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Introducing The Most Impressive Cell Phone Bill Of The 110th Congress

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Senators Amy Klobuchar (D-MN) and Jay Rockefeller (D-WV) recently announced plans to introduce our wet dream of a cellphone bill. The bill realizes our wildest legislative fantasies: a world where cellphone companies stop inventing official-sounding fees and levying harsh ETFs, and instead allow their customers to take unlocked phones to the company with the best reception according to precise coverage maps provided free of charge.

The Cell Phone Empowerment Act of 2007 would improve the lives of cellphone users by attacking a smorgasbord of the industry's most eggregious practices:

  • Early Termination Fees: FCC regulations would require companies to prorate ETFs, with the penalty for escaping a 2-year contract cut in half at the end of the first year.
  • Service Maps: Cellphone companies would be required to provide detailed maps showing call quality down to the street level. The maps would be augmented by data on dropped calls and coverage gaps collected and publicized by the FCC.
  • Fee Disclosure: Overage charges would be displayed separately from taxes, and companies would be prohibited from levying any fees, apart from the basic service charge, not expressly authorized by federal, state, or local regulation.
  • Contract Disclosure: Depriving us of a source of many posts, companies would be prohibited from extending contracts without "point-of-sale notification," and customers would have 30 days to cancel any contract, new or extended. Any contract changes would need to be sent to consumers in writing, and could not take affect for 30 days.
  • Unlocked Phones: The bill would give the FCC a homework assignment: a single-spaced report to Congress on the harmful and anti-competitive practice of locking handsets.
  • Military Exemptions: Companies would be required to release military members awaiting deployment from their contracts.
  • This bill is amazing. Seriously, we like this bill so much, were it not for those pesky Capitol police irradiating everything, we would send the Senators a fruit basket.

    Both Senators are members of the powerful Senate Commerce Committee. They have asked Chairman Inouye (D-HI) to schedule a hearing on the bill, which he should do without delay.

    Klobuchar and Rockefeller Announce Cell Phone Consumer Empowerment Act of 2007 (Press Release) [Senator Amy Klobuchar]
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    (AP Photo/Ann Heisenfelt)

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    Comments:

    97
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    flintstone03
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    Yes Please!

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    All for it! Cell companies make $$$ hand over fist off of us consumers!

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    Doesn't the military already get exemptions under deployment? If they don't, they should. I know T-mobile does this and I've never heard comapnies doing otherwise.

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    I'm not sure this bill will look as good once the rest of the Congress gets its hands on it. I hope for the best, though.

    Still, it could pass; they could play up the Military Exemption in order to ward off any would-be opponents. You could any Congressman against the bill on the spot and ask them "Why do you hate the troops?"

    I mean, we already know that the cell phone companies hate America.

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    ....we lready know that the cell phone companies hate America.

    The current state of affairs makes them so much money they love us. They really do.

    However, I'm hoping against all hopes this really does take effect as it is. But we all know those scummy lobbyists are going to have a lot of work on their hands and they have likely already started working against this.

    *crosses fingers*

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    @Cowboys_fan: AT&T/Cingular has done this for years.

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    Hurray for the Military Exemption.

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    I hope this results in generally cheaper service for everyone. With my first cell phone eight years ago, I had a decent plan for about $30/month. Now it looks like plans start around $40/month before assorted taxes and fees.

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    Guess which two Senators will soon receive major campaign contributions from the cellphone companies? Right after this bill dies, that is.


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    I really fail to see the issue here. None of this is stuff (with the exception of the contract changes) that is worth Congress's time.


    Don't like an ETF? Don't sign a contract with one.


    Don't want a locked phone? Buy an unlocked one, and forego the subsidy the carrier is providing you.


    Don't like the fees you're being charged? Why didn't you get them in writing upfront?


    Don't like the coverage in your area? Return the phone, you get 30 days.


    Honestly, it shocks me that Congress is wasting their time meddling in a tremendously competitive market that 99.9999% of the time works extremely well. It's not our government's job to protect people who can't be bothered to actually read what they're signing.


    The likely result, if this passes, is higher costs for phones (since the subsidy won't be as sure to be paid off) and a government coverage map website, set up at great cost (passed on to customers), which nobody ever reads.



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    Shit, I could have saved a hundred bucks with that military exemption.

    Rather than pay the contract termination fee I just payed for the last couple months of service which I couldn't use.

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    @ptkdude: Well, if they've been doing it for years, it's been less than 3 years.

