FCC Doesn't Want You Spending Too Much On Your Mobile Plan

Last week, we asked you what annoyed you most about your mobile phone plan, and most of you picked “cost.” Now comes news that the Federal Communications Commission is going to review new proposals intended to keep you from spending more on your phone bill than you’d planned.

Writes the NY Times:

In an interview on Tuesday, [FCC Chairman Julius] Genachowski said that the five-member commission would consider proposed rules that also would require cellphone and mobile Internet companies to notify customers when they were about to incur roaming charges or other higher-than-normal rates that were not covered by their monthly plans.

A recent Government Accountability Office study found that one in three users of wireless phones and data networks had received unexpected charges on their bills.

“The solution is a 21st-century solution,” said Genachowski. “One that is workable, one that is nonburdensome and one that is a terrific example of a 21st century consumer policy.”

As an example of something positive being done by mobile companies, Genachowski singled out AT&T’s system for the iPad, which notifies customers when they are reaching the monthly limits in their plan. “But that has been the exception and not the rule,” he said. “The magnitude of consumer complaints about bill shock has been very significant.”

For its part, AT&T isn’t thrilled with the FCC proposals. In a filing with the agency, the company wrote, “To the extent that the commission adopts a static rule ‘defining’ part of the customer experience, it was serve as an obstacle to attempts to improve it.”

F.C.C. Wants to Stop Cellphone ‘Bill Shock’ [NY Times]


Edit Your Comment

  1. Oranges w/ Cheese says:

    That’s great and all FCC, but how about forcing the companies to provide plans that are cheaper than $40 a month?

    • pecan 3.14159265 says:

      Or offer more tiers because I don’t need 500 minutes a month and I don’t see why I should be paying $60 for it. Give me 200 minutes a month and mobile to mobile and I’ll gladly pay $30.

      • Bunnies Attack! says:

        Or go pay-as-you-go… straighttalk on VZW’s network, 1000 mins, 1000 txt, 30 mb for $32 a month (after taxes etc). If I remember correctly, you said previously you use a dumbphone anyway…

        • Oranges w/ Cheese says:

          Pay as you go is all well and good until you need data.

          • yesthatsteve says:

            If you’re in a Virgin Mobile USA service area, they have 300 minutes of talk with unlimited texting and 3G data for $25/mo. Add in taxes, and I pay less than $27/mo.

            They also recently started selling the Samsung Intercept for $250. If you want an Android phone with inexpensive service, this is it.

            • Oranges w/ Cheese says:

              ooh! I will have to check it out. Unfortunately for me, my contract with AT&T isn’t up until May :(

            • JixiLou says:

              My Virgin Mobile phone is coming in the mail tomorrow, so I can start doing this! Any advice?

        • pecan 3.14159265 says:

          I used to use a dumbphone – now I have a smartphone and I’ll never go back.

    • Poisson Process says:

      $40 per month represents both service and a repayment of the subsidized phone’s true cost. There should be an automatic price reduction when the phone is paid for; when the contract runs out.

      • Oranges w/ Cheese says:

        Automatic Price Reduction! Good idea!

        Tmobile offers plans hwere you pay up front for the phone (or you can pay installments) that knocks $20 off the monthly bill for the phone.

        I wish other carriers would do this. However, the cost of said device is not as high as they make it out to be, a lot of that “subsidy” is pure profit.

        I think its only fair they make money on the service or the devices, not both.

        • Loias supports harsher punishments against corporations says:

          Really, I find this an atrocious policy. Why?

          Your two choices are to pay for the phone and be on T-mobile’s contract-free plan, or subsidize the phone on a two-year contract. But unlike most carriers, the contract and non-contract plans actually charge you at different rates.

          The two-year plan actually costs MORE than the contract free plan. The rationalization they have given me is that since they subsidized the phone, I am “paying” for it over two years of higher plan rates. But, if the cost of the phone is fully subsidized over two years, then neither plan saves me any money. But one of those plans actually locks me into a two-year contract. T-mobile wins.

          • Oranges w/ Cheese says:

            Actually, my boyfriend is doing the “contract free” plan at the moment. He put some sum down on the $500 phone and is paying monthly (I am unsure about the time period).

            Because they add the equipment payment to the bill we can see it itemized, which is nice.

            He’s saving $20 on the plan cost monthly, but paying about $28 monthly for the phone.

  2. buzz86us says:

    I am so hoping this leads to the $20 unlimited talk/text plan because some of these cellphone plans ridiculous in the cost. I would like true-unlimited data service with tethering for $30. There is no excuse the tech is like 30 years old its time for the price to come down.

