Bill Shock Will Become Less Shocking

by John Giere, SVP, Product and Marketing

Back in March, I wrote a blog post about the EU’s roaming regulation, highlighting the fact that carriers were going to be required to warn users when their bill hit 80% of the limit. Yesterday, the US debuted its “bill shock” plan which mirrors the one in the EU.

The plan comes from the FCC and requires wireless providers to alert users when they have exceeded or are about to go over their voice, text or data usage.

This announcement comes a day after the FCC released a white paper (.pdf) about complaints that they’ve received around bill shock. Key statistics from the white paper show that:

• 764 people complained to the FCC about wireless bill shock in the first half of 2010
• 67% of the complaints were over amounts of $100 or more
• 20% had complaints of $1000 or more
• The largest complaint received during this time was for a bill totaling $68,505

The FCC plan mandates what many carriers have already begun doing: enhancing the customer experience by introducing flexible pricing plans, offering better deals for data packages, proposing incentives for consumers to upgrade their plans to ones that better suit their needs, and to implement more transparency and clarity over their policies.

Three New Rules
There are three basic rules in the anti-bill shock proposal.

1. Wireless carriers will be required to notify users via text message or voicemails if they go over their allotted monthly voice minutes, texts or data use.
2. Alerts must be sent out if users are incurring extensive international roaming charges.
3. Finally, carriers must overtly define the usage tracking and monitoring tools available. (Carriers like AT&T and T-Mobile already allow consumers to set usage caps and alerts.)

The principal is simple: Let consumers know that they are risking additional charges and fees before they incur them. If they go over their limits, at least they received a fair warning.

Helping Operators Help You
Here at Openwave, we believe that greater transparency in the rates and charges consumers will incur will help improve the customer experience across the country. We are currently working with several carriers to help enable these functionalities for their subscribers so that people like Kerfy Pierre won’t be hit with a $35,000 bill after returning home from helping earthquake victims in Haiti.

Openwave offers a flexible and dynamic solution to help carriers prevent bill shock. Openwave Passport is a notification and recommendation solution that not only informs users when they are close to their roaming limit (or pre-pay limit, or premium service limit, etc.), but it can offer any number of time- or volume-based extensions.

As FCC Chairman Julius Genachowski said at the Commission’s monthly meeting, “Companies should compete on the basis of value, price and service, not consumer confusion.” Openwave’s Passport is key in helping carriers do just that.

I’m interested to see how the FCC enacts these rules to promote transparency and disclosure by carriers. Stay tuned for a follow-up blog. In the meantime, have you been a victim of the mobile industry’s unexpected phone charges? If so, leave a comment; we’d love to hear about it.