I paid $199.
Soon, maybe in January, the Palm Pre will be coming to Verizon, and they most likely will discount it aggressively - that is Verizon's marketing approach. Verizon has been selling a boatload of BlackBerry smartphones in buy-1-get-1-free deals. And are selling various BlackBerry smartphones for $99.99 or less. Many of these phones are definitely worth much more than $99.99. If the user terminates their contract, Verizon stands to lose a lot of money.
I am sure when the Palm Pre comes to Verizon, they will be selling it for $99.99, yet it lists for $549.00.
Thank you for your response, because it caused me to reflect on one more point; and that is, I do not believe that Verizon should add an additional charge if the user's 2 year contract is fulfilled. The user should only have to pay an additional charge if (as argued in my original post above) they terminate their contract before the terms are fulfilled.
If Verizon is proposing additional charge for a large class of high-end phones after the 2-year contract expires, then I oppose it. If the 2-year contract period does not cover the price of the phone, then the user should be given the option of paying an additional charge every month to cover the true cost of the phone. Extending penalty beyond the 2 year contract period is a covert way of extending the 2-year contract period. This is a subversive way of gradually extending the contract period of millions of Americans from 2-years to 3-years, in line with the much derided policy of Canadian wireless companies.
@Thinker
You read something wrong. There is no proposal to charge anything at the end of the 2 year contract. It's all about charges imposed if you break the contract before its finished.
I still can't figure out why this is such a big deal to people. All the carriers have to say "Cost of breaking contract: $x" and not tie it to the subsidy at all. You can't just break your Comcast contract or your apartment lease or whatever without having a penalty. This is the same thing.
I guess the FCC can be cool sometimes... but I still hate them with a strong burning passion.
@NeoJew
Considering that members of the committee rotate every now and then, I don't understand how you can hate "an organization" when it's really just a few people calling the shots (people who get replaced, mind you).
@NeoJew
shoot, not me. i'm gonna have to pat obama on the back on this one, because regardless of what side of the political isle you're from you gotta love this new FCC. 1) they dont want people ripping you off w/ through the roof ETF fees 2) their stance on net neutreuality is actually on the side of people and not big business 3) they were quik to admit that after the last 3 or 8 years (or whatever) that cable card has been out its been nothing more than a complete and utter failure.
The only thing that could make me fall more in love w/ them is the FCC looking into the big 4 carriers jacking up prices for SMS fees at the same time, when it costs them literally nothing. Well, i can dream right?
Anyways, i think the only people that wouldn't be a fan of the fcc right now would be fatcats on wallstreet. and i could give two shits about them to be honest.
The FCC is laying down the smackdown on this issue.
This is excellent. I'm really happy the FCC is finally doing something worthwhile.
@MRCUR your icon is my current wallpaper. :-)
@FlyersPh9 - It's a great background. I used to use it on my iPhone.
@MRCUR
Could you please link me to it?
@Nel I love that wallpaper too =]
http://interfacelift.com/wallpaper_beta/details/1958/hexillus.html
The FCC has been on a roll recently, lets hope they continue and make big red bleed.
@dever Three years ago I was like "hey, at least the CRTC isn't as bad as the FCC". But oh man, how the tables have turned. The new FCC is rockin' and the CRTC is well.. corrupted beyond all belief.
@dever
Yes let's make Big Red bleed so my monthly service charge can go even higher, faster.
Also, if the FCC caps termination fees then you can expect the difference between $350 and the FCC cap to go directly into the price of a new phone. Don't want early termination fees? Pony up $600 for your new mobile like the rest of the world. Don't have $600? Then STFU
@Joseph Mama Yes except in "the rest of the world" you do not pay a month to month premium to subsidize your device because it wasn't subsidized. I have and would be happy to pay the $600 if Verizon would discount the device cost that is built into their plans. Right now paying $600 only allows me the benefit of further enriching Verizon. Also don't tell me you are niave enough to think that if Verizon is selling you a unsibsidized $600 that the cost per unit to them is $600. Excessize fees such as this only work because of the oligarchical structure of telecoms in this country and need to be regulated in some way. I will STFU now.
