October 12, 2016
Contact: NCL Communications, Cindy Hoang, email@example.com, (202) 207-2832
Washington, DC—The National Consumers League (NCL), the nation’s pioneering consumer and worker advocacy organization, today called on the Federal Communications Commission (FCC) to examine the role that international mobile roaming (IMR) services play in wireless “bill shock.” An NCL analysis of the market for IMR services found that a significant portion of the more than 73 million Americans who travel abroad annually may be at risk of incurring higher than expected charges on their wireless phone bills, a phenomenon commonly known as “bill shock.”
In 2011, at the urging of the FCC and consumer groups—including NCL—the wireless industry began providing notifications to travelers of international roaming charges that they may incur while using their cell phones overseas. Given the explosive growth of data-intensive smartphones since 2011, however, NCL believes that notifications alone may not be sufficient to prevent IMR-related bill shock. In comments filed with the FCC, NCL called on the Commission to gather new data on the impact of IMR-related bill shock and consider possible regulatory or voluntary industry solutions.
“No one wants a sky-high cell phone bill as a souvenir of their trip,” said John Breyault, NCL vice president of public policy, telecommunications and fraud. “Unfortunately, due to the high cost of roaming, even consumers who are careful and try to limit their mobile data use can come home to a surprise bill in their mailbox.”
NCL’s analysis of the major American wireless carriers’ IMR service offerings found that roaming package pricing is extremely expensive when compared with domestic service rates. In addition, the carriers’ roaming packages often offer significantly smaller data allotments, slower speeds or both. Finally, while there are cheaper alternatives to buying roaming packages—such as buying a local SIM card and prepaid plan in the destination country—NCL found no instances where U.S. carriers attempted to educate their subscribers about those alternatives.
“We recognize that U.S. carriers are often at the mercy of foreign carriers who can and do set wholesale IMR rates far in excess of cost,” said Breyault. “However, as regulators around the world have recognized, this situation represents a market failure which the FCC would be wise to examine as it seeks to protect the millions of American consumers who take their smartphones with them while traveling abroad.”
Since the FCC last examined bill shock, international regulators have taken action to address the high cost of IMR services. The European Union (EU) will eliminate intra-EU roaming fees by 2017 and the Gulf Cooperation Council countries have agreed to reduce IMR data rates by two-thirds by 2020. The Asia Pacific Economic Council and Organization for Economic Co-operation and Development (OECD) have also urged member countries to take action to address high IMR rates and educate consumers often cheaper alternatives to IMR services.
“Consumers in the U.S. should not play second fiddle to consumers in Europe or the Gulf countries when it comes to protections from IMR-related bill shock,” said Sally Greenberg, NCL’s executive director. “Consumers should not be put at risk of incurring outrageous cell phone charges just because they took their phone with them while traveling abroad.”
About the National Consumers League
The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.