March 14, 2014

Editorial: Cellphone wars benefit consumers

The cellphone companies are duking it out, and that is good for all of us.

For years now, Verizon, AT&T and T-Mobile have been parading their assets in television and print commercials, bragging about whatever advantage they think they hold: network size, affordability, new technology, reception (who could forget those “Can you hear me now?” ads).

Their goal was to snag consumers for a contract that lasted a couple of years. Once they got you to sign the dotted line, it was hard — and expensive — to wiggle out. That’s because the companies included a pricey termination fee, usually $200 to $350.

The companies didn’t charge much for the actual phone, in many cases; sometimes they were free with a contract. What they wanted was that long-term commitment — forced loyalty. If you wanted to switch to a competitor, it was going to cost you.

But changes are ahead for 2014, prompted by an astute offer from T-Mobile. In January, at the International Consumer Electronics Show in Las Vegas, the company announced that it would pay early-termination fees for people who move over from other cellphone companies.

“If you’re feeling stuck in a contract with no way out, or scared to leave thanks to big ETFs, we feel you,” T-Mobile says in its campaign. “It’s OK to want out. Remember, it’s them — not you. Now, break up with your carrier, switch to T-Mobile and get up to $650 per line.”

That move started a war that is already benefiting consumers, who have long wondered why they have to deal with so many restrictions when it comes to their cellphone plans.

And it’s not just a matter of contract length. Why, for example, can you get a new cellphone only when a company allows it? Why do you have to pay so much more for international calls or texts made by cell? Why is a cellphone usually so much more expensive than a land line?

Text Only | Photo Reprints