Verizon Wireless To Issue $90 Million In Refunds

tekgoblin writes "Verizon Wireless had somehow been charging customers extra money on their bills for data that they actually hadn't been using. Approximately 15 million customers were affected by the billing error. According to BGR the FCC had been pressuring Verizon to respond to the hundreds of complaints that had been piling up. So Verizon's answer was to refund all of the overcharged money as soon as possible."

Comments

And?

[Pharmboy]

At least their answer was to issue refunds.

Re:And?

[gorzek]

It's also hardly limited to Verizon. I've been with Sprint for several years and had a few occasions where they put strange charges on my bill. Of course, I called and complained and they took them off, saying they were "billing errors." I don't know what I'd prefer, that they're so shady they're purposely tacking bullshit charges onto people's bills, or they are so incompetent they don't know how to keep such mistakes from happening.

I can only guess how many people get those charges who never bat an eye and just pay them.

Re:And?

[gorzek]

The same thing happens with banks, for that matter, or any instance where you're charged for something. What are the odds you'll be accidentally credited instead of, say, debited twice for the same thing? And if multiple erroneous debits wind up overdrawing your account, how good are the odds that the offending party will reimburse the overdraft charges?

These errors always seem to be at the expense of the consumer and it's a struggle just to get back to zero, much less be compensated for your time and trouble.

Re:And?

[ScrewMaster]

The same thing happens with banks, for that matter, or any instance where you're charged for something. What are the odds you'll be accidentally credited instead of, say, debited twice for the same thing? And if multiple erroneous debits wind up overdrawing your account, how good are the odds that the offending party will reimburse the overdraft charges?

These errors always seem to be at the expense of the consumer and it's a struggle just to get back to zero, much less be compensated for your time and trouble.

Yeah, you're right about that (and it's statistically improbable at best.)

Still, I did have one positive experience along those lines once. Gotta be about twenty five years ago, but at the time I was pretty broke and was waiting for some money to come in, so I could open another checking account and get away from a bank that had seriously screwed me over (in fact, that's why I was pretty broke.) Suddenly, a substantial amount of money appeared in my account: obviously a banking error, but I immediately withdrew some of it, used it to open an account at another bank, then immediately withdrew those funds and put them back in my original account. A couple of days later, the original bank fixed its mistake, but that was all the time I needed.

But you're right, that's pretty goddamn rare.

That's why...

[Anonymous Coward]

You either get the truly unlimited plan, or the phone that doesn't even speak internet.

Cost of billing?

[vlm]

These customers would normally have been billed at the standard rate of $1.99 per megabyte for any data they chose to access from their phones.

Meant to say, "... standard obscene rate of ..." Thats oligopoly cartel price gouging at its finest.

I work in the telecom industry (not mobile phones). Over my career all the costs of landline long distance service have collapsed except for the cost of billing. Thus most of the "whatever cents per minute" cost is the cost of detailed billing, auditing, handling complaints. Finally the industry moved to "all you can eat" billing and everyone benefits.

I have no interest at all in owning a "smart phone" or whatever until per meg billing is abolished. I'm guessing out of the $2/meg they blow about $1 on customer support / complaints / legal / billing clerks time / software costs in support of the billing process itself and stash about $1 in pure profit.

If I'm going to pay money to get screwed, the scenario is not going to revolve around cell phone billing. F that whole industry and the shills and crooks that run it.

Re:Cost of billing?

[inode_buddha]

Reason why I'm strongly considering switching *from* Verizon: I only make about 1/2 dozen long-distance calls per year, landline only -- I don't have a cell phone. I'm paying about $75 per month even if I make *zero* calls incoming or outgoing. That's like a grand per year. There is no way in hell that it costs them that much to maintain the line, nor to operate their biz. I'm looking at a "dumb" cell phone which has no features other than being just a phone. No contract nor termination fees - the phone is owned outright. Flat rate per month with no roaming nor long-distance charges. X$ per month buys you X minutes, and that's it.

Re:Cost of billing?

[vlm]

Metering a connection doesn't cost anything at all.

Well, that would truly be a miracle. It costs a heck of a lot more to bill on a meter rather than flat per month.

