Google, AT&T, Sprint: Fees Under Scrutiny

NEW YORK (TheStreet) -- Google(GOOG), AT&T(T), SprintNextel(S), Deutsche Telekom(DT) subsidiary T-Mobile and the Verizon Communications(VZ)-Vodafone(VOD) joint-venture Verizon Wireless have each been handed a letter full of questions from the Federal Communications Commission investigating their "substantial" early termination fees and their lack of transparency.

The FCC wrote that these standardized questions are an essential step to ensuring that consumers have the information that helps them make informed choices in a competitive marketplace. Google, AT&T, SprintNextel, T-Mobile and Verizon Wireless were given a February 23 deadline to finish the questions.

The FCC says it recognizes that wireless carriers may have various rationales for early termination fees, but says it's concerned that these expensive and, in some cases, rising fees are hindering customers' ability to switch carriers.

"We therefore believe it is essential that consumers fully understand what they are signing up for -- both in the short term and over the life of the contract -- when they accept a service plan with an early termination fee," the FCC wrote in the letters.

The FCC says that it is currently investigating options for improving consumer information and transparency about communications services and fees, including early termination fees, as a follow up to the FCC's Notice of Inquiry on Consumer Disclosure issued in August 2009.

"Our discussions with wireless companies since December indicate that there is no standard framework for structuring and applying ETFs (early termination fees) throughout the wireless industry," the FCC wrote.

The FCC adds that it knows some companies do not have ETFs.