U.S. Government exempt from Early Termination Fees
It seems there are some benefits to working for the man. In 2004, a company then known simply as Nextel began investigating whether they could assess ETF’s to government contracts that ended before their pre-determined termination date. At the time, Nextel’s VP of marketing issued a public statement hypothesizing that “the government will never, never accept such penalty amounts”. Uh, ok. After a lengthy process, Sprint-Nextel has now, according to the Associated Press, “ultimately decided against charging the fees to the government even though it charges the same fees to consumers and businesses.” Great. No justification for the selective treatment was given, but perhaps Sprint executives now enjoy diplomatic immunity in the Baltic region. No word on whether other telecom companies harbor similarly shady policies, but we wouldn’t be surprised if this was the case across the board.
nobogy should pay etf
People shouldn’t be bound in contracts, or restricted to one carrier for their handsets either. Don’t ya just love capitalism…4or the love of money…
It sure would be great if a site like BG would start the process for developing a classaction or discrimination lawsuit against the carriers for ETFs. I can’t wait for the day when I can choose any phone I want at Best Buy, Amazon or Target. I believe the real cost of phones is probably less than the carriers and manufacturers let on. I believe they are in collusion to keep their phone profits high.
I’ll have to pay $200 to Sprint next month so the ball-and-chain can get the 3G iPhone at AT&T.
Meh, it’s my own fault for not stepping in and getting involved. Her friends all told her Sprint was best in NYC.
Don’t you believe it.
1) I bet the government pays full price for their handsets. Perhaps even more.
2) I bet the government pays more for the data plans. Not that the iPhone and Blackberry on AT&T have a rate for “consumers” and a rate for “enterprise users”. Which do you suppose the government is paying?
3) Imagine how much turnover there is in the government, and how often they would cancel the plans before the contract date?
4) The government probably has one massive contract, for which they pay a huge lump sum to get the services they require. They most likely don’t actually pay to open and close account on the fly. It costs the government X million dollars per year and Sprint/AT&T gives them what they need up to a certain limit. And if you do the math out, this is probably way more than it would cost for John Q. Public to do the same thing. There is support, security, extra software, etc. included in this. And by the way, when Sprint said it was going to shut down the IDEN (Nextel) network, the government stepped up and said “We want to keep it alive.”
The government typically pays much more than the rest of the world for things. So I think this argument about them not paying the ETF is probably fairly moot.
While I don’t think ETF’s should exist, I agree with them not being charged to the government (even though charged to individuals and businesses) only because it affects everyone if the government pays an ETF x 1,000’s of lines (tax money). If I pay an ETF (my pocket only) or a business does (they can probably write it off on taxes who knows, but they can adjust prices on services they offer) no major affect
Wait… the government uses Sprint?!!!!
Wow. And we (the people) lose again. I pay taxes, can I terminate for free?
I’m US gov–so I’m fine with it! Yipppeee! Suckers!
i understand the etf is (in theory) a way for the carrier to recoup a portion of the money they lose when someone switches carriers. But in todays economy this is irrelevant. for someone like me who pays 50 for voice, 30 for data, 20 for messaging and 10 for early nights… finding a company that will do better than that… paying the etf is kind of a bargin.
the etf should just be the amount of the discount given on the device and should be lowered monthly based on the depreciation of said device.
at&ts new plan IMO is more legit than others.
ATT voids the ETF for a few major companies that they do business with.
Most of those accounts who have the ETF waived are on giant pooled plans where the first line will cost anywhere from 600-1000 for the line and will give say 20,000 anytime minutes and each additional line is 10 dollar flat fee. They void the ETF because just like another visitor claimed there is a lot of turnover as well as new hires so in the end it equals out. Not only that but most businesses get a discount based on the ammount there bill is every month it’s not always a set percentage so if they don’t meet a certain level that say for example 20% my drop to 8%.
Not to mention that busuiness/government does pay for equipment and services that do cost more.
They don’t normally get the type of discount a normal customer would get who was eligible for an upgrade or a new customer and for example the iphone data which is the same exact thing everyone has on their account with the current iphone 2G is paying $20 a month were as they pay $45 and that was before any enterprise email setup.
The ammount of the discount and then discounted as the contract progresses.
