BUCKS WATCH
Industry’s “Missoula Plan” Could Raise Fees By $3.50 Per Month - A broad coalition of state regulators and telecom companies this week released a new plan to solve the long-festering issue of intercarrier compensation (IC). IC is the process by which telecommunications companies pay each other for handling calls that pass from one carrier’s network to another carrier’s network. For example, if a Verizon customer called a phone number in Nevada, Verizon would be obligated to pay Qwest, the local phone company in Nevada, for handling the call. Due to the growth in cellular and VoIP calling, the IC system has come under increasing pressures and has led to multi-year discussions in the telecommunications industry about how to reform it. Unfortunately, the proposed plan, called the “Missoula Plan” since it was first discussed at a meeting in Missoula, Montana, calls for the $6.50 federal subscriber line charge that appears on all U.S. local phone bills to increase to as much as $10 over four years. The “Missoula Plan,” has been opposed by a coalition, including the major cable companies, CTIA (the wireless industry’s association), and the National Association of State Utility Consumer Advocates (NASUCA). TRAC believes that consumers are already paying too much for phone service. The plan doesn’t make sense for most consumers, according to TRAC. The continued shift of costs on to the back of the low volume long distance user needs to stop. We urge the Federal Communications Commission to carefully review the impact that the “Missoula Plan” would have on consumers when considering the merits of the plan. For more information on the Missoula Plan, click here.
Ways to Save for Parents of Texting Teens – Recent studies have suggested that teens are abandoning e-mail and opting instead for instant messaging and texting to communicate with their friends. For many teens, texting is the preferred communications method, with actual phone calls being made only when in-depth conversations are needed. Unfortunately for parents, the high costs of text messaging (anywhere from 5¢-15¢ per incoming and outgoing message) in particular can quickly run up a hefty phone bill every month. What’s a budget-conscious parent to do? To answer this question, TRAC set out to find a wireless plan that would include at least 1000 text messages and at least 100 minutes of airtime for less than $25 per month (excluding start-up costs and additional monthly fees and taxes). Here’s what we found:
- U Prepaid, by Alltel – U Prepaid advertises prepaid service for 75¢ per day. What caught our eye was the option to include unlimited text messaging and unlimited night and weekend calling in that 75¢ per day ($22.50 per 30-day month). Alltel’s “nights” run from 9:01 PM to 5:59 AM and all day Friday-Sunday is considered weekend calling. This makes it an attractive option for teens that generally text during the week and make calls when trying to coordinate activities with friends during the weekend. Note that voice calls made outside the nights and weekend period costs 10¢ per minute, so keep that peak time calling to a minimum. U Prepaid handsets purchase prices run anywhere from $49.99 to $199.99. For more information, click here.
- Virgin Mobile 100 Minutes w/1000 Text Message Option – Virgin Mobile offers 100 anytime minutes for $14.99 per month. 1000 text messages per month can be added for a $9.99 monthly fee, bringing the $24.98 total to just under our $25 maximum. Remember to add at least $20 to the account every 90 days or it will be deactivated. Automatic credit or debit card payments can be set up to help avoid this headache. Handsets prices run from $19.99 to $149.99. For more information, click here.
As you can see, the options for low-cost, text-friendly service are rather limited. Still, if your teens are more interested in communicating with their thumbs than with their voices, these two plans could be worth your while to investigate.
WIRELESS WATCH
T-Mobile and Verizon Wireless Again Top J.D. Power Customer Care Survey – T-Mobile and Verizon Wireless again tied for top honors in the biannual J.D. Power Wireless Customer Care Survey, which the market research firm released Wednesday. The survey measures the quality of wireless customer interactions with their wireless carriers on the telephone, in retail stores, and online. Encouragingly, the survey found that the average number of calls that a customer must make to their carrier in order to have their problem resolved decreased from 1.94 in January to 1.76 in July. This is especially important, given that customers overwhelmingly (74%) prefer to call their carriers to get problems resolved. Echoing a study released recently by AARP, the biggest reason (45%) for customers to call their carrier continues to be billing problems. Call quality continues to be the second most –complained about issue (31%). Alltel came in third in the survey, followed by Cingular and Sprint/Nextel. With call quality being such a big issue for consumers, TRAC encourages consumers to check in to their carriers’ grace periods prior to signing a service contract. Typically, the grace period will run anywhere from 15-20 days after service activation, during which time the subscriber can cancel service without being charged a $150 or more early termination fee. Thanks to the grace period, if the carrier’s call quality is sub-par (for example, the phone doesn’t get service in your home), you can cancel the service contract without incurring the early termination fee. For more information on the J.D. Power survey, click here.
INTERESTING LINKS
FCC Main Page: http://www.fcc.gov
FCC Complaint Form - http://svartifoss2.fcc.gov/cib/fcc475.cfm
List of State Regulatory Commissions: http://www.naruc.org/displaycommon.cfm?an=15
What do you think? Got a tip you want to share? Nominate your "Scam of the Week" and your "Tip of the Week" - If we select your submission, we'll give you a one-year free membership in TRAC and acknowledge your contribution by name in TRACNotes. Send an e-mail to trac@trac.org to submit your ideas!
TRACNotes is distributed to TRAC members and those who have signed up on the TRAC website "Newscenter." If you do not want to receive TRACNotes, simply click here and let us know. You won't receive these in the future. We hope you choose to remain a part of our network, and that you find TRACNotes helpful. Our goal is to provide you with useful information about what is happening in the telecommunications marketplace for consumers and to keep you up to date on TRAC's policy advocacy. If you like what you see, please consider becoming a member of TRAC by clicking here.
©2006 Telecommunications Research and Action Center. TRAC grants unlimited rights to reproduce TRACNotes or any information contained in it provided attribution is given as follows: "Source: Telecommunications Research and Action Center. http://www.trac.org"
