Termination Fee being whittled down?

Discussion in 'Android General Discussions' started by drbob, Jan 19, 2010.

  1. drbob
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    drbob New Member

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    Verizon whittles $350 ETF 'advanced device' list a bit, FCC pressure paying off? -- Engadget

    Verizon whittles $350 ETF 'advanced device' list a bit, FCC pressure paying off?

    "There hasn't been any official announcement by Verizon -- nor any recent public chatter between the carrier and the FCC -- but for whatever reason, Big Read has gone ahead and smacked some ten devices off its premium "advanced device" list that it had used to determine whether a particular phone qualified for the gargantuan $350 early termination fee..."

    Here is the current Verizon "advanced device" list, where the $350 still applies:

    Advanced Device List*

    (I can see the Droid and Eris (sort of) being on the $350 list but why the Palm Centro? Are they still selling those!?)
  2. tktouch12
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    tktouch12 New Member

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    they should make all of them like 150., just because it would be cool., and then people would buy new phones more often. but eventually with technology evolving, the droid will maybe get off that list
  3. Vladimir
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    Vladimir New Member

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    sounds like a good biz decision to me lol....
  4. tktouch12
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    tktouch12 New Member

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    haha, well i'd appreciate it. i'd get a new phone every 6 months :)
  5. triptych
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    triptych New Member

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    If I signed my contract before the 350 took effect, would I still be responsible for it?
    I did not receive an notification from verizon either by snail or email.
    I purchased my droid on launch day
  6. pc747
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    pc747 DF Administrator Staff Member Rescue Squad

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    I almost understand why companies do that; because you only paying 1/2 price for the smart phones (droid being retailed around 600 you pay roughly 300). So initially the cell companies take the hit; granted they make their money back in 3 months of the 2yr contract agreement.
    Overseas customers pay out right for their devices opposed to being subsidized by the cell companies. It would be nice if a verizon would drop the etf to a lower price or at least make it where if you cancel before 5 months in your contract (minus the 30 day granted) then the customer is responsible for paying the rest of the cost for the device. But if you are beyond 8 or 9 month mark the etf should be dropped to around 150-200.
    This will keep a company from loosing out if a person buys an expensive smartphone for 300, get the 100 rebate back, and then cancel at about the 2 or 3 month mark. Hence only paying 350 for a 600 phone. Verizon/att/sprint pays retail for the phone and sells it at a subsidized rate so that people would sign up.
    If verizon offered the option to pay full price for the phone and offered a deal where your bill was half the amount. How many could honestly afford to walk in and drop 600 on the counter and still be able to pay their bills.
  7. thelion
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    thelion New Member

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    As long as you signed your contract BEFORE the change, you are fine. Your contract will have the old amount. But keep an eye out - I signed mine before the change (by two days) and they tried to nail me with the higher ETF when I was going to cancel.
  8. Lafond
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    Lafond New Member

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    I don't know about you, but I would MUCH prefer that option.
  9. garrett
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    garrett Active Member Theme Developer Developer

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    personally i dont understand what the big deal is with the ETF fee's

    i dont know about you guys but when get a new phone thus signing a new contract there are no plans to cancel that plan early.

    it wouldnt bother me even if they raised the ETF to $25,000.00 because theres not going to be reason for me to ever pay it.
  10. tktouch12
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    tktouch12 New Member

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    same here..

    yes, after about a year, the phone companies make their money back, so they should lower the etf after a year maybe? just a thought
  11. bossrogue
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    bossrogue New Member

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    Agreed. Especially since VZW gives you that 30 day period to where if you're not satisfied with the service/phone, you can just walk away unscathed.
  12. bluedust
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    bluedust New Member

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    Okay, well that's good for yourself, but there's other people that live out here on this wonderful blue planet, and we all don't share your mind or thoughts.
  13. voodoodaddy
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    voodoodaddy New Member

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    Can someone explain something to me? I saw a story the other day and it makes me wonder how they can get away with raising the ETF on these "advance devices", especially the Droid, to $350. The logic they use is "we subsidize these phones so customers dont have to pay $500-600+ for them so we have to raise the ETF or else we could lose money."

    The story I referred to was the teardown price of the parts for the Droid. Parts total just under $180. I bet most of us paid $200 or more for the Droid (I bought 2 at $200) so how is it we are getting a subsidized device again??? Maybe there is an angle to this Im not understanding. But if the device only cost $180 to manufacture and we are paying $200 or more to buy it, how can they use the above argument about raising the EFT?

    Motorola Droid Parts Worth More Than iPhone 3GS or Nexus One's, At $179.11 - Motorola droid teardown - Gizmodo
  14. garrett
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    garrett Active Member Theme Developer Developer

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    So when you get a new phone/contract you plan on ending that contract early?

    If this is the case then maybe a pre-paid plan is best suited for your needs.
  15. zakany
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    zakany New Member

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    I agree, however, sometimes unplanned things occur. In my instance, my wife put her phone through the laundry. Like a good husband, I gave her my phone and (mostly) fixed hers. Just a few buttons didn't work (2, 5, 0, back, etc.). I wanted a Droid for Xmas, and got it, but it costs more to cancel my phone than it does to let it run out in a couple months.

    I would have preferred to have simply canceled and move my number. As it is, I have a new number and my old phone is set to forward all calls to my Droid. Once my contract expires, I'll have Verizon do the transfer (this way, my cell phone number doesn't effectively change).

    For me, I split the different between a monthly plan and a two-year contract. I have a one-year contract. I don't consider the phone paid for until then.
  16. xjman349
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    xjman349 New Member

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    Because motorola has to make money too. They are selling the phones to Verizon a lot higher than it costs to make them. Thats how motorola makes money. So Verizon wants to make sure they get some return on the devices hence raising the ETF.
  17. voodoodaddy
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    voodoodaddy New Member

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    But Motorola surely isnt selling the device to VZW for much over the manufacturing cost.
  18. Lafond
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    Lafond New Member

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    It's been reported that the raw manufacturing cost is around the $180 mark. To remain profitable, they must sell it for more than a stitch over that. Though I'm sure they have some pretty hefty R&D/cap-ex to ammortize per phone that is not included in those reported costs.
  19. pc747
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    pc747 DF Administrator Staff Member Rescue Squad

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    Like said earlier, verizon pays the retail price for the device, actually cell phone companies in general. Whether its the iphone, bberry, android, or windows....when you put the phone on the counter Motorola, apple, blackberry, htc, etc... is getting the retail value for the phone. As a consumer you can either buy outright or subsidized with a contract. Thats why i understand why verizon has a high eft.
  20. crspang
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    crspang New Member

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    $180 is for materials only, it does not include labor, software development costs, freight, etc. Moto would not be in business very long if they only sold the Droid for $200 or so.