Cell phone users fight contract fees
Dissatisfied customers in several states have filed class-action lawsuits against cell phone companies for contract cancellation fees. Jeff Tyler reports to protect themselves, the cell phone industry wants immunity from the FCC.
Cell phone in a Verizon store. (Roberto Schmidt/AFP/Getty Images)
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TEXT OF STORY
Scott Jagow: What's the most annoying thing about cell phone companies? It's probably gotta be those contracts and the penalties. Well, things might change on that. Jeff Tyler explains.
Jeff Tyler: Cell phone providers say it's only fair to charge customers up to $175 when they cancel their contracts early. Companies say the fees cover the costs of all those cut-rate phones.
That's not how Bob Williams with Consumers Union views the fees:
Bob Williams: These are used by the phone companies as a way to keep their customers locked up.
Dissatisfied customers have filed class-action lawsuits in several states. The industry wants the Federal Communications Commission to give it immunity.
Again, Bob Williams:
Williams: It would give them billions of dollars in protection. In California, Cingular, not so long ago, had to give people their early termination fees back under.
In return for legal protection, the phone companies would let customers drop cell phone service in the first month without penalty. After that, any cancellation fees would be prorated.
Williams says the industry isn't giving up much. Some companies, like Verizon, already offer these services.
I'm Jeff Tyler for Marketplace.
Comments
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From Orlando, FL, 11/22/2008
We have started researching Unfair Cellphone Cancellation Fees and with a new administration in Washington consumers may have a better chance of getting new rules for the cellphone companies to follow, Google: Cancel Unfair Cellphone communati steve lee
Cancel Unfair Cellphone Cancellation Fees
From hereford, AZ, 08/14/2008
what can be done to protect people against unfair cell phone contracts
From Martinsburg, WV, 07/16/2008
AT&T just took over my plan from Cell One. I have had it several years, just reupped the contract for 2 years about 6 months ago. I called to find out how much it would cost to cancel...they said $720!
From fair oaks, CA, 06/12/2008
Maybe we need a different approach. Lets get a measure on the ballot that no service provider (cell phone,sat,cable ect) can issue a time limit on services. so they raise there rates. They will either lower them or go out of business. we got along without cell phones and cable tv before. And maybe while we at it we should put on the ballet that if your going to show us commercials then you can`t charge us for tv. Make the advertisers pay for it.
From Asheville, NC, 05/22/2008
And is there a class action suit in progress in North Carolina?
From Maryville, TN, 05/22/2008
What legal rights do we have relative to the ATT/Verizon NSA illegal spying since 2001 on our Cell Phone calls, Emails, etc and do we have a legal right to discontinue our Cell Phone contracts with ATT or Verizon?
05/22/2008
Is there a class action suit going on in Tennessee?
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