Verizon Wireless Doubles Contract Cancellation Rate From $175 to $350 on ‘Advanced Devices’
Friday November 13, 2009
While signing a contract will typically lower the cost of the cell phone you buy, the design of the cancellation fee is to keep you with the carrier and demotivate you from switching to another.
Prepaid wireless, on the other hand, comes with no contracts. The no-contract carriers, though, can charge you more for your handset and tend to have less of a cell phone selection.
Verizon Wireless recently decided that it'll become even more strict with its contract-based consumer and business customers and among the highest in the industry with its cancellation fees.
As the FCC continues to debate whether or not cancellation fees are justified, Verizon Wireless announced last Thursday that its early termination fee (ETF) will double from $175 to $350 specifically for customers under a one- or two-year contract with an "advanced device".
A Verizon spokesman says these higher-end phones typically include "a combination of advanced capabilities that ... increase the cost of the device," according to PC Magazine.
"These capabilities can include a premium HTML browser; high-resolution ... camera with optical zoom; dual-processor chipsets; Wi-Fi; very high display resolution; and operating systems such as BlackBerry, Windows Mobile, Palm or Android," the Verizon Wireless spokesman added.
The Verizon Wireless cancellation fee, though, does prorate and has done so since 2006. It decreases by $10 after each month of service has elapsed. T-Mobile and Sprint began prorating its cancellation fees later in 2007 and AT&T began doing so in May 2008.
"This is an attempt by Verizon Wireless to keep consumers from switching to prepaid carriers that are offering better value," Omar Abhari, senior vice president of operations for prepaid carrier PlatinumTel, said in a Friday statement.
Abhari added: "This is a short-term solution that only proves that contractual wireless plans are not in the consumer's best interest and that prepaid should be considered."
Information about most of the prepaid wireless carriers can be found here. Also, take our new Verizon Wireless poll below!
Comments
Recently changed my upgraded my phone with Verizon, but considered not. Verizon phone (cept the Droid) are deprived of the latest fun features and so I shopped it out. Discovered that Verzion’s network was best, in my area so stayed, but won’t sign another contract. Cheaper plans, such as the $50 Boost mobile, and Wal-mart’s Trac-Fone have made contract service a thing of the past. The next phone I buy will be in cash, with no service agreement.
I have Verizon and have had it for at least 8 years I believe..but seeing as I am ‘out’ of my last 2 year term..they just decided for me..that I won’t be signing for another…!! $350 tells me they WILL not be letting anyone out of contract early.
Only have 4 more months with my Verizon contract and will certainly shop around before getting my new cell phone without being tied down with a contract for another 2 years. Too bad that in these bad economical types they have too increase fees and the consumer has too suffer.
It is about time that the Government starts putting more regulations on Phone carriers and internet providers who continue to price gouge their customers.
There is a simple solution that I found, I bought a prepaid Straight Talk phone from Walmart with unlimited talk, texts and data for $45/month and it runs on Verizon’s network so I get the benefits of having the best carrier with the best national coverage in America without being tied to a contract and I don’t have to worry about any cancellation fees. I don’t get a really fancy phone but the phone I got is really great and I can type texts supa fast.
Verizon is the cell carrier that charges the most to give you the least. Remember when Verizon came out with their first Bluetooth phone? (Motorola V710) They crippled the Bluetooth to only allow the use of a handsfree headset. Why do they do this? To squeeze more money out of you. IF you want to transfer pictures, you’ll need to pay for picture messaging. If you want to sync your contacts to your PC, you’ll need to buy their $40 kit. After being with Verizon for a decade, I decided to switch because if you do the math of how much it cost you over your two year contract, it is just not worth it.
If people knew they could get the benefits of being on Verizons Network from Straight Talk, they’d scream. $45 a month for unlimited talk and text! Awesome deal!