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FCC Will Tackle Cell Phone 'Bill Shock' 477

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."
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FCC Will Tackle Cell Phone 'Bill Shock'

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  • All you can eat (Score:5, Insightful)

    by Jonah Hex ( 651948 ) <> on Wednesday October 13, 2010 @02:38PM (#33885572) Homepage Journal

    I was forced to switch from one of Sprint's discontinued "Family Plans" to an everything plan in order to get a modern phone a few years ago, and now that I've got an even nicer phone that sucks down more data, I wouldn't be surprised if they discontinue this plan too. Maybe the FCC can keep things semi reasonable, instead of letting things get even worse.


    • The problem is that a government "solution" is often like a shirt that is "one size fits all", in that no one is happy. There are so many interests lobbying in D.C., that most protection laws have gigantic loopholes, and companies often find loopholes where there are none. While it is obvious that congress needs to set some basic regulation, the biggest thing they could do to reduce abuse is to encourage competition and let the market place work the way it should, in the open and on a level playing field.

      • Re:All you can eat (Score:4, Interesting)

        by Garble Snarky ( 715674 ) on Wednesday October 13, 2010 @03:07PM (#33886076)
        Clearly the carriers have not been motivated by the market forces to offer this kind of service so far - how would the government change that by continuing to "let the market work the way it should" ???
      • Re: (Score:3, Insightful)

        by Da_Biz ( 267075 )

        Intelligent markets driven by reasonable regulations IS the freest market we can muster.

        For example, the Enron debacle in California was caused, in part, because of a lack of transparency pertaining to how their operated their generators. This produced congestion on transmission network paths needed to deliver power to California from the Pacific NW. IIRC, this caused prices to spike up to $1,000 per MW/hour (maybe more), when typical prices are more in the $40-80 range.

        Enron accomplished this because the

  • This is such a simple great idea - send a text you've reached your monthly plan limit. No more guessing or having to check.
    • by sconeu ( 64226 )

      Verizon does this. I've gotten SMS warnings that I only have NN minutes left on my plan.

    • US Cellular does this, but it is optional. The consumer has the ability to get it as part of the packages.

    • Top-up reminders are something that the prepaid carriers have been doing for years.
    • Re:Great Simple Idea (Score:5, Interesting)

      by omnichad ( 1198475 ) on Wednesday October 13, 2010 @03:10PM (#33886134) Homepage

      It's a great idea, but not easy in practice. When you're on a partner tower (say a Verizon customer roaming on a Sprint tower), Verizon may not get the bill from Sprint on those minutes until weeks later. Then, all those minutes suddenly post to your account. If they get to the point where this is all done in real time, then it would be a lot useful. But having 200 minutes used, and suddenly jumping to 400 in the course of an hour without even making a call is very possible.

      • Re: (Score:3, Interesting)

        by Tanktalus ( 794810 )

        There is another great simple idea hidden here: get them done in real time. All carriers will have the incentive to get this done when they realise that they won't be able to back-charge you for minutes prior to the texted warning. If that's not an incentive to get this done in real time *now*, nothing is.

        Information in consumer's hands is not only good for consumers, but good for ethical businesses, too. If the carriers give any excuse(*) for doing this, they're really just telling us how they want to c

    • by rolfwind ( 528248 ) on Wednesday October 13, 2010 @03:16PM (#33886228)

      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.

  • Root of the Problem (Score:5, Interesting)

    by BJ_Covert_Action ( 1499847 ) on Wednesday October 13, 2010 @02:42PM (#33885650) Homepage Journal
    Maybe I am missing something, but why doesn't the FCC go after the roots of some of these problems. For instance, can someone please explain to me why in the hell we are being charged for text messages in the first place? I mean, other than to screw us over and make a pretty penny?
    • Re: (Score:2, Insightful)

      by alen ( 225700 )

      because if they were free then spammers would come in and clog up the data channel with constant texting. since you have to pay for incomming texts it's illegal to spam you via cell

      • Re: (Score:3, Funny)

        by Abstrackt ( 609015 )

        Oh, so all we have to do to stop spam is make it illegal? ;)

        • by Surt ( 22457 )

          Well, we'd kill it in short order if it cost the spammers a consequential amount of money. Imagine if they had to pay a penny per spam sent. Spam would be largely gone tomorrow at that price.

