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FCC Will Tackle Cell Phone 'Bill Shock'
MexiCali59 writes "The FCC is expected to launch a proceeding at its Thursday meeting that could force wireless providers to change their billing practices. The agency wants to prevent consumers from unknowingly racking up oversized bills on their phones when they go over their minutes, a situation the agency calls 'bill shock.' The agency released a survey earlier this year that showed one in six American consumers had been surprised by a cell phone bill. The FCC's proposed rules would require carriers to send text or voice alerts before and when minutes are used up. Notifications would also have to accompany out-of-country charges, and carriers would be required to clearly disclose any tools they offer to simplify billing."
The problem isn't that people sometimes go over, it is that they are charged a ridiculous amount more when they do. I have a USB 3G Modem with a 5 Gig limit which I watched quite carefully. When I knowingly went over just a few hundred megabytes my bill went from $50.00 to $750.00. Now luckily, I was able to convince an upper level rep that I could have rooted my phone and tethered it, but I chose to get the 3G stick to be fair and make sure they received a reasonable amount of compensation for services provided. Until I laid this on them they absolutely were not going to budge at all. I am very much the exception, as obviously the average customer doesn't even understand what I just wrote, so they would have been just straight screwed.
This is of course ridiculous. Now I admit that I could have perused my contract more fully, but my provider has always been quite reasonable so - having a 7 year relationship with them - I trusted that my contract would also be reasonable. Also, bear in mind that most people don't grok the difference between 5 gigabytes and 300 Megabytes, so the whole "people should pay attention to the contract" argument is flatly absurd.
The bottom line? There should definately be a law against charging multiple orders of magnitude more for overages. There is absolutely no reason why they cannot pro-rate the overage at a reasonable increase (say 50%) and they absolutely count on peoples ignorance to jerk them around.
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The first comment is, to me, the most interesting response:
Sounds like we're once again legislating to save irresponsible people from their own self-destructive actions.
This response is a dramatic oversimplification of what's going on (sadly, a common occurance). What I believe the FCC is proposing is ensuring that _reasonable_ and _prudent_ laypeople can clearly understand the cost consequences of their actions. And, allowing a customer to set a reasonable price cap on their cell phone spending _increases_ accountability--for costs that match their spending ability.
For example, the cost of your garden variety LOL or ROFL missive sent via text message while roaming in Cancun (phone from Sprint [USA]) was about $1. For some, this can become frighteningly expensive. Given that European pay-as-you-go service carefully tracks (and easily reports to the user via a simple text message) their remaining credits, I fail to see why this reasonable ability isn't available to everyone.
And, as someone who has done disaster relief, I have been surprised by a few increases of $40-50 for roaming charges. I am willing to pay this--but I also desire the ability to know up front. I don't think the end user should have to carry their carrier's Terms and Conditions and rate sheet in their back pocket.
Also, some of these cell phone contracts are ludicrous: even the better ones (I like AT&T) don't do a great job clearly delineating between different types of service (for example, my unlimited SMS messaging plan doesn't include picture messaging). If I, as a person who reads contracts as a part of their job, can accidentally miss this, this circumstance doesn't bode well for an average person who doesn't do this.
Accountability requires reasonable rules and transparency--US cell contracts and bills need some help on this front.
I'd rather see the government mandate a fee against people that make stupid, nonequivalent analogies.
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I'd also like the government to adopt (for everyone) a law that states that the advertised price is the price. Not tack on a million different taxes and surcharges (most of many are optional for the phone companies to charge) to it where it goes from the advertised $79.99 a month to 105.49 or whatever. Don't tell me the companies can't achieve it - all the gas pumps here can and it's pretty much standard in Europe.
Now, I don't care if the companies itemize the taxes to explain why the price is where it's at. But this crap happens too often (occupancy tax in hotels) that it's all a scam on an unsuspecting consumer and an educated one can't tell exactly what he'll pay, they just pad the advertised amount in their head with an extra 20%, maybe more.
And if you're all about the free market, having reliable price points is one of the keys for real competition.
I could understand advertising $39.95/mo exclusive of taxes, but the phone companies themselves tack on a bunch of other surcharges that are _not_ taxes. They make them sound like taxes by calling them "regulatory recovery fees", but they're really unadvertised price hikes that they can spring on you at will, even when you have a contractual price.
Make phone companies advertise their ACTUAL rate first. Then go after these warnings...
(It's for this reason I use a prepaid Tracfone; no surprises.)