Chairman says more questions than answers raised by Verizon's response to FCC

Chairman says more questions than answers raised by Verizon's response to FCC
It was the day before Xmas when we reported to you that FCC Commissioner Mignon Clyburn, one of the 5 sitting commissioners on the FCC, said that Verizon's letter to the FCC about its ETF was"unsatisfactory and troubling." Maybe that didn't scare Big Red. but now that the FCC Chairman himself, Julius Genachowsi has weighed in, we might see the heat turned up a bit. Genachowski says that Verizon needs to explain more clearly its policies about the Early Termination fees it levies on those who walk away from a 2 year Verizon contract before the 24 months has expired. Some walk away because they want a hot new phone that is an exclusive on another carrier, or because they received a free handset from a BOGO offer and want to sell the extra phone. Either way, the carrier losses on the phone it had subsidized comes out of its own pocket unless they can recoup the money by charging the ETF.

At the CES in Las Vegas, Genachowsi said, "I thought that response raised more questions than it answered. . There's a very real level of consumer confusion around these areas." The Chairman refused to say what his next move would be, but did say that the FCC will continue to investigate. For its part, Verizon justified the increase from $175 to $350 in the citing higher customer acquisition and marketing costs. That basically suggests that customers playing BOGO arbitrage were costing Big Red some big cash.

source: Yahoo via Phonescoop



1. Mateo8326

Posts: 472; Member since: Jul 15, 2009

Good luck Verizon we all know where this is going LOL

2. JackFace

Posts: 190; Member since: Nov 03, 2009

Damn FCC. Verizon is a business. If consumer don't like the way they conduct their business, consumers can go elsewhere, and Verizon will pay for it in the way of losing customers. Simple. The FCC needs to stay the hell out of this.

3. Striker13084

Posts: 128; Member since: Mar 30, 2009

Amen brother, communication is the key word in FCC. If anyone has a problem with this shouldn't it be the Better Business Bureau

6. rhomaion

Posts: 187; Member since: Sep 23, 2009

HA! I hope your precious company gets screwed. Vodafone should just stay the hell out of this country.


Posts: 26; Member since: Jan 07, 2010

The govt is trying to get into any and everything possible these days. Especially business and trying to tell them how they need to be run. If Mcdonalds charges a dollar more for there burgers than Burger King i wouldnt be suprised if the govt would step in and ask them why they charge more than the competition...and ask for explination. I know im going to get some angry responses to this one but..."THANKS OBAMA" The US is on the fast track to socialism.

4. icarus

Posts: 24; Member since: Dec 12, 2008

It's Going nowhere, this is an election year and both people that are commenting are trying to be "of the people" to ensure they keep their sweetheart positions... smoke & Mirrors

5. mobilemike11

Posts: 16; Member since: Jan 09, 2010

I agree with you JackFace. Let the company make it's own decisions, and if customer's want service with them, they will still join up. Verizon Wireless chooses to run it's business in a way that is deemed best fit for both today's cellular market and our economy. They sureley don't hold a gun to our heads and make us sign that contract with an upgrade or new line of service. Also, when it comes to a company as a whole, of all the major phone carriers out there, Verizon still manages to be profittable in an already hurting US market. The increase in the ETF, for whatever reason it is, is done out of necessity. When AT&T cut their billing ties with Apple and the iPhone back two years ago, AT&T lost hundreds of dollars per every handset sold. The same concept goes for Verizon with a line being cancelled close to the start of a contract, there is a huge loss to the company. One cannot beleive that Verizon pays RIM only 9.99 for a Blackberry Pearl Flip right? In order to stay competitive, Verizon must offer phones at a price that is appealing to the consumer, otherwise they'd never sell. One can never know if they will want or have to cancel service with a provider, but if you do,there is a penalty. If cellular ETF's were always 350 dollars this would not be an issue, but change is always negative when it means more money spent by consumers. Let's face it, Verizon as a whole has great business ethics and are smart in how they market themselves and operate. To this day, they are not closing stores left and right like Sprint, or struggling to maintain thier network (AT&T) to allow for high end PDA users to enjoy their data services. The FCC needs to stay out of it, and consumers need to educate themselves, otherwise quit complaining!

7. rhomaion

Posts: 187; Member since: Sep 23, 2009

Ok... So if some innocent person gets raped but doesn't know how to fight back that makes it ok? Rather or not the consumers do or don't want it doesn't make it right. Wrong is wrong and evil is evil whatever way you look at it. Are all you friggin retards that blind that you can't see greed for greed? This is what will get this country killed and boy oh boy when it does if only I had a camera to take a picture of all you dumb founded "americans" wondering how this oh so "mighty and strong" country fell. Note I didn't say to cherish because that day won't be a day to cherish. WAKE UP! Did all you forget why the terrorists targeted the Twin Towers? It was our "monument", our greed that got out of hand and now it is just coming right back.

8. mobilemike11

Posts: 16; Member since: Jan 09, 2010

Greed is surely the root of most evil in this world, but we're talking about a company basing it's business decisions on profits and market trends, not religious and political differences. The plain and simple fact is, people (as in adults) KNOWINGLY sign a legal binding contract with a 350 dollar termination fee. So wait, I guess the saying still goes, "you can't rape the willing."

9. dubracer223

Posts: 46; Member since: Mar 16, 2009 the soap box there numb nuts.

10. dubracer223

Posts: 46; Member since: Mar 16, 2009

good point mike..GLAD YOU DID YOUR HOMEWORK unlike others around here. might i add once again that the raise in etf is only on premium devices! customers are made aware off all terms & conditions prior to any contract being signed and and completed if they werent paying attention at the time then screw them because everything is also provided to them in the literature IN THE DAMN BAG. so this OMG I DIDNT KNOW shit isnt gonna cut it. one more thing ....they have 30 days to decide if they wanna keep it. shall i keep going?

12. icarus

Posts: 24; Member since: Dec 12, 2008

man i hope this is extremely well veiled sarcasm... if can't even be bothered to attack your ignorance


Posts: 26; Member since: Jan 07, 2010 just compared rape and a terrorist attack to a company raising a TERMINATION fee by just over $100..

11. DonLouie

Posts: 594; Member since: Dec 22, 2008

Nobody is taking the decision to raise prices from them, the justification behind it is at question. Instead of leaving it at it pays for subsidy they added advertising and R&D cost, all the carriers have this cost and some more than others but vzw is the only one to raise the ETF. AT&T, the #2 that's paying the highest subsidy out for the it phone hasn't. The # 3 and 4 carriers, struggling to keep subs and make money, should've been the 1st to do this because unlike #1 churn is high and profits low. This is just a way to ensure loyalty thru high cancelation fees

13. DonLouie

Posts: 594; Member since: Dec 22, 2008

Another example of their greed in action is them proposing mandatory data on ALL 3G phones, dumb or smart

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