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)
More on Retail
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
Comment | Refresh
From CA, 10/04/2009
Is there a current class action currently in California? I was with Helio that was bought by Virgin mobile. Not only have i suffered with terrible customer service, but the phones are terrible, and they just recently discontinued downloadable music. First i didn't sign a contract with Virgin, and my contract offered music down loads. It is just criminal that cell phone companies do not have to worry about people leaving due to their poor customer service. their customer service can get worse and worse and with the contract you have no say so. No contracts would insure that us as customers would be assured the best customer service as paying customer, or we will take our business elsewhere. Thanks for your time.
From rocky mount, NC, 08/26/2009
the congress should kill the concept that cellphone, satellite and cable providers should be able to force its customers into so-called 'term contracts.' consumers aren't public corporations. why are we being treated as if we were? under no circumstances should these monopolistic devices be allowed. this is as close to sharecropping as the average consumer has been since the 1920s. how can these businesses, and the legislators and the pro-business supreme court allow ANY company to guarantee itself (and/or the industry) a non-competitive customer base when the scientific discoveries were PAID FOR BY TAX DOLLARS? what a loophole: my income tax dollars go to corporations and universities in support of military and/or other research, then the government sells production rights to corporations AND allows those corporations to gouge us. is that what the nation's concept 'freedom' is?
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?
Post a Comment: Please be civil, brief and relevant.
Email addresses are never displayed, but they are required to confirm your comments. All comments are moderated. Marketplace reserves the right to edit any comments on this site and to read them on the air if they are extra-interesting. Please read the Comment Guidelines before posting.
You must be 13 or over to submit information to American Public Media. The information entered into this form will not be used to send unsolicited email and will not be sold to a third party. For more information see Terms and Conditions and Privacy Policy.