In a move that could send shockwaves through the wireless service provider world, government officials reportedly are trying to help cell phone customers avoid high fees when cancelling contracts.

 

According to The Associated Press, the Federal Communications Commission is proposing that cell phone customers not be required to pay a fee if they cancel service within 30 days of singing up or 10 days after receiving their first bill. Fees for quitting a contract early routinely run $175 or higher, according to the AP.

 

FCC (News - Alert) officials have declined to comment, the AP said.

 

Ric Causey of Allen, Texas, told the AP that it was “ridiculous” that he had to pay $600 in termination fees to Sprint (News - Alert) after he canceled three cell phones because of what he characterized as poor reception near Dallas.

 

The freelance video producer told the AP that he’s had no luck trying to reach an agreement with Sprint officials, but ended up paying the money so his credit wouldn’t be undermined: “I understand the fine print, but I ended up paying $200 per phone just to switch service . . . I never got any satisfaction. I figured I’d deal with it later, but I never got reimbursed.”

 

The FCC proposal wouldn’t get rid of all cancellation fees, according to the AP. Yet it would cap the fees and reduce them month by month over the course of a contract based on how long customers have left, according to anonymous sources cited by the AP.

 

In a strange twist, cell phone companies also could stand to profit from the deal.

 

The FCC agreement would let the companies off the hook for law suits filed by angry customers that total in the billions of dollars, according to the AP.

 

The nation’s second-largest wireless company, Verizon (News - Alert) Wireless, had offered the proposal to the FCC for its review, according to the AP, along with other leading wireless companies.

 

According to the wireless companies, cancellation fees are necessary to recover the cost of cell phones, which they subsidize under long-term service contracts, and to defray their costs for signing up new customers, the AP reported.

 

Yet consumers and groups that represent consumers say the fees are designed to prevent customers from switching among providers.