Cell Phone 'Bill Shock' Hits a Nerve, FCC Says

A survey commissioned by the Federal Communications Commission has found that nearly one in five American consumers have been subject to sudden and unexpected rises in their monthly cellular phone bills.

FCC looks to prevent mobile service 'bill shock'

The FCC survey, which was conducted by research firms Abt/SRBI and Princeton Survey Research Associates, found that 17% of U.S. cell phone users said that their cell phone 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 interviewed a total of 2,463 mobile phone users living in the United States.

A plurality of those who saw their bills unexpectedly increase reported that the amount of the increase was relatively small, between $1 and $24 per month. However, 23% of those who saw their bills unexpectedly increase experienced very large increases totaling more than $100 in a month.

What's more, the vast majority of those who saw sudden bill increases said that their carrier made no effort to contact them to talk about the jump in their bills. Only 14% of users said that their carrier tried to contact them when they were about to exceed their monthly voice, SMS or data usage, while only 10% of users said their carrier contacted them after their bill suddenly increased.

The FCC survey also found a great deal of confusion of wireless early termination fees, as only 47% of cell phone users whose plans had early termination fees did not know how much money they would have to pay if they cancelled their contracts early. The FCC said that one reason for this confusion is carriers' billing practices, as "only 36% of cell phone customers who are familiar with their bills said that they include 'very clear' information" on early termination fees.

Joel Gurin, the chief of the FCC's Consumer and Governmental Affairs Bureau, says he hoped the survey results would entice carriers to do a better job of informing consumers of when and why they might experience sudden increases in the amounts they owe.

"Several carriers are taking steps to make their fees and billing more transparent, and we would like this to become a universal practice," he said. "We're confident that we will be able to work with both wireless carriers and public interest groups to help consumers avoid these unwelcome surprises."

The CTIA isn't having any happy talk about cooperation, however, as the wireless association immediately shot back at the FCC's survey today by calling it "a missed opportunity to educate consumers."

"Nowhere mentioned in the documents is there any information for consumers about how they can better manage their wireless usage," said CTIA president Steve Largent. "Carriers go to great lengths to keep their customers satisfied and informed."

The FCC has been sparring with carriers over early termination fees since last year when it launched a general inquiry into the utilization of the fees in general, as well as a specific inquiry that asked Verizon to justify doubling ETFs for its customers. In justifying its inquiries into ETFs, FCC cited concerns that the fees "have an important impact on consumers' ability to switch carriers" and said the commission must make sure that "consumers fully understand what they are signing up for… when they accept a service plan with an early termination fee."

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This story, "Cell Phone 'Bill Shock' Hits a Nerve, FCC Says" was originally published by Network World.

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