US lawmaker slams iPhone termination feeThe Apple iPhone has enjoyed favorable reviews since its recent debut, but it came in for some rare criticism.
The phones, which cost between $500 and $600, are usable only on AT&T’s wireless network and will remain that way until 2012.
Even though the phones become expensive paperweights if customers quit AT&T’s wireless plan, the company will still charge a $175 early termination fee, said Rep. Edward J. Markey, chairman of a US House subcommittee on telecommunications and the Internet.
Markey described the phone as a “Hotel California service. You can check out any time you like, but you can never leave, you’re stuck with your iPhone and you can’t take it anywhere.”
The issue arose at a hearing on whether Congress should grant the cell phone industry’s wish and pre-empt states from regulating wireless phone companies.
State public utility commissions have no authority over pricing on wireless plans, but do have the authority to regulate the terms and conditions of wireless service agreements.
The wireless industry opposes what Verizon Wireless general counsel Steven Zipperstein called “patchwork, utility-style regulation” as “unnecessary and harmful.”
The Federal Communications Commission is currently considering rules that will dictate how a valuable swath of spectrum to be auctioned in the next six months will be used. Among the proposals is a requirement that one block of airwaves being auctioned be accessible to all wireless devices, which would include the iPhone.
