

FCC Commissioner slams Verizon on $350 ETFs - abraham
http://arstechnica.com/tech-policy/news/2009/12/fcc-commissioner-slams-verizon-on-350-etfs.ars

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joshfinnie
I am not sure if the FCC Commissioner slamed them on the $350 ETFs, but the
fact that with the current rules if someone wants to cancel their plan with a
month left there is still $120 left on the ETF. Showing that only $230 is
going to recouperate the cost of the phone which are what ETFs were for in the
first place.

Also, Verizon did nothing to explain the more pressing issue of charging
people the random $1.99. I think that fact is the last straw that broke the
commissioners back.

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ars
I think the ETF should be the actual cost of the phone (i.e. different for
each model). And then it goes down exactly prorated to the contact length.

Isn't that how it works in europe? I remember reading that they were not
allowed to hide the cost of the phone?

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elai
Well at least it's not canada, with $400 ETFs, and a separate data ETF if you
happened to get a data plan with your phone of $400. And mandatory 3 year
contracts for most deals. The ETFs are charged by $20*(# of contract months)
or $400, whichever is lowest, so you have to wait at least 1.3 years before
your ETF fee will go down.

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nkohari
ETFs would be much less of a problem if buying unlocked phones wasn't like
hunting unicorns.

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tkahn6
Are these ETFs flat rates? Meaning, is the ETF the same for cancellation at a
year in a half and two months in?

If it is, that does seem ridiculous, but if it isn't it should be taken into
consideration that a droid at retail without a two-year contract costs ~$600.
If someone buys a droid at $200 with a two-year contract and then cancel's
their contract, Verizon would (with the old ETF) effectively lose ($600 -
($200 +$175+profits on whatever data/minutes you paid for)).

The reason you can buy the phone at $200 is because you've said that you'll
make up the difference (and allow them to turn a profit) in data/minutes fees
over the next two years.

Whether or not they should be making a _profit_ on the ETF is up for debate,
but at least they should be allowed to break even.

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keltex
ETFs usually go down by $10 per month. So after 1 year, $350-$120=$230.

