U.S. regulator prods wireless carriers on bills

FRAMINGHAM, Mass.  Wireless subscribers in the U.S. should not be shocked if they start receiving text or voicemail alerts telling them when they’re about to hit their monthly limits on voice, data and SMS.

That’s because the Federal Communications Commission (FCC) and the CTIA Wireless Association have reached an agreement where CTIA member carriers will send out free alerts to subscribers who are about to exceed their monthly service limits and incur overage charges on their accounts. In addition to sending alerts for users about to incur overage charges, the carriers will also issue alerts to users when they are about to incur international roaming charges. The policies are designed to help users avoid “bill shock,” a term used by the FCC last year to describe large, unexpected overage charges that appear on users’ wireless bills.

FCC Chairman Julius Genachowski, appearing at a joint press conference Monday with CTIA President Steve Largent, said that carriers would offer the alerts automatically and consumers would not be required to opt in to start receiving wireless usage notes. He also said that the FCC will soon launch a Web portal in tandem with the Consumers Union advocacy organization to help users learn what kinds of alerts are offered by different carriers and to track whether carriers are complying with their own standards and policies.

 

In Canada, the Canadian Radio-television and Telecommunications Commission (CRTC) hasn’t forced carriers into a formal bill alert policy. According to Marc Choma, a spokesman for the Canadian Wireless Telecommunications Association (CTWA), most carriers have a variety of usage monitoring tools, including automatic alerts. But they vary from carrier to carrier.

 

Most complaints in Canada about service from wired and wireless providers goes to the Commissioner for Complaints for Telecommunications Services. According to its most recent report, which covers Aug 1,2009 to July 31, 2010, of the 3,747 complaints that couldn’t be resolved and had to be investigated,  44 per cent involved a billing error, and another 35 per cent involved a contract dispute.  Half of the complaints dealt with wireless providers.

 

The report “strongly” encourages wireless and wired provders ensure that their customers are fully aware of all the details of the contract prior to entering into an agreement or making a change to their service plans. Consumers should make sure they understand a plan before signing a contract, the report adds.

 

While U.S. carriers such as Sprint Nextel and AT&T Inc. have already developed their own alert systems to warn consumers of additional charges, the deal with CTIA will not only bring more carriers into the fold but will provide a uniform way for consumers to understand their carriers’ system for setting up alerts. And as Consumers Union policy counsel Parul P. Desai noted today, some carriers had been charging their customers to receive alert notices before the FCC-CTIA deal, meaning that the agreement to provide free alerts will save some wireless subscribers additional money every month.

The FCC has been working on ways to help consumers avoid bill shock for the past year. It commissioned a survey last year showing that 17 per cent of U.S. cellphone users said their cellphone bills had “increased suddenly from one month to the next” even if they “did not change the calling or texting plan” they subscribed to.

 

The survey also found that carriers didn’t do a good job of contacting people when they were about to hit their monthly limits on voice or data, as only 14 per cent of users hit with bill shock said that their carrier tried to contact them when they were about to exceed their monthly voice, SMS or data usage, while only 10 per cent of users said their carrier contacted them after their bill suddenly increased.

 

(From Network World U.S., With files by Howard Solomon, Network World Canada)