Friday, June 30, 2006

Verizon Wireless To Lower Exit Fee

The Washongton Post writes that Verizon Wireless (VZ) "would reduce the $175 in fees its customers pay to get out of cellphone contracts, setting a precedent among major carriers at a time when consumers and regulators are putting pressure on the industry to change its practices. Starting this fall, new and existing Verizon Wireless customers will be able to pay less to terminate their contracts, depending on the amount of time remaining."

The article noted "early termination fees ranked third among complaints by wireless consumers in the first quarter of this year, according to the Federal Communications Commission."

Roger Entner at Ovum said, "If the other [carriers] don't follow, it gives Verizon a huge leg up. It's smart -- they're targeting other companies' subscribers."

This is a nice goodwill gesture for Verizon customers, but I'm having a hard time seeing how it gives them a leg up on targeting their competitor's customers. Doesn't the prorated termination fee make it easier for Verizon customers to jump ship? I'm still waiting for the carriers to starting paying customers to jump like back in the days when the long distance companies were sending checks left and right to get consumers to switch service. Can the mobile operators be close behind?