| ETF I don't have a problem with ETFs. Most customers doesn't want to pay the retail price for a new phone or can't afford the retail price of a phone. In exchange for getting a free phone or a phone at a discounted price, they agree to a two-year contract (which is typical in the wireless industry. One-year contracts are an option but most people can't afford the price of a phone that has a one-year contract). They also agree to pay an ETF if they cancel the contract before it ends. What is so hard to understand about that. Also, when a carrier gives a customer a free phone, do you think the manufacturer gave the phone free to the wireless carrier? The reason contracts are required is that the costs of the phones are subsidized by the carrier.
For all the people whining about the ETF, no one forces anyone to sign the contract. It isn't as if the salesperson forced them to take a contract at gunpoint.
With the pro-business Supreme Court we have now, I hope at&t files an injunction in US District Court of Washington, DC against any meritless lawsuit regarding early termination fees. Hopefully this will go all the way to Supreme Court who will rule that based upon contract law and precedents, ETF(s) are valid. |
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 a333A hot cup of integrals please
join:2007-06-12
Rego Park, NY
 ·Cingular Wireless
1 edit | Sure, ETF's are valid, but ONLY when they're prorated. When a carrier is making at LEAST $40/month off of even the most basic subscriber, its hard to justify a constant ETF that doesn't get reduced along the length of the contract. Think of it... If Cindy consumer cancels after 31 days of service, while Joe cancels 15 days before his 2 yr contract's up, how can they BOTH pay the same ETF? It just doesn't make sense...
As a side note, prepaid services from many carriers, GoPhone for instance, offer phones that're pretty cheap, despite the lack of contract, so the point about subsidizing the price w/contracts is sorta moot here...
As proof, compare the two pages below (Both are descriptions of the same phone, a Nokia 2610):
Postpaid:
»www.wireless.att.com/cell-phone-···ku980158
(IE it's $149 w/o contract)
Prepaid (GoPhone):
»www.wireless.att.com/cell-phone-···ku980143
(IE it's only $49 even WITHOUT contract)
I wonder why........ |
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EPS
join:2008-02-13
Hingham, MA | Prepaid phones are "subsidized" as well, since they're locked to a particular network- wasn't at&t or TracFone or someone suing people who were unlocking prepaid phones awhile back? |
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| It was Tracfone. They were suing some people that were buying mass amounts of phones, unlocking them and then reselling the phones overseas. |
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a333A hot cup of integrals please
join:2007-06-12
Rego Park, NY Reviews:
·Cingular Wireless
1 edit | Well, that was for selling them innit? And, actually, even if you buy the phone outright on postpaid, you still get a 'locked' device. Not much of a difference, really.
BTW: ALL cell companies know that unlocking a phone is not much of a chore for the tech-savvy. Honestly, all the effort they put into branding a phone is really moot. All you need is either a software flash or even simpler, a PUK/SIM unlock. Heck, walk into chinatown and pay 30 bux, and they'll be more than glad to assist.... |
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KearnstdElf WizardPremium
join:2002-01-22
Mullica Hill, NJ | reply to screenoscar
ETFs should only apply to the first contract. when you renew you are no longer paying back that free phone, which you paid back several times over during the first contract.
a diminishing ETF is also a good idea, the longer you are in the less it is. so if you have a week left and cancel it should be zero.
