AT&T to raise fees for iPhone contract breakers

[RamboLiberal]

Source: MSNBC/AP

NEW YORK - AT&T is raising the fees it charges buyers of the iPhone and other smartphones if they break their two-year contracts, while lowering them for "dumb" phones to better align the fees with their real costs.

Starting June 1, smartphone buyers will have to pay $325 for breaking their contract, up from $175 currently. For buyers of regular phones, the fee is being decreased by $25 to $150.

The early termination fee goes down for every month customers stay in their contract — by $10 for smart phones and $4 for regular phones. So if a smart phone contract is broken after two months, the termination fee is reduced by $20 to $305.

The changes only apply to new contracts and renewals.

AT&T charges customers $199 for the latest model of the iPhone, but pays Apple far more than that. AT&T makes the subsidy back through the customer's service fees over the two-year contract period. AT&T likely loses money for every customer that breaks a contract and pays a $175 termination fee, but may break even with the new, higher fee. A new iPhone model is expected to be announced next month.



Read more: http://www.msnbc.msn.com/id/37279856/ns/technology_and_science-wireless/

[Hawkeye-X]

1. Cross AT&T off my list.

iPhone is supposed to be independent of AT&T as of when? July?

Hawkeye-X

[Teka]

2. Why?

They are subsidizes the iPhone cost. They want to make the money back. Seems reasonable to me.

[Hawkeye-X]

3. I'd rather pay a full price for a iPhone plus service

than to be in the monopoly of AT&T.

[Teka]

7. How is AT&T a monopoly?

They have rights to one product - there are many other smart phones available.

I went with AT&T to get an iphone. I researched the coverage areas, had friends that had AT&T give me bar readings at the place I usually go.

I went in knowing that there are certain areas that AT&T doesn't cover well - but 99% of where I go, they do.

[Bonhomme Richard]

8. I agree n/t

[MessiahRp]

4. 2012

Documents in a civil class action suit showed that AT&T has iPhone exclusivity through 2012. :(

[Sen. Walter Sobchak]

5. Termination Fees? Hah, just get your ass kicked off for free

I got kicked off AT&T for excessive roaming, which is pretty easy to do in Southern California where their coverage sucks.

Find one of their numerous dead zones with T-Mobile coverage and make some epic weekend long calls and in a few weeks they will kick your ass off.

[skyounkin]

6. Ohhh that is a good to know!

[KeepItReal]

9. CDMA (non-AT&T network) iPhone is being manufactured

If it comes stateside, it will be for either Verizon or Sprint, or both.

http://www.iphonehacks.com/2010/05/cdma-iphone.html

AT&T is gonna lose alot of customers like me who are sick and tired of dropped calls/call fails. Left Verizon for iPhone/AT&T and will go right back to VZ if they get the new phone and have reasonable plans. VZ is such a better network.

[onehandle]

10. Verizon doubled their high-end smartphone termination fee to $350 last year.

Funny that wasn't shown any 'outrage' here last year.

Meanwhile, old iPhones can be sold for hundreds of dollars on eBay offsetting any termination fee.

[JCMach1]

11. Make people pay the 'real' cost and stop the contract BS... I much prefer buying unlocked phones

Though they do cost.

[PFunk]

12. I love macs (NOT apple) but when the iphone is cut lose from AT&T is when I get one.

The same with the ipad (which I heard has the same policy).

[RobinA]

13. I'm Kinda Stuck

with AT&T. They are the only service I can get in my house. Needless to say, I don't come up against termination fees much.