Kansas City Business Journal (Kansas & Missouri)
Sprint Nextel Corp., already bleeding subscribers, has given its customers another reason to leave.
The wireless carrier raised its text messaging rates from 10 cents each to 15 cents on Oct. 1. The move has enticed some customers to exploit a contract loophole that allows them to cancel service and not pay a $200 early-termination fee if their rates change.
Sprint Nextel has pushed back in some cases, calling on language in its subscriber contracts that the rate change must be “material and adverse.”
Keeping subscribers from fleeing has been a key priority for Sprint Nextel. It shed 188,000 valuable postpaid subscribers last month, while rival Verizon Wireless added 1.9 million subscribers. Verizon Wireless said “almost all” the additions came on postpaid plans.
Melissa Hill, a Nextel subscriber in Phoenix, said a customer service representative she spoke with on Oct. 25 lied about the text messaging change, claiming that her rates had not gone up. On Oct. 30, a different customer
service representative at Nextel confirmed the increase but told Hill that text messaging was an optional service and insisted that she would have to pay the $200 penalty to cancel.
“They’re screwing the people who found out” about the loophole, she said.
She said she wants to cancel service because the quality of calls on her Nextel phone has suffered since Sprint Corp. merged with Nextel Communications Inc. in August 2005. Sprint Nextel is in the midst of a massive retuning of the Nextel network, which has led to degraded call quality.
Sprint Nextel spokesman David Gunasegaram said the carrier will look at each customer on a case-by-case basis to determine whether the price increase was “material and adverse.”
Asked to elaborate, he said only that customers affected in a “substantial” way could disconnect without penalty.
Harvey Rosenfield, founder of The Foundation for Taxpayer and Consumer Rights, a consumer watchdog group based in Santa Monica, Calif., that frequently sues wireless companies, said any customer affected should be able to disconnect.
“I don’t think that Sprint Nextel has a prayer on this,” Rosenfield said. “I think (consumers) can file suit.”