    • Oranges w/ Cheese says:

      Even if it wasn’t $20 for unlimited talk/text (I doubt they would agree to that) $20 for unlim data + 100 minutes would be perfect for me. I BARELY use my phone’s minutes except to call my parents, and if necessary I can do that on Google Voice.

      The problem is, that they wouldn’t allow “in network” minutes with a plan like that. As it is I upgraded out of a grandfathered $30 plan because it didn’t offer the in network calling for free, but now because of that I barely use the minutes at all.

      • pecan 3.14159265 says:

        Yeah, IIRC most pay-as-you-go plans don’t feature mobile to mobile calling.

        • GearheadGeek says:

          There are some that do, but they tend to have a flat charge ($1 or so) per day you make or receive any call. AT&T has at least one plan like that, and I think T-Mo does as well.

    • jessjj347 says:

      Yes! The biggest issue for me is that they do not allow tethering…
      Why should I have to pay for access to the Internet on my cell phone specifically when I can connect a dozen computers through the other service I pay for?

  3. Bort says:

    cue free market types to tell us how ransacking customers is good for the economy, and any steps that inform you that your about to lose obscene amounts of money without your knowledge is evil

    • TuxthePenguin says:

      Cue people who don’t really understate that this isn’t a free market, rather an oligopolistic market where prices are set by a few, major players and everyone follows through…

      But, to meet you half way, what if they offered this service as a “security” plan for $1 per month? Would you be willing to pay that for the “security” of being warned about overages?

      • Bort says:

        i have yet to see anyone claim we are seeing perfect competition
        not owning a cell phone i will keep that dollar and many thousands more

      • Anonymously says:

        The phone companies treat their customers worse than their enemies. They can shove that $1.

  4. apd09 says:

    I have the LG Storm and my phone will allow me to disable data services and phone services while roaming. I guess that is a feature of smartphones so for me this doesn’t change anything about the way my phone is used, and it really does not address the main issue we all said, the cost. The cost meant the monthly data plans, not paying for roaming because you did not bother to look at your phone and see you were roaming before making a call or playing around on facebook.

  5. TuxthePenguin says:

    As good as these new rules are – warnings about going over minutes, etc – can they please look into the oligopoly pricing practices of the major cell phone companies? I understand that the companies need profits to fund the expansion of 3G/4G/new technologies, but there is a MAJOR pricing error in regards to these data services.

    We pay $30 a month for unlimited texting as a family (AT&T)… which is stupid considering both my wife and I also (still) have their unlimited data usage. Excuse me? How about the bleeping FCC look into THAT.

    Warnings are great and all… but that’s going to save, on average, tiddly-winks compared to what you could save the consumer if you forced all cell phone companies to include texting in their data plans…

    And don’t get me started about at-home and business data services…

    • BobOki says:

      Or maybe someone look into my Evo 4g being charged an extra $10 a month for being an Evo 4g.

      • buzz86us says:

        isn’t there apps that allow free texting over data networks?? You might want to look into something like that.

    • buzz86us says:

      I am not sure that they do upgrade. I have had a Virgin Mobile (verizon network) phone for the last 5 years and I have not been able to get a solid call out where I live despite the fact that the map says I should get 5 bars.

    • jessjj347 says:

      They don’t really use the money to invest in infrastructure…that’s what pisses me off the most.

  6. err says:

    Why does it take so long for things like this to take effect? After letting the cellular companies gouge custormers for years and make ludicrous profits, now the FCC decides this might be a good idea? Sish!!!


  7. Nigerian prince looking for business partner says:

    I really can’t complain too much about the cost of cell phone plans. I can’t remember when exactly but I got my first cell phone (for work) but it was some time in the mid 90’s. The cost was about $120/month.

    It came with some free minutes (maybe a couple of hours at most), I still had to worry about roaming, there were hardly any towers, there was no data, no texting (or if there was, I didn’t use it), no free night & weekends, no free calls to other cell customers, etc.

    Today, I pay around $130 but this includes two smart phones, unlimited data, more minutes than I can use, coverage virtually everywhere, free night and weekend calls, free calls to others on the same network, etc. It would be nice if it were cheaper but I’m getting much better service than I was 10 – 15 years ago for less money. Not even controlling for inflation, I’m paying less for my cell & data plans (for two phones) than I was paying for local & long distance on my home phone 20 years ago.

    • Bunnies Attack! says:

      My first cell phone in the mid 90’s with Bell was the basic plan with like 200 minutes at $19.99 a month… just because you grossly overpaid before doesn’t mean you’re getting a good deal now.

