The Hidden Cost of a 2Yr Nexus One Contract
Here’s why paying $530 for an unlocked, unsubsidized Google Nexus One doesn’t sound so bad after all. Flip the first two digits of that price, and you’ll get Google’s early termination fee (ETF): $350. The relevant clause from the Nexus One’s Terms of Service (TOS):
You agree to pay Google an equipment subsidy recovery fee (the ‘Equipment Recovery Fee’) equal to the difference between the full price of the Nexus handheld device without service plan and the price you paid for the Nexus handheld device if you cancel your wireless plan prior to 120 days of continuous wireless service. For example, if the full price of the Nexus handheld device without service plan was $529 USD and the price you paid for the Nexus handheld device was $179 USD with a service plan, the Equipment Recovery Fee you pay will be $350 USD in the event you cancel within the first 120 days of carrier service.
To be clear, the ETF applies to those who paid “only” $179 for a phone and a two-year contract with T-Mobile. And the price apparently drops after you’ve used the phone non-stop for 120 days (which is faster than you may think). Besides, those who enter into two-year contracts only do so after much thought and careful financial-planning, right?
Well, given the dearth of advice on how to get out of cell phone contracts early, perhaps not. Worse, due to the vagueness of the TOS, seems Google’s ETF isn’t the only thing premature terminators have to pay; other fees may be due to T-Mobile.
Whatever the case, such an ETF—again only effectively applicable for 120 days after the phone is first set up—makes paying $530 for only the phone a more attractive proposition.
Post from: The Gadget Blog
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