          • Most spam is sent from compromised computers though, so it's unlikely the spammers would be the ones footing the bill. Unfortunately, I think educating the users will ultimately prove to be the best method to reduce spam.

          • Re: (Score:3, Insightful)

            Imagine if they had to pay a penny per spam sent. Spam would be largely gone tomorrow at that price.

            No, they'd just use stolen credit cards to pay for the spam.

      • You know you can send texts to people via email right now for free, pretty much.

      • Re: (Score:3, Interesting)

        because if they were free then spammers would come in and clog up the data channel with constant texting.

        Spammers can still clog up the data channel with constant texts for free if they want to now. It's called the SMS gateway [] which allows one to send SMS texts through email.

        since you have to pay for incomming texts it's illegal to spam you via cell

        Because spammers really care what the law says, right?

      • by Luyseyal ( 3154 )

        Right, because a spammer would never contemplate buying an unlimited texting plan for 20-30/month or intentionally target devices that are likely to have these kinds of plans, right?

        That we haven't had a truly successful iPhone or Symbian worm is merely luck and time will solve that problem.


      • Then why do we pay for both incoming and outgoing texts while in Europe they only pay for outgoing texts? Same with calling.
        • Then why do we pay for both incoming and outgoing texts while in Europe they only pay for outgoing texts? Same with calling.

          Not just Europe, Canada too, for texts anyway. For all the places I've been, the US is the only one that charges for incoming texts.

      • Re: (Score:3, Interesting)

        by The MAZZTer ( 911996 )
        I still get "spam" from AT&T in my SMS inbox. I don't have to pay for it but it's still spam. And why should I be paying for it anyway? Charging for OUTGOING messages always made more sense for phone calls and it makes more sense for texts too.
      • That's just like how spammers come in and clog up the data channel for other text only services right now as well, right? I mean, nobody can even use e-mail anymore because of spammers. Oh wait...

        Somehow ISPs and web-based e-mail companies have managed to attack the spam problem pretty effectively while still keeping their e-mail services free. In fact, the companies that have found the best solutions to filtering spam are enjoying dominant places in the e-mail market, probably in part because of their s
    • by immakiku ( 777365 ) on Wednesday October 13, 2010 @02:49PM (#33885752)

      Because the nature of the business (high barriers to entry, mainly) ensures we have a limited selection of carriers. Limited selection means less competition means less competitive practices, like charging for random "services" like text messages even if the "services" should come for free as part of the protocol.

    • by mcgrew ( 92797 ) *

      I don't pay for text; unlimited texting (and email and internet and voice) are a flat $50 per month with my carrier. Maybe you should shop for a different provider?

    • by Late Adopter ( 1492849 ) on Wednesday October 13, 2010 @03:26PM (#33886370)
      Why are the cell phone companies extending customers a near-infinite line of credit on the phone? What exactly makes them think that people are going to PAY a thousand dollar phone bill. It's sheer stupidity, they're sending out ludicrous bills and hoping to make it up on the suckers.

      When I signed up for my Sprint plan, they did a credit check and capped my spending at $250. How hard is that? And how hard would it be to ask to have your plan capped to a certain multiple of your usual bill (say, 2x)?
  • Have all cell phone bills max out at $500.00 PERIOD.

    If you are dumb enough to go to that limit, so be it, but at least you KNOW what your maximum bill will be.

    Then, you can text with reckless abandon!
    • Re: (Score:3, Insightful)

      by Surt ( 22457 )

      So that would be an unlimited plan, priced at $500, right?

      Overpriced. Every carrier will sell you an unlimited plan for less.

      • by tepples ( 727027 )

        Every carrier will sell you an unlimited plan for less [than 500 USD].

        Does this include unlimited international roaming?

    • by scrib ( 1277042 ) on Wednesday October 13, 2010 @03:02PM (#33886008)

      I was looking for this post because I wanted to make it. :)

      I was thinking that a mandatory user-definable bill-cap would a good way to go with this. The default would be set at, oh, 50% more than your no-extra-charges bill. You would have the option of raising your cap permanently or temporarily.

