Mobile Phone Operator Lobbyists Say No Laws Necessary To Prevent 'Bill Shock'

from the because-it-doesn't-happen? dept

Fri, Jul 9th 2010 5:30am — Mike Masnick

For nearly a decade we've been covering stories of people getting bill shock when mobile phone bills show up that are in the tens of thousands of dollars. The issue, of course, is that mobile operators do a dreadful job informing their customers of the fees they may be facing. And, while it would be quite easy for the providers to set up some kind of alert (or credit card-style temporary block) if a bill starts to go outside of the "norm," none of the mobile operators seem interested in doing this.

Over in the UK they've put in place laws to prevent such ridiculous bill shock situations, and regulators in the US are considering the same... but the lobbyists for the mobile operators, CTIA, are protesting that such rules are "unnecessary." That would be a lot more convincing if people didn't send in stories about ridiculous bills every few weeks. CTIA also claims that "Members have adopted internal practices and procedures to remediate billing concerns directly with their customers," but in practice those "remediation" practices seem to basically be "wait until the press starts paying attention, and then finally back down."

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Filed Under: bill shock, regulations
Companies: ctia

29 Comments

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Nate (profile), 9 Jul 2010 @ 6:18am

If the proposed rules are unnecessary then CTIA shouldn't mind them going into place because it really wouldn't affect their practices at all. Hmm...
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kryptonianjorel (profile), 9 Jul 2010 @ 6:42am

I'm mixed on this matter. I don't want to end up with a cell phone bill that is $1,000 but at the same time, I also know not to use my data plan in Europe without checking the pricing first. Ignorance is no excuse; call your phone company and do a price check on anything and everything if you have any questions, because when the bill comes around, there is no excuse for ignorance. There are some exceptions (such as the famous vzw .002 dollars/cents case) but I believe people need to take responsibility for the services they use (no matter how outrageous the pricing plans are)

A lot of times we here stories of kids racking up these bills. If the kid is not responsible enough to use a cell phone within the plan that the parent has selected for him/her, then he/she should not be getting a cell phone. Some kids may not have been told whats extra and what isn't, and any bill they rack up is the parent's fault for not properly instructing them as to what they're allowed to do with the phone.

Anyway, I think it all boils down to responsibility. Should there be laws to prevent irresponsible behavior? No. Would it be nice if the mobile phone operators sent bill warnings? Yes. In the end, its about cost and profits. The phone companies don't want to lose the profits from the runaway bills, and they don't want to set up or run a system that alerts users to a potentially runaway bill.
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NAMELESS.ONE, 9 Jul 2010 @ 6:55am

@2
"I'm mixed on this matter......."

Soon as you wrote that you lost ...EVERYONE.
Anyone that doesn't agree with #1 is not human

People that write BULLSHIT paragraphs about nothing are idiots.
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Haywood (profile), 9 Jul 2010 @ 7:00am

What are the odds of collecting?
I'm a normally responsible person, I pay my bills, on time. However, were I to get a cell phone bill for $10,000, I'm afraid they would have to eat it, even if that meant going phoneless forever.
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David Muir (profile), 9 Jul 2010 @ 7:05am

Re: Mixed on this matter
If it all boils down to responsibility, and you feel that someone who racks up a multi-thousand dollar bill in one month is being irresponsible, then I suppose nothing will change your mind. But surely there's some responsibility on the cell provider's part too? Would the responsible thing be to track usage like the credit card companies do and alert subscribers to "unusual charges" incurred on their plan? Forget responsible, wouldn't that be a great customer service perk that sets your company apart from the competition?

The worst example is the "unlimited text" plan that actually has a really high limit (in the fine print) and when the teen exceeded the limit, the company charged him an astronomical bill. That is very irresponsible advertising and business behavior by the company: don't call something "unlimited" when it isn't.
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Stuart, 9 Jul 2010 @ 7:13am

Re: Re: Mixed on this matter
I like the fact that you feel some of the responsibility falls on the service provider. I am hoping that means that you also feel that some of it falls on the guy getting the bill. Do we really need to tell people not to use the hair dryer in the shower? Can we not just let the stupid fall of their own accord?
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Anonymous Coward, 9 Jul 2010 @ 7:14am

Re: What are the odds of collecting?
Good for you! You'd be left with your morals and a ruined credit score.
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Anonymous Coward, 9 Jul 2010 @ 7:16am

Re:
"I don't want to end up with a cell phone bill that is $1,000 but at the same time, I also know not to use my data plan in Europe without checking the pricing first."

Remember this fiasco?

http://media.grc.com/mp3/VerizonCantCount.mp3
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Anonymous Coward, 9 Jul 2010 @ 7:17am

Don't buy it. If there is no consumer protection against their greed. Don't buy it. You are in control.
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Anonymously Brave, 9 Jul 2010 @ 7:28am

Re: Responsibility
When I was a teen, I went to a small carnival that briefly came into town. There was a dart game that caught my attention, so I went to check it out. There were lots of large prizes displayed. According to the sign, it cost $5 to play. I figured, what the heck...its only $5.

