[Rocketfan]

It's called lock-in, folks: The tactic that works by ensuring that once you sign on with a product or a company, you have virtually no way to escape. You're stuck for life. Apple does this with the iPod by locking iTunes to its music player. Online e-mail providers do this regularly by making it impossible to get your email out of their system and onto another.

But perhaps the most notorious example of electronics lock-in is the good-old cell phone contract early termination fee. Every carrier has one: If you want to get out of your contract early, you'll pay at least a hundred bucks for the privilege. The carriers justify it by saying you get a better deal on your cell phone when you make the initial purchase, but for many, hanging on to a crummy phone for two years just isn't worth it, and many people find that after the first year has passed, they want out of the deal (usually so they can get an iPhone).

And that termination fee is always painful.

http://tech.yahoo.com/blogs/null/154280

[El Scorcho]

Apple does this with the iPod by locking iTunes to its music player...

I know everyone expects me to protest, so I will.

Not really. You can use the iPod with other software and music purchased in iTunes these days isn't locked down. I know I'm nitpicking, but it's not the best example anymore.

The email example is spot-on though and why I will continue to pay for my own domain and host my own email for the foreseeable future.

[Liberty4Life]

Regarding Verizon:

#1) People are leaving Verizon for AT&T b/c of the iPhone.
#2) Verizon, because of its two-year service contracts, give its customers much better deals on their cell phones.

[El Scorcho]

And, this just in, you'll have to double the amount you pay for your data plan if you want to tether that Droid.

http://www.pcworld.com/businesscenter/a ... t_you.html

The "unlimited" data you get for your $60 a month of data charges isn't unlimited either. It's 5GB on the phone and 5GB to your tethered device.

If AT&T would actually enable the tethering in the iPhone to be used, I have no doubt they'd be doing the very same thing. They've got us all where they want us.

[BJWilliams]

I am now glad I never did get a BB...and sounds to me like I may not be getting a smartphone for a while

[El Scorcho]

Hrm. I was just reading an article this morning where a Verizon spokesperson was pointing out that the ETF can be avoided all together if customers decide to pay full retail price for their phones instead of taking Verizon's subsidy.

I have to say that the ETF's make sense from that point of view.

[olldflame]

ETFs are a legitimate part of the current marketing strategy and price structure in the wireless industry. They are practically giving phones away and building the cost of the phone into the price of the contract. They have to be able to recoup those costs if someone opts out early. Check out the prices of unlocked phones on line and you will see how much you would be paying without it. It can be worth it though, particularly for people who travel a lot overseas.

[Hold My Own]

How can they do this when there have been so many lawsuits for those with the fees and the customer actually winning?

[olldflame]

I think most of the lawsuits that have been won against the wireless companies were centered on other issues, like automatic contract renewal. The right of the company to charge an ETF if it is in the contract is pretty clear. You are essentially buying your phone on installments, with the payments included in your monthly fee. Of course, this is only if you are getting a discounted price on the phone in return for signing the contract. Pay full price or provide your own unlocked phone, and you shouldn't even need a contract. I don't think a lot of people realize how expensive the high end phones actually are. An unlocked Blackberry Tour will run you $500.00 or more. Of course Verizon and Sprint aren't paying that much, but they are paying a good bit more than the $100 or so they charge with a 2 year contract.

[El Scorcho]

How can they do this when there have been so many lawsuits for those with the fees and the customer actually winning?

See my post. They're legit. If enough people keep suing, they'll just stop subsidizing the phones.

[olldflame]

Something which I think is genuinely unfair is that the carriers, who clearly augment their monthly rates to cover the cost of subsidizing phones for the vast majority of customers who choose contracts which include them, don't give a discount to those who either provide their own phones or choose not to upgrade at the end of their contract. You are not "locked in", but you pay the same rates.

[El Scorcho]

Something which I think is genuinely unfair is that the carriers, who clearly augment their monthly rates to cover the cost of subsidizing phones for the vast majority of customers who choose contracts which include them, don't give a discount to those who either provide their own phones or choose not to upgrade at the end of their contract. You are not "locked in", but you pay the same rates.

I agree. I also wish they wouldn't be allowed to advertise their data plans as unlimited when they are not. I don't know how their marketing people get away with it.

[LUconn]

Unlimited* data! FOR FREE**!!!






*limited
**not free