Wireless Carriers Admit Their Service Plans Still Far Too Confusing For Most Consumers To Actually Understand

from the I-have-three-degrees-and-can't-understand-my-Verizon-bill dept

Wed, Jan 7th 2015 12:30pm — Karl Bode

I've written about the telecom industry for going on fifteen years now, and even I have to spend an inordinate amount of time trying to decipher many of the industry's new pricing offerings and promotions when they first hit the newswires. Of course, this confusion is often by design; the more complicated moving parts in play when choosing a plan and device (should I enroll in early phone upgrade programs? Will I have enough pooled data? Do I really need device insurance?), the more difficult it is for the average consumer to understand what it really is they're buying and make direct comparisons.

While T-Mobile's recent competitive assault on Sprint, AT&T and Verizon has helped encourage some positive changes in the sector (the shift away from device subsidies and contracts in particular), many of the competitive responses and promotions have been largely cosmetic in nature with even the carriers admitting they're still not all that interested in really competing on price. As a result, despite progress, a lot of the industry's problems remain, including intentionally-confusing bills that require several advanced degrees to truly fully understand. Even T-Mobile, which is cultivating a reputation as a consumer hero, acknowledges that consumers will never be able to understand what it is they're buying:

"Industry insiders acknowledge that, short of creating a spreadsheet to sort out the pitches, expecting consumers to navigate all of these offers is unrealistic. "We’re in a state of the industry where the carriers have sown a massive amount of confusion," Mike Sievert, the chief marketing officer for T-Mobile USA, said in a telephone interview. "Can you even decipher what’s going on with the carriers anymore?"

Of course T-Mobile laughs this off as a sort of "gosh, that's just how it is" affair, when again, this confusion is by design. AT&T, the company that has so far been hit the hardest by T-Mobile's often hilarious attacks on industry compatriots, takes the opportunity to imply that this confusion is the fault of increased T-Mobile competition, not the carriers themselves:

"I think we’re propagating some confusion in the marketplace — us as an industry," Glenn Lurie, the new chief executive of AT&T Mobility, said in a recent interview. "There’s been so much noise that customers are getting confused." Criticizing his competitors’ limited-time discounts, Mr. Lurie of AT&T said his company’s reputation was built around being respectful and transparent to customers. "Deal of the day is not necessarily how you get there."

Of course that's the same AT&T that has been at the vanguard of making wireless plans headache-inducing for years. It's also the same AT&T that just settled an investigation by the government into not only turning a blind eye to cramming and spamming, but for intentionally making bills more confusing so such scams would be harder to detect. While the press loves to make a lot out of the wireless industry's current price war, there's still a long, long way to go in terms of generating enough competitive pressure to force carriers to offer truly lower prices and a product people can understand. Of course, when the majority of consumers don't even know what a gigabyte is, that may be easier said than done.

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Filed Under: cellphone service, competition, confusion, mobile phones, wireless plans
Companies: at&t, sprint, t-mobile, verizon

17 Comments

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DannyB (profile), 7 Jan 2015 @ 1:10pm

There's a REASON for that confusion
That confusion exists in order to allow sales people to manipulate people into higher priced plans than they need, while convincing them that they are saving money.

I seem to recall back in the 1990's when one major national cell phone network operator started running ads about how their competitors cell phone plans required a rocket scientist or something like that. Nothing has changed.
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Anonymous Coward, 7 Jan 2015 @ 1:14pm

Postpaid are the most consumer friendly plans, and are often the least expensive too. Of course there are more options with prepaid, but it's worth considering if you're going to sign another 2 year contract.
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DannyB (profile), 7 Jan 2015 @ 1:16pm

Competition (or lack of it)
The major players not being interested in competing on price is a sure sign of lack of competition.

In any market where real competition exists, the players compete on both price and service, or exit the market as they should.
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DannyB (profile), 7 Jan 2015 @ 1:20pm

Thinking about cell phone insurance?
Go to your the insurer that provides your homeowner's insurance and ask them about a rider or a policy that covers your cell phone? (Your laptop, your camera, etc.)

You may find that you really don't want the cell company's insurance scam. It has a lot of limitations. It has a high deductible. It has a high monthly cost. See what your the provider of your regular homeowner's insurance can do for you.
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Anonymous Coward, 7 Jan 2015 @ 1:35pm

T-Mobile isn't that much better...
I just signed up with Tmo back in november - and the lady who assisted me with my signup either was a moron, or intentionally screwed up my plan.

When I got my first bill, I was paying more than twice as much as I signed up for and had to call them to "correct" it. Apparently all they did was credit me the difference, because it was still screwed up the next month...

After asking them to fix it again, I realized they had also tacked on some new charges for changing my phone number (which they said was free for the first change after signing up), and another fee for getting my second phone replaced (it bricked itself within a couple weeks of receiving it)... which they claimed I wouldn't have to pay for such a premature failure.

