Rep. Edward Markey (D-MA) is behind a bill that would eliminate contracts and contract extensions for those of us who buy a full-price phone. His bill would level the playing field for those of us who are ok with shelling out a few (hundred, ouch) extra bucks for a phone in exchange for not signing away years and years of our lives to our wireless carrier.
Here's the scoop from mocoNews
By Tricia Duryee - Tue 26 Feb 2008 04:24 PM PST
The U.S. House of Representatives is holding a hearing Wednesday on legislation that would require carriers to offer wireless service without contracts when devices are not subsidized.. The Wireless Consumer Protection bill is sponsored by Rep. Edward J. Markey (D-MA), chairman of the House Subcommittee on Telecommunications and the Internet.
The bill immediately brings to mind the iPhone because AT&T (NYSE: T) requires customers to sign a two-year contract even though the popular $400 device is not subsidised by the carrier. Carriers typically insist on contracts because they discount many of the devices they sell to customers.
While the bill is a great idea, some carriers are already (partially) following its primary guideline. At Sprint (speaking from experience) I could always buy a phone, sans discount, and not risk renewing my contract. Until recently, any change to my plan would renew me for 2 more years, but even that has gone away.
What I think is really great is that the bill would also force carriers to offer price-competitive rate plans for non-contract customers. Presently, even if you buy the handset at full price, you cannot start a new plan sans contract. I am, of course, talking about post-paid/monthly cell phone plans, not pre-paid. Most carriers will let you retain your rate plan after your initial contract expires, but the plans that they would let you select when you first sign up if you don't want a contract are a joke.
Lastly, the bill would make sure that Early Termination Fees (ETFs) are prorated as the contract wanes and are for the purpose of recovering handsert subsidies as opposed to punishing customers for, say, trying to leave a carrier they feel is mistreating them. Most carriers have adopted, or said they'll adopt, pro-rated ETFs. I like the fact that the bill would, in theory, set a standard rate of depreciation for ETFs and even, perhaps, a cap on ETFs.
Edward Markey is very rapidly makingme wish I lived in the 7th District of Massachusetts. Not that he needs the vote, but I'd love to be able to say "Edward Markey is my Congressman."
