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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."
If you RTFA, it actually says the overages were caused by "built in applications" such as web features on the phone put there by verizon, and then charged $1.99 for 1MB of data used despite it being merely a few kilobytes downloaded.
Also, the majority of customers will be receiving Credits instead of an actual refund. So essentially they will never get this money back.
They had designed their phones such that there was a shortcut button to their web portal. Users without a data plan, taken to that portal, were charged for the data at the usual ridiculous out-of-plan rates. They could have the portal blocked but this just meant they were charged for the data used in retrieving the "this portal is blocked" page instead. So there's an interesting bit of background detail going on here. Maybe $2 per customer isn't much to the customer, but it's a tidy bit of extra revenue to Verizon.
No kidding!!! What do you say at this point?
As opposed to the usual error free billing errors?
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.
"Science flies us to the moon. Religion flies us into buildings." - Victor Stenger
Thank God they don't run the Internet
Otherwise:
$90 million was no "accident." This is all standard operating procedure. In some circles, this is huge theft. If done to the government, it would result in criminal charges. Being quick to refund was nothing more than cover their asse[t]s. The telecoms are all resisting FCC inquiries and we know why... we KNEW why -- because they are all massively ripping off the public.
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.
'$90 million was no "accident."'
Maybe it wasn't, but I find this "matter-of-fact" statement amusing. What, the fact that it's a large number makes the idea of an error impossible? A systematic error in their billing system - the kind of thing I have no problem believing would slip past a corporate QA department - could easily rack up $90M across the book of business before being noticed.
IT makes it possible to do everything - including screw up - a lot faster than you would imagine.
'This is all standard operating procedure'
Citation needed. If you've ever actually worked in a corporation, then you know that the management will do all manner of unethical thing, but only to the extent they can delude themselves into believing it's really ok. I've yet to meet an executive so far gone that he believes you can overcharge your customers and then repay the principal when you get caught. They like to be a lot more subtle than that.
'The telecoms are all resisting FCC inquiries'
All companies resist all manner of oversight. Oversight costs money even when you're following the rules. This doesn't mean that there should be no oversight, but it does mean that a company cannot be presumed guilty for trying to avoid oversight.
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.
Check out my world simulator thingy.
A systematic error in their billing system - the kind of thing I have no problem believing would slip past a corporate QA department - could easily rack up $90M across the book of business before being noticed.
So why would it take an FCC inquiry (and a large number of consumer complaints, endless websites/news stories about Verizon's bad data-charging habits, "Verizon Math", and even firing employees who offer service blocks to customers)?
In most cases, okay, I can totally grok the 'never attribute to malice' line. But Verizon? Sorry... they're the type where this sort of thing is designed, not accidental. Also, that $90m is likely only a portion of the money they've taken in over the years.
Quo usque tandem abutere, Nimbus, patientia nostra?
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.
I have no problem with your religion until you decide it's reason to deprive others of the truth.