back to article FCC bids to curb 'bill shock and mystery fees'

On Thursday, the US Federal Communications Commission will detail a set of proposed rules that will require wireless carriers to notify users when their monthly voice and data plans are nearing their limit. "Consumers must know that the FCC's got their back," Commission chairman Julius Genachowski said in a Wednesday speech at …


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  1. Anonymous Coward
    Anonymous Coward


    You mean I'm supposed to actually look at my bill before I pay it? Nah, I only look at the Amount Due line.

  2. mhoulden


    Who wants a "creative" bill? The last time creativity and accounting went together was when Enron et al cooked the books.

    1. The BigYin

      Enron is old hat

      Just ask Lehman Brothers.

  3. Michael C

    New Rules: (proposed by me)

    1: un-bundle unlimited data from unlimited calling and text plans. I should be able to choose which I want and which i do not. (AT&T does this to an extent). Including that i should be able to get a smartphone without a data plan (for use on WiFi only) if i so choose.

    2: notification of use of any feature that incurs a fee, including the amount of the fee and total incurred of that fee thus far in the calendar month. If I don't have a text plan and get a text, it should be "pending" until i approve to receive it. If I go to send one, I should be told exactly what it will cost to do so, and that't I've racked up $7 in text fees thus far this month.

    3: Overage fees many not exceed 150% of the price difference between the current plan tier and next one higher if that higher tier would accommodate the overage without additional overages. For example, if the overage is $0.10 per text, and I have 200 texts for $5, but there's a plan that offers 700 texts to $10, then $5 is then $7.70 is the max overage i can pay in any month I stay under 700 texts. (essentially, they auto-upgrade my plan tier for one month at a 50% premium). If you auto-upgrade this way 3 months in a row, it should notify you in your bill that you will instead be set to the new plan tier automatically the following month and billed the standard rate unless you call to stop it. Same goes in reverse, if you under-utilize your plan 3 months in a row, it should automatically be reduced.

    4: There MUST be an unlimited option for each feature, priced at not more than 33% higher than the highest not-unlimited tier, or $20 more, whichever is lower.

    5: Data is data is data. SMS can go over IP, and should when able by default. If you phone can't do concurrent voice and data, it should use the SMS frequencies when you;re on a call, but if you're not on a call and have a data plan, SMS should come in via IP and incur no additional charges. SMS plans should really only exist for data-incapable phones like simple camera phones.

    6: ETF prorating: ETFs covering additional subsidies must reduce each month by a fixed amount such that in any month the remaining ETF is not more than the number of months remaining in the plan plus 1. if the subsidy was $400 on a 24 month plan, in the last month the ETF should not be more than $33, and should have dropped about $16 per month each month. Contract ETF fees must be separate from subsidy and be clearly defined. Contract ETFs may not exceed 70% of the remaining total due on the contract, with a max fee of $250 on 2 year plans and $150 on one year plans. If a subsidy is offered, and has a fixed number of months reducing subsidy ETF, then starting in any month not under contract, the plan price must be reduced by not less than 80% of the value of the monthly subsidy. Your total ETF is the sum total of your contract ETF and unpaid subsidy reimbursement.

    7: subsidy changes: Subsidies may not be included in the base monthly plan rate, they must be in addition to it, and after the subsidy term has expired, the monthly rate must be reduced accordingly. A premium of not more than 25% may be charged on this monthly subsidy (essentially interest on the loan). If your prorated subsidy is $20 per month, after 24 months you can expect your phone plan to reduce by not less than $15. Also, if you are offered an "early trade up" your remaining unpaid subsidy is WAIVED. For example, everyone who got an iPhone 4 12 months after getting an iPhone 3GS would still own half their subsidy, but trading in cancels the one from the old phone and replaces it with a new $400 subsidy and 2 year term. You would not owe both the remaining subsidy and the new one. Whatever the value of the subsidy, you can pay that in full on day 1, or at any point in time during the contract, and have no additional monthly fee. The phone companies offering to upgrade your device is their offer to you and waives any other outstanding obligations if it comes with an additional contract requirement.

