Carrier subsidized Nexus One has two ETFs

Google is making buyers of the subsidized Nexus One pay twice if they cancel early, according to the company's own Terms of Sale. The search company charges an "Equipment Recovery Fee" of $350 for the smartphone if they cancel their service before 120 days have passed. It explicitly warns that the fee is above and beyond whatever T-Mobile might charge and could result in customers effectively buying the Nexus One twice if they leave.

The terms justify the secondary charges as compensating for "liquidated damages" to Google when the phone hasn't been in use long enough to recover costs. However, T-Mobile's own Early Termination Fee is intended to cover those losses and again clouds the issue.

Google hasn't responded to the concerns as of this writing. Unlocked Nexus Ones aren't affected by the pricing system.

The secondary fee is a blow to Google's attempts to position the Nexus One as a new business model, where the company branding the phone, not the carrier, is responsible for sales and support. Others also sell phones directly but either leave all cancellation fees to the carrier, such as with Apple's iPhone, or else are like Nokia and limit the majority of their own sales to full-price, unlocked devices. [via Phandroid]

By Electronista Staff