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Consumer Protection
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NHMC, Public Knowledge Ask FCC To Include Text Messaging In The Universal Service Fund NHMC and Public Knowledge submitted comments asking the FCC to clarify the status of text messaging as a Title II telecommunications service. Giving text messaging this classification will create regulatory certainty and help ensure the future of the Universal Service Fund. To read our comments, click here.
NHMC Signs-On to Bill Shock Reply Comments NHMC joined a diverse group of organizations to submit Reply Comments in the FCC's Bill Shock proceeding. In the Reply Comments, NHMC and others reiterated calls for enhanced consumer protections when it comes to cell phone bills. To read the Reply Comments, please click here.
Faster Cellphones To Bring A Wave of New Services and Charges If you think cellphone bills are complicated now, just wait. Within weeks, some of the biggest wireless companies will offer super-fast Internet connections for cellphones that rival the speeds delivered to desktop computers. As competitors follow suit with their own juiced-up networks geared for the Web, consumers can expect a cornucopia of new services - along with new charges. For now, consumers can buy flat-rate monthly data plans from most carriers. But Verizon Wireless and T-Mobile are moving toward tiered pricing packages based on how much data a customer uses. All-you-can-eat plans are no longer available to AT&T's new customers, who must choose from a menu of data services. "There are a variety of things you can do and a lot is on the table," said Peter Thonis, a spokesman for Verizon Communications. "You could be charged based on useage or by speed difference, or you could do both. There are no definitive answers here." The Federal Communications Commission is trying to keep up, launching an effort to prevent mystery fees and confusing increases from appearing on cellphone bills. But the wave of changes is only beginning. Cisco, which provides routers for wireless networks, is working with corporate clients such as Verizon to create even more options for consumers. Users could opt for "turbo charging" streaming video feeds to their smartphone for an extra fee. Just pay a little more for "gold service" compared with "bronze service" for data packages and speeds, said a Cisco official, who wasn't authorized to be identified speaking for the company. Imagine bundles of television channels such as ESPN and Fox delivered on your iPad or other tablet for a few dollars extra. Add a few more dollars and get parental controls to block R-rated movies and World of Warcraft on your teen's Droid. Heavy users of Facebook may be able to buy priority service for that application or spend a bit more to keep Twitter's Web site from failing during peak hours. None of this is offered today, but Cisco says its partners are far along in implementing such new features. All this, according to consumer groups and analysts, will lead to a labyrinth of fees and charges on cellphone bills that could make an accountant's head spin. Consumer advocates say confusion is to the advantage of carriers. "You have a population without true knowledge of how much they are consuming compared to carriers who have true knowledge of demand on their networks, and that assymetry leads to things like bill shock," said Sascha Meinrath, a director of the open technology initiative at the New America Foundation. The FCC is considering rules that require carriers to text or call users when they approach their voice and data limits. The regulation is aimed at avoiding "bill shock." FCC Chairman Julius Genachowski said that even though carriers say they let users know how many minutes of talking and megabytes of data they use, mystery fees continue to confound consumers. Verizon Wireless recently agreed to pay $25 million in a settlement with the FCC on false data charges for 15 million subscribers. The federal agency estimates about 30 million cellphone users have experienced bill shock from sudden increases. And Genachowski doubts that most people know how much data is consumed by watching an episode of "Mad Men," a recipe for even more confusion in the new world of ever-more-powerful smartphones and tablets that act like computers. "Most people still don't know what a megabyte is," Genachowski said in a speech introducing the regulatory proposal. "So it's hard to expect them to know when they have reached their limits." In a recent survey, the research arm of investment house Sanford C. Bernstein found that consumers were not happy with the idea of usage-based pricing plans. "They're generally ill-equipped for any estimation of their usage and they are ill-equipped to judge its implications," Bernstein analyst Craig Moffett wrote. "Given the option, the vast majority of respondents would stay with their unlimited plans." Sprint Nextel was the first to offer mobile broadband services, known as fourth-generation wireless. It is offered in 62 markets and only in unlimited plans, though chief executive Dan Hesse said he is watching competitors with tiered data plans. The nation's largest carriers say they need to manage traffic with various offerings to prevent congestion. They tout more options for users and say tiered prices are more fair to those who don't use their phones for Internet access as much as others. For now, Verizon Wireless and T-Mobile offer tiers of data packages and flat-rate plans. AT&T's customers can maintain their unlimited voice and data packages until the end of their contracts. Those customers will then have to choose from a menu of data plans. "What we're trying to do is offer choice, and there will always be those that then say choices are too many. So you're darned if you do and darned if you don't," said John Walls, a spokesman for wireless industry trade group CTIA.