      • Nigerian prince looking for business partner says:

        $20/month? Damn, that must have been a bargain.

        I think I got the phone around 1993 or so and it was with Bell Atlantic. I don’t recall there being anything as cheap as $20/month back then. My phone was one of the first non-bag phones around and I did use it a lot for work and there weren’t nearly enough free minutes to cover my calls.

        • Bunnies Attack! says:

          Oh you know what, I lied… counting backwards it was probably closer to 99/00… and it was with Bell Canada. In 93 that was probably bleeding edge so maybe $120 isn’t that bad… I had a boss that still used his gigantic car phone well into the mid 2000’s because he inexplicably didn’t know that they gave free upgrades every few years.

        • Willow16 says:

          I got a cell phone in 1994 with AT&T. It was $15/month for 15 minutes. I kept that phone and plan for years and never went over minutes.

  8. ShruggingGalt says:

    Wait a sec, my phone already does this, but I ignore it because roaming is included….besides, how in the world is the FCC going to enforce this when you get sticker stock because your teenager is the one texting?

    • Oranges w/ Cheese says:

      Enforcing realistic limits and sanity checks is a good idea. I can’t tell you how many times I would have a customer call me (when I worked as a CSR for AT&T) with a $700 bill (the worst I saw was $9000 dollars) because some feature wasn’t enabled and the system did nothing to cope with such a large and uncharacteristic usage.
      The system should, as a default, automatically sign you up for a “plan” once your overages reach the cost of said plan. There’s no reason it can’t automatically detect a $50 overage and backdate it out for a $30 plan.

      Sure, either way the customer is going to call and say “WHY IS MY BILL SO EXPENSIVE WTF” but then you can tell them “Sir, your bill would’ve been $1000 dollars had our system not signed you up for this extra feature, this is why it did, and I can remove it immediately if you’d like.”

      Part of it is responsibility and smarts, being able to check your plan online you can double check that a CSR did what they said they would do, you can also check yourself for overages and manage your usage. However, a lot of people won’t or CAN’T do that, so the system should be smart enough to do it for them.

      On the other hand, the plans are far too expensive in general. Especially texting, which used to basically be free, but now that its so popular they’ve seen they can make bank on it.

    • Bunnies Attack! says:

      Text to all members in the family plan? If your teenager has his/her own plan, then I guess you’re SOL.

  9. MustWarnOthers says:

    I’m still rocking a Motorola Razr V3m (yeah, I know).

    I’ve been paying like 50 bucks a month, for the past 6 or 7 years. All it does is make calls and send text messages. I don’t even make any calls on it, and receive only a few a month. Most of my communication is through email.

    It’s easily the most worthless expense I currently have. The voice plans NEED to go down in price. I really fail to see how my usage of my cellphone puts a 50 dollar strain on the “network” each month.

    20 dollars a month should be where voice plans should fall nowadays. 20 or 30 for the Data plan wouldn’t be so bad, if the entire package was around 50-60 TOPS for Voice and a decent amount of data.

    • Nigerian prince looking for business partner says:

      Wouldn’t you be better off getting a pay as you go phone?

      • Loias supports harsher punishments against corporations says:

        I’ve looked into those, and they are honestly not much better a situation. I’d rather pay $5 more for truiple the minutes for the offchance I need them.

        • webweazel says:

          We thought that, too. Until we went over our minutes one month because of a job transfer/moving situation. 40 cents per minute! That was the beginning of the end for us. If we need the extra minutes for a situation in our life, there are NO surprises about how much it will cost with prepaid. We just get extra minutes as we need them, and don’t buy extra if we don’t need them.
          17 cents a minute all the time we pay now, and we actually USE the minutes we buy. Before, we were paying cash money for 300 minutes per month (at 10 cents per minute-no rollovers), and only using like 15 minutes on average plan minutes per month. So we were paying $30 and only using about $2-3 worth every month. Do the math. See if it still works for you.
          (Rollover minutes are a better deal-those you can stack up pretty high and becomes a better value over the long term.)

    • Oranges w/ Cheese says:

      I agree, you could probably save a lot of money with a prepaid SIM. I had a Razr and I went prepaid for a short while. Once I lost my job though, I had to go back to a contract because the added cost of fielding interview calls was making the prepaid vs. postpaid not cost effective.

    • Loias supports harsher punishments against corporations says:

      You and me are in the exactl same situation – same phone too.

    • Geekybiker says:

      Voice actually uses a fair amount of bandwidth. I’m not saying it shouldn’t be cheaper, but its texting that is plain criminal in its cost to data use ratio. Texting should be included in any data plan. Unlimited texting should be no more than $5 a month for those without a data plan.

