I won't pay AT&T early-termination fees

Yesterday T-Mobile started taking orders for iPhone 5, which goes on sale from the carrier on April 12. I ordered one black and one white 16GB iPhone 5, setting me back nearly $293, thanks to California's outrageously high sales tax (yeah, I know it's a pittance to many Europeans). I'm in process of ripping all five lines from AT&T's grubby paws and moving them to T-Mobile. Expect a very public spectacle, as I write about my struggle to get AT&T to reduce early-termination fees.

My first attempt on the first three lines failed. An AT&T customer rep knocked $100 off my bill, which isn't nearly enough. He said, and I've heard this before, the carrier's computer system wouldn't let him reduced ETFs. They're firm obligations that I don't feel obligated to pay -- well, not fully. I'm ready to make my case in the court of public opinion and in process hopefully raise more discussion about ETFs. T-Mobile does away with them. Why not other US carriers?

I don't switch carriers lightly -- something long pondered -- because of onerous ETFs. But I've reached a point where enough is enough and take the risk knowing AT&T may compel me to pay more than $700 extra after the last numbers migrate. AT&T ETF is $325 per smartphone, an amount that reduces monthly through the contract period.

Piss-poor Service

My family is switching to T-Mobile for two reasons:

  • Cutting the monthly bill (including ongoing device payments) by about one-third
  • Terrible AT&T service in my area -- otherwise I would wait out the contracts and change later

The latter reason reflects on ETFs. Almost since I moved to San Diego five-and-a-half years ago, AT&T service displeased. Early days, we had frequently-dropped calls, which increased after iPhone 4 and again 4S released. Some of these problems are documented in past BetaNews stories. Eventually, call dropping nearly stopped altogether.

But a new problem emerged about a year ago. While calls are clear to us, nearly everyone on the other end complains voice is broken up. The problem is much, much worse following iPhone 5's launch, and it's chronic.

Mutual Obligations

From my perspective, AT&T failed to live up to its end of the contract. Phones are useless as phones if we can't make calls. Neighbors in the same apartment building complain of reception problems, too, and it's not unusual to see someone in my family or another tenant walking down the street to make calls. We put up with this situation for a long time. The local corporate AT&T store admitted some years ago that my neighborhood is known for signal problems. Since switching three lines to T-Mobile late last month, calls are clear. Is service like that too much to ask?

My father-in-law is 91 -- he spent three days in hospital at New Years. His life could depend on our receiving a phone call from him. He uses and iPhone, and I really can't ask him to learn something else. Frankly, I should have switched carriers sooner for his benefit and strongly feel AT&T is owed little to no ETFs on the three lines where phone calls are difficult to next to impossible to make.

Funny, if I moved from T-Mobile for similar reasons, I would feel differently. Under the new Simple Choice plan, a phone is clearly financed and unlocked free and clear if I want to take it elsewhere. iPhone 5 is $99.99 upfront and $20 monthly for 24 months. AT&T sells the phone for more, upfront ($199.99) with contract or full price without ($649 vs. $579.99 from T-Mobile). But, more importantly there, is the contract, which, I say, obligates both parties -- AT&T to provide service and for me to pay for it. Why should I pay for service that isn't provided? T-Mobile financing is a one-way obligation -- that I pay off the phone as promised for the privilege of putting down less upfront and to receive interest-free financing. The "Uncarrier" makes no service objection directly related to the phone's cost to me.

Subsidy Madness

ETFs are the bones holding the whole subsidy model in place. US carriers sell you a smartphone for X-lower dollars, hiding the device's real price, and on smartphones obligating you to pay for data service for 24 months. My father-in-law doesn't need data at all on his iPhone 4 -- home WiFi is more than enough. But as part of the subsidy-obligated contract, data plan is required. Twenty bucks a month for 300MB data. Last year I moved the whole family to a shared plan, trying to waste less paying for nothing.

If AT&T provided adequate phone service, I would wait out the contracts and move them one by one. That's what I did with T-Mobile years ago, when we switched to AT&T so that my daughter and father-in-law could have iPhones.

I'm ready to pay half the ETFs, and AT&T is welcome to the subsidized phones. I don't expect to pay nothing. But if I'm contractually bound to pay, AT&T is obligated to provide adequate service, which it never has to our apartment since the family moved here in late 2007. We put up with poor cellular service -- from frequently dropped calls to garbled ones -- for more time than is reasonable. AT&T can't win back my cellular business, but could keep me for U-verse, for which I've been a customer since February 2008.

I'll do the right thing and pay something. Will AT&T do the right thing, too, and make fees reasonable for the service provided? A future post will answer that question.

Photo Credit: Christina Henningstad/Shutterstock

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