Verizon Wireless must now answer to the Federal Communications Commission (FCC) regarding its recently increased early termination fees, as the FCC continues a crackdown on the wireless industry.
Last month, VZW increased smartphone ETFs from $175 up to $350, a move that angered wireless subscribers — and the federal government.
“It appears that if a customer cancels a two-year contract after 23 months, the customer would still owe an ETF of $120,” a letter to Verizon from the FCC notes. “Is this correct? If the ETF is meant to recoup the wholesale cost of the phone over the life of the contract, why does a $120 ETF apply?”
Furthermore, VZW must also answer other questions regarding its ETF fees, but it’s unknown when the wireless company will enter official communication with the FCC.
“What information about the higher ETF does Verizon Wireless provide to prospective customers, and when ? How do consumers know whether the increased ETF applies to the device and service plan they would like to purchase?”
The FCC gave wireless subscribers so much leeway that they began charging even more hidden fees against consumers, while also increasing prices and possibly working together to drive up text messaging prices.
In August, the FCC opened up an investigation into AT&T, Verizon, Sprint-Nextel and T-Mobile, as the FCC was critical of carrier exclusivity deals and SMS pricing.
I applaud the FCC for finally cracking down, but the federal government should have never let the companies get away with this in the first place. The costs of text messaging plans for consumers has skyrocketed — and even though an investigation has been launched — nothing has been done to resolve the issue.