    • webweazel says:

      I agree with the other people who wrote here. You NEED to go prepaid. You didn’t mention which carrier you’re with, but I’m with TMobile. I only use my phone for the rare phonecall when I’m out, and maybe 3 texts a year. It costs me about $30 PER YEAR. The simple phone I got cost about $20, if I remember correctly.
      As an aside:
      TMo has a great “gold rewards” plan. Once you spend $100 in total, you get 15% more minutes when you refill, and the minutes last for 1 whole year. IF you go this route, buy the phone and a $100 card. This will last one year. When it runs out, buy a $25 card. Your old minutes plus the $25 will last for another year. They’ll send you a text when it’s going to run out.
      It was terribly hard to research the different prepaid plans, but this was the best one going.

  10. Donkey Hoti says:

    Hmmm… the government passing a law trying to force private companies to modify their fee structure. Well that NEVER backfires and screws the consumer even worse, does it?

    • Duke_Newcombe-Making children and adults as fat as pigs says:

      Damn. And here I thought I could jump in with a “SOCIALISM!!1111 Destroying OUR FREE-DOMZ” first before a “the gub’mint always screws stuff up” post.

  11. veritybrown says:

    My first cell plan was back in the early 00’s, and I paid $30 a month for 60 local talk minutes (which was almost always more than I ever used) and unlimited texting. Now I pay $70 a month for a 2-phone family plan with 700 unlimited shared minutes (which we don’t even come close to using up), free in-provider calls, and NO included texting. If I could choose to have fewer available minutes and pay less, that would make me happier. If I could have unlimited texting included in my current plan, that would make me happier. But those are pretty much my only complaints.

    Unless people have spouses/teens who are running up their bills without their knowledge, I have a hard time feeling sorry for people who are getting “surprised” by a huge bill due to overages. They know (or should know) what is included in their cell plan; using minutes you don’t have available in your plan is not very different from writing checks for money you don’t have in your account. It’s a consequence of your own irresponsibility. If people are getting frequent “bill shock,” maybe they should upgrade to a different plan.

  12. JoshC96 says:

    For the love of pickles…no wonder print media is dying: “it was serve as an obstacle”. “Was?” Seriously? The original filing (http://ecfsdocs.fcc.gov/filings/2010/07/06/6015659027.html) is grammatically correct so why can’t your quote be correct, as well? Oh, that’s right…you’re quoting the NYTimes, not AT&T.


  13. bosozoku says:

    Why do people pay so much?

    We have 5 lines and unlimited text messaging, 2 of our lines have unlimited data plans all for $25.67 per phone a month ($128.35 total).

    Thanks T-Mobile and discount through work!

    • Nigerian prince looking for business partner says:

      I think it’s the data plans that drive up the cost for most people. Regardless of carrier, isn’t the cost only around $10/phone for a typical family plan?

    • pecan 3.14159265 says:

      But you ask your question and act like you pay less just because you chose a better service or plan – you didn’t; you pay less because you get a work discount. Most people don’t.

      • Oranges w/ Cheese says:

        Yeah, this is really the only reason I stick with AT&T. 21% service discount is impossible to beat.

  14. Steve says:

    My first phone – about 10n yrs ago or so was a basic t-mobile (then voicestream) service – $20 for 75 min + 500 weekend mins. We very rarely went over the 75 min (just once if Irememebr correctly), Much as I’d like a smart phone I can’t justify the cost _i(‘ll make do with my ipod touch and free wifi services). $20 a month was still too much – so 18 months ago I ditched the service and got t-mobile prepaid service (and kept my number) – so $50 for a phone (included $25 phone card) and $100 phone card (for 1000 min for 1 yr). Still had about $60 at the end of the yr (i don’t use my phone much) – then added the $25 card, which kept all my minutes for another yr.

    so final cost is about $6.25 / month (over 2 yrs).

  15. Macgyver says:

    If people are complaining about the cost, which they know when they sign up, maybe it’s time for them to start looking at prepaid phones.
    And if you have a smartphone, and you also complaining cost, maybe smartphones aren’t for you.

    • Oranges w/ Cheese says:

      Yes, so instead of fixing the egregious pricing issues, you’re telling people to just stop buying? What if they need their smartphone for business and their company doesn’t help out?

    • elangomatt says:

      I want a smartphone, but haven’t gotten one because of the high cost. I am currently using prepaid with a messaging type phone, but I really want an android device. I am considering the android phone on Virgin Mobile, but was really hoping for a better android phone than that one.