So, I plopped down a fin and the guy handed me a dart. I threw it an popped a ballon. Then...he handed me another dart. I threw it, too. He kept handing me darts, one at a time.

Finally, he said I had popped enough balloons to win the prize! Of course, he said I owed him $50 for it! $5 for each additional dart!

I told him he didn't disclose that he was charging $5 per dart before I started the game. He told me...you didn't ask. Gotcha!

This is the game played by the cell phone companies and it is far too much to ask for consumers to learn the ins and outs of all of the contracts we enter into in order to find and understand all of the hidden "gotchas!". Saying we all have a responsibility to be experts on these services is simply making excuses for the industry and their shady skills at hiding important information within pages and pages of useless stuff.

Honestly, do you know every part of your contract for cable service? What about power? Water? Land line phone? Internet? Your mortgage/rent?

Without some sort of safeguards, a cell phone company could offer "Unlimited calling", but state in the small print that they will charge you $100 every time you press the "Send" button.

Any time a company provides a service for which they will bill after the fact for special options, there needs to be a clear communication of what is involved. At the very least, the first time a feature or service is used, a message should indicate that "this will cost $X per Y amount of use...is that okay?"

The world shouldn't be run like a cheap carnival.
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Anonymous Coward, 9 Jul 2010 @ 7:30am

Re:
Actually laws are made to regulate irresponsible behavior all the time. It's not that I don't see your point that people are responsible for there acts, however we need to look out for the 'not so bright' of us. It's the same idea of speed limits. I know I can drive safely without a speed limit, but the next guy over might really like that peddle on his new mustang...
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Anonymously Brave, 9 Jul 2010 @ 7:36am

Re: Re: Re: Mixed on this matter
I'm sorry, but the hair dryer in the shower analogy is a poor one.

Let's try one that fits a little better:

If the cable industry were allowed to do what the wireless industry does, they would simply allow you to watch pay-per-view channels by doing nothing more than tuning to them...no ordering...no extra button presses...no messages on the screen...no additional notification other than an ambiguous sentence buried in the small print of your original contract. Then, at the end of the month, they bill you for 150 hours of pay-per-view programming at $10 per hour.
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fogbugzd, 9 Jul 2010 @ 7:41am

Re:
The carriers make it hard to be responsible by knowing your plan. For starters, the plans are often so complex that it is difficult or impossible to know all of its provisions. It would be hard enough if the provisions never changed, but my plans seem to change frequently.

Try this experiment. Go to a mobile carrier's brick and mortar store. Try to identify the most experienced salesperson and ask them a specific question about the pricing plan on your phone. Then go to another person who looks experienced and ask the same question. You will probably get two different answers if your question is specific to your plan. You can also try technical support if you want a third variation. And I am willing to bet that the phone company won't stand by the information you were given if there is a dispute.
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shutslar (profile), 9 Jul 2010 @ 7:52am

Re: Nate
If the proposed rules are unnecessary then CTIA shouldn't mind them going into place because it really wouldn't affect their practices at all. Hmm...

Be careful about the "If your not doing anything wrong" logic. If you aren't doing anything wrong, then you won't mind if they place cameras throughout your home, office, car, etc.
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Haywood (profile), 9 Jul 2010 @ 8:05am

Re: Re: What are the odds of collecting?
At my age it matters little as to credit score. My house is paid off, as are my cars, I tend to pay cash for my cars. I don't have a lot of moral dilemma over not paying a rip off. Any sort of honorable debt, I'll eat beans and rice to pay off, for rip offs, not so much.
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Anonymous Coward, 9 Jul 2010 @ 8:06am

Re: @2
What's wrong with being undecided?
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Pixelation, 9 Jul 2010 @ 8:12am

The nice thing is there are now multiple companies that offer unlimited service and no contract. It isn't everywhere yet but eventually it will be. People are catching on to the scam run by the large carriers. I am against big government but this is one area that should be regulated more carefully.
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John Dod, 9 Jul 2010 @ 8:22am

Say wha?
I am mixed on a lot of things. On the surface, most rules and regulations are great. But usually they end up being so one sided that they are unfair to the other side. So you end up with just as bad situation for different reasons.
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Anonymous Coward, 9 Jul 2010 @ 8:27am

And that is why NetNeutrality is also necessary.
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Sean T Henry (profile), 9 Jul 2010 @ 8:29am

Re:
kryptonianjorel
If you go over seas and know that your phone will work for a small extra charge but data is very expensive so you decide not to use it. The phone decides to continually poll the server to check for new e-mail. You get an outrageous bill due to the phones operation but it must be your fault that the phone was programed that way.
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Anonymous Coward, 9 Jul 2010 @ 8:47am

Re: Re: @2
he's a troll, being undecided sends him into a rage
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nasch (profile), 9 Jul 2010 @ 9:26am

Re: Re: Nate
The point is that if the CTIA thought such practices were appropriate and all wireless carriers should be doing them, why would they lobby against those rules?
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TesserId (profile), 9 Jul 2010 @ 9:29am

Shocking!
Somebody had to say it.
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pr, 9 Jul 2010 @ 11:44am

Monthly cap
The simple thing is that when you sign up you specify a monthly cap.

