For Immediate Release - April 13, 2012

Statement on cellular phone upgrade fees

Undersecretary Barbara Anthony
Statement on cellular phone upgrade fees

I am very concerned that consumers have little choice in the cellular phone marketplace except to pay this new activation fee when upgrading to a new phone. With the announcement this week by Verizon, all four cellular phone carriers are charging upgrade fees – in addition to the price of a new phone.

AT&T and Sprint are charging $36; Verizon is charging $30 while T-Mobile is charging $18. I want to stress that these charges are in addition to the cost of the new phone and the cellular phone contract.

Consumers need to closely examine the fine print when buying a phone, upgrading to a smart phone and entering into a cellular phone contract. Lower upfront costs may have hidden fees down the road in regard to data plans, directory service or other costs.

In some instances, consumers can negotiate with cellular phone carriers to waive upgrade costs, but again there are pluses and minuses to agreeing to the longer term contracts that often accompany such a purchase.

Consumers need to be their first and best advocate when making any significant and important purchase such as a cellular phone. My office offers these important reminders:

  • Ask for all information in writing up front.
  • Understand what you are buying.
  • Try to negotiate the most consumer-friendly plan.
  • Don’t sign any documents without fully reading all the material.
  • Pay special attention to cellular phone contract terms.