Consumers Union Urges Crackdown on Cell Phone “Bill Shock” in FCC Comments

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WASHINGTON, D.C. – January 10, 2011 — Consumers Union, the nonprofit publisher of Consumer Reports, today joined other public interest groups in filing joint comments at the Federal Communications Commission (FCC) in support of a crackdown on cell phone “bill shock” — the problem when people get hit with unexpected charges on their wireless bills.

The groups’ filing cited a recent survey by Consumer Reports that found approximately one in five respondents had received a cell phone bill that was significantly higher than they had expected in the past 12 months. Among those who experienced “bill shock,” half said the bill was at least $50 higher than expected, and one in five said the bill was $100 more than expected. The survey of 58,000 Consumer Reports subscribers was conducted in September 2010.

The FCC proposed requiring wireless providers to notify customers before and when they reach their monthly limits for voice, text, and data services in October 2010. Customers would get a notice, such as a voice or text message, when they approach their limits. Today is the deadline for submitting comments to the FCC about its proposal.

Parul P. Desai, policy counsel for Consumers Union, said, “For too long, consumers have been getting blindsided by surprise charges on their cellphone bills. Wireless companies are not providing adequate, uniform tools for people to keep up with their accounts. Notifying customers before they exceed their limits is a simple, effective way to prevent ‘bill shock.’”

Consumers Union has endorsed the FCC proposal. In the comments being filed at the FCC today, the groups are urging commissioners to consider going further by requiring that wireless carriers obtain a subscriber’s affirmative “opt-in” agreement to such penalty fees before they can be charged. Under this proposal, if a subscriber declined the charges or failed to respond, wireless carriers would be required to discontinue service until the subscriber agreed to the penalty or purchased an additional allotment of service, or the subscriber’s monthly allotment for the service was replenished. The groups noted that a subscriber in this situation should still be allowed to contact the wireless carrier and 911.

The groups signing on to the joint comments included Consumers Union, the Center for Media Justice, Consumer Action, Consumer Federation of America, Free Press, Media Access Project, National Consumers League, National Hispanic Media Coalition, and New America Foundation.

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Contact: David Butler, Consumers Union, 202-462-6262, dbutler@consumer.org