      Your phone would just say "You have reached your pre-set spending limit. You must raise this limit before any further additional fee services will be available from this phone."

      How hard is that?

  • And if you are traveling internationally, they will charge you international rates to receive that message.

    Although that is a small price to pay. Knowing that you racked up $1,000 in charges the first day instead of $7,000 after you get back. But you know someone will complain about that $0.20 message.

    • by Splab ( 574204 )

      Wonder how far the FCC (and EU) has their heads stuck up their arses. Yes it would be awesome if customers could get these informations real time (or close to), but most companies aren't exchanging TAP data real time, the information can be as much as 14 days delayed.

      Either the governments should just revoke the carriers licenses and make telephony the way they think it should be or stay the fuck out of our business. If they think there is price fixing (EU) or unfair practices going on then deal with it thr

  • just say no (Score:4, Interesting)

    by Surt ( 22457 ) on Wednesday October 13, 2010 @02:46PM (#33885708) Homepage Journal

    I've had to do this with each of verizon, at&t, and tmobile on one occasion.

    Just say you don't want to pay. Say it in person, imply you are going to jump carriers if they do not fix it. Go by during lunch or on a weekend when their store is busiest, and complain loudly enough that the other customers are going to watch them deal with your issue.

    They will fix it for you, and they will be very polite and apologetic about the situation to avoid losing potential customers. I have had friends use this technique as well, and so far our attempts have a 100% success rate.

    • Out of curiosity, how do they deal with your issue?

      Do they just credit you? Do they put some limit so that your phone becomes useless after it reaches the limit? Do they give you a one time credit? Do they offer an upgrade so you can avoid paying this bill?

      • by Surt ( 22457 )

        I'm pretty sure they just had a mechanism to cancel the overage for the month. One might suspect based on the ease with which it happens that they do this pretty regularly to soothe irate customers who are risking sales.

    • imply you are going to jump carriers if they do not fix it

      That works when the overage is less than the $350 to cancel your service.

    • Re: (Score:3, Insightful)

      by Da_Biz ( 267075 )

      This ABSOLUTELY does not work with Sprint (and precipitated my departure). After hours of being on the phone with their so-called customer service (and three defective "warranty replacement" phones in the mail), I pleaded with folks at a retail location to help. Sadly, they were absolutely powerless to help--and felt horrible. Everything had to go to a completely worthless call center...

  • Simplified billing (Score:4, Interesting)

    by JWSmythe ( 446288 ) <> on Wednesday October 13, 2010 @02:50PM (#33885770) Homepage Journal

        I found one of the better solutions to "Bill Shock". Prepaid phone with unlimited minutes. My bill is my bill, and I can plan for that amount with no confusion.

        I was screwed twice by cell phone companies who were out to screw their customers. The first time, I was overcharged $300/mo for "roaming" in a city 100 miles away, even though I never left my city limits during the entire period in question.

        The second time, several years later, my phone didn't even work at a house I moved to. I left it sitting on my desk until the battery died, but I still paid the bill normally. Then I started getting overcharged $300 for "roaming". They couldn't demonstrate any calls, or even show any minutes used. I asked them to clarify how I could be roaming if the phone was dead. They couldn't give me any answer but "you need to pay..." But when the phone was working, they were kind enough to nail me with all kinds of fees for International use. Hop over the border, or even be close to it, and they can hit you for it.

        Nope, I'm done with that nonsense. No more calls if I'm a day late (and every day after that for months). If my phone gets shut off, it's because I didn't pay the normal fixed amount, and they leave me alone. I *still* get calls 5 years later about a phone I bought as a gift for someone, and my name isn't suppose to even be on the account. No, I'm not paying their phone bill, because it's not my account dammit.

  • Ideally, the screen would tell you, at all times, the number of minutes you have left on your plan. When you're on a call, this number will count down.

    • like a Tracfone does?
  • by mykos ( 1627575 ) on Wednesday October 13, 2010 @02:55PM (#33885872)
    We don't want the government to decide what they can and can't charge. We just want the government to require going over to be something you have to consciously opt in to do.

