AT&T Raises ETF to $325 for Smartphones, Feeds Us Crap in an Open Letter

When Verizon raised its early termination fees to $350 for smartphones last year, everyone was up in arms. Now AT&T is following suit just before the new iPhone is set to be announced. In an open letter to the public and its customers, AT&T said that if “you wish to cancel service before your two-year agreement expires, you agree to pay a prorated early termination fee (ETF) as an alternative way to complete your agreement.” The cost? $325 if you sign up for a new contract or renew your current one after June 1. Current AT&T customers shouldn’t be affected.

Fair enough. If you don’t want to pay that hefty fee, don’t sign the contract, right? It’s not always that easy, especially when you run into situations where you have to or really want to cancel your contract. $325 is just going to be a hefty price to pay. On the bright side, the cost goes down $10 every month you stay with AT&T. The downside? The ETF used to be $175, and to get it back down to that you’ll have to stay for 15 months with the new terms.

Oddly enough, basic phones will get a cut in termination fees – down to $150 from the original $175. AT&T, sometimes you just don’t make any sense.

Here’s a full copy of that open letter:

An Open Letter to our Valued Customers

May 21, 2010

At AT&T, we work hard every day to provide you with a great wireless experience at competitive prices.

One of the ways we do this is to offer you the industry’s leading wireless handsets below their full retail price when you sign a two-year service agreement. In the event you wish to cancel service before your two-year agreement expires, you agree to pay a prorated early termination fee (ETF) as an alternative way to complete your agreement. Of course, if you prefer not to enter into a term commitment, we offer the same great selection of devices at their full retail price with no term commitment or ETF, as well as prepaid GoPhone options.

We are now making changes that will lower the ETF for many customers who agree to new term commitments, and will increase it for others. Current AT&T wireless customers who are within their two-year consumer service agreement or have an existing enterprise service agreement will see no change to their current terms.

Beginning June 1, 2010, we will reduce the ETF in new and upgrade two-year service agreements for all customers who are buying basic and quick messaging phones. Whether you are new to us or upgrading handsets, the ETF will decrease to $150 from $175, and be reduced by $4 for each month that you remain with us as a customer during the balance of your two-year service agreement. After the term commitment is completed, the ETF will no longer apply.

For customers who enter into new two-year service agreements in connection with the purchase of our more advanced, higher end devices, including netbooks and smartphones, the ETF will increase to $325, and be reduced by $10 for each month that you remain with us as a customer during the balance of your two-year service agreement. After that, the ETF will no longer apply.

Thank you for being an AT&T customer. We hope you enjoy your AT&T wireless device and service. We appreciate your business and we will continue to work hard to earn it.