As such, the second month my bill was even higher than my first bill - which was already twice what I was supposed to be paying.

Even the 3rd month bill (which I just received), is still wrong - it's about $10 too high, and I see they still haven't removed everything that they were supposed to remove.

It's as if they play this game where they put mistaken charges on your bill and hope you don't notice... I'm getting pretty tired of calling them... The ironic thing is, I haven't had my own cell plan since 2005 - but my company insisted I finally get a phone and they'll reimburse me (up to a certain $, so the billing overages I'm dealing with come out of my pocket if I don't get them reversed). I remember now why I had cell phones.
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Anonymous Coward, 7 Jan 2015 @ 1:37pm

Re: T-Mobile isn't that much better...
oops... should have been: "I remember now why I *hate* cell phones."
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Anonymous Coward, 7 Jan 2015 @ 2:23pm

It doesn't help when companies advertise unlimited data and it's really something like 3gb data and you're also limited in what you can do with that 3gb data(eg no youtube or tethering l)
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John Fenderson (profile), 7 Jan 2015 @ 2:27pm

LOL
Mr. Lurie of AT&T said his company’s reputation was built around being respectful and transparent to customers.

Oh, lord, I had to pick myself up from laughing so hard at this. When it comes to billing, confusion has been AT&T's middle name from the first AT&T bill I ever paid, way back in the stone ages before cellphones or the internet. Mr. Lurie, you may find that an awful lot of us still remember how "transparent" AT&T long distance phone bills were back in the day.
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k-h, 7 Jan 2015 @ 6:43pm

Yeah because a phone call is a 2K data connection
Worth a tiny fraction of a cent.

SMS? A megabyte of SMS data would cost you $10,000 or there about.

Phone companies own a money tree. Structural separation of last mile wire, fibre or wireless and content is the only way to fix this mess.
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PRMan, 7 Jan 2015 @ 7:43pm

Re: T-Mobile isn't that much better...
I was just about to switch to them (from Sprint) for this very reason. I've had to call them 5 times about a line cramming and even call the state PUC on them. They finally took it off when I threatened to call the FCC.
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Lurker Keith, 7 Jan 2015 @ 11:46pm

My dad typically hands me the bill for anything if the requested payment doesn't match what it was the month prior, & wants me to sort it out.

Unlucky for the various companies that like hiding things, I not only can read their billing statements, I can also read legalese & know most of my rights (there may be a few that have slipped past my notice, so I'm hedging).

It's almost always up to me to talk to customer service. I typically have to state to knock it off w/ the macros/ prearranged dialog. I'm usually way past where they want to start (I pre-troubleshoot, since I'm technologically gifted & can usually work most things out that is possible to be worked out on my end) anytime I have to call, so they actually have to work to fix anything.

& I don't let them get away w/ any of the stuff I read on TechDirt... Didn't even before I found this site.
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Ninja (profile), 8 Jan 2015 @ 4:53am

Re: LOL
Reswpectful: we won't raise our voices or say anything that may be considered impolite when you lose your mind because our customer service is so bad and start screaming and swearing at us.

Transparent: our stores are built with transparent glass and our offices are open so there's nothing blocking our views.
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nextrow (profile), 8 Jan 2015 @ 5:11am

VoIP Services
Yes, there are various voip phone services to do
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Sheogorath (profile), 8 Jan 2015 @ 8:11pm

Any time a phone salesperson tries to push insurance on me, I just point out that thanks to a major design fault (charger port on bottom of phone), Samsungs don't last one year, never mind two. Also, I already have two years' warranty under European law, and I've never had a phone get lost, stolen, or broken yet.
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Rs, 9 Jan 2015 @ 4:50am

Closest to transparency
I've been with Ting for a couple of years. I urge anyone who is unhappy with their current carriers and to support Ting's Business model. My bills are basically my monthly usage, sales tax, 911 recovery and other mandated charges (currently about $3 per month for 3 lines)
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John Fenderson (profile), 9 Jan 2015 @ 9:47am

Re:
I have a nonnegotiable policy of never buying extended warranty or insurance for these sorts of things. When they try to push them on me, I just tell them that and they leave me alone about it.

"I just point out that thanks to a major design fault (charger port on bottom of phone), Samsungs don't last one year, never mind two."

How is that a design fault? I think it's a design feature, and am very happy that's where it is. Also, my last cellphone was a Samsung and I used it for three years before upgrading to my current Samsung. My old phone is still in use, too -- I gave it to my daughter last year and it's still working perfectly.
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Sheogorath (profile), 10 Jan 2015 @ 5:18pm

Re: Re:
Because of how people hold their phones, the charger port gets way more abuse while charging when it's on the bottom of the phone than if it's on the top. What you call a feature may be such on an iDevice, but it's a fault on everything else given that there's no docks for them in the UK.
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