Verizon Wireless agreed last week to pay $21 million to settle a class action lawsuit alleging that it unlawfully charged consumers early termination fees for ending cell phone contracts before they expired. According to the report at Cellular-News.com, a Verizon Wireless spokesman called the lawsuit a "distraction" and said "this was an easy way to resolve it." But with similar lawsuits pending against Sprint, and the Federal Communications Commission (FCC) waiting in the wings to enact rules which permit such fees under a national framework, the question of whether these fees will continue has not yet been resolved.
Certainly a wireless provider that sells a phone at a discount to a customer is entitled to recoup the difference between what it paid for the phone and the amount that it charged the customer for the phone. The problem lies with charges to customers that have already paid enough during the term of their contract to fairly compensate the wireless provider for the phone, and to others that did not purchase the phone from the wireless provider.
It makes no sense at all, for example, to charge a customer early termination fees when that customer bought his or her phone on eBay, and simply signed up with the wireless provider for cell phone service. Likewise, a customer that has had their phone for 5 years should not pay an early termination fee. And yet, these customers are charged the same amount as a customer that bought a phone from the wireless provider and then terminated the contract a month later. It is not right, it is not fair, and this practice should be stopped. With any luck, Verizon Wireless, Sprint, and every other wireless provider will get the hint: start treating customers fairly or pay the consequences.