You can't seriously claim there will never be a cost in capital or labor when connecting operational gear with the financial servers? Never an opportunity cost or labor cost when scheduling maintenance? Whats that, we'll make it all quadruple redundant? No problem open the wallet wide... Never a customer support call to complain about overcharges? Now that operational logs are "valuable" they won't have to be stored more carefully? Never be an outage of the logging system that "costs the telco millions, in aggregate"? Never a cost of "fraud" where someone steals service, no matter how cheap? Never a cost of anti-fraud measures? Never a cost of internal employee monitoring to make sure they do not "correct" their own bills, and then the costs of firing and replacing them? Never a cost of auditing to prove its all honest, or alternatively the cost of dishonest auditing to cover it all up? No cost of all the personnel training / education / R+D for all levels from the router jockeys to the customer service team and all the way up the management chain? What about the cost of storing all metered data for months or maybe years to handle billing corrections?

In comparison, billing by month has the unexpected cost of ... ... um ... Ah yes, prorated service upon cancellation. Of course you could "get rid" of prorated service contractually, a couple different ways, ranging from being nicely generous to being total stingy bastards. Hmm, gullibility test, I wonder if mobile phone operators would be generous or stingy... Anyway, that leaves us with the cost of monthly billing being ... uh .. yea thats it, exactly nothing. Going to be hard to either match or lower that cost with metered.

Re:Cost of billing?

[TheGratefulNet]

people think of me as 'gadget freak' and I have at least 6 pc's always running (mix of linux, bsd, xp, win7), I do embedded development (very much into arduino things these days) and I have my own hardware lab at home. I live in the bay area and have 30 yrs in software devel.

but I don't own a smartphone. don't really want to buy one either (or rather, don't want to pay $100/mo for the priviledge of being with the in-crowd and walking around touching a small flat panel pad thingie).

phone companies suck but mobile phone co's suck even worse. the whole system stinks. if your company is paying your way, fine. mine isn't and I'm not into all the hassles and 2yr contracts that come along with this in-crowd game.

its almost a fulltime job just knowing the various carriers, models, and having to dispose of your broken model (these aren't fixable by regular people and they are EOL'd very quickly) and relearn some new one, that's just not fun to me anymore. I can transition from one pc to another easily enough but doing that between various level of lock on phones is just crazy. (the vendors do this to us and we seem to just accept it!)

I choose not to take part in this rat race. I know that 'phone == fun' to a lot of you but it isn't that way for all of us. the carriers and the various lock-downs, fees and contracts all make a really unappealing package for those who are not already sucked into the system.

I get enough internet at home and at work. don't really need it while I'm away from my desk or system.

Re:"Mistaken charges" is a bit euphemistic

[AmberBlackCat]

I think Sprint is worse. Because whenever I would play an MP3 from the memory card in the phone, we got charged for data. I think their music player connects to the internet for some reason. My phone had a habit of launching the music player without my knowledge sometimes, perhaps due to a button placed on the outside of the phone. One day it played the same song all day and we were charged for several hours of internet use. This is regardless of the internet connection being explicitly turned off in the settings. If I tried to use the web browser, it would say the internet connection was off and ask if I wanted to turn it on. If I played an mp3, it would say nothing and just start charging for data.

I really don't understand cell phone companies

[penguinchris]

As others have noted, this is because of the practice of making the internet connection the most easy to select thing on the phone... despite the fact that extremely few people without smartphones use the internet on their phones. The two phones I had before I got an unlocked Nexus One were like this - you had to be careful because it's so easy to start the web browser, and there's no way to disable it. Nowadays, people also complain about the bloatware on Android phones, and now there's no easy way to get an unlocked Android phone.

Sure, these companies can get away with whatever they want because there's not really a cell phone free market in the US. Since they're already getting away with whatever they want, though, why do they purposefully make customers angry with this kind of stuff?

They act as if they don't actually make any money on selling phones and service, and their business model relies on tricking people into ridiculous charges. That's obviously not true, and it's simply insulting to the customers not only to nickel and dime them "legitimately", but also to trick them into paying ridiculous fees like this.

