Google Lowers Nexus One Termination Charges

by Gaurav Kheterpal on February 10, 2010

Nexus One - A Lower Termination Fee

Nexus One - A Lower Termination Fee

It seems that Google has finally given in to the public criticism and the federal inquiry over the high Nexus one termination fee.

The so called ‘Equipment Recovery Fee’ has been brought down from the current $350 to $150 with immediate effect. This notification comes via updated ‘Terms of Sale for Nexus Device‘ which mentions

“You agree to pay Google an equipment subsidy recovery fee (the “Equipment Recovery Fee”) in the event you cancel or downgrade your wireless plan within 120 days of activation of wireless service. If you activate a new line of service with T-Mobile, your Equipment Recovery Fee will be $150 USD if you cancel or downgrade your service plan within 120 days of activation. If you are upgrading an existing line of service with T-Mobile, your Equipment Recovery Fee will be $50 USD if you cancel or downgrade your service within 120 days of activation. You authorize Google to charge the applicable Equipment Recovery Fee directly to the credit card or other payment method used to purchase the Nexus handheld device upon cancellation or downgrade of your wireless plan. You will not be charged the Equipment Recovery Fee if you return your Nexus handheld device to Google within the 14 day Return Policy period as set forth below.”

The termination charges apply to users who break their 2 year T-Mobile contract after 14 days and within 120 days of Nexus One purchase. While Google has denied lowering the fee on account of federal inquiry, it is obvious that the pressure of an inquiry from federal regulators has prompted Google to take this step.  In an official statement, Google mentions

“”Google’s overall financial philosophy with regard to operator service plans remains unchanged: We make no profit from commissions from operators or from equipment recovery fees, and our recovery fees are based on operator charges to Google for early termination of service. We have been looking for ways to improve our customers’ experience, so we were able to work with T-Mobile to find a better solution for our customers”

I’m wondering what took Google & T-Mobile so long to find a ‘better solution’ for customers. In January, FCC had issued letters to T-Mobile, Google, AT&T, Sprint Nextel and Verizon Wireless seeking clarifications on the termination fee.

I’d hardly be surprised if other carriers follow suit in lowering their termination fee pretty soon!

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Written by: Gaurav Kheterpal. Follow by: RSSTwitter,, or Friendfeed

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