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Judge Rules Sprint Early Termination Fees Illegal

thebdj Re:I don't understand (343 comments)

The problem with this is the judge is taking it upon himself to decide there is no proper basis for such a penalty, when it is clearly intended as a penalty - a disincentive to terminate the contract.

Honestly, you could probably argue these fees violate anti-trust law in the US if you get the right US District Court to agree with you that these fees are less about subsidized phones and more about preventing customers from switching services. The cell phone companies have always resisted anything that made leaving them easier (phone number portability comes to mind). There are plenty of ways to make these fees more legitimate, as in the prorated fees used by the other major providers. This is less likely to draw legal complaints.

What is next? A court reviewing a software license agreement that has a large penalty clause in it? It seems that a "penalty" that is not identified as a penalty but stated to the customer as a cost recovery, a pro-rated subsidy or something else would be a problem. But every cell phone agreement I have seen says it is basically a penalty.

Yes, but the penalty has to still conform to law. Just because you put something into a contract does not make it legal. The legality of contract clauses from cell companies and software makers (since you brought them up) have been contested and in some cases defeated in court as being unfair or out right illegal.

This said, the contract is silent on the purpose of the fee; however, the cell service providers have states repeatedly it is a means to protect their subsidies of the phones. As I stated above, the court is seeing this for what it is, total bullshit. So to recap, a contract does not make that which is illegal legal and a non-prorated termination fee does not stand up well when your main argument is cell phone subsidies cost money.

more than 6 years ago

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thebdj thebdj writes  |  more than 8 years ago I am a big fan of attempting to move towards content delivery that provides the consumer the means to view new (and old) television programming on their own time. This includes allowing them to view this content without those commercials that chew up nearly eight minutes for each half hour of television.

I did recently begin using the iTMS. I will admit I was somewhat impressed, and while I still believe I will buy most my CDs used whenever possible, it is a good alternative when there are only one or two tracks that I am after. I also was impressed that some items that are available on DVD are also on there. (I noted the Best Of SNL collections.)

My problem became the flat $1.99 for short videos and TV shows. I was miffed that SW: Clone Wars v1 was $1.99 an episode. This series would cost a person much more then finding the DVD, since it comprised of more five minute shorts. I also still believe music videos are not work $1.99 a piece. The latter could be resolved by providing the MP3 of the song with the video.

I know that Apple has stated he does not want a tiered system; however, I believe a tiered system where the $0.99 (or in case of videos $1.99) is the max price (or maybe even the "average") would be ideal. iTunes is somewhat effective, in my opinion, because songs and whole albums are more cost effective then purchasing CDs at a retailer. With the pricing scheme for videos, this becomes a bit more precarious.

It is also an uneven system. A single music video or short video cost the same $1.99 as a 30-minute TV episode, which is the same as a full 60-minute TV show. I do not like the idea of adjusting video prices based on popularity, because this is overly subjective. I would like to see a length based system. Short videos (music video length in time) for about $0.99 to $1.29 and 15-30 minute tv shows being $1.29 to $1.49. Of course the hour long shows would be around $1.99 and you could adjust for longer videos. Full-length movies could stay at $9.99 if they are movies with more expensive DVD releases.

I cannot remember which of my movies were bought on the cheap. I do know quite a few were in Wal-Mart $5.50 or lower bins and some were had for $6 at Best Buy. I guess I just feel there is something to be said for having the physical copies, especially when costs are very close. I also await HD quality TV shows for free, legal download. I enjoy my HDTV and would love to be able to enjoy HD quality shows on my TV.

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