FCC on right track on ‘bill shock,’ but stronger protections needed – National Consumers League

By John Breyault, Vice President of Public Policy, Telecommunications and Fraud

NCL recently joined with several other major consumer and public interest groups in calling on the Federal Communications Commission (FCC) to strengthen its proposed “bill shock” rules to ensure that consumers don’t get hit with bloated wireless bills.

Why do we need rules to protect consumers from “bill shock?” In a nutshell, it’s because the wireless marketplace has changed dramatically and the status quo is not sufficient to keep consumers from getting hit by high fees that they did not anticipate. Numerous studies from the FCC itself and independent groups attest to this:

• A May 2010 survey by the FCC found that 30 million American consumers have experienced “bill shock” on their wireless bills.
• A November 2009 report by the U.S. Government Accountability Office found that more than one in three consumers (34 percent) received unexpected charges on their wireless bills.
• A September 2010 survey of Consumer Reports readers found that more than one in five respondents had received unexpectedly high wireless bills. Half of those respondents reported charges of more than $50 and one in five more than $100.

The FCC’s proposed “bill shock” rules would protect consumers by requiring:

• Over-the-limit alerts when a consumer is approaching monthly limits for voice, text or data;
• Out -of-the-country alerts when a consumer’s use of their cell phone on an international roaming network (which is generally very expensive);
• Clear disclosure of usage management tools that consumers can use to review usage balances and potentially cap usage.

NCL supports the FCC’s proposed rules, but we are urging the commission to go further by instituting a “circuit-breaker” rule that would require carriers to suspend service if a consumer chooses not to accept penalty fees (or fails to respond to alert notifications). We are also lobbying for rules that would mandate that alert notifications be made available in alternate languages for non-English speaking users.

Last year, NCL supported legislation proposed by New Mexico Senator Tom Udall which would have mandated similar rules as what the FCC is considering. Senator Udall’s “Cell Phone Bill Shock Act” would have also required alerts to be provided at the 80 percent and 100 percent thresholds for voice, text, and data allotments, similar what NCL is proposing in our comments at the FCC.

The next step on this issue will be the February 8 deadline for reply comments at the FCC. Following this deadline, the FCC will review the record generated by the proceeding in preparation for a final vote on the rules. Consumers who have experienced “bill shock” and have been unable to rectify the situation directly with their carrier can file a complaint with the FCC online or via a toll-free hotline at 1-888-CALL-FCC. For more information on the “bill shock”, including tips on how to avoid high cell phone bills, visit the FCC’s “bill shock” education page here.