    My carrier won't do it. I asked them if I could block data if I have no data plan, seeing as how they made the default internet button right in the center of my phone (and it sticks out the most). They said no. I suspect most other peoples' carriers won't, either.
    • AT&T is willing to turn off data on a phone if you ask. Unfortunately it disables MMS as well, though you can still get SMS.

  • Would be to require carriers who offer more than one plan to do this work for the consumers. There's no justification for playing "gotcha" every month with every consumer. Why is it your responsibility to figure out someone else's convoluted sales system? Why do we allow companies to design contracts to trip up, confuse, and overcharge consumers?

    Write a law that requires all carriers, who offer more than one plan or option for phone service, to calculate your bill as it would be under each of those plans

    • by Renraku ( 518261 )

      No justification? The justification is higher revenue gained through legal and well-defined means. Just because most people don't read the contracts to realize that deep on page seventy five of part one of your cell phone text messaging agreement there's a clause that charges you $8/text to anyone that has been out of country in the past month doesn't mean that they aren't legally responsible for the debt!

      Anyway, enough of the snark.

      I think you're kind of right, in that they need to be more clear and laid

  • by Da_Biz ( 267075 ) on Wednesday October 13, 2010 @02:59PM (#33885940)

    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.

  • It's insane that cell phone companies are effectively giving people $10,000 lines of credit (I've heard of cases where international roaming charges racked up that much in a month). At the very least, there should be an option to specify a maximum amount, where service is turned off if it goes over that amount, and I have to confirm that I want to continue service and understand how much it's going to cost to go over that amount. This would handle the vast majority of cases where people go way over becaus

  • by RapmasterT ( 787426 ) on Wednesday October 13, 2010 @03:02PM (#33886012)
    How about you do something about the god damned HIDDEN CHARGES.

    I'm not talking about overage minutes or text...those are clearly stated in my agreement and I'm on the hook for overages. I'm a big boy and I can pay the bills I agree to.

    But SOMEHOW my cell phone bills seem to include over 20% in taxes, fees, surcharges...all that I never agreed to, was never informed of, and are not optional. How about that? How about when advertising service plan rates the cell companies be required to also report how much the government is going to tack on top of it too.
    • by yeremein ( 678037 ) on Wednesday October 13, 2010 @03:31PM (#33886454)

      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.)

  • Back in the day (Score:3, Interesting)

    by Hatta ( 162192 ) on Wednesday October 13, 2010 @03:05PM (#33886046) Journal

    this happened to me on land lines. Being a kid, I knew that I needed to use an area code to call long distance. So I figured that any number that was in my area code was not long distance. So I set about dialing every BBS in my area code. Oops.

    Turns out, and I still don't understand why, that quite a few of the numbers I called were not considered local. How was I supposed to know? My dad ended up getting a bill for a couple hundred dollars.

    Personally, I don't think the phone company should be allowed to charge anything without an explicit declaration of price and agreement on the part of the customer. Even on POTS. When I dial a number, *any number*, I want to be quoted a rate and given a chance to decline.

    These days I just have all long distance calls from my home phone blocked. If I need to make a long distance call, I have a phone card which has a fixed rate per minute, and it tells me how many much time I have left for a call. It's simple math to get back to the per minute rate. Why can't cell phones be as convenient?

  • Don't subscription services with overage charges make a bulk of their money off the overages? Blockbuster's main source of revenue was late movies. If we take this away from the cell phone companies, they'll likely just raise their rates all around for everyone.

    iPhone: Free!
    iPhone monthly charge: $200
    iPhone minute reminder fee: $5
    iPhone text reminder fee: $5
    iPhone data reminder fee: $5

  • If we could get polling in targeted populations more accurate, we could use them as metrics for sunsetting legislation. If below 1/3 of the people directly served by a programme are not measured satisfied by the sunset review deadline (eg. 2 years, or 4 years, or the last day of a fiscal year 3 years from passage, etc), the law rescinds itself. Require 1 hour of debate at the review deadline, no matter how many people are satisfied. Really popular programmes won't be sunsetted.

    A case like cell phone dissati

  • by ShooterNeo ( 555040 ) on Wednesday October 13, 2010 @03:29PM (#33886412)

    Cell phone companies do NOT operate in a free market. The spectrum rights they are granted amount to legally authorized monopolies. Also, the vast array of towers a company needs in order to have reasonably broad coverage means that not only do cell phone companies have a legal monopoly, their market niche is also a natural monopoly.

