AT&T: "Early Termination Fees A Great Deal For Consumers"

[Ed Hansberry]

Originally Posted by makicr

I think that a big part of their pushing the 2-year contracts is also to keep system stability. They are paying out money to build or rent more towers to provide more complete (and faster) coverage. They are making these investments and need to have a solid customer base to be able to finance them.

They also need to have a good understanding of what their customer base will look like in 1 year, etc, as they need to evaluate what additional enhancements are needed for the network. Just imagine how much slower the infrastructure updates would come if their customer base could just up and walk away if T-Mobile or Verizon had a real great offer that week.

Nah... that has nothing to do with it. There are really only 4 carriers in the US. Having a great product and great customer service is the way to be the winner here. Most people will pay more for better service and product. With only 4 carriers, people can only go to so many places. Many areas only have 2-3 viable carriers with the other not represented in their area.

If you wanted to prevent people carrier jumping for the deal of the week, just tack on a $20 nusance fee to close out a contract. That is something most would pay with no problem every few years, but someone shopping for a quick deal wouldn't want to pay.

[Ed Hansberry]

Originally Posted by makicr

I think that a big part of their pushing the 2-year contracts is also to keep system stability. They are paying out money to build or rent more towers to provide more complete (and faster) coverage. They are making these investments and need to have a solid customer base to be able to finance them.

They also need to have a good understanding of what their customer base will look like in 1 year, etc, as they need to evaluate what additional enhancements are needed for the network. Just imagine how much slower the infrastructure updates would come if their customer base could just up and walk away if T-Mobile or Verizon had a real great offer that week.

Nah... that has nothing to do with it. There are really only 4 carriers in the US. Having a great product and great customer service is the way to be the winner here. Most people will pay more for better service and product. With only 4 carriers, people can only go to so many places. Many areas only have 2-3 viable carriers with the other not represented in their area.

If you wanted to prevent people carrier jumping for the deal of the week, just tack on a $20 nusance fee to close out a contract. That is something most would pay with no problem every few years, but someone shopping for a quick deal wouldn't want to pay.

[darkfire07]

I work for AT&T currently. If you bring your own unlocked GSM handest, you CAN get a regular rate plan without a contract. The only reason you'd pay anything up front would be if your credit class required a deposit.

Ed, the problem we face time and again is that the MAJORITY will gladly sign a contract to get a phone for free or a greatly reduced price. I know YOU prefer to spend how ever many hundreds of dollars out of pocket to buy the device you want, uncrippled and unstained by carrier firmware...I'm the same way. My Tilt has been running modified firmware since the day I bought it. But day in and day out people come to my store demanding a free phone. They don't really care how they get it...they just want to not pay out of pocket.

Given this, I think ETFs are now the way they should be. Pro-rated based on the amount of time left on the CONTRACT you CHOOSE to sign, in exchange for a subsidized phone.

However, I think more effort should be made to educate the customer. The average American at this point still thinks mobile phones are free. The subsidy/contract/ETF model has never been explained to them, nor the fact that many of these mobile devices are highly advanced and expensive.

DF7