updated 03:35 pm EDT, Thu April 25, 2013
T-Mobile must spell out penalties for early cancellation of new plans
T-Mobile's newly-launched "Uncarrier" plans are seeing some resistance from judicial channels. Washington State Attorney General Bob Ferguson has demanded T-Mobile correct "deceptive advertising" that promised customers no annual contracts not requiring the user to "serve a two-year sentence," despite having what the office calls hidden charges for early termination of a new device plan that amounts to the same two-year contractual obligation.
The new plans start from $50 per month for one phone, which comes complete with unlimited calls, unlimited texts, and 500MB of tethering-enabled data allowance. Extending it to 2GB of data costs an extra $10, then a further $10 for every 2GB extra, with usage that goes past the allowance being throttled down to 2G speeds. New phones are available, with a small or nonexistent initial payment, plus a monthly fee based on the unsubsidized price of the phone.
"As Attorney General, my job is to defend consumers, ensure truth in advertising, and make sure all businesses are playing by the rules," Ferguson said. "My office identified that T-Mobile was failing to disclose a critical component of their new plan to consumers, and we acted quickly to stop this practice and protect consumers across the country from harm."
After an investigation of the new T-Mobile offerings, the Attorney General's Office found that the company failed to disclose that customers who purchase a phone using the 24-month payment plan must also carry a wireless service agreement with T-Mobile for the entire 24 months -- in other words, a contract -- and pay the additional monthly fees for the phone or pay the full balance owed on phone if they cancel earlier.
Customers in Washington state between March 26 and April 25, 2013 are now allowed to return the device and cancel service as a result of the ruling, without being required to pay the remaining balance owed on their devices. Additionally, to avoid litigation, T-Mobile has agreed to clarify customers' obligations to the carrier for the sale of service or equipment; make clearer the consequences of canceling service before a device is completely paid; train customer service representatives on the agreement, and pay attorney fees to the Attorney General's office in the sum of $26,046.40.