Many cell phone users do not know when their contracts end, and very few of them know thespecifics of their legal rights.END-USER AGREEMENTS: A contract of adhesion is when the agreement it is drafted by aparty that has superior bargaining powers, and uses that leverage to write the agreement to theiradvantage (a "take it or leave it" deal). Generally enforceable (similar to website agreements,software licenses, etc.
clickwrap, shrinkwrap, etc.)
unless unconscionable (e.g., severepenalty provisions, very small print, etc.).
Most businesses would never conclude theirvolume of transactions if it were necessary to negotiate all the terms of every consumercontract.
LATE FEES: Currently limited relief for consumers; Waiting for either the Courts or the FCC todetermine who is going to regulate (the
is in favor of nationwide uniformity; The FCCChairman has said he favors a single national rule that would require early termination fees toshrink over the course of a contract). Most complaints are based on high rates that wirelesscompanies use to compute late fees. According to the
Better Business Bureau
, wirelesscompanies have received the most or second-most consumer complaints compared to otherindustries every year since 2003.
―CELL PHONE JAIL‖
& EARLY TERMINATION FEES (ETF
―locked‖ into contracts (cannot switch
when a competitor offers a betterdeal).Most phones sold in the U.S. are also
into the carrier that sold them; certaincountries require mobile phones be sold in an unlocked state; Prices for an unlockediPhone can range from $400 to $700.A way for wireless companies to subsidize expensive mobile telephones (e.g., $50 for a$350 phone).
A reasonable fee to recover the cost of cell phones, which wireless companiessubsidize in exchange for customers signing up for long-term contracts.Form of
Usually range between $175 to $200.
Wireless companies subsidize the telephone in exchange for revenues fromcontract for years to come.
’s often much
higher that the actual lost profit the wirelesscompany suffers.Right to opt-out of mandatory arbitration.