Lawsuit takes issue with T-Mobile's ETFs
By Chris Ziegler 
posted Nov 19th 2006 5:36PM
posted Nov 19th 2006 5:36PM
You don't like early termination fees. We don't like early termination fees. In fact, with the exception of the carriers' bean counters, we can't think of anyone that likes 'em. But the fact of the matter is, a contract's a contract, and the ETF is the (relatively small, in the scheme of things) penance we pay for the right to break it. Be that as it may, a new class action suit brought against T-Mobile in an Idaho federal court claims that the nation's #4 carrier is breaking thirteen state consumer protection laws by charging customers $200 to wiggle out of their agreements. Specifically, the claim stems from the fact that T-Mobile doesn't make allowance for reducing the ETF based on the amount of time the user has been with the carrier, nor the "quality of service" they receive. For its part, T-Mobile isn't commenting on the suit, but we're guessing we can imagine the hand gesture they're doing their best to not display right about now. To the plaintiffs: can we recommend Sprint?[Via The Wireless Report]
That is retarded. None of the national carriers offer prorated ETFs. Cingular used to but they don't anymore. I fucking hate stupid customers who think that everything is owed to them.
well....I have no problem with early termination fees....but I DO have a problem when they are applied incorrectly....case in point:
signed up for family plan. Put little sister on plan. Little sister's phone is stolen. Ask Wireless carrier to please shut it off so that no calls can be made while we buy a new one. Told we can't do that, we can only terminate the line, at a 400$ termination fee. 400$ TERMINATION FEE???!!!!!!
I don't WANT to TERMINATE the line...I only wanted to shut it off until you send me another phone. My options were to:
a) pay the termination fee
or, b
b)"upgrade" (which was really a downgrade), thereby ALSO EXTENDING a contract I was unhappy with in the first place. WTH? I couldn't just buy my own phone and you send me another sim card, cancelling the old one?
THIS is one reason I am unhappy. Termination fees make sense when in contracts. It's fair. It's just NOT fair if my service becomes less than what I signed up for, or, for the above bogus reasons.
BUT I hope contracts are done away with. I'm excited that Metro PCS is coming out with Blackberry where 50$ gets u unlimited everything and BB service. But either way, even IF they decide not to do BB, after this, im going to metro pcs, because once my service gets crappy, i should be able to move elsewhere, and they're prices are more reasonable.
This would be a great victory for consumers if this goes through. It would be more than just t-mobile that would be affected. Sets a precedent, and I'm always on the side of the consumer to demand better service and consideration for our hard earned dollars. Everything is owed to customers if they're paying money. That's how we get better service, and that's the beauty of capitalism and the free hand of the market, that in groups we can force corporations with huge amounts of power to provide us with the goods/services that we're willing to pay for.
To Evan:
Just because none of the carriers offer prorated ETFs doesn't mean that it shouldn't be done. If they're given the opportunity OF COURSE they're not going to offer it. Why would they give up money? I think prorating the fees would make a lot of sense.
Scenario One: I've been a loyal customer paying $100/month to my carrier for a year and a half. Then I move to an area that my carrier claims to cover but service is spotty.
Scenario Two: I just got the cheapest plan with a carrier two months ago but I decide that I want to switch to another company because they have this fancy new phone that I want.
In both of scenarios the customer is charged the same early term fee. I ask: is that fair?
Thats great that you have been a loyal customer paying $100 a month. But its not like thats a donation, you are receiving cell phone service in return.
If you knew you were going to switch to another carrier in two months to get a fancy new phone then why would the carrier you were with NOT charge you a fee. "Oh sure mister customer, we understand that you want to get that cool new phone that company x offers. Don't worry about the fact that we subsidized a handset for you because you signed an agreement with us that apparently doesn't mean a thing."
I am all for fair customer service but in this case the decision to sign a contract is one that the customer makes, not the company. If you want a cheap phone you need to sign a contract. You could not sign a contract and pay more for the phone and not be troubled with things like ETFs...thats what I do.
Agree with Evan. :-)
1) If you want a cheap phone, you need to sign a contract. If not, just go for pre-paid phone or buy unlock one from ebay.
2) Customers who want to switch to another company because they have this fancy new phone that they want, probably will have same problem again when newer & cooler phone come out in next 2 months.
3) T-Mobile also is the only carrier offers Personal Coverage Check before you decided to sign the contract with them.
And which operator offer prorate ETF?
To Evan: Effective 11/16 Verizon did just that. ETF's are prorated on any new contract.
What Ryan states is true, effective 11/16/06 etf's are prorated on new contracts, this was announced to the nation 6 months ago on national tv and now it's in practice. I also heard Sprint has a variable etf in certain markets.
I'm in the middle of a Verizon contract, I wonder if this will apply to me too? Because I am aching to switch to Cingular and grab me an 8525
Verizon's prorated contracts only apply to new or renewed 2 yr agreements done on or after 11/16, but still kudos to them for offering it.
I think all of you guys would agree that prorated contracts are needed. Yes these companies are providing a service so they should be paid for their services. They can price the cell phones conversely with the prorated ETF. This would allow the company to be able to make a profit on it even if someone quits their plain early, and this too would allows use to have new cell phones (toys) at a reasonable price. This makes both parties happy. The CEO's of these companies can still afford their house in the Hampton and to buy ivory back scratchers and we the consumers can still go out there and endanger our fellow man while we try to drive and text message our friends.
