Verizon To Double Wireless Early Termination Fee
In a move that could spark industry-wide change, Verizon is doubling its early termination fee--to $350--making it more expensive for customers to bailout on their two-year contracts with the carrier.
Under the new agreement, which will be used for new contracts beginning Nov. 15, someone terminating in month 23 of a 24-month agreement would still owe a $110 termination fee, according to a short item today in Boy Genius Report.
BGR quotes a Verizon document that explains the new fee:
"Beginning 11/15/09, customers purchasing an Advanced Device with a 1 or 2 year service agreement will be subject to an ETF of up to $350 if they disconnect service prior to completing the minimum term. The $350 ETF will decrease by $10 for each month of service completed."
It is not immediately clear what "advanced devices" Verizon is referring to, though the term sounds suspiciously Droid-y.
In Verizon's defense, the new fee seems aimed at people who purchase a new phone, cancel their service, pay the current $175 ETF, and resell the phone at a profit on eBay. While I can't blame them for attacking that abuse, actually charging someone $110 to leave a contract with just a month remaining is clearly over the top.
Hopefully, Verizon will collect the new fee on a selective basis to handle abuse situations.
(By the way, ETFs are just one of the sneaky ways wireless companies get money from their customers).