Following the previous FCC inquiry, AT&T, Sprint, T-Mobile and Verizon Wireless along with Google have once again responded to the FCC’s ETF inquiry by stating their defense of early termination fees.
All four carriers and Google filed their respective official responses on Feb. 23, stating that customers are already well informed about ETFs before committing to wireless contracts and realize that customers have plenty of alternatives, taking into account the rise and range of pre-paid/flat-rate providers also serving the marketplace.
The carriers also stated that the industry is highly competitive and state that ETFs are needed to recover costs that go towards customer acquisition and equipment subsidies.
Verizon stated that it plans to clearly put ETFs on device cost labels in the future and also affirmed to the FCC that is has reduced the number of handsets on its “advanced devices” list following the previous FCC inquiry. Under Verizon’s “advanced devices” list, those devices are sold with a $350 early termination fee instead of the standard $175 fee.
For its part, Google defended the equipment recovery fee it is charging Nexus One customers who end their T-Mobile contracts early because it states that T-Mobile pays the company a commission for each customer T-Mobile acquires through Google, much like any other third-party dealer.
Google then stated that it passes that commission to the customer in the form of a device subsidy, which Google has to repay to T-Mobile should a customer cancel within 120 days in the form of the equipment recovery fee. Google also made terse statements to the FCC regarding the company being grouped with the wireless carriers and took care to emphasize to the FCC that the recent equipment recovery fee reduction had been planned prior to the latest inquiry.
T-Mobile stated to the FCC that its single $200 ETF is the best solution for the carrier and emphasizes that its customers are able to avoid the fee by signing up under an Even More Plus service plan.
For its part, Sprint has stated to the FCC that it “continues to evaluate the market” with regard to a multiple ETF system.
All of the carriers involved also stated that customers have a minimum of 14 days to test products and service at the beginning of their agreement before the ETF goes into effect.