Actually Verizon now offers a prorated ETF. I think this is a big step in the customer satisfaction dept. Why should you be raped by a carrier for finding a better service. I do however think customers that get cancelled for not paying their bill should have a higher ETF than people that just cancel.
This is ridiculous. If you don't want to pay an ETF, then DON'T break a contract. If you're so unhappy with service that you want to leave, then it's in your best interest to pay the ETF because overall it will save you money versus paying your monthly rate times however many months you have. I've never understood why people think they deserve to be let out of contracts early with no fee. That is the problem with most wireless customers, they want EVERYTHING for free. Free phones, free minutes all the time, free termination fees, free activation fees, free accessories, free chargers. So disgusting.
I think you completely missed my point. I have no problem with early term fees. Signing contracts make sense to both the company and the consumer. My question was: is it fair that the customers in both scenarios will get charged the same fee?
Maybe I didn't make it clear but what I was trying to get across is that the customer in Scenario 2 SHOULD be charged the full fee. There's nothing wrong with my service, I just want to get something else.
However, in Scenario 1, I'm getting screwed. I've been a loyal customer spending quite a bit of money for the past 18 months so obviously I'm not unhappy with the product. But Wireless Company X claims to have service in my new town but it really isn't there. At this point, I'm no longer getting the same level of service that I had been. In other words, Wireless Company x is not fulfilling their end of the bargain. Yet I'M the one who has to pay for it.
Evan:
Cingular does (still) have prorated ETFs in certain markets throughout the country. I happen to live in one.
i work customer care for a cirtain carrier and i get thousands of calls a week from customers. and i agree 100 percent with aalqadaffi when he says "That is the problem with most wireless customers, they want EVERYTHING for free... So disgusting." and you know who takes the brunt of this? those poor souls working the phones who don't make the policy, they just have to enforce it. i hear alot "i'm such a good customer... i make my payments on time every month... i've been with you for so long... this is my first month with you guys and i'm unsatisfied.." and not to mention the slander, insults and verbal abuse from these people. GET OVER IT! GET OVER YOURSELF!! self-righteous idiots. a contract is a contract. thats it. what makes you so special anyway? and if you don't want the contract, then you're not getting the better deal. and thats it, take it or leave it.
I work with a wireless carrier that will remain nameless.
For the 2 scenarios i have a few comments
Scenario #1
No Carrier Promises Great Coverage in all the areas they have coverage in. If any sales person , customer service rep says otherwise they are lying.
Wireless Service Coverage has many factors that may hinder "Perfect Coverage" Weather, Surrounding structures, Damaged Equipment Due To Weather or Vadalism, etc
Scenario #2
In NO Wireless Carrier's Contarct does it state that they will accommodate a customer if they want a new phone that they don't offer as a wireles carrier.
In both cases, the carrier can not control the situation 100%, no matter what the customer may believe.
Math Time :
Let's say your bill is 54 bucks a month after taxes.
You have 9 months left to your conract
That means you will be paying the carrier $486 untill the end of your conract.
Now .... $486 - $200= $286 you could save if you just paid the ETF and went to the carrier of YOUR CHOICE.
When you buy a car with financing from a bank, you won't be let out of that contract if the vehicle doesn't get the mileage you were quoted by the manufacturer right? The same Common Sense rule applies to Wireless Carriers
In regards to Wireless Carriers not providing the best possible service on purpose..... PLEASE...
No Good Service = No / Less Money for the Carrrier
Good Service = More Money for the Carrier
Next consumers will blame the landline wireless phone makers for the battery life or distance of usage on that phone and try and sue them for a new phone
Prorated ETF = a good thing.
The sole reason the ETF is there is to discount (or "subsidize") the cost of the phone. They are banking on you being with them for "x" months (going rate now is 24). This is also why phones are "locked" so you can't use another carrier's SIM card. They want to make sure they get their money if you switch carriers. In other words, they won't give you an unlock code until you pay the ETF (and any other un-paid balance). I recently switched from Cingular to T-Mobile (I was fed up with their lack of good customer service and higher prices for the same exact amount of minutes/messages/data). I had actually just renewed my contract (24 months!) about 3 months prior. However, I saved over $15/month with the switch. Sure, I had to pay $150 ETF, but that's about how much I saved for the phone, so that made it pretty much a wash compared to if I payed full-price, but the $300 *EXTRA* I would have paid Cingular is pure savings. I'm getting the same level of service with T-Mobile (actually, better - there was 1 tiny dead-zone I always dropped a call with Cingular, but T-Mobile works fine). I'm getting the same number of minutes and messages per month. I'm saving $15/month. I'm using the same physical phone with the features I want. I just had to wait until my bill was paid before they'd give me the ETF (I borrowed a friend's old T-Mobile phone to use my SIM card in the interim).
Now let's say the ETF is pro-rated.. it's actually a benefit to the providers! Consider this scenario:
1. Mr. Smith moves to a new area and is getting spotty service. He's had Provider Wireless for 6 months, and 18 months left on his contract at a $40/month rate plan. Let's say for round math that the ETF is $240. With a flat ETF, it's in his best interest to cancel ASAP, save the monthly service charges, and bail. With a pro-rated ETF, he'd pay $10 less in ETF every month, but pay the provider $40 more. In essence, the provider benefits $30/month. However, now there's a reason for Mr. Smith to stay with Provider Wireless and give them a chance to fix problems / improve coverage in his area since if things don't improve, the ETF is less every month. Not to mention the PR benefit, and "why-we're-better-than-Competition-Wireless" in the sales pitch at the mall.