Verizon Wireless Prorates Fairness In Prorated ETFs

from the gee-thanks dept

Verizon Wireless got a bit of praise a few months back when it announced it would start prorating the early-termination fees it charges customers who break their contracts before they expire. Operators use ETFs to ensure they recoup the subsidies they pay to make handsets cheap for users to buy, but the ETF doesn't drop as subscribers get closer to the end of the contract, which seems a bit unfair. Now, Eric writes in to point out that Verizon's finally released the details of the ETF changes, and as you might expect, they're not quite as fantastic as people would have hoped. The changes came into force Nov. 16 -- and will only apply to contracts signed on or after that date. Furthermore, the ETF only drops by $5 per month rather than proportionally to the length of the contract. While it's a step in the right direction, it seems a lot less benevolent than originally thought, and keeps the deck stacked strongly in the operators' favor. Perhaps a better solution would be to charge an ETF in line with the subsidy on each handset, then prorate that proportionally over the life of the contract.
Hide this

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Reader Comments

Subscribe: RSS

View by: Time | Thread

  1. identicon
    Anonymous Coward, 18 Nov 2006 @ 1:35pm

    Re: Re: ironic

    Just because you're in a contact doesn't mean it's not unjust. A HUGE number of contracts I've read from companies have illegal clauses in them - that's why there's an enforcement clause at the end of most which says that if any clause is deemed illegal the rest of the contract stays enforcible.
    Which is why you should ever sign any agreement without having a competent attorney go over for you first. So the next time someone wants to sell you something with a contract, don't forget to figure in the cost of an attorney.

Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here

Subscribe to the Techdirt Daily newsletter

Comment Options:

  • Use markdown. Use plain text.
  • Make this the First Word or Last Word. No thanks. (get credits or sign in to see balance)    
  • Remember name/email/url (set a cookie)

Follow Techdirt
Insider Shop - Show Your Support!

Essential Reading
Techdirt Deals
Report this ad  |  Hide Techdirt ads
Techdirt Insider Chat
Recent Stories

This site, like most other sites on the web, uses cookies. For more information, see our privacy policy. Got it

Email This

This feature is only available to registered users. Register or sign in to use it.