Opinion: FCC 'bill shock' regulations overdue

Ever been taken aback by an unusually high cell phone bill for a given month? If so, you’re not alone: according to the Federal Communication Commission, one out of six Americans has suffered from what’s been dubbed “bill shock.” Now, it appears that the FCC intends to help prevent consumers from receiving this kind of nasty surprise—and I, as a bill shock victim, give it two thumbs way, way up.

The FCC has published comments by Chairman Julius Genachowski saying that bill shock is a serious problem. Consumers, Genachowski argues, should receive some kind of alert from their mobile provider when they approach their plan limits; he even points out that AT&T already does this for iPad users that subscribe to the network’s data plans.

But, Genachowski added, “They’re not yet helping consumers consistently.” And it’s not just small potatoes—according to the FCC, 67 percent of complaints it has received about bill shock involved charges of a hundred dollars or more and 20 percent were for a thousand dollars or more.

On Thursday, the FCC will vote on proposed regulations that would ensure that consumers don’t find themselves suddenly drowning in overage fees. Besides providing messages to consumers approaching their limits, the regulations would also involve sending “out-of-the-country” alerts to customers traveling internationally, and would also allow users to set their own caps on usage. The European Union already enforces automatic alerts for consumers getting close to their text, voice, and data limits, as well as for roaming charges.

As someone affected by bill shock—though not in the magnitude of many of the truly unfortunate stories cited by the FCC survey—I’m completely behind the proposed rules. Last month, I went over my 200 text message limit for the first time ever, thanks to a combination of travel and other unforeseen circumstances. And while no blame should be placed on anybody other than me, I was certainly, shall we say, nonplussed to receive a text message from AT&T informing me that I had racked up $50 in excess fees.

I realize that AT&T is a company that, like all companies, is out to make a buck, but would it really have killed them to let me know before I hit those additional 500 text messages? Not to mention that once I’ve gone over, I have little recourse to stop my friends from sending me additional text messages and continuing to rack up charges. Were AT&T’s little globe anthropomorphized, it wouldn’t be hard to see the dollar signs in its eyes.

But instead, AT&T used my indiscretion as an opportunity to try and upsell me on a more expensive texting plan—something for which I have no desire, as this was (hopefully) an aberration. (And let’s not even get into how much of a racket text message pricing is.)

More to the point, AT&T is already making plenty of money from me by virtue of the fact that even though I subscribe to the cheapest voice plan available to iPhone users—$40 per month for 450 minutes—I regularly undershoot that by hundreds of minutes. (Not to mention I’ve racked up more rollover minutes than I could ever feasibly use.) That’s money they get no matter how little I make phone calls; the $50 in text message overage is gravy.

One of the anecdotes FCC Chairman Genachowski related in his remarks was the story of one man who was charged more than 15 times what he expected for phone usage after an overseas trip. The man, who was a tech executive working on a system to allow people to pay their parking meters via cell phones, pointed out that it was a simple matter to send a text message before consumers hit their limit.

“The only reason not to do it,” the executive told Genachowski, “is if you’re trying to take advantage of a customer.”

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