CTIA: Klobuchar cellphone bill unnecessary

Amy KlobucharCTIA, the wireless industry's trade association, said the bill introduced today by Sen. Amy Klobuchar (D-Minn.), which aims to curb cellphone contract cancellation fees, is not needed.

Steve Largent, CTIA president and CEO, said wireless carriers already pro-rate early termination fees (largely because of a previous bill Klobuchar introduced in 2007).

"That was the response of a highly competitive industry to consumer demand, and this type of prescriptive mandate runs the very real risk of limiting consumer options in the future," he said.
 
“With more than 95 percent of the U.S. population having an option of at least three different wireless carriers, this is a fiercely competitive market with every carrier competing with each other for every single customer," he said. "Consumers have many choices, one of which is to purchase a prepaid plan which comes with no contract.  About 20 percent of American wireless consumers currently have selected that option."

He also said a national framework of legislation will provide maximum consumer benefits, rather than allowing states to impose their own unique conditions "that ultimately increase costs." 

Update (6:30 p.m.): Sprint Nextel also says the industry does not need legislation. Sprint spokesman John Taylor said in a statement: "Sprint Nextel is already offering pro-rated early termination fees as proposed by the Senators' legislation; we are doing so not because of any legislative action, but because that's what consumers expect of us. That's why we don't believe legislation is necessary."

When Verizon Wireless announced it was raising its early termination fees, Sprint said it did not plan on following suit.

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