Cellphone Companies to Warn as Plans Approach Limit

By: Peter Svensson, Associated Press
By: Peter Svensson, Associated Press

New York, NY (AP) - Cellphone companies pledged Monday to warn subscribers before they go over their monthly limits for calling minutes, text messages and data use.

The pledge comes in response to a threat of regulation by the Federal Communications Commission, which wants to curb nasty surprises in the monthly bills of wireless subscribers.

CTIA - The Wireless Association, a trade group representing the major cellphone companies, said they're also promising to warn subscribers that they're paying roaming fees if they travel abroad.

The warnings will arrive as text messages, and subscribers won't need to sign up for them - they'll arrive automatically. CTIA said its member will have warnings in place on at least half their plans in a year and all of them in two years.

AT&T Inc. and Verizon Wireless, the two largest carriers, already provide text-message warnings on their data plans, but not on text messaging or calls. Instead, subscribers have to look up their usage data.

The announcement was made jointly by the CTIA and the FCC, which credited Consumer's Union, the publisher of Consumer Report, for raising awareness of the issue. The magazine had found that many of its subscribers had been startled by high monthly bills.

Curbing occasional high bills is unlikely to have much of a financial effect at phone companies. Analyst Michael McCormack at Nomura Securities noted that the companies say that only a few percent of their subscribers exceed their allotments in a month. The trend over the past few years of making calls to other cellphones "free," or not counting toward the plan limits, has reduced the number of people who go over on calling minutes, he said.

Phone companies are also moving away from charging for each text message or selling "buckets" of 500 messages per month. Rather, they have moved toward offering unlimited text messaging.

The biggest remaining "bill shock" problem for consumers may be in international data roaming, McCormack said. Someone who travels abroad with a smartphone might use it sparingly for calls, but be unaware that apps are using data in the background, racking up big fees that only become apparent when the bill arrives.

The alerts are voluntary for the phone companies, but FCC Chairman Julius Genachowski made it clear that the agency would step in if companies fail to police themselves.

Kathleen Grillo, senior vice president for federal regulatory affairs at Verizon Communication Inc., said the voluntary approach was preferable because things change quickly in the wireless world and regulations don't always keep up.

"The result is an industry code that will serve consumers better than rules that would soon be outdated," she said.

Asked at the press conference why it would take two years to fully implement the warnings, CTIA President Steve Largent said phone companies have to reconfigure their systems.

You must be logged in to post comments.

Password (case sensitive):
Remember Me:

Read Comments

Comments are posted from viewers like you and do not always reflect the views of this station.
  • by Anonymous on Oct 18, 2011 at 10:07 AM
    when will people again become responceable for their own actions?? until we have to suffer for our choices, we will never learn. If you are unable to keep up with your usage, the phone will tell you how much you use, and be a grown adult, then you should get all the charges they can give you.
  • by Anonymous on Oct 18, 2011 at 09:27 AM
    Is it really difficult for an adult to 1.) know what they sign up for, 2.) know where they are (a phone usually lets you know if you're roaming) and 3.) pay attention to your own usage. Grow up already. Pay your bill or get off the phone.
  • by Anonymous on Oct 18, 2011 at 05:57 AM
    One problem with the text warnings is you may not hear the text message or feel the vibration. If you go near the border of the US you can jump over to a different tower and be charged $2 a kb...not mb for data usage. If you have a smart phone that checks for updates, e-mail and so on then you can be looking at a high bill very quickly. My opinion is it should cut off data usage and/or service, except to make 911 calls, if you go over or are near a international roaming area and haven't physically authorized the extra charges. A warning is not the answer. A physical acceptance to the text message (Yes I want to be screwed over or No I have brains and you can shove these extra charges up your rear) would be much better.
  • by TK on Oct 18, 2011 at 01:54 AM
    I keep a charged cell phone in my car in case I need emergency services and have to call 911. I had cell phone service turned off a while ago after I found out that prepaid Verizon sells your name and cell phone number in data lists to telemarketers and debt collection agencies. Verizon employee told me they don't sell your info if you sign up for a contract!!!
WCTV 1801 Halstead Blvd. Tallahassee, FL 32309
Copyright © 2002-2016 - Designed by Gray Digital Media - Powered by Clickability 132028818 - wctv.tv/a?a=132028818
Gray Television, Inc.