    Monopolies are one of the common reasons for capitalism/the market failing. The only way we know to patch this hole in our economic system is to have the government make rules and enforce them.

    Anyhow, for this reason, in order to stop the cell phone companies legally scamming us by charging us ridiculous rates for overages and not telling us until the end of the month, they need to mandate notifications when our bill goes over.

    I think notifications aren't enough : I think a user should be able to set a maximum dollar cap for a month of service, and if the bill goes over that the cell phone company must either get the user to agree to lift the cap or to cut off service until the end of the month. (except for emergency calls or calls on night/weekend minutes, etc)

  • by roc97007 ( 608802 ) on Wednesday October 13, 2010 @03:40PM (#33886566) Journal

    Have you noticed that most of the cheaper non-smart phones have a prominent button for "marketplace" or some such WAP service? Just hitting it accidentally can double your bill if you don't have a data plan. (And if you have a cheap flipper, you probably don't have or need a data plan.) This button is usually the only one that can not be remapped or disabled. It is essentially a "PROFIT" button for the carrier.

    We bought the unlimited data plan and unlimited texting plan for our daughter's first cell phone on the theory that just one mistake could be many times more expensive than the cost of the plan. We went a long time without surprises, and then one day I got a bill that was an appreciable fraction of a grand. Turns out the carrier had some kind of "ask a question via text" feature, daughter had discovered it, and was using it to help with homework. Had I known, I would have researched it, found how much it cost per question, and shut it down. But the billing cycle is such that you don't know you're in trouble until you're in LOTS of trouble, and I'm certain this is intentional also.

    I argued with the carrier for a very long time, going up the chain of command (or just sideways -- you never can tell) and eventually found someone who cared that I was going to take four phones to a competing carrier unless they addressed this. They offered a 50% reduction in the bill and I gritted my teeth and took it. And also made very sure that I was aware of all such "services" and had them all locked out.

    The great rank and file -- whom I like to call "Fred and Ethyl", would not know about this stuff until they're nailed by it. Even people who are being careful -- my case -- can still get nailed by "services" of which they are unaware. This goes way beyond disallowing Google Maps on a smartphone so you can charge someone ten bucks a month for the carrier's app. This is like buying a car with Onstar built in and then finding out that it's free to call a red and white ambulance but there's a $10,000 charge if the ambulance is blue and white. It's an arbitrary "gotcha" designed to generate windfalls for the carrier.

    To a certain extent, they all do it, but some are worse than others.

  • by roc97007 ( 608802 ) on Wednesday October 13, 2010 @04:14PM (#33887012) Journal

    This is not a "protect people from themselves" issue. Things are purposely set up to maximize the possibility of you unintentionally racking up charges. A "Web" button that can't be disabled right next to the "Call" button. Smartphones that "phone home" over the data line even when data is disabled while traveling internationally. Huge, punishing charges if you go over your limit even by a tiny bit. (I mean seriously, if $40 a month will cover several gigabytes of downloads, why charge over $80 for 2.2 Megabytes of downloads without a data plan? Answer: Because they can.) Phone bills that lag 45 days or more behind your actual usage. "Services" that have a per-usage charge that isn't spelled out when you use them. (Teens typically fall for this.) The carrier not clearly communicating that you can turn a lot (but not all) of these "services" off by a simple request.

    It's not just a matter of reading and understanding the TOS. We're all professionals here, we can really dig into a TOS and find the line buried on page 3 in the middle of paragraph six dealing with FCC regulations where they've buried the over usage fees. That doesn't cover everything -- there's ways to overinflate your bill that aren't covered by the TOS.

    Mind you, my nephew was a fine counterexample. He was told that local calls on the weekends were free, and he thought he heard that all local calls were free. His first bill was the size of a paperback and well over a grand. To my knowledge the carrier is still looking for him. No matter how foolproof one makes a system, fools will find a way to crash land. But besides that, the system as it currently stands is designed to blow your hand off if you turn the knob to the left instead of the right, and that's the part that really needs to stop.

Experience varies directly with equipment ruined.