The Federal Communications Commission last Friday asked Verizon Wireless why it recently doubled the fees it charges customers when they break their contracts on "smart" phones. In November, the carrier increased the maximum early contract termination fee for smart phones from $175 to $350. Like other carriers. phone devices are subsidized and the carrier makes the money back in service fees over the term of the contract.
Verizon did not respond specifically to the FCC's inquiry, but the mobile operator has said it needed to raise ETFs in order to defray the costs of advanced devices it sells to customers at a subsidized price. According to the Associated Press, Verizon spokesman Jeffrey Nelson said, "Smart phones quickly became a major part of our business and cost us a whole lot more."
One of the questions the FCC seems to be asking is how a customer is to know whether the increased fee applies to THEIR phone, and whether it's spelled out anywhere except in the formal customer agreement; which, of course, no one reads.
Sounds like a policy of "begging forgiveness" rather than "asking permission" to this cell phone user. I routinely look at my cell phone bills to scan for additional charges and changes. I'm convinced that many services add extra charges from time to time with the knowledge that people don't review their bills or their contracts. They certainly don't call me if there is an opportunity to save some money on my plan.
It will be interesting what the FCC determines as the outcome to this one.
Barbara Bartlein is the People Pro. For her FREE e-mail newsletter, please visit: The People Pro.
Verizon doubled fees on 'smart' phone contracts