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News
Congressman Proposes Bill to Require Contract-Free Phones
Tuesday, February 26th, 2008 at 3:00 PM - by .(JavaScript must be enabled to view this email address)
Rep. Ed Markey (D-Mass.) has proposed a sweeping bill to alter the terms on which customers purchase mobile phones. The "Wireless Consumer Protection and Community Broadband Empowerment Act of 2008" recognizes that wireless service has become a replacement for traditional phone service for millions of Americans and seeks to require broader disclosure of fees and terms, require plans with no early termination fee, proration of plans that do have termination fees, offer a contract-free non-subsidized phone and a host of other remedies that seek to address practices in the mobile phone industry.
Rep, Markey is the chairman of the House telecommunications and Internet committee. Hearings on the bill start on Wednesday.
The mobile phone carriers have responded, according to C|Net, by saying that the early termination fee is necessary to offset the cost of subsidized phones. Accordingly, the Markey proposed bill would require carriers to offer a non-subsidized phone.
The proposed legislation mirrors the rules that have been in force in Europe for some time.
Seeing the handwriting on the wall, some carriers, including AT&T, have already announced plans to prorate termination fees. That move is probably intended to serve as evidence that the mobile phone industry can regulate itself. Rep. Markey’s proposed legislation however goes into much greater detail to protect the interests of the consumers. No doubt that the CTIA and the carriers will fight this bill, but the weight of time, the dependence of so many Americans on cell phones and the precedent in Europe all portend a sea change in the way Americans purchase mobile phones.
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