    Plans with limits:

    If you paid for 900 minutes, you GET 900 minutes. unused minutes, texts, MB, etc must carry from month to month. Everybody gets rollover. Overages must reduce back-stored underage before incurring a fee. Carriers may cap max stored under-use at not less than 3 months worth. They must not expire for at least 1 year (or length of the plan, whichever is longer). Reducing your plan tier should remove 3 times the difference in tier minutes from your pool. (ex going from a 1500 minute plan to a 1000 minute plan would erase 1500 rollover minutes if you had that many). You can not be charged retroactive overage fees doing so.

    9: Bill changes: Your remaining subsidy ETF and contract ETF must appear on your bill at all times, including the amount it is reduced by. You can pay either or both iof these at ANY TIME, and be released from ongoing costs in addition to the base plan rate, and be released from your contract, though you may choose to continue service. (currently, if you pay an ETF, you have to close your account, I might want to pay it to save the premium charges and reduce my monthly bill now but remain on a plan, this way i can). Overages per plan option must be included in a summry for that option.

    10: every device MUST have a month-to-month contract option, each for minutes, SMS, and data. If you get a subsidized device on a month-to-month plan, you are however committed to pay monthly until you have paid off the subsidy, you simply have no contract requirements other than to pay a minimum plan fee for at least a calling plan until the subsidy balance is paid in full.

    This will break the entire phone company billing model. they will resist this hard. Plan base prices will be increased. So, put into the law that their total quarterly profit shoudl they adjust their rates higher may not exceed the per-subscriber profit margin of the previous 6 month average by more than 2.5%. If they raise the rate too high, they simply have to credit back the difference in the following month's bill cycle. this gives them a cushion of a few months to adjust their billing terms without risking a financial collapse, but ensures the consumer does not get screwed. People on current plans will not take in all of these new rules immediately (just the billing changes, and high bill protections, and ETF fee changes apply), unless the accept a change to a new plan tier system and monthly rates (without extending their contract) in order to benefit from other new rules (like rollover etc and new overage rates).

    Finally, as for billing and tracking usage: If the device can not read out in real time the remaining minutes/mb/sms on the plan, then a text (free) must be sent to each device operated by someone with authority on the account on the plan at 75%, 90%, 100%, 110, and 125 of useage. Also, at the point that the monthly bill would be 25% higher than normal, and at each additional 25% thereafter, the text sent will be followed by by an e-mail. If in 4 hours the plan oener does not respond to the message, access the web portal, or call support, the plan must stop acruing overages. Use can be restricted by 911 must remain available, and phones must still be able to use any free data available or remaining options in separate plans (run out of minutes, you can still call after 9PM and still use data freely until you hit those caps too). Only if the customer approves may overages beyond 25% be permitted.

  4. Anonymous Coward

    Just stop the ludicrous rates they charge!

    There is no way in or out of hell it costs any of the carriers 30,000 dollars to transfer data and phone calls to one phone. When are they going to set a maximum limit per phone per month?

    The rest is just "Information Superhighway Robbery"

  5. Robert Carnegie Silver badge

    Don't customers who suddenly get bills for thousands of dollars...

    ...subsidise a cheaper service for the lucky majority that the phone companies don't pick on?

    And we get to laugh at their misfortune as well.

    It's a public good.

  6. MJIsles

    If people paid more attention

    to their actual usage rather than complain about how much they are supposed to pay, maybe this wouldn't be an issue for the goverment. When you sign up with a contract carrier for a specific plan and you go over that plan, no matter how much, how is anyone surprised when you get charged more fees? If you want to avoid that hassle and the bills, as I did, then switch to prepaid where you pay for what exactly what you get and use it until it runs out. Many prepaid companies out there are offering deals on the same basic level as any contract carrier and bills ehre no surprise. My prepaid provider, NET10, just created a $50 unlimited use plan with flexibilty to move between that plan and 2 other low cost plans based on usage - why would I ever go back to overage fees?

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