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    Lobbyists will try to strike it down, the people vs. industry, who will win?

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    Good luck with that, it will never happen!

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    ... the penalty for escaping a 2-year contract cut in half at the end of the first year.

    Honorable Senators, is it too much to ask to have the penalty prorated on a monthly basis, rather than annually?

    A carrier will currently receive the same amount of money as liquidated damages whether I cancel at month 1 or month 23. However, the actual loss they suffer (that is, portions of the equipment subsidy they have yet to recover from the monthly bill) is a whole lot different.

    It looks like Verizon's started down this path, where it starts at $175 and drops by $5 for each subsequent month of service. But, $5/month means it's not prorated on a straight-line basis, and at 23 months you're still stuck with a $60 ETF, when I'm sure they aren't actually still $60 in the hole that point.

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    The ETF should be the ammount of the "discount" off retail pricing for your handset of choice and then divided by length of term chosen.


    So you can choose say a 5 year plan if you wanted and get a bigger discount, then having that subsidy divided by 60 months.


    Where as someone who chooses a shorter term, say 6 months to a year would have that ammount divided by the 6-12 month length of term.


    This would equate to an actual cost to the carrier of "loss", even though we know the subsidy is a fraction of the profit they make off most consumers.


    If the Cell companies where smart they'd jump on this, back it up, and then advertise "customized calling plans". I see the first telco on board with this profiting greatly.

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    This is all pointless to get the mindless consumer's wagging their tongues in anticipation of something monumental.

    Here's what is NOT in the bill.

    Your rates now go up by $20/month and phone subsidies are reduced to cover the changes required.

    Okay, now.. what's better.. paying an additional $20/month or dealing with the other stupidity?

    I'm probably being conservative with the $20.

    This is a political move to garner favor with constituents, it's toothless. Cell companies will fight it to be sure because they would have to rework their business plans in the face of something like this passing, but I can guarantee that the CEO of VerizonWireless is laughing. Sure, I can prorate an ETF, because my consumer paid more for the phone up front, and I'm milking an additional $20 out of them per month.

    Whatever.

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    sounds too good to be true. i'll belive it when i see it. cell phone companies are notorious for charging you fees that their inadequately trained staff over in india can't even clear up for you.

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    @Cowboys_fan: Unfortunately not that I know of except for the local Cingular store. I work with the Army and we're deployed right now -- a few of the folks I work with who are single and in the Army got shafted having to cut their contracts before we left for Balad. The married ones just left their phones with the spouse anyhow, so no harm there.

    All this and I live near a town that really wouldn't exist without its Army base.

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    Unlocked Phones: The bill would give the FCC a homework assignment: a single-spaced report to Congress on the harmful and anti-competitive practice of locking handsets.

    Ummm, still not good enough! We don't want a damn report, we want unlocked phones! Just put that in the bill: require cell phones to be unlocked and usable on any carrier! Then the bill would be golden.

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    Too good to be true. Cell phone companies have too many lobbyists in Washington to ever let this happen. Remember, lobbyists run Washington not anyone else!

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    Too good to be true, but not because it's a good law that won't pass. It's a stupid law that will impose a bunch of costs on the companies and jack up rates for everyone across the board.

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    @allstarecho:


    To make cellphones "usable on any carrier," you'd need more than unlocking, you'd need some major changes in, oh, physics.


    Even if Verizon made it mission #1 to get my RAZR to work on T-Mobile or AT&T's network, it never will - they're technically entirely different, and a CDMA phone will never work on a GSM network, and vice versa.

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    I think it would be better for consumers overall to just end the practice of the carriers subsidizing the phone costs, and let the phone manufacturers compete in the open marketplace. It could reduce phone manufacturers costs by selling one model of phone that could be used on all carriers networks. It would benefit consumers since the mfrs. have to compete based on phone performance/features, and would be less likely to strip out standard features like full bluetooth support because verizon wants to charge extra to transfer a picture off the phone.

    I should be able to buy a phone from any E/RE-tailer, activate it with the carrier of my choice, and have access to all the features.

    This would eliminate the waste of perfectly useful phones being tossed after 2 years cause the carriers want to lock you into a new contract.

    Selling phones in the open marketplace would quickly drive down the prices due to real competition, and would increase competition among the carriers. (And churn rate for the lower-quality carriers)

    We still need the other protections in the bill to reduce abuse by the wireless industry, of course.

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    Jay Rockefeller also had his hands all over the cable TV deregulation bill several years ago.

    That worked out real well.

