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AT&T increasing early termination fee to $325
- jqueryin 16y agoSounds to me like Google IO got them a little scared and they don't want customers dropping their plan for another carrier that has a better selection of Android phones.
- pkulak 16y agoWell, it's not for existing contracts. So, it's really having the opposite effect on me. I was strongly considering leaving AT&T for Sprint or T-Mobile and getting an Android phone before this: now it's become a near certainty unless the new iPhone just absolutely blows everything else out of the water.
- sandipc 16y agoif they changed the ETF on your existing contract, you would have a great reason to opt out of the contract early.
- bshep 16y agoExactly, usually cellphone contracts have a clause that allows you to terminate early with no fees if the terms are changed and you do not agree with them. I've actually done this before, I don't remember the carrier but they raised texting from $0.10 to $0.15 and I called them up and said that I wanted to terminate early since I did not agree to the change in terms. I didn't really use texting, but I wanted to go to a different carrier. My guess is this is why they are not changing current contracts as that would allow people to leave even faster.
- tptacek 16y agoYou seriously think AT&T can change their ETFs inside of a couple days? I don't think it's possible a company as big as AT&T could finish planning the meetings that it would take to plan contractual changes in that time period. Beware the tech-colored glasses. Most people don't care what Google does.
- smackfu 16y agoYeah! AT&T will screw over their customers all by themselves.
- blehn 16y agoOr they might be anticipating an iPhone release on Verizon, in which case about half their iPhone customers would jump ship, and would probably be happy to spend $175 to do so. Edit: the article says the change doesn't apply to existing contracts, so this theory probably doesn't make sense. Edit 2: Then again, maybe ATT will have a brief exclusive on the 4G iPhone, and they want to lock those new contracts in before the phone hits Verizon. Ok, I'm going with that.
- deleted 16y ago[deleted]
- noelchurchill 16y agoMaybe they're offering Apple even more cash up front for extending the exclusivity agreement, and they're ensuring they're going to earn that money back by raising the ETF.
- bradleyland 16y agoOr maybe someone at ATT realized that their ETF was almost half as much as Verizon's and adjusted it accordingly. Also, I think it would be fair to speculate that as your "average consumer" starts buying more smartphones, carriers will see more early terminations. Businesses are typically better able to pay their bills and are more apt to fulfill a multi-year agreement.
- donw 16y agoAnybody know if this applies to existing contracts? If so, I'll probably terminate mine tomorrow...
- andreyf 16y agoFrom the article: "If you are on existing AT&T contract this won't affect you until renewal time. If you’re considering an iPhone this must be a consideration before signing up with AT&T now."
- jrockway 16y agoThat's one way to solve their network capacity problems.
- tjarratt 16y agoI don't follow, how is increasing the cost to terminate your service going to solve the problem of there already being too many people on your network? At best this will keep the problem from getting worse, but not solve it in the least. At least until contracts start expiring...
- jrockway 16y agoIf this was Slashdot, I would post an ASCII art picture of a joke flying over a person's head. Since it's not, I won't.
- tjarratt 16y agoI'm just going to hope that this means Apple is releasing an iphone with Verizon, or Sprint. This is a really nasty way to fight customers going to Android phones.
- jsz0 16y agoMaybe AT&T noticed that Verizon got away with a dramatic ETF increase earlier this year and figured why not? Who's gonna stop us? As the article mentions it's still $25 cheaper than Verizon's ETF. Previously it was $175 cheaper. I can't think of any good reason AT&T would want to undercut Verizon on ETF. I suspect this has more to do with the economy than the day-to-day dynamics of the SmartPhone market. Both AT&T and Verizon are probably seeing a lot of customers not fulfilling their 2 year contracts. The FCC (or congress if needed) really need to examine this situation. I understand the need for the ETF in the context of a 2 year contract a customer signs but I'm deeply opposed to the lack of transparency on the real value of hardware subsidies and the way the cellular industry punishes people with lack of choice if you don't want to sign a contract. Why does an unsubsidized customer typically pay the same (or more) as a subsidized customer? That's just not fair.
- Retric 16y agoAlso IMO, the ETF should be reduced based on the time remaining in the contract. If you have been a customer for 18 months on a 2 year contract they should have recovered 75% of their phone subsidy. Yet they still charge more than that.
- wmf 16y agoAFAIK all ETFs are now prorated thanks to some saber-rattling from Congress.
- silentOpen 16y agoThis is not true under the current ATT ETF rules. I got a 3GS in January and the rules I agreed to said the ETF dropped by $5/mo.
- Retric 16y agoThey now reduce it by 10$ per month, but still if you compare the discount to the total they still keep 95$ if you break it a month early. (325 - 10 * 23 = 95$)
- cwilson 16y agoNormally when cell carriers make a big change like this (see text message rate hikes in the past for an example) you are actually able to leave your contract free of charge, which is ironic in this specific case. Anyone know if this applies? If so, bye-bye AT&T when Verizon announces iPhone support (which is probably one of the reasons they are doing this in the first place)!
- Gimpson 16y agoThis change only applies to new contracts signed after the change goes into effect.
- Gimpson 16y agoAny chance that this increased ETF might be a sign they'll offer larger subsidies when the new iPhones are released? With several very nice looking Android alternatives out I wonder if AT&T wants the new iPhones to be priced much more aggressively.
- wmf 16y agoThe low end iPhone is $99; if they increase the subsidy by $150 they'd be paying you $50. OTOH if the cost of the iPhone 4 increases and they want to offer it for "zero down" then the new ETF makes sense.
- lurkinggrue 16y agoI guess they are getting ready for a non At&T iPhone.
- callmeed 16y agoBTW, you can avoid the ETF by simply "moving" to a region that only offers "partner coverage" or none at all ... you may have to give proof but that's fairly easy to do. I don't normally condone hacking out of a contract like this, but AT&T is probably my least favorite big company on the planet. When we moved our company to Oregon, I actually had my account suspended because of "excessive use of partner coverage" ... despite the fact my wife and our staff all had iPhones but were never suspended. AT&T offered to let me out of my contract (despite me pleading). So, I unlocked my iPhone and put it on T-Mobile. I'll never give them another dime.
- 100k 16y agoWhat kind of proof do they need that you moved?
- callmeed 16y agoI believe you fax them a lease/rental agreement or a utility bill that shows an out-of-coverage address. I think I'll make a web app that generates a fake one for people that want to get out of their AT&T contract.
- smokey_the_bear 16y agoI moved somewhere where I get 0 bars on either of my AT&T phones anywhere within a half mile of my house. I called them, but they claimed that their map showed that I had coverage, so I couldn't get out of the contract. They also said they would be adding another tower soon. A year later I got an email that they'd added a tower, but the service quality did not improve.
- davidmurphy 16y agoPlease don't. Lying is wrong. AT&T's charges may be a lot, but two wrongs don't make a write. The ends don't justify the means. I'd say this is "cracking" out of a contract, not "hacking."