FCC May Ask Mobile Carriers to Warn Customers on Fees

Photographer: Andrew Harrer/Bloomberg

Wireless companies might have to warn their customers about extra fees for using more voice minutes or data. Close

Wireless companies might have to warn their customers about extra fees for using more... Read More

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Photographer: Andrew Harrer/Bloomberg

Wireless companies might have to warn their customers about extra fees for using more voice minutes or data.

The U.S. Federal Communications Commission is considering rules that would force mobile carriers to warn customers when they’re about to incur fees for using more voice minutes or data than their plan allows.

Verizon Wireless, AT&T Inc. and other service providers may face rules similar to those in Europe, where carriers are required to send text messages to subscribers who are close to plan limits, the FCC said in a statement today.

The initiative is a response to “hundreds” of complaints from customers who received unexpectedly high bills, the agency said. Customers said they received bills with hundreds of dollars in unexpected fees because of charges for services subscribers thought were free, according to the statement.

“Carriers have been working to change the overages, because one of the biggest causes of customer dissatisfaction are these big fluctuations in the price of your monthly bill,” Chris Larsen, an analyst at Piper Jaffray & Co. in New York, said in an interview. “But carriers never like to be told what to do, so there should be some real discussion about how this would be implemented.”

Some of the extra fees end up costing carriers because of the expense to explain the new charges through customer service, Larsen said.

Monitoring Tools

AT&T, Verizon Wireless and other carriers let customers monitor minutes of talk time as well as data and text use by typing codes such as #MIN into their phones, the CTIA wireless industry association said in a statement.

Verizon Wireless also offers online monitoring tools and ways to restrict calling during certain times, spokesman Jeff Nelson said. The Basking Ridge, New Jersey-based carrier may consider sending users text messages when they’re approaching or exceeding plan limits, he said.

“When you prescribe a specific remedy for a problem, it doesn’t necessarily meet the needs of actual customers,” Nelson said.

AT&T, based in Dallas, offers similar features, spokesman Mark Siegel said. Customers on family plans can pay a monthly fee to limit a child’s use or have a service send warnings when the child is approaching his limit, he said.

John Taylor, a spokesman for Sprint Nextel Corp., said the company advises its customers of potential extra charges through its website and phone customer service.

Verizon Communications Inc., which co-owns its wireless unit with Vodafone Group Plc, fell 21 cents to $28.40 at 4:01 p.m. in New York Stock Exchange composite trading. The shares have dropped 14 percent this year. AT&T, down 8.5 percent this year, declined 3 cents to $25.64. Sprint climbed 10 cents to $4.13.

To contact the reporter on this story: Amy Thomson in New York at athomson6@bloomberg.net; Greg Bensinger in New York at gbensinger1@bloomberg.net

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