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Verizon Doubles FIOS Cancellation Fee to $360

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by underthesea

underthesea's picture
In The News

First Verizon ups its Early Termination Fee (ETF) to $360 ETF for smartphone cancellation, now it's upping the ante to include FiOS customers. The Verizon customer cost of canceling a two-year FiOS contract has now jumped from $179 to $360. Worse yet, if a customer is forced to cancel Verizon FiOS services because of a move to a part of the country without FiOS service (and there's a lot of 'em, which makes you wonder if that's why Verizon's ceased installing its FIOS altogether right now), you as a customer are still on the hook for the full cancellation amount. And there's no grace period. The FCC needs to get involved again, though who knows how long it could take to sort things out. In the meantime, Verizon Communications is reportedly jacking up its early termination fee for its FiOS TV service. The company is doubling its customer Earlly Termination Fee to $360 from the $179 Verizon currently charges customers for canceling their service early. The new fee applies to new customers who sign up for Fios service on or after January 17 and applies when customers cancel service before their two-year service contract ends. "We don't have anything to announce on this front right now," a Verizon spokeswoman reportedly stated by e-mail. On the bright side, the $360 Verizon Early Termination Fee will be prorated, decreasing over the life of the 24-month contract. Subscribers canceling their Verizon service in the middle of their contract, at a year mark, would pay less than customers canceling at the beginning of their contract. For example, a Fios customer who signs a two-year contract and cancels within three months of the contract start, would pay $330;. if the customer cancels after 16 months, the fee would be $135. The new Verizon Early Termination Fee started for any new customer after January 17. And there will be no grace period; previously, Verizon has offered customers the option of trying out the service for 15 days with no early termination fee for cancellations during that time. Gone are the days. News of Verizon's increased early termination fee comes at a time when the Federal Communications Commission (FCC) is looking into a similar early termination fee hike instituted late last year by Verizon Wireless. In November the company, jointly owned by Verizon Communications and Vodafone, announced it was doubling its $175 early termination fee to $350 for "advanced devices" like smartphones. Verizon is also prorating that smartphone early termination fee, the smartphone cancellation fee decreasing by $10 for every month of service into the two-year customer contract. The FCC isn't particularly pleased with Verizon--or at least has some questions for the company. Early December of last year, the FCC sent a letter to Verizon, asking the telecommunications company to explain why the new cancellation fee is necessary and how it will be implemented to customers. Verizon has provided some preliminary answers but the FCC hasn't made official comments on Verizon's answers; early indications suggest that the FCC isn't satisfied with Verizon's initial responses to the FCC's inquiries. "Verizon's response to the FCC [on early termination fees] has raised more questions than it has answered," said FCC chairman Julius Genachowski. "What strikes me is that there is a very real level of consumer confusion around these [cancellation] fees." While the FCC and even Congress have both questioned the wireless and paid TV industries about their early termination fees to customers, the termination fee practice persists. Not only do those fees make it more difficult for consumers to switch services, but fees also make it more difficult for competitors who are offering to pay those early termination fees to get consumers to switch. Comcast, Verizon's chief competitor throughout much of the country, has been steadily gaining back Fios TV and Internet customers by offering huge discounts and rebates on the Fios early termination fees for customers who switch to Comcast services before their contracts with Verizon end. With a higher fee, Comcast would undoubtedly have a more difficult time offering to pay a rebate to customers willing to break their contracts and switch to Comcast. Whether the early termination fee is being paid by a competitor or the consumer, one thing is clear, it is meant to keep customers locked into a service with a specific company. The FCC has not yet asked Verizon specifically about its cable and TV early termination fees. It's yet to be seen whethe rthe FCC will expand its inquiry to include those areas, as well as early cancellation fees pertaining to smartphones.

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