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An ETF is an Early Termination Fee, which you have to pay if you leave your contract early. It protects the carriers since they're subsidizing your phone.

• pyre 16y ago
  You say that it 'protects' them, but it was only recently (last year or two) that they decided to pro-rate those fees. So a month before my 2-year contract is up, my ETF would be the same as if I cancelled within the first month. This is bogus if the reasoning is so that the carriers can 'recoup the cost of the phone that they were subsidizing.' Even with the pro-rated ETFs now, IIRC they won't be insignificant at the 'month before the end of a 2-year contract' point even though the carrier has obviously made back most (if not all) of their sunk costs by then... ETFs are there because the mobile carriers like to bank your monthly fees as a constant revenue stream, and when people cancel early it screws up their numbers and projections, much in the same way that banks penalize you for closing out a CD early. Talk about how it's to 'protect the carriers from people that cancel early without covering the full cost of the phone' is just people buying in to the BS story that the US mobile industry's PR depts have been telling us for years.
  • gte910h 16y ago
    > decided to pro-rate those fees. They didn't decide. Non-prorated fees were found to be unenforceable. I'd call that forced.
    • pyre 16y ago
      That's even worse. I didn't know the root cause of the change, just that it had happened.
      • deleted 16y ago
        [deleted]