I *don't* think there should be more regulation, but I hope that the FCC continues to do things like this, to the point where it's no longer profitable for the cell carriers to act like such assholes. Maybe then people won't hate them so much, too.

Re:I really don't understand cell phone companies

[vlm]

there's not really a cell phone free market in the US.

I *don't* think there should be more regulation,

If, as you correctly observe, the market is unfree, why wouldn't you want it to be regulated to be fairer? There seems to be no other valid justification for regulation, so why apply it?

Re:"Accidents" and "Refunds"

[ZedNaught]

Verizon never does the right thing. While they are refunding the money for the accidental data usage, they are also imposing a mandatory $9.99 minimum data plan on every wireless customer with a browser capability on their cell phone to prevent this from being a problem in the future. So they give back $90 million and collect $9.99 per line going forward.

Re:"Accidents" and "Refunds"

[zeropointburn]

It seemed like everything they did after taking over Alltel was designed to drive people away. They gave us a few months on the original much more generous plans before booting everyone to overpriced Verizon plans. Viaero has been awesome since I switched, with the same or better plans and coverage as Alltel. It was much much cheaper with Viaero to get unlimited access for both lines compared to any other carrier.

  I'm not a shill (and not AC), just a satisfied customer. I'm sure they are probably just as greedy as any other telco, but so far they have treated me very well.

I was overcharged hundreds of dollars

[bmidgley]

It looks like this is unrelated, but a fun adventure for everyone.

I had a motorola flip phone I was using for tethering with verizon in 2007. I started getting bills for $600, $700, $800 for each month. I would call in and they would fix it. After about three months of this they told me they would not fix it any more. I had to get a firmware upgrade after which tethering stopped working. The device was worthless to me.

When I looked at the bill, it seems I was being charged per minute if I connected through the 1xrtt network. One rep actually told me "unlimited broadband" meant only unlimited when it was 3g and I was responsible to pay for when it connected at the slower speed. But there was no way to disable the 1xrtt fallback. It was just a convenient lie.

Then the collections department started calling me, saying "when do you think you will be paying this $1800 bill?" I asked them if they knew there were open tickets on the account to fix the broken charges. It basically came back to "but when do you think you will be paying this bill?"

I insisted on a device replacement and they got me a palm treo that worked ok but never as well as the flip phone for what I needed. They also reversed all the bad charges.

I quit verizon when the contract was done and I'm never going back.

Re:"Accidents" and "Refunds"

[tsj5j]

I'm really curious about how the US legal system works.

When a user shares a song, they pay statutory damages hundreds or thousands of times of the song's original value.
When a corporation rips off the public (by accident or on purpose), they get to just refund what they took without any "encouragement" to make sure it doesn't recur.

Is that right, or am I missing something?

Re:"Accidents" and "Refunds"

[Myopic]

Very close to evil? Sheesh, you are a lot more forgiving than I am. I think it's evil to fail to provide straight-up easy plain non-bundled prices for each individual product in your line. It's hard to find any companies which offer that, and impossible for communications companies. But, eh, I'm sort of a hater that way.

First hand account?

[mcrbids]

I can say first hand, with confidence, the $5 refunds they are "giving" are a joke, and pale in comparison to the problem.

I have a large family, and *had* a large family plan to match. Every single month I had "mystery charges" that they couldn't explain. No, it's not just one month, it's month after month of spending hours on the phone sorting out why the !@#$ I'm getting charges without decent explanation.

Charges with names like "account restoral fee" (on a line that had been in continuous use for years) and "recovery surcharge". (what's being recovered? And why am I being charged for it!?) Charges that, when enquired about, nobody could justify. Charges so egregious that it sometimes doubled my total bill.

I wrote letters, I complained, I got stonewalled and nobody said much. I switched providers to Metro PCS, where the deal is simple: prepaid, unlimited calling, no contract. Wow, what a difference! I pay my bill, I get service. I don't, the service quits. The bill is always the same - no surprises, and they don't even have a shutoff/restoral fee so if I'm late paying the bill, I go online and pay, and within a few minutes, service is active.

Verizon, I was one of your best customers, but now, you've lost me for good. And I don't hesitate to talk about it.