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Washington AG Slams T-Mobile Over Deceptive 'No-Contract' Ads
zacharye writes "Washington State Attorney General Bob Ferguson on Thursday ordered UNcarrier T-Mobile to correct 'deceptive advertising that promised consumers no annual contracts while carrying hidden charges for early termination of phone plans.' T-Mobile, which recently did away with standard cell phone service contracts and typical smartphone subsidies, is accused of misleading consumers by advertising no-contract wireless plans despite requiring that customers sign an agreement that makes them responsible for the full cost of their handsets should they cancel service prematurely ..."
With a standard cell contract, your recurring charges stay the same indefinitely. You are billed as if your phone is subsidized even if it is not.
There are 0x40000000 types of people: those who understand 32-bit IEEE 754 floating point, and those who don't.
It's a loan, not a cell service contract.
You can cancel your service anytime, just pay up the rest of the principal on the 0% interest loan they're giving you.
Maybe you're on your first phone contract or have simply never owned a phone out of contract, but I can say for absolute fact that you do not get any special treatment for owning your phone outright. The cost of the plan is a fixed amount, subsidized or not. If you bring your own phone you are only aiding the carrier hedge their bets by paying the same monthly rate as a contracted user but posing zero repayment risk.
That's true with Verizon, AT&T, and Sprint. But not T-Mobile. As soon as you pay for the phone, you're monthly bill goes down. Also, if you bring your own device, you get that dropped rate immediately.
Are you being deliberately dim? You are paying for a new phone whether you get one or not because the plans offered cost the same whether or not you bring your own device. I can attest from personal experience with Sprint ... even if you bring your own device they still won't give you a new line without a 2 year service contract that costs exactly the same as it does if you get one of their "free" or "low cost" phones..
You can even sell your phone on ebay to try to recoup some of the costs if you don't want it anymore.
And for the tl;dr set T-Mobile will even buy the phone back and credit that to what you owe.
"A person is smart. People are dumb, panicky dangerous animals and you know it." - K
Prior to T-Mobile's offering of no-contract plans - if you paid for your phone outright, or brought your own phone - you STILL had to sign up for a contract.
That's true, though it isn't the recent no-contract offering that started it. T-Mobile has been doing it for several years now. My plan has been $20/month cheaper than it otherwise would be ever since I brought my N900 to them three years ago.
I just read through it, and T-Mobile's deal is basically a 0% APR loan with a down payment and fixed $20/month payment, on top of your monthly service charge, for however long it takes to pay off the principal (depends on the price of the phone).
Any competent lender is going to provide you with a contract which spells out what happens when the loan ends, what happens if one or both parties terminate early, etc, and in T-Mobile's case, the loan is contingent on maintaining carrier service, and the remedy is full payment of the balance. Otherwise, people will just quit and get a $600 phone for the price of a $99 down payment.
Similarly, most new auto loans may be contingent on maintaining a service of some sort, like full coverage insurance. I think Washington State's AG has his head firmly implanted betwixt his butt cheeks, since any non-retard should easily tell the difference between the pay up front no-contract, month to month deal, and the other one which includes all kinds of disclosures as to the fact they're agreeing to a loan... But whatever.
Constitutional rights may be respected, repealed, or modified; but they must never be ignored.