  16. Sword_Chucks says:

    I have the cheapest plan for talk, text and data out there about $70, Im also paying insurance (which finally came in handy a couple weeks ago) and because I bought a new phone, financed at 0%apr by Tmobile, my bill is around $100.

    • wednesdayaddams says:

      My previous plan (2 months ago) was only $78 with all that (unlimited text, data, insurance, a ring back subscription and the minimum minutes being 500 and that is with the taxes included)

      So it’s not the cheapest out there.

  17. wednesdayaddams says:

    I am with Alltel right now which will be changing over to AT&T by the end of the year or beginning of ’11. I pay only $90 (even) for unlimited data, 500 min with free calling after 7pm free mobile to mobile , unlimited text, insurance, ringbacks subscription,and this includes my taxes as well. I also have 2 lines and 15 my circle numbers. I never go over my set $90 a month. When I added my second line my bill only went up $12. I also have the HTC Hero with the Droid OS. I feel like this is a great deal, considering I have left the internet on my phone running for hours at a time and I love to listen to Pandora radio. I am a very heavy data user and when I went to AT&T’s website to determine my usage I was off the charts. They say we will be able to keep our currant contract (I have major doubts about that) I feel very happy with Alltel and am a little aprehensive about AT&T. I think that reason Alltel sold out was because of their low cost. I wish AT&T would follow suit or at least give a reasonable price on actual ‘ulimited’ service. I will have to learn how to function with a cap on my data. Stupid AT&T!

  18. dreamfish says:

    The European Union has already implemented this:

    “Thanks to the EU’s roaming rules, from 1st July travellers’ data-roaming limit will be automatically set at €50 excluding VAT (unless they have chosen another limit – higher or lower). Operators will have to send users a warning when they reach 80% of their data-roaming bill limit. The operator will have to cut off the mobile internet connection once the limit has been reached, unless the customer has indicated they want to continue data roaming that particular month.”


    • Loias supports harsher punishments against corporations says:

      God I hate American politics. I bet the EU had no ruffles of feathers and it went without much hassle.

  19. BoredOOMM says:

    Maybe if some of the redundant taxes were removed, it would bring down the cell phone bill?

    • Oranges w/ Cheese says:

      They aren’t redundant. Some go to city / county / state / federal. Hardly redundant, but I would agree, they’re unnecessary.

  20. Geekybiker says:

    I’d settle for the legally required option just to stop service at a set dollar limit.

  21. olivetree says:

    I switched to pre-paid two years ago. Now I am paying $45 a month (no contract) for unlimited minutes, unlimited text message, unlimited mobile web access. I don’t get the best smart phone but I have saved tons of money, like $1,500 for these two years. I have no regret.

  22. Dyermaker says:

    My big problem with cost is not being able to have a plan that meets my needs. My wife and I share a plan that has 1500 minutes at a cost of $129/month with a low low cost of 40 cents per minute if we ever went over. Between us we have never used more than 350 but more typically remain within 150-180 or so.

    If we decided we needed MORE minutes, we could get 3000 minutes at $169/month, but there is no way to get less. Oddly enough, the cost per minute going over drops to 25 cents if you spend for the big plan.

    That’s 5.7 cents per minute for the 3000, 8.6 for the 1500. Why tcan’t they extend the same math and charge 11.5 cents for a 750 minutes ($86.25/month) or 14.4 for 375 minutes ($54/month) plans?

    Why force me to pay for something I’ll never use, and then ask me to pay an extra $10/month for a premium data plan.

  23. jamar0303 says:

    If only there was a provider that did like Softbank in Japan does- uber-low basic fee for in-network calling and charge either a-la-carte or package for everything else.

  24. TheGreySpectre says:

    no, last we you asked us what we did not like about our phone…then gave us a myriad of choice which had to do with the plan but none that had to deal with the phone.

  25. HogwartsProfessor says:

    Make them quit locking you into a plan, giving you abysmal or no service and then charging you $400 to leave. That is just pure evil. That’s why I have prepaid and not a contract phone.

  26. colione112 says:

    If you have Cricket in your area check them out everything is unlimited. Talk/Text $35 month. Android $55 a month, Blackberry $60 a month… The android and blackberry are half the price monthly of AT&T and Verizon. Coverage isn’t in every nook and cranny in the country, but if you’re in their area, you can’t beat the price.

  27. TheFingerOfGod says:

    After having lived in the UK for about 9 months (and visiting for months at a time before that) I am absolutely SHOCKED at the cost of cellphone service in the US. To top it off, o2 had better service than AT&T (according to my very unscientific “study”, errrr, plain ol’ observations).