more on Locked In a Cell: How Cell Phone Early Terminati on Fees Hurt Consumers

[David Farber <dave () farber net>]

Begin forwarded message:

From: Robert Daffin <rsd3414 () ACRretail com>
Date: October 11, 2005 9:49:56 AM EDT
To: "'dave () farber net'" <dave () farber net>
Subject: RE: [IP] more on Locked In a Cell: How Cell Phone Early  
Terminati on Fees Hurt Consumers


My wife and I use Nextel.  I purhcased both phones (Motorola i90's) at a
steep discount in exchange for a one year contract nearly three years  
ago.
I've been month-to-month with them ever since the contract expired, and
there have been no changes in my terms of service.  I do occasionally  
get
flyers that offer me some slight savings for signing a new service  
contract.


Out of curiosity, I investigated the purchase of two new phones from  
Nextel
several months ago, but was surprised to discover that the steep  
discounts
offered are only available to new customers.  Thus, even if I was  
willing to
sign a two year contract to get new phones, I'd have to do it with  
another
carrier to get the discount.  I find it fascinating that Nextel is  
willing
to offer such deals to attract new customers, but is uninterested in
offering the same to retain existing customers, even when every other
provider out there offers competitive new customer discounts to current
Nextel customers.

I don't know how the recent mergers will affect our situation in the  
future,
but for now, we're content with our phones, our plan, and our  
service.  If
we ever decide that we need new phones, or if Sprint/Nextel decides  
to try
to force us into a new contract, we'll likely have no choice but to  
go to
another provider, in spite of our overall satisfaction with Nextel.   
It is
no wonder that there is so much customer churn in the cellular market.

-R

-----Original Message-----
From: David Farber [mailto:dave () farber net]
Sent: Monday, October 10, 2005 5:01 PM
To: Ip Ip
Subject: [IP] more on Locked In a Cell: How Cell Phone Early Termination
Fees Hurt Consumers




Begin forwarded message:

From: Gerry Faulhaber <gerry-faulhaber () mchsi com>
Date: October 10, 2005 2:12:10 PM EDT
To: dave () farber net
Subject: Re: [IP] more on Locked In a Cell: How Cell Phone Early
Termination Fees Hurt Consumers


Dave [for IP]--

Could we hear from an IPer who is either with Verizon Wireless/
Cingular/Sprint or who has direct experience with real world data?
Are there differences across carriers?  (Normally, if there's an
anticompetitive practice going on, I would expect this to become a
dimension of competition)

Gerry

----- Original Message ----- From: "David Farber" <dave () farber net>
To: "Ip Ip" <ip () v2 listbox com>
Sent: Monday, October 10, 2005 10:47 AM
Subject: [IP] more on Locked In a Cell: How Cell Phone Early
Termination Fees Hurt Consumers




> [My experience with Cell Companies is not what Gerry describes. I
> always supply the phone since I am not happy with the cell phones
> sold in the USA. Yet I am tied up with 1 or 2 year contracts with
> $175 cancellation agreements. Why?? djf]
>
> Begin forwarded message:
>
> From: Gerry Faulhaber <gerry-faulhaber () mchsi com>
> Date: October 9, 2005 1:13:21 PM EDT
> To: dave () farber net
> Subject: Re: [IP] Locked In a Cell: How Cell Phone Early
> Termination  Fees Hurt Consumers
>
>
> Dave [for IP]--
>
> Re: cell phone contracts.  I think the way this works is that you
> can  get a cellphone at a below-market price from your service
> provider in  return for a one- or two-year contract, OR you can buy
> your phone  elsewhere and get the service without a contract (or
> maybe a contract  of shorter duration).  So this is a trade-off,
> you get a price break  on your instrument in return for a longer
> contract.  But you don't  have to take this; you can still avoid
> the lengthy contract by buying  your own phone at a market price.
>
> Why is this a problem?  If you don't like the long contract, then
> don't take the price break on the phone.  Seems to me a perfectly
> legit deal.
>
> The practice of automatic contract renewal I think is sleazy, but
> it  is very widespread.  Even Consumer Reports automatically re-ups
> my subscription on my credit card every year, and CR is a very
> legit  outfit.
>
> Now let's be honest here.  If you sign a contract to get the
> cheaper phone, then as soon as you actually have the phone you want
> to get  out of the contract, and this seems to be what this is all
> about.   "Gimme the cheap phone, then I'll whine about how I'm
> being exploited  by a long-term contract".  Pretty cheesy.
>
> Professor Gerald R. Faulhaber
> Business and Public Policy Dept.
> Wharton School, University of Pennsylvania
> Philadelphia, PA 19104
>
> ----- Original Message ----- From: "David Farber" <dave () farber net>
> To: "Ip Ip" <ip () v2 listbox com>
> Sent: Saturday, October 08, 2005 10:05 PM
> Subject: [IP] Locked In a Cell: How Cell Phone Early Termination
> Fees Hurt Consumers
>
>
>
>
>
> > Begin forwarded message:
> >
> > From: Monty Solomon <monty () roscom com>
> > Date: October 5, 2005 3:00:50 AM EDT
> > To: undisclosed-recipient:;
> > Subject: Locked In a Cell: How Cell Phone Early Termination Fees
> > Hurt Consumers
> >
> >
> >
> >
> > Locked In a Cell: How Cell Phone Early Termination Fees Hurt
> > Consumers
> > August 2005
> >
> > Executive Summary
> > http://masspirg.org/MA.asp?id2=18535
> >
> > Press Release
> > http://masspirg.org/MA.asp?id2=18541
> >
> > Full Report
> > http://masspirg.org/reports/lockedinacell05.pdf
> >
> >
> >
> >
> >
> >
> > -------------------------------------
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>
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