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Senator Targeting Verizon's New ETF Policy

Article Comments  100  

Nov 10, 2009, 2:23 PM   by Eric M. Zeman

Senator Amy Klobuchar from Minnesota has said that she plans to introduce new legislation to prevent wireless carriers from unfairly raising penalties on costumers who cancel their contracts early. Last week, Verizon Wireless confirmed its plans to raise Early Termination Fees from $175 to $350 for advanced devices starting on November 15. Klobuchar wrote to the FCC, "Verizon Wireless' decision shows us once again that the wireless industry cannot police itself and will not, on its own, make its practices more competitive and consumer-friendly. To that end, I urge the FCC to review the recent Verizon Wireless decision as well as the competitive and economic impact of ETFs on wireless consumers." Klobuchar also wrote to Verizon CEO Lowell McAdams, urging him to reconsider. She is prepared to file legislation that would block Verizon's planned ETF increase, though Klobuchar has failed in similar initiatives in the past. Sprint has publicly stated that it will not increase its ETF policy in the wake of Verizon's decision. Neither AT&T nor T-Mobile have made their stances clear.

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Nov 13, 2009, 10:44 AM

Dear Senator Klobuchar - Cell Phones don't grow on trees.

What an ignorant move by someone who clearly does not understand the wireless industry. An absurd waste of taxpayers money.

ETF's don't "unfairly" raise penalties. They prevent fraud and people taking advantage of carriers and retailers.

Without ETF's, a consumer could purchase a Motorola Droid for $199, cancel it, pay a term fee of $175 (pre increase; have a total of $375 in the phone and turn around and sell it on Ebay for over $500. The consumer could win/cheat the system...however, the carrier and retailer would lose as the device itself COSTS more than $500.

What doesn't she understand about "Subsidization??" If a consumer doesn't want to be subject to a ETF or 2-year agreement; they have the option to pay a "fair" retail ...

Nov 12, 2009, 10:47 AM

Yeah, Yeah, Yeah...Blah, Blah, Blah...............

She's just upset because now she can't get her Storm for $49, pay one month of service ($70), Activation Fee ($35) then ETF to cancel on day 31 ($170), which equals a total of $325, instead of paying the full retail price otherwise of $499. That is why they're increasing the ETF's people. Not to be greedy, they're doing it to cover their a$$.

I'm willing to bet at the end of the day and at the end of each quarter, VZW will still net more add's of new lines over any other carrier nationwide. Besides, most customers understand the ETF purpose. They're getting a device that retails for more than someone's average rent or mortgage payment in my area for a measley $50, or in some cases Free.

To me it just seems simple....You don't lik...

Nov 12, 2009, 12:35 AM

What part of contract don't people understand`

This is what I don't get. You agree to a contract to get a phone at a lower price.

It is a contract. Let's look at the definition of a contract.

From Websters: 1 a : a binding agreement between two or more persons or parties; especially : one legally enforceable

From Blacks Law dicionary: CONTRACT - A contract is an agreement between two or more persons, including a corporation, that creates an obligation to do or not to do a particular thing. As defined in Restatement, Second, Contracts, Section 3: "A contract is a promise or a set of promises for the breach of which the law gives a remedy, or the performance of which the law in some way recognizes as a duty." From Black's Law Dictionary, 1990 edition.

When you have time ...

Nov 10, 2009, 5:05 PM

She must not like her Droid.....

I think ETF's should have provisions for reasonably unusual or unfortunate circumstances. Just don't patronize them if you don't like their policies.
the problem with that is then, everyone who wants to get out of it just invokes said unfortunate circumstances.

"oh yea, um.. I need to get out of my contract cause my dog died..I dont have to pay the ETF because of that right?"

Yes, it makes i...

Nov 10, 2009, 3:09 PM

Not sure I get this ...

While I'm all for some oversight of some of the nonsense that wireless providers like to pull out of their butts to rack up more charges on their customers, I have to say I don't really see the problem with an increased ETF on a higher priced phone. What they *should* do, in my opinion (for what's its worth), is prorate the ETF based on the markdown provided on the phone for going under contract.

So, for the simplicity of math here, if I buy a phone that without a contract costs $560 and I buy it for $200 with a 2yr contract, I'm getting a $360 markdown. Why not just pro-rate the markdown as an ETF at $15 a month? So if I jump out of my contract after one month, I owe $345. If I jump out after a year, then I owe $180.

Maybe the ...
i believe this already being done

Nov 10, 2009, 4:35 PM

And if they win...

Phones will only be discounted a maximum of $200 from the SRP.

Senators should take business courses before they try legislating what is "fair."
you know what's funny is a lot of them used to be exectives before they became politicians...it's that washington brain washing they get once they are sworn in. the government has their greedy little fingers in everything. DOES THIS SENATOR REALIZE WH...

