Wireless carriers agree to fight 'bill shock' with free alerts |
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The Consumers Union, Federal Communications Commission and major wireless carriers today announced new industry guidelines to help consumers avoid billing overages, or “bill shock.”
The Big Four carriers – T-Mobile, Verizon, Sprint and AT&T – all agreed to institute alerts within the next 12-18 months that will warn customers when they are about to go over their data, text or voice plans, or incur roaming charges.
The new guidelines are a result of pressure from the FCC, which launched an inquiry into “bill shock” last year, after receiving complaints from thousands of customers who incurred enormous charges by unknowingly exceeding their plans or roaming internationally.
Speaking at the Brookings Institution today, FCC Chairman Julius Genachowski cited several examples of consumers who had unwittingly run up enormous bills. One woman received a $34,000 cell phone bill for international charges after a trip to Haiti after the 2009 earthquake, said Genachowski, while another customer was charged $18,000 after his free data downloads expired without warning.
Going forward, the alerts will be free and provided automatically, with no customer opt-in required, said Genachowski. He added that the FCC will continue to monitor the actions taken by the wireless carriers.
“Moving forward, the FCC will take a “trust, but verify” approach,” he said. “Because the wireless industry has taken these steps to help consumers avoid bill shock, we will put our rulemaking on hold. We will, however, be closely monitoring industry practices to make sure that all carriers provide this necessary information to consumers, as promised, and, if we see non-compliance, we will take action.
The CTIA, a trade group for the wireless industry said two out of the four alerts for data, voice, text and international roaming will be in place by October 17, 2012 and the rest will be in place by April 17, 2013.
The wireless industry had resisted government regulation of its policies and voluntarily offered to move toward the free alerts.
“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,” said CTIA President and CEO Steve Largent.
Bellevue-based T-Mobile hasn’t responded to a request for comment.
Update: Here is T-Mobile's response to the new guidelines:
“T-Mobile is pleased to be able to work with CTIA, the FCC and Consumers Union on today’s initiative which sets out Wireless Consumer Usage Notification Guidelines that customers can rely upon to avoid overages on voice, data, text and international roaming," said Tom Sugrue, senior vice president of government affairs. "FCC Chairman Genachowski and his staff are to be commended for their leadership and willingness to work with the industry to leverage marketplace solutions to satisfy consumer needs rather than imposing inflexible regulation.”
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