This is just like when you put a cap on the amount you can take out each day with your ATM card. You hit the monthly cap, your phone doesn't provide any more optional services.

Every honest provider should be happy with this without being forced to. It keeps customers from getting mad at them for surprise bills. The crooks won't like it, but that's what regulation is supposed to do.
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Ron Rezendes (profile), 9 Jul 2010 @ 12:14pm

Re: Re: Re: Mixed on this matter
"Do we really need to tell people not to use the hair dryer in the shower?"

Actually, yes you do - it's required by law! That's why all hair dryers come with a warning label on the cord.

It's also why ladders have anywhere from 12-17 warning labels on them! To protect the company from lawsuits of people who hurt themselves and then say "No one ever told me it wasn't safe to use the top of the ladder as a step!"

McDonald's coffee cups now warn you that the contents are "hot"! The lady who won her lawsuit after burning herself with a cup of hot McDonald's coffee had to be a moron to not know the coffee was hot, but she's a rich moron now!

I don't necessarily agree with any or all of these examples but my opinion won't change the mind of a jury.

In the case of the phone companies, good customer service practices would practically force some sort of consumer protection. Of course, much like the software and hardware industries, it's difficult to justify the cost for such programs because taking advantage of these circumstances is profitable despite the inherent "sleaze" factor involved. They would much rather collect every last dime, then spend millions on marketing to attract new customers when the dissatisfied ones leave. Customer service and tech support people hate this mode of operation but marketing folks love it because they get to travel to trade shows hawking the services at the expense of the company (consumer).
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Not again, 9 Jul 2010 @ 1:23pm

Re: Re: Re: Re: Mixed on this matter
God I'm tired of the "hot coffee" red herring. The coffee was too hot, she spilled it, it burned her much worse than coffee ever should. McDonalds admitted to keeping the coffee hotter so that it lasted longer. She did not get rich and in fact she only ever wanted her medical bills paid.

Oh, and you're a buffoon.
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Ron Rezendes (profile), 9 Jul 2010 @ 3:28pm

Re: Re: Re: Re: Re: Mixed on this matter
Well let's review your errant "red herring" statement in depth here, I'm sure the truth might cause you some discomfort but hey what do you expect from a buffoon?

#1 "red herring": any diversion intended to distract attention from the main issue (If you were talking about fish then the rest is irrelevant.)

Doesn't seem to apply here since I'm referring to customer warnings required by law and/or legal proceedings which is the path the conversation went when Stuart asked: "Do we really need to tell people not to use the hair dryer in the shower?". My examples are not a diversion/distraction from this point. Epic fail on your behalf.

#2 "She did not get rich": I'll grant you SOME leeway here since the definition is relative to each individual but from my perspective, any amount of money between 480K and 640K would certainly change my financial status to "rich". Since rich is a relative term and I was the one using it - again fail on your behalf.

#3 McDonalds admitted to keeping the coffee hotter so that it lasted longer." Absolutely incorrect and a blatantly false statement!
(Source: http://www.lectlaw.com/files/cur78.htm)Quote: "McDonald's also said during discovery that, based on a consultants advice, it held its coffee at between 180 and 190 degrees fahrenheit to maintain optimum taste."

These things you pull out of your rear orifice smell like crap probably because they amount to as much. Epic fail and outright lie on your behalf.

McDonald's was found to be 80% at fault and the customer 20% - this indeed was not entirely McD's fault even though the coffee was indeed served hotter than one might expect. However, a little research (hopefully you don't need a definition here just some experience) shows even this is debatable:
"Though defenders of the Liebeck verdict argue that her coffee was unusually hotter than other coffee sold, other major vendors of coffee, including Starbucks, Dunkin' Donuts, Wendy's, and Burger King, produce coffee at a similar or higher temperature, and have been subjected to similar lawsuits over third-degree burns.[18]"

"Home and commercial coffee makers often reach comparable temperatures.[19] The National Coffee Association of U.S.A. instructs that coffee should be brewed "between 195-205 degrees Fahrenheit [91–96 °C] for optimal extraction" and consumed "immediately". If not consumed immediately, the coffee is to be "maintained at 180-185 degrees Fahrenheit".[20]"

Source: http://en.wikipedia.org/wiki/Liebeck_v._McDonald's_Restaurants

Thank you for your complete waste of time here, hopefully "Not again" is when we'll see you post and not just your board name.
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Sam K (profile), 9 Jul 2010 @ 9:51pm

Here in Australia, I know of several occasions where friends or family members have had bill shock, usually in the order of about $1000 to $1500, and I don't know anyone who has ever had to actually pay it.

In each case they basically said to the phone company "I am never going to pay this, ever. So you have 2 choices, either you waive this bill and I remain your customer, or you don't and I switch to another carrier while you piss a lot more money up the wall trying to collect the debt."

And every time the carrier has eventually rolled over and waived the bill.
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Anonymous Coward, 10 Jul 2010 @ 5:14am

It is called EXTORTION , plain and simple!
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