Cell Phone Relief

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If you watch TV or listen to the radio, you’ve probably heard your fair share cell phone advertisements, which are ubiquitous. What I’ve always found interesting about them is how the coyly squeeze in all that legal jargon at the end of the commercial, either by displaying it in illegible fine print or by a quickly worded addendum that the average human could never comprehend, or for that matter, would even make the slightest effort to try to understand.

Well, it just so happens that part of that message relates to what are known as early termination fees. These fees, as everyone who has a cell phone is well aware of, are a penalty that the service providers charge if you back out of, or sometimes even simply change, your original agreement.

The reasons for why you might want to do this could be as simple as the phone being too expensive or the realization that maybe you didn’t actually need one in the first place. Whatever the conclusion, once you lock into a phone plan, you’re in it for the duration of the agreement, which usually ranges anywhere from one to three years. If you do want to change, the penalties are steep, often running into the hundreds of dollars.

The cell phone companies claim the fees are necessary because they help subsidize the cost of the cell phones, while consumers argue that the fees are unreasonable and are simply a ploy by the cell phone providers to lock customers into their service.

Well, now the government is trying to do something about it. Under an FCC proposal , lawmakers want to eliminate cancellation fees for up to 30 days after a customer signs a contract or ten days after they receive their first bill. They also want to cap fees and make them more representative of the costs incurred by the phone company while also prorating the penalties over the course of the contract.

Too good to be true? Well, of course there’s a reason behind it, and as hard as it may be to believe, it is not entirely altruistic. It should be mentioned that this proposal was submitted to the FCC by the phone companies, which pretty much says all that need be said.

It turns out that the cell phone companies are currently embroiled in a series of class action lawsuits by angry customers who are trying to recoup billions of dollars of late fees in the state courts. If the FCC approves this bill, it would exempt the phone companies not only from these lawsuits, but also from any further state regulation of these charges. As it stands today, federal law prohibits the states from overseeing wireless rates but gives them some authority over contractual terms and conditions.

Regardless of the outcome, people with cell phones should do their homework and choose a plan responsibly. And remember to take some time to sort through the legal jargon that is sequestered in the fine print of your contract. It could spare you a lot of pain and suffering, not to mention expense, in the future.