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FCC Investigates Verizon Cancellation Fees

The Federal Communications Commission (FCC) is questioning why Verizon Wireless doubled its early termination fees from $175 to $350.

In a formal letter sent Friday, the government agency asked the nation's largest cellular operator several questions regarding the rationale for the new cancellation policy. The FCC is also seeking answers about how clearly labeled the ETFs are on customers' monthly bills.

Verizon did not respond specifically to the FCC's inquiry, but the mobile operator has said it needed to raise ETFs in order to defray the costs of advanced devices it sells to customers at a subsidized price. For example, the BlackBerry Storm 2 costs about $179 with a new two-year contract, but it costs $539 without a contract or ETF. The unsubsidized price is relatively close to what Verizon has to pay for each device, although it likely gets a bulk discount.

To continue reading, see the full story on InformationWeek.com.

— Marin Perez, InformationWeek

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