Say Hello To At&T'S New Early Termination Fees

[Maestro23]

http://gear.ign.com/articles/109/1092082p1.html

Next to dropped calls and slow data transfer speeds, the worst part of wireless services are the exorbitant early termination fees (ETF) imposed by carriers, which penalize customers who end their contract prior to its expiration date. Depending on which carrier you use, these fees can run as much as $350, but up until now, AT&T has remained on the lower end of the spectrum, with an ETF of only $175. Today, however, AT&T took a turn for the dark(er) side of contract wireless service by increasing their termination penalties to a whopping $325.

Starting June 1, AT&T will be changing the terms of their ETF policy for smartphone and netbook service plans to the jaw-dropping new price, which will be offset by cost reductions based on the number of months of service completed prior to termination. In other words, if you are halfway through a two year service agreement the original termination fee will be reduced by $10 each month, cutting the total cost to $205.

Fortunately, the cost increase applies only to new customers, and any pre-existing subscribers will see no change in their termination fee. Subscribers with basic phone plans, on the other hand, have seen a reduction to their early termination fees, going from $175 to $150, with a prorated reduction of $4 for every month already served.

Many are calling the increase a reaction to a similar increase made by Verizon made in November of last year, but AT&T may also be posturing themselves for the end of their exclusive rights to iPhone service, which was rumored to conclude this year. If new carriers are announced either at Worldwide Developers Conference or sometime later this year, AT&T could lose many new subscribers to competing networks, and subsequently stand to gain added revenue from the increased fees.

For all the latest on AT&T and the iPhone, stay tuned to IGN.com.

[Yankee4Life]

I don't have At&T but this will seal it for me to never even consider being a customer of theirs.

[JoeRudi26]

Fortunately, the cost increase applies only to new customers

Wow, now that's how you drum up new business. :facepalm:

[MarkB]

Wow, $325? That's crazy. I've been listening to Off The Hook for a few years and they often used to cover phone related issues (in fact, I'd be surprised if this story wasn't menationed in next week's show), so I'm used to hearing the horror stories of non-service from Verizon, T-Mobile, Sprint and AT&T, but that sort of money for contract termination will just make more users want to use pay as you go phones. That's insane.