Verizon shocked users earlier this year when they announced that they would be doubling their early contract termination fee from $175.00 to a monstrous $350.00 for “advanced devices.” This was shocking to the FCC as well, which demanded that Verizon explain itself.
Verizon did so last Friday, issuing a 77-page document which detailed all of the reasons why they should be allowed to keep their larger ETF. Chief amongst those reasons, Verizon alleged that it costs more to obtain “advanced device” models, and that those models also strain the network more than other phones. In effect, Verizon claims that they have to spend more to obtain and support smartphones, and therefore lose more when these customers cancel their plans. Verizon also reminded the FCC that the bureau has previously endorsed early termination fees.
Unfortunately for Verizon, though, the FCC announced yesterday (PDF) that they found the carrier’s response “unsatisfying, and in some cases, troubling.” FCC Commissioner Mignon Clyburn went on to say that, considering Verizon’s high plan rates, it was unreasonable of them to expect customers to pay so much money to break their contracts. Clyburn further questioned Verizon’s assertion that customers aren’t being inadvertently charged when they use functions that aren’t supported by their plans.
The Commissioner concluded her statements by saying that she is looking forward to “exploring this issue in greater depth” with her colleagues in the New Year, suggesting that this is an issue that is far from over.
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