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    I'm shocked (shocked!!) that the sponsoring Senators doing this aren't Republican. Did I mention shocked. Oh yeah, they're not. Because they're whores. Watch them fight it saying if consumers win, so do the terrorists. Or a Strong America loses when consumers win. Whores. Did I say, whores!

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    @justaguy2 :


    "To make cellphones "usable on any carrier," you'd need more than unlocking, you'd need some major changes in, oh, physics."


    Umm... or they could just make new cell phone compatible with both techs like Blackberry 8830 ([na.blackberry.com])


    Your arguments against fair pricing practices lead me to believe that you might be one of the lobbyist along with your friend LTS! :) Its like says lets not stop [insert any company here] from adding arbitrary fees on top of the advertised price of their product else they will increase the base price !! And if the result of this bill passing would be an increase in monthly rates let free market and supply/demand take its course... I am sure some of the cell phone users might "get by" without them.

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    @thepounder: That is really surprising to me. These people protect our lives, the least a company can do is allow them out of a contract in order to defend them/us.

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    What the hell got into Congress? These proposed changes are so good for the end customer and competition in general... surely this will never come to pass.

    I'm actually in the market for a smartphone/pda combo right now, and SunCom doesn't have any I like. (on the website at least, haven't checked my local brick and mortar) I just called and was smugly told that I would have to pay a $200 ETF even though I've been a customer for some 4 or 5 years now.

    That makes me want to suggest SunCom to acquaintances looking for a mobile, sure it does.

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    Lets just force any company to do anything we want... Just because we said so... They won't increase the cost of the phone because of new regulations. No, they'll just absorb the costs and do whatever the law says, right?


    Lets just make a law saying they have to give it to us for free too! YEAH DUDE!!!

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    no it's more about forcing companies that use the law as it is to cheat and decieve customers while artificially inflating a market.


    don't give the tired ol "well then don't sign it if you don't like the terms" bit, because THEY ALL PLAY THE SAME GAME.


    the pre-paid or no-contract phones are a scam unto themselves. pay an inflated rate for not signing the draconian rate and miss out on the subsidy for the phones, even though they're making a LARGER PROFIT off the phone and useage...

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    This is a nice bill that will likely turn into some anti-consumer nightmare by the time it's pooped out of the lawmaking machine.

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    Now we should all watch closely to see how a bill dies in congress. My monies going to be that it'll never come out of comittee, or that it'll be full of interesting loopholes before it gets anywhere important.

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    Consumers can already buy unlocked phones, unbranded by their carrier right from the manufacturer, or from any number of websites. Do that, and you eliminate the contract.



    As for the rest of it, people should actually read what they are signing. They could put a clause in there that they get your first born if you are late on your bill and people wouldn't even realize it. I work in the wireless industry and out of 50 people, I'd say only 1 person actually even glance at the terms and conditions, then complain when it comes back to bite them.


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    I'd think you should just have to pay back the subsidy if you end your contract, but I wouldn't want to meddle much more than that. I really can't see the point in mandating coverage maps through legislation.

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    I wouldn't hold my breath over the "introduction" of a bill no matter how good it is.
    It now becomes a target to subtract anything of worth to consumers in the language by the telecom industry.

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    I hate the things the bill is trying to outlaw as much as the next person, but the Government has no business meddling in the business practices of cell phone companies. Like a previous poster said, if you don't like how a cell phone company does business, don't do business with them.

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    All of a sudden, such a turn around. What's the motivation? Maybe the senators got tired of these contracts because THEY had horrible service? =P

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    @JustAGuy2: *Sorry for the double post, but I didn't see this....

    ANYWAY, well, try to compare the US with EU/UK, and then tell me if it's worth the time for MORE ENFORCED flexibility. The moral of those companies (in the US) is atrocious.

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    @wwwhitney:

    If there were more carriers out there and there were fewer barriers to entry, I'd be with you 100 percent.

    But there aren't and I'm not.

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    @MIKECOLIONE :


    And consumers should pay more attention to the fine print in their mortgage papers, calculate how much their payment would go up if rate increases, etc, etc... if the consumers can be taken advantage of while making the single biggest purchase of their lives you think people would actually read pages of a phone contract, maybe you would blame the credit card user if they don't read those periodic 'changes to the terms and conditions' mail if the credit card company decides to sell consumers information to spammers.


    I am all for being an informed consumer but onus of fair and anti fraud practice does lie on the companies foremost.

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    "I never doubted you for a second. Wonderful!"