That idea does really make sense, but I think that would actually be worse for some.
All those customers who got their free upgrade where the phone is listed at 249.99 or more at no commitment would be basically putting there self out there so to speak when most carriers just offer a set fee.
Plus it’s less confusing as it stands now. It’s 175 standard for every customer with it dropping by 5 every month.
No need to explain to a customer why their one line with a Nokia 2610 will cost $195 to cancel and their line with the blackberry only $150 when they bought both phones at the same time. (Just as an example)
Well you can always Screw the customers & sprint nextel has a known habit of doing just that, but you might wanna think twice before doing it to the government
I love the “W” jackets these douches are wearing.
Oh and any large customer (big spender) is going to get a ton of flexibility in their pricing and ETFs.
yea, if you pay around 200 a month to att and you bitch and moan to customer service you can pretty much get whatever u want.
another easy thing to do is if you’ve been with one provider for some 8+ years, mere mention “i’ve been a customer here for x years and this is how i get treated?”
my fam has been with att (cingular, cellone etc) for almost 20 years now and it’s super easy to get att to kiss your ass. i got the 8525 for 50 bucks when it was new, all i said was well verizon has a similar smartphone and they’re offering it to me for 50. att complied right away! we never paid an etf when my sister left for t-mobile (worst choice of her life) and we never renewed her contract when she joined back up to get the razr.
try and stay with a company for a while, it pays after a while.
And this article is supposed to be a shocker? What’s so surprising? It’s the government.
don’t forget att has a nasty habit of screwing over cusomers too
At Swissfreak,
Having worked for many of the wireless carriers in my career, this has always been the case. Government has never paid for Early Termination Fees. Neither do members in active duty for the Armed Forces, Navy, Marines, etc.
As far as pricing, no they also do not pay full retail for the handsets. The higher up in the government you are, the less you pay, but it’s never full retail. They get better pricing than customers.
Sprint, VZW and AT&T don’t charge the gov’t ETFs. I’m not sure about TMO since I’ve never dealt w/them in the government capacity. It’s not that the gov’t is special, they’re just a large company. If you approached a carrier and said “Hey, my company wants to purchase 6000 phones, 30k minutes/month and 4500 data plans from you”, they’d probably agree to waive ETF for you as well.
@swissfreek The gov’t isn’t one big entity, but lots of ’smaller’ ones. House, Senate, Whitehouse, NSA, DoD, DHS, etc. Each of these groups maintain their own contracts with carriers. Also the gov’t isn’t paying full-price for a phone. Size matters.
ETF’s are the dumbest things any idiot has thought up of since Palm Treos.
I just don’t pay it at all. I ignore them. I haven’t really been affected by it. Not even to get a new phone. My credit went down minimally. And to get a loan they don’t care if you haven’t paid a cell phone they care about paying your previous cards and cars so all has been well. Cancelled with verizon in 2001 and att in 2004 and nada
I’m more concerned about companies that tack on ETF’s after you complete the contract and go elswhere.
I’m fighting AT&T over a fee they say we owe when we changed carriers AFTER the contract ended.
@Corey, thank you for that explanation. I was just about to say that pretty much any large corporate account is afforded the same luxury and a lot more. The average individual consumer line does not bring anywhere near the guaranteed money that large corporate accounts do, so whether it is an enterprise or government account, there are privileges to having large numbers.
well that an th fedgov can just intimadatte them with the FCC pull ther licences ect
then ther is the FTC
I have no problems with ETF. Without them there would be no point in contracts, because the biggest thing in the contract states that you stay with X Carrier for X amount of time or pay X amount in an early termination fee.
Contracts allow you to get phones at MUCH cheaper prices. I work for AT&T so I know the cost, the retail, and the contract prices of every phone we offer. With the signing of the contract you get $200 off the price of a phone and only have a, now, DECLINGING $175 ETF.
Now that was for some of the comments left, as far as the gov. being exempt and no real reason left is not fair to the consumer. Now if it is for Government employees then I see fairness in it. Say a military or government employee is stationed or put in another country for their job and the country doesn’t have the carrier, then there should be no ETF. However, I think that should go for ANY employee of the workforce; NOT just government employees.