I know I harp on this topic a lot, but I really believe that AT&T and Verizon are causing America great harm. They’re causing our country to be non-competitive, they’re dragging our industries and companies down like a ball and chain. They are genuinely hurting employment, productivity, and competitiveness.
The going rate for month of cellular telephone service in Asia is about $25. This includes unlimited incoming phone calls, and about 10 to 15 GB of high-speed data. There are no contracts to sign. You just go to 7-Eleven and buy a SIM and activate it.
I don’t know why in the United States it’s necessary to sign a two-year contract. How are the cell phone companies being hurt when a customer terminates their service. The only explanation I can think of is that the cell company loses revenues from a customer who wants to leave because the coverage at their home or office is crappy.
These two-year contracts prevent customers from shopping around. They prevent customers from leaving a company that removes towers. They prevent customers from leaving a company when the tower speed drops from 40 Mb per second to a quarter megabit per second. The only purpose for two-year contract is to keep a customer locked into something that they don’t want. They probably don’t want it because it doesn’t work.
I am absolutely confident that if we outlawed two-year contracts on cellular service that we would see the quality of service immediately improve.