Truth-in-Billing Needed to Protect Consumers

FOR IMMEDIATE RELEASE

Date: January 26, 2010
Contact: Liz Rose, Communications Director, 202-265-1490 x 32

WASHINGTON -- Today, the Federal Communications Commission asked several wireless businesses, including Verizon Wireless, AT&T and Google, for information relating to their assessment of early termination fees.

Free Press Policy Counsel Chris Riley said, "The FCC should be cheered for continuing to press for more information about the widespread anticompetitive practice of restricting consumer freedom through shockingly high early termination fees. Consumers should not have to pay $350 -- or more -- to cancel a bad service, but the harm is even greater when this penalty comes as a surprise. The FCC is right to express concern that disclosure of these penalties and their justification follows no clear format. We urge the FCC to clarify that the 'discount' offered on devices should be measured relative to the wholesale price of the device and not to the artificial, meaningless, and uncompetitive 'retail price.'

"Excessive and poorly disclosed early termination fees are a symptom of the dire need for FCC intervention in a broken market. The state of consumer disclosure must be improved for there to be any hope of meaningful competition in the wireless industry. But Free Press encourages the FCC to go beyond letter-writing, and to strive to break open the closed market for mobile services and devices, and to encourage the creation of real competition, which would mean lower prices and better service for consumers.

"We encourage wireless companies and their executives to put their customers first, and not their nearly 30 percent profits and million-dollar CEO salaries. We hope that other companies do not follow Verizon Wireless' lead and fail to respond meaningfully to the FCC's reasonable request."

Free Press is a national, nonpartisan organization working to reform the media. Through education, organizing and advocacy, we promote diverse and independent media ownership, strong public media, and universal access to communications. Learn more at www.freepress.net

Free Press is a national, nonpartisan organization working to reform the media. Free Press does not support or oppose any candidate for public office. Through education, organizing and advocacy, we promote diverse and independent media ownership, strong public media and universal access to communications.