Friday, June 6, 2008

Many see the [early termination] fees as an unfair penalty that makes it difficult to switch providers.

Scrutiny of Phone Fees May Broaden to TV, Internet | FCC Hearing to Target Cancellation Charges | By Cecilia Kang | Washington Post Staff Writer | Saturday, May 31, 2008; Page D01

A planned federal hearing on penalties that cellphone users pay for canceling their contracts early may be expanded to include a discussion on similar fees for ending cable and Internet services ahead of schedule, the chairman of the Federal Communications Commission said in an interview yesterday.
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The attention to cancellation fees illustrates a growing frustration among consumers, who spend an average of $200 each month for wireless phone, cable and Internet services. Many see the fees as an unfair penalty that makes it difficult to switch providers. Early-termination fees were among the five most common complaints by cellphone users, who filed 20,300 service-related complaints in 2007, according to the FCC.

Many wireless companies are fighting lawsuits seeking hundreds of millions of dollars in fees that have been collected from former subscribers. Cable, DSL Internet and paid television services such as Verizon's FiOS also have had an increase in complaints from consumers about early-termination fees.
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Now wireless carriers are pushing a policy that, if adopted, could provide relief from the fines, which typically range from $150 to $200. Verizon and AT&T have recently softened their policies, with prorated plans that would knock down the penalty by $5 for each month of service. T-Mobile intends to introduce a similar plan next month; ...

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