FCC Publishes Bill Shock Proceeding In the proposed rules, the Federal Communications Commission (FCC) would require mobile service providers to provide usage alerts and information
Klobuchar To FCC: Crack Down On 'Cramming' Sen. Amy Klobuchar, D-Minn., called on the Federal Communications Commission Wednesday to do more to crack down on unauthorized charges added to consumers' phone bills by a third party. In a letter to FCC Chairman Julius Genachowski, Klobuchar, a member of the Commerce Committee, voiced concern about the practice known as "cramming." She said complaints about unauthorized charges have been on the rise, particularly among smart phone users who can download applications to their phones. "Victims of cramming may have inadvertently signed up to receive a message - such as a horoscope or a joke - without realizing they would be billed each month. Or a victim may simply be an unlucky target of a scam," Klobuchar wrote. "These charges, which may go unnoticed for months, appear to be legitimate and are often hidden in a bill." She added that such charges often are difficult to remove. Klobuchar, who has been critical of early termination fees imposed on wireless phone customers who break their contracts early, urged the FCC to consider adopting rules that would require phone companies to clearly identify third-party charges on their customers' bills, including a clear description of the services being charged. In addition, she called on the FCC to establish clear procedures companies must follow to ensure that a consumer has agreed to purchase a service that will be charged to their phone bill. "As I have written to you before, wireless consumers are increasingly faced with confusion over wireless charges and uncertainty about their bills," she added in the letter. "Cell phone cramming and unauthorized third-party charges only add to this confusion." Verizon Wireless has agreed to pay a record $25 million fine to settle allegations from the Federal Communications Commission that the wireless provider erroneously billed millions of customers for unexplained data charges. Last month, Verizon Wireless agreed to pay a record $25 million fine to settle the FCC's allegations that the wireless provider erroneously billed millions of customers for unexplained data charges.
Groups Continue Urging FCC To Act On Text Message Discrimination And Censorship In light of new reports detailing the “flawed system” surrounding charitable SMS donations, in addition to more nonprofits coming forward in a fight against text message censorship, public interest groups continue to urge the FCC to act on a three-year old petition that would ban such practices by US wireless carriers. In a blog post yesterday, Washington DC-based Public Knowledge detailed new developments surrounding its petition to the FCC filed back in 2007. Public Knowledge, as well as other interest groups, have been in a long battle to force the FCC to put a plan in place to stop unfair practices when it comes to the text messages sent over wireless operators in the US. “Unfortunately, American cell phone carriers are not content with merely passing messages between phones, as they do with telephone calls,” Public Knowledge explains in its post. ”The wireless industry does not allow organizations to use a regular phone number to send text messages to the public; they must lease a “short code”, a special number that can be revoked or blocked by a carrier at any time.” Short codes are a central element in the fight against change, as acquiring one is a long drawn-out and costly process — especially for nonprofits and charitable organizations. “How can a group get a carrier to restore its text messaging access once it’s gone? So far, the answer appears to be filing a lawsuit or a getting a story in the New York Times. For most nonprofits a lawsuit against a deep-pocketed carrier is a nightmare. And what charity wants to waste a front page New York Times story on a dispute over texting, rather than a profile of its contributions to society? A public relations battle with AT&T, the country’s second biggest advertiser, is probably not a good use of donor money,” continued Public Knowledge. Speaking of the New York Times, the paper recently featured an article detailing the “flawed system” that stifles charitable giving via text, saying many nonprofits can’t support the costs associated with obtaining a short code — let alone the massive awareness campaign that’s necessary to promote wide-spread SMS donations. Many cite the recent success the American Red Cross has had with its mobile giving efforts following the Haitian earthquake, but smaller nonprofits say they don’t have the opportunities the Red Cross had to promote its mobile giving campaign — in particular, a worldwide platform as all eyes were tuned to news stations around the world, and even Michelle Obama promoting a short code on national television. Small nonprofits that have to go it alone face a much tougher battle. Even the National Hispanic Media Coalition (NHMC) recently came forward to demand that the FCC put an end to wireless carriers’ “increasingly bold actions to limit free speech on their networks.” While the message seems to be clear, Public Knowledge says it has only one question: “FCC, what are you waiting for?”
Immigrant Rights Groups Ask the FCC to Protect Civic Engagement Over Cell Phones In a letter to the Chairman of the Federal Communications Commission, nearly thirty non-profit organizations representing people of color and/or working towards comprehensive immigration reform requested that the Federal Communications Commission swiftly exert authority over cell phone text messages. “Text messaging is a necessary tool for many members of our organizations and for countless public interest and civil rights groups because, while many of our constituents do not have Internet access, nearly all of them have wireless cell phones,” said Alex Nogales, President and CEO of the National Hispanic Media Coalition (NHMC). “Wireless service providers should not be permitted to discriminate against certain types of text messages at the expense of the general public.” Communities of color have been using text messaging to encourage democratic participation and galvanize support for important causes. One example, our “Text JUSTICE” campaign, relies on text messages to mobilize communities across the nation whenever action is needed to support immigration reform. With over 100,000 subscribers, some estimate that “Text JUSTICE” is the largest text message action list in the country. This has given voice to many who, traditionally, have not been heard in this important debate. And it has been used to great effect. For instance, in May of this year, the “Text JUSTICE” campaign was implemented to assemble over 500,000 people in 30 states in support of just and humane immigration reform. This is just one of the many examples of how text messaging plays a vital role in activism in our communities. Nogales added, “In recent history, some mobile providers have begun a troubling trend of discriminating amongst text messaging traffic and refusing to deliver texts with which they disagree. Our organizations invest a great deal of time and money into text message advocacy and should not have to worry about the uncertainty of whether or not a service provider will deem our ideas worthy of transmittal.”
