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Print 11 comment(s) - last by CENGJINYIWEI.. on Jan 31 at 7:54 AM


The Nexus one has some BIG ETFs!  (Source: Kansas City Star)
Early termination on a Nexus One can cost $550

Google’s Nexus One became available on January 5 through T-Mobile. The phone sells for $529 without a contract, Google also offers the phone for $179 contingent upon a two-year plan with T-Mobile.

While this offer seems appealing, it is important to remember to read the fine print. A recent CNET report reviews the contract and terms of sales associated with the purchase of an activated Nexus One, and what it reveals may curb consumer interest.

Early termination fees (ETFs) are something we’ve all become accustomed to, but with T-Mobile and Google teaming up for the Nexus One, things are getting a little out of control.
Generally these fees are used to compensate for the fact that phones bought under contracts are offered at discounted prices. In T-Mobile’s contract for the Nexus One, that corresponds to a $50 to $200 charge for early terminations after the 14-day grace period.

Unfortunately, the fees don’t end there. If the phone is bought for the subsidized price of $179, Google reserves the right to charge a "equipment recovery fee," totaling up to $550, which is $21 more than the unsubsidized cost of the phone. These fees are outlined in the terms of sale as a means to "liquidate damages Google will incur as a result of such cancellation," and "are not limited to, loss of compensation and administrative costs associated with such cancellation or changing of wireless service provider(s), market changes, and changes in ownership."

With this, the question becomes whether or not these ETFs are enough to deter potential customers, especially considering that this phone is brand new. And for those techies out there that are looking to have the latest, remember you do get 14 days to try it out.



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Double dipped?
By vapore0n on 1/13/2010 10:04:06 AM , Rating: 2
Id like to see the FCCs comment on this. And if they dont, Id like to see Verizon's comment on why not.




RE: Double dipped?
By Fox5 on 1/13/2010 10:54:05 AM , Rating: 4
To be honest, this business of subsidized phones just needs to end. As it is, carriers are just hiding the true cost of the phone, and then dipping in a little extra.


RE: Double dipped?
By tastyratz on 1/13/2010 1:54:14 PM , Rating: 2
No subsidizing phones is fine, just transparency and fairness are more like the tooth fairy right now. If subsidization ceased then do you really think the monthly rates would go down?

The fcc certainly does need to investigate this though - more than the cost of the phone is absolutely outrageous.

Is it prorated as well?


RE: Double dipped?
By LostInLine on 1/15/2010 5:02:17 PM , Rating: 2
Have you not seen T-Mobile's "Even More" plan?


RE: Double dipped?
By kake on 1/13/2010 2:29:00 PM , Rating: 2
The only problem of canceling subsidized phones is that the contract prices won't go down to reflect the savings that the cell companies are seeing.

I for one am not willing to pay 500usd for a phone and not see any reduction on my bill as well. Remember, this is corporate America.


RE: Double dipped?
By CENGJINYIWEI on 1/31/2010 7:54:45 AM , Rating: 1
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Don't like ETFs?
By RMSistight on 1/13/2010 4:15:27 PM , Rating: 1
Just buy the phone outright. That's what I've been doing and I never buy subsidized phones. I can come and go as a please with any providers.

However, I do like the idea of a prorated ETF. That makes perfect sense.

Don't like to pay $500+ for a phone? Then quit your bitching about ETFs. Remember, cell phone service is optional.




RE: Don't like ETFs?
By Bioniccrackmonk on 1/13/2010 7:45:28 PM , Rating: 1
quote:
Just buy the phone outright. That's what I've been doing and I never buy subsidized phones. I can come and go as a please with any providers.


Why would you pay full price for the phone just to be able to jump carriers whenever you want to. Why not find a carrier that fits your needs, then subsidize through them. I bet money you are not paying less for a service plan compared to someone who did subsidize their phone.

quote:
However, I do like the idea of a prorated ETF. That makes perfect sense.


100% agreed

quote:
Don't like to pay $500+ for a phone? Then quit your bitching about ETFs. Remember, cell phone service is optional.


ALL companies are in business to make money. People who buy their phone out right and then sign up for the same plan someone else is offered is paying A LOT more in the end.

Why not get what you can out of these carriers? If you don't like 2 year contracts, then get a 1 year contract, 12 months with one service provider is not the end of the world.


RE: Don't like ETFs?
By invidious on 1/15/2010 2:01:55 PM , Rating: 1
quote:
Don't like to pay $500+ for a phone? Then quit your bitching about ETFs. Remember, cell phone service is optional.

Don't like to listen to others comment about their phone service? Then quit reading the comments section of phone articles. Remember, being a dumbass is optional.


We do no evil...
By Tim Thorpe on 1/14/2010 2:08:36 PM , Rating: 2
...well almost...




By jmunjr on 1/16/2010 2:58:40 PM , Rating: 2
I recall reading subsidizing phones is illegal in some countries because they consider it anti-competitive. I don't know if that's true, but I agree with it.




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