Nov 10, 2009, 2:42 PM


This seems a little ridiculous.Whether or not I agree with 350 dollars. They are making a business decision to prevent equipment scams based on subsidized pricing for handsets that retail at 800 plus dollars on average.
Is she one of those customers that everytime they get mad at their carrier they want a free phone or free service and if not "I'm gonna cancel" and "no I'm not paying an ETF, I didn't sign a contract" "oh yeah I got a different phone but its not an upgrade, it was a free phone"
Why not spend her energy focusing on MSRP for handsets, which would lower subsidies for the Carrier.
Oh is it because the government can f*** with carriers, but not with manufacturers??

signed I'm getting a Droid and I don't care what the ETF...
True that, I think if they are going to say anything about wireless serveices make a change to either set a standard price for messaging or plan price since they continue to grow without any change or bumps in the road. Furthermore just start a Govern...
I'm sure she doesn't even deal with her cell phone bill or provider. The state and tax payers take care of everything for her.

Nov 10, 2009, 6:34 PM

it's all about choice.

people! if you dont want a contract buy the phone out right! you have that choice! you also have the choice to get the subsidy and sign a contract. if you're a constant switcher than you should probably buy the device out right.

it's common sense.
And since when have politicians had anything to do with common sense?

Nov 10, 2009, 2:55 PM

Not suprised

How would verizon not think that congress would get involved? It was under the previous threat of intervention that the ETF's were prorated. Verizon should compare the number of sales they gain by offering BOGOs on high end devices to the number they loose to people afraid of "what if" and the $350 term fees.
What makes you think they haven't?

Nov 10, 2009, 3:17 PM

Answer to end all of this

Just as I have thought for years. If people are going to complain and government is going to get involved...just eliminate contracts, and have customers pay full retail for phones...see where that goes...I GUARANTEE within 1 year that people will be begging for contracts, subsidies, and ETF's again....all I'm saying is....pick your poison people...
Just like Sprint has. They're not raising ETF's, they're laying off 2000 people.
they should of done that since day 1.....look at the European and asian countries, they do that and they have better phones than us. the iphone is crappy tech to them. if they really did that i think we would be on 6g by now because they could of used...
"I GUARANTEE within 1 year that people will be begging for contracts, subsidies, and ETF's again....all I'm saying is"

I understand the contracts and I agree with having them but pro-rated is teh best. Reason why

As the Value of the Phone goes...
Carriers should provide SERVICE and not phones. That is what the manufacturer is for, i.e Nokia, Motorola... When the cable company provides my tv services they dont sell me a tv though.
If I buy my phone out right, then shouldnt I have a lower cell payment as compared to someone who didnt? we still pay the same monthly payment for cell service wether you buy it out right or sign a contract.
So of course if the phone is no longer subsidized and I stay with Verizon for 2 years, then I get a rebate? Or maybe they offer lower rates to make up the difference? Not likely. 🤣
Absolutely! The only reason wireless carriers have contracts and early termination fees at all is because they subsidize handset cost which is the dumbest thing. ExxonMobile does not subsidize the cost of a Malibu to get consumers to buy gasoline ex...

Nov 11, 2009, 10:35 AM

Senator Amy Klobuchar's Contact Infomation

You can write her tat the following addresses.

Washington, DC

302 Hart Senate Office Building
Washington, DC 20510
phone: 202-224-3244
fax: 202-228-2186

Metro Office

1200 Washington Avenue South, Suite 250
Minneapolis, MN 55415
Main Line: 612-727-5220
Main Fax: 612-727-5223
Toll Free: 1-888-224-9043

Southern Office

1134 7th Street NW
Rochester, MN 55901
Main Line: 507-288-5321
Fax: 507-288-2922

Northwestern & Central Office

121 4th Street South
Moorhead, MN 56560
Main Line: 218-287-2219
Fax: 218-287-2930

Northeastern Office

Olcott Plaza, Suite 105
820 9th Street North
Virginia, MN 55792
Main Line: 218-741-9690
Fax: 218-741-3692

Toll Free Number:


Or email her from her webs...

Nov 11, 2009, 12:44 AM

My tax dollars go to pay for this?


Nov 10, 2009, 8:45 PM


"Senator Amy Klobuchar from Minnesota has said that she plans to introduce new legislation to prevent wireless carriers from unfairly raising penalties on 'costumers' who cancel their contracts early."

What's a costumer???? Someone that dresses kids up in costumes?? Author, PLEASE LEARN HOW TO SPELL!!!!

Nov 10, 2009, 3:11 PM

Women's suffrage

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