AT&T, Verizon may have to alert customers near useage limits under FCC proposal

By Kaye Spector

Plain Dealer Reporter

 

After a monthlong business trip to Asia a few years ago, Les Wagenheim of Pepper Pike had an ugly surprise waiting for him when he returned home: a $2,500 bill for his BlackBerry.

This was despite signing up and paying for a plan that was supposed to keep his mobile phone bills lower while he was traveling.

What happened? Somehow, neither of the two AT&T employees he had contact with while signing up for the overseas plan told him to switch his phone’s roaming feature off.

“I took comfort in the fact that I was covered. Lo and behold, I was not,” he said.

“They cheerfully took my money but they didn’t say, ‘Hey be careful, don’t operate the phone in this mode.’ ”

Wagenheim, who eventually got his bill reduced to $500, would have been warned by AT&T that he was facing higher service charges if a measure under consideration by federal regulators had been in effect.

The Federal Communications Commission wants to stop cell phone “bill shock” by requiring wireless companies to alert subscribers before they run out of minutes, hit data usage or text messaging caps or start racking up international roaming charges.

The FCC will propose rules today and may take a final vote in coming months. Subscribers may get voice or text alerts when they use too many minutes in a month or place calls using more expensive networks outside the United States, the agency said in a summary distributed by e-mail.

The FCC has reports of unauthorized “mystery fees” popping up on bills, Chairman Julius Genachowski said Wednesday in a speech in Washington, D.C.

“It’s hard to keep track of everything you’re being charged and too easy to find yourself paying more than you had planned on,” Genachowski said.

A survey by the FCC showed 30 million Americans, or one in six mobile-phone users, had experienced bill shock, Genachowski said.

Carriers led by Verizon Wireless, under FCC investigation for overcharging 15 million customers for data, have said mandatory messages aren’t necessary because carriers give customers ways to track use of data, voice and text features.

AT&T’s iPhone app, for example, gives subscribers such information, which is also available on the company’s web site.

Providers are concerned about “prescriptive and costly rules,” Christopher Guttman-McCabe, a vice president for CTIA- the Wireless Association, a Washington-based trade group, said in an e-mail.

“The industry continues to develop tools to keep customers informed about their level of usage,” he said.

The FCC’s proposal would require clear disclosure of the tools to track minutes of use, in part because “too many consumers don’t know about them,” according to the summary.

Wagenheim, owner of Bedford Heights-based Pearlessence home fragrances, called the FCC proposal “brilliant.“

“Obviously, a lot of people have been burned, so it’s good that we’re headed in this direction,” he said. “Now that somebody’s on to protecting the consumer, we’ll all benefit from this.”

Bill shock typically happens only once, said computer consultant Spike Radway. After that, the customer is highly motivated to learn the details of how to use their phone.

“For parents or someone getting their first smart phone, I think it’s a good idea that they are doing the legislation,” said Radway, owner of Team Spike Consulting LLC. “I think it’s going to prevent people getting big bills one time for something they didn’t think about.”

Bloomberg News and the Associated Press contributed to this article.