Wednesday, October 19, 2011

No More Surprises: Cell Phone Companies Agree to Overage Warnings

http://www.flickr.com/photos/angelshupe/
 Article first published as No More Surprises: Cell Phone Companies Agree to Overage Warnings on Technorati.

In an effort to avoid regulation, wireless providers have agreed to notify customers who are reaching their limits on voice, data, text and international roaming charges.

In a joint statement with the FCC, Consumers Union and CITA, a large wireless industry association, the major cell companies announced they will provide free warnings that users are about to incur overage charges on these commonly used services.

CITA members include wireless industry heavyweights such as AT&T, Verizon, T-Mobile, Sprint and TracFone.
Half these notifications must be working by Oct. 17, 2012, with the remainder up and running by April 17, 2013. This is good news for consumers.  According to this report, by the Wireless Consumer Association International, about 13.5 percent of customers will go over their plan's voice limit, and almost one in five (18%) will exceed their data limit.

Cell phone customers have long complained about 'bill shock', when unknowingly exceeding their plan limits. Companies have made billions off these charges, and agreeing to these notifications was only done to avoid mandates from Washington. The joint statement quotes President Obama,
“Far too many Americans know what it’s like to open up their cell-phone bill and be shocked by hundreds or even thousands of dollars in unexpected fees and charges... Our phones shouldn’t cost us more than the monthly rent or mortgage. So I appreciate the mobile phone companies’ willingness to work with my Administration and join us in our overall and ongoing efforts to protect American consumers by making sure financial transactions are fair, honest and transparent.”

The FCC and Policy Council for Consumers Union praised the agreement, saying more than 97% of wireless customers will benefit from the new rules and urged the companies to implement the notifications quickly.
CITA President and CEO said,

..."Today’s initiative is a perfect example of how government agencies and industries they regulate can work together under President Obama’s recent executive order directing federal agencies to consider whether new rules are necessary or would unnecessarily burden businesses and the economy.”

Because compliance is 'voluntary', the Consumers Union said, they are going to work closely with the FCC to make sure companies comply, "and we're pleased the Commission is keeping this proceeding open to help ensure compliance."

So, today cell phone customers enjoy a rare victory against surprise overages and Americans get a rare example of government, industry and consumer groups working together to protect users.

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