Lawmaker disapproves of Verizon's ETF changes

Sen. Amy Klobuchar (D-Minn.) said she will likely introduce legislation to prohibit wireless companies from unfairly raising early termination fees (ETFs). That decision was coupled with a letter Klobuchar sent to Verizon Wireless CEO Lowell McAdam expressing her disapproval of Verizon's decision to double its early termination fee to $350 starting Nov. 15 for consumers who purchase so-called "advanced devices." 

"I remain concerned that ETFs--especially at these high prices--unfairly penalize consumers, bear little to no relationship to the cost of the handset device, and are anti-consumer and anti-competitive," she wrote in the letter. Verizon will pro-rate the new ETF at $10 per month. 

In her letter, Klobuchar noted that in the last Congress, she introduced the Cell Phone Consumer Empowerment Act, which she said "would encourage transparency, competition, and quality service in the wireless market." In an interview with the Washington Post, Klobuchar said she will likely introduce a bill that will require operators to pro-rate ETFs so that a subscriber who cancels a two-year contract after the first year will only pay half the ETF.    

Steven Zipperstein, Verizon Wireless' general counsel, said in a statement that consumers can choose to pay the full retail price for a phone and not sign a two-year contract. The "vast majority of our customers have chosen the contract model with subsidized handsets," he said. "This model has contributed to the widespread adoption of mobile devices across all segments of consumers."

For more:
- see this Washington Post article
- see this The Hill article
- see this Minneapolis Star Tribune article

Related Articles:
Droid Eris headlines Verizon's holiday handset blitz
Rumor Mill: Verizon to double ETF to $350 on 'advanced devices'
Verizon launches first Android phone, Motorola Droid

Article updated Nov. 10 to reflect Verizon's comment.

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