FCC PAPER FINDS ONGOING CONSUMER FRUSTRATION WITH “BILL SHOCK”
(10/14/10) Washington, DC -- The FCC today released a white paper on complaints the Commission has received on wireless “bill shock” -- a sudden, unexpected increase in the monthly mobile phone bill, even when the customer had not changed service plans.
Key statistics from the white paper show that:
This white paper follows an FCC survey, released in May 2010, which showed that an estimated 30 million Americans had experienced bill shock in one form or another.
FCC Chairman Genachowski highlighted these findings in a speech today at Center for American Progress. He also announced that the agency would be holding a public forum on unexpected phone charges and related issues, which will include consumers and consumer groups, industry representatives, and technology experts.
“It is a very difficult time in our economy. Millions of Americans are struggling to get by -- and even a small, unexpected fee can make a big difference,” said Chairman Genachowski. “Now, more than ever, we need to make sure consumers aren’t being charged for more than what they signed up for, and that they have the information they need to make the best decisions for their families. Consumers need a watchdog -- and they can rest assured knowing the FCC is looking out for them.”
Wireless bill shock can result from:
Joel Gurin, Chief of the FCC’s Consumer and Governmental Affairs Bureau, said, “This complaint record is more evidence that bill shock is a widespread consumer problem -- and it gives us new evidence that it’s often very costly. We’re getting hundreds of complaints per year on bills that have gone up by a thousand dollars or more. That’s a serious issue by anybody’s standards, and one that we’re moving to address.”
The white paper can be found at: http://www.fcc.gov/stage/Bill-Shock-White-Paper.pdf
More information on the FCC’s work on bill shock is available at http://www.fcc.gov/cgb/billshock/
Senate Moves to CALM Down TV Commercials
[SOURCE: Radio Business Report/Television Business Report] 9/30/10 The CALM Act, originally proposed by Rep. Anna Eshoo (D-CA), has made it through the full Senate, by way of the Commerce Committee, and is that much closer to becoming the law of the land. It would require that commercial volume be equivalent to that of the programming in which it is embedded. Sen. Jay Rockefeller said it was all in the name of protecting consumers.
The full name of the Senate version of the bill is S. 2847, Commercial Advertisement Loudness Mitigation (CALM) Act.
Here is the Senate Commerce Committee description of the bill:
“The legislation would direct the Federal Communications Commission (FCC) to adopt a regulation limiting the volume of television advertisements, consistent with existing recommended technical standards. The FCC would have to implement these regulations within one year of the CALM Act becoming law. This would effectively fix a problem that annoys many television viewers—when commercials are many times louder than the regular programming they are viewing.”
“The CALM Act also makes clear that the FCC may grant waivers to television broadcast stations, cable operators, or other multichannel video programming distributors that demonstrate complying with these rules would pose a hardship.”
Senate Commerce chair Jay Rockefeller (D-WV) commented, “As Chairman of the Commerce Committee, I have made it a top priority to protect American consumers. That is why I am pleased the Senate took action to pass the CALM Act. This common sense bill will make sure advertisers can’t just blast advertisements at consumers at unbearable volume levels.”
RBR-TVBR observation: Hey, we’re all for being protected. We’re just not sure that this is at the top of our list of worldly dangers that send us scurrying for our protective gear. Rockefeller said consumers are being protected from commercials blasted at “unbearable” volume levels. Unbearable? Really? If advertisers are forced to tone done the volume, perhaps our senators should be required to tone down the rhetoric.
NHMC Urges FCC to Protect Consumers from Wireless "Bill Shock"
(7/6/10) The main purpose is to ensure that wireless customers understand their bills and are forewarned before receiving a bill that is much more expensive than their typical monthly fees. It urges the FCC to require that wireless providers warn customers when there are excessive increases in their bills, and that they disclose in a clear manner, the true cost of their services instead of how they currently market their services, which is very confusing. Commenters urge these warnings and disclosures come in any language in which wireless providers advertise. There is a system in Europe that requires wireless providers send text messages to consumers that are about to go over their minutes. The FCC should develop a smiliar system in the U.S.
Click here to read the full filing.
Click here to read the letter sent to the FCC in support for rules to protect consumers from “Bill Shock”. (10/7/10)
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