[IanHar]

3 years!!! That's outrageous. I assume that was a B2B contract. The only comparable i can think of in consumer market would be mortgages, but even then it's only an early settlement fee. They don't demand that you continue to pay for something you don't use.

Brian, You hit the nail on the head when you said:
"However, I can see why they do it - by guaranteeing income into the next accounting quarter, such businesses make themselves more attractive and viable for investment from banks and other third parties, and additionally adds more potential value to the company worth for resale."

The problem with this is that they are essentially passing this cost on to customers that are not happy with their services (otherwise they would be renewing their contracts). They do this, rather than earn the revenue.

It's just wrong.