@Joseph Mama I would happily pay $600 for my phone upfront if the monthly payments weren't already priced higher in order to pay for the subsidized phone Verizon assumes I will buy.
I can only assume Clyburn isn't a Verizon customer?
@GeorgeAnthony I woulda guessed that she was. All the Verizon customers I know are all a little ornery, Astronomical monthly prices and all.
hey Verizon, here's what I think of you're ETF:
Screw. You.
OH SNAP! Mom, Verizon did'nt clean his room!
@One Love
Verizon: MOOOOM!!! AT&T did not finish its 3G homework and now she is playing with her iPhone !!! MOOOOM!!!
Totally agree. As much as I admire Verizon for their coverage efforts, I think the maintenance and business expenses SHOULD and ARE already covered on what customers pay monthly. It is a monstrous ETF that only decreases $5 per month.... Adding that Verizon offers also expensive plans this is just a way to scare customers away, but again... does the Average Joe read the Fine Print ? Not really... They call 6 months from now to say "No one ever told me I had to pay $350 to cancel the contract".
Verizon don't let AT&T yank your cause from this area, because their ETF is $175.... now is there a map for that ? :S :'(
@TikiTeko actually, the ETF on the $350 "advanced devices" go down by $10 dollars, not $5.
@AwlAmericanDawg
$350 / 24 months = $14.50/month.
So that means Verizon's ETF is more than $100 higher than the amount a customer gets credited for over the duration of a full 24 month service contract. It's basically a "fuck you for switching providers" fee. It has no relationship to the 24 month service period at all at $10/month. I have no problem with a $350 ETF but it should be factored in proportion to the service contract at 24 months / $14.50 month otherwise it's just anti-competitive.
@(Unverified)
How about for ever month over my contract that I stay I get $10? Seems fair to me but would never happen
@schmidt1985 Related- in Japan you get a 50% discount for being willing to sign a 2-year contract.
@Jamar Japanese phones also have HDlite tv and surround sound (literally, not faked) among other things. The iPhone is crazy popular over there as well, and it doesn't cost nearly as much to own/use. I wish even some of Docomo's phones were offered stateside though.
TAKE THAT VERIZON!
I hope the FCC keeps up this roll of worthwhile contributions.
@Martin C Agreed!
@Martin C
great pic.
@cherryboom
Shut up, I love my Droid.
Take away the high monthly fees, or the ETF, just one or the other is all you need to fatten your wallets.
That $350 "ETF" is just Big Red's ways of saying, As if we don't rape you already on Monthly Bills we just want to let you know starting now if you ever think of leaving us before the time you agreed 'to have us stop raping you' we will charge you another big fee of $350!
Mignon Clyburn, as in Jim Clyburn's daughter? Guess Verizon didn't make a big enough contribution to the democrat party or her dad.
A fair solution would be to make people pay the difference in cost of their subsidized phone. In some cases, it would be $0, in other cases maybe $300.
@DigitalCrypt
You are correct sir, thats how its done in the UK.
The subsidy/ETF bullshit is just that.
The carriers shouldn't subsidize phone hardware, but instead make a payment plan for the device and spread it over the life of the contract, cutting the subsidy costs out of their rates. Want to switch to another carrier? Go for it, but you'll still be paying off the phone. Already own a phone? Get a cheaper monthly rate. Pay the phone off early? Get a cheaper monthly rate.
@mullingit0ver
100% agree with you. FCC should look not only at the ETF, but at the whole scheme ETF is based on.
Since ETF is supposed to reimburse the carrier for the phone you purchased from them, if you already have a phone, or pay the full price of the phone from the start, your plan should be reduced, since you don't need to pay them anything for the device anymore.
Similarly - if you buy the phone using the cell company's subsidy, after 2 years have passed and your phone has been paid off, your plan should become cheaper, because you are not paying for the phone anymore.