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[65 Arcanist]Filan(High Elf) Zone: Broadband Reports |
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 RARPSL
join:1999-12-08
Suffern, NY | reply to a333
said by a333:Sure, ETF's are valid, but ONLY when they're prorated. When a carrier is making at LEAST $40/month off of even the most basic subscriber, its hard to justify a constant ETF that doesn't get reduced along the length of the contract. Think of it... If Cindy consumer cancels after 31 days of service, while Joe cancels 15 days before his 2 yr contract's up, how can they BOTH pay the same ETF? I agree with you. The prorating should be TRUE pro-rating not the so called "pro-rating" that the cell companies are trying to push as a replacement for the flat-rate ETF. On a 2 year contract the EFT should be reduced by 1/24 of the original EFT each month - IOW: Joe should only get charged 1/24 of the original EFT (or should be smart enough to just let the contract lapse and pay the last month's bill) while Cindy should be charged only 23/24 of the EFT (if the 31 day cancellation option is not offered). |
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RARPSL
join:1999-12-08
Suffern, NY | reply to screenoscar
said by screenoscar :
I don't have a problem with ETFs. Most customers doesn't want to pay the retail price for a new phone or can't afford the retail price of a phone. In exchange for getting a free phone or a phone at a discounted price, they agree to a two-year contract (which is typical in the wireless industry. One-year contracts are an option but most people can't afford the price of a phone that has a one-year contract). They also agree to pay an ETF if they cancel the contract before it ends. What is so hard to understand about that. Also, when a carrier gives a customer a free phone, do you think the manufacturer gave the phone free to the wireless carrier? The reason contracts are required is that the costs of the phones are subsidized by the carrier.
For all the people whining about the ETF, no one forces anyone to sign the contract. It isn't as if the salesperson forced them to take a contract at gunpoint.
With the pro-business Supreme Court we have now, I hope at&t files an injunction in US District Court of Washington, DC against any meritless lawsuit regarding early termination fees. Hopefully this will go all the way to Supreme Court who will rule that based upon contract law and precedents, ETF(s) are valid.
EFT's are valid but ONLY if they are based on the remaining term of the contract. The CellCo says that the phone subsidy is fully paid in 2 years. OK but after 1 year it has been 50% paid back so the EFT should only be 50% of the original amount (IOW: It should decline 1/24 each month).
As an alternative, an amortized schedule could apply by treating it as a 24 payment loan with the original EFT as the total payment amount (which includes the interest payment). This is a system where each month one month's interest on the remaining principle is removed and the remainder of the reduction pays off part of the principle. IOW: With an EFT of $240, this is a loan of some amount at some interest rate and the EFT owed is reduced by $10 a month but some of that goes towards the interest and the rest towards the principle so that after 1 year you owe more than $120 just like if you had pre-paid a loan with a total payment amount of $240.
A flat 1/24 reduction per month is simpler but so long as the contract DEFINES the EFT as a loan, the loan method can be used (but a loan prepayment table SHOULD/MUST be supplied). |
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 quetwoThat VoIP GuyPremium
join:2004-09-04
East Lansing, MI | reply to screenoscar
My biggest problem with ETF's is when I already own my own equipment, and every carrier will force you into a two-year agreement regardless if you take their free phone or not. And with that two year agreement, comes a hefty ETF. I'm not being subsidized. And there isn't a carrier in the mid-west that won't make you sign a contract to get their SIM card. |
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Reviews:
·Sprint Mobile Br..
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I can understand both sides of this... i paid $175x3 to Cingular to get out of their contracts... switched to sprint and bought the original phones for full price and don't have to worry about an etf cause they didn't give me anything... But on the other side the $525 was cheaper than 20 more months at $100 a month to keep crappy service that i didn't like... |
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a333A hot cup of integrals please
join:2007-06-12
Rego Park, NY Reviews:
·Cingular Wireless
| I suppose that's a good option, but IF the no-contract phones are truly unlocked. Or else, you still have to pay for new no-contract phones when you switch to a new carrier. Now, the better idea, in your case, would be to buy a dual band unlocked CDMA handset and use that with either Sprint/Verizon. OR to buy an all-out world phone unlocked for about $400 and then use with either Sprint/Verizon/AT&T/T-mobile.
However, for 3 phones, the price is just absurd... |
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just to let you know...through att if you have your own equipment than you don't have to sign a contract, att's policies state that if a customer has own equipment or pays full retail value that they are not subject to contract...store wont tell you that because they make commission off contracts |
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