Ben Kurland, co-founder of BillFixers, a Nashville-based company that helps its clients negotiate bills with cellular providers, cable companies, Internet providers and other service providers. BillFixers.com
Do you ever feel like hanging up on your cellular service provider? You’re not alone. Cellular providers are among the most disliked companies in America. Around a quarter of their customers are dissatisfied with their service, according to the University of Michigan’s American Consumer Satisfaction Index. That puts them roughly on par with widely reviled sectors such as health insurance and airlines. And that antipathy is generated in part by the tricks they play on consumers.
Here are five annoying and costly cellular provider tricks and what, if anything, consumers can do about them…
Receiving a copy of your bill could increase your bill. Companies in many sectors offer customers discounts if they agree to have their bill payments drawn automatically and directly from a bank account (or in some cases through a credit card)…and/or sign up for paperless online billing. Cellular providers claim to offer these discounts, too—but they actually use this as a sneaky way to charge extra. How? Their advertised prices almost always include these “discounts” already—customers who don’t sign up pay more than this promoted price. If a discount is already built into the initial price, customers are not really receiving a discount at all, they’re paying a surcharge if they opt to receive a paper bill—one that costs consumers $5 to $10 per month. Example: Most Verizon and AT&T plans offer a paperless billing “discount” of $5 per month per line but quote prices that already factor in this “savings.”
Why do cellular companies impose such steep surcharges on customers who want printed bills? Their goal isn’t just lowering the cost of processing payments—they have discovered that customers who sign up for autopay and paperless billing are much less likely to notice when carriers inflate their monthly charges.
What to do: If you have autopay and paperless billing, check the amount your cellular company charges your bank account or credit card every month. If this amount is higher than normal in any month, carefully examine the cellular provider’s bill online. Call the carrier to complain if you believe you have been overbilled and shop around for a different plan and/or carrier if higher-than-expected bills recur.
Some of the “government fees” on cellular bills are imposed by the service providers themselves. The typical cell phone user pays around 20% more for his/her service every month than the advertised rate—and despite what cellular providers want you to think, steep taxes are not the only reason.
There’s a good chance your monthly cellular bill features “regulatory charges” and/or “administrative charges” in the same section that lists taxes. Despite the bureaucratic names, these charges are imposed by the cellular carriers, not the government. When confronted, the providers sometimes protest that these fees are government charges because the money collected is used to pay taxes and fees imposed on the carrier by the government—but all businesses face government taxes and fees, and few use this as an excuse to tack extra fees onto customer bills.
What to do: Consider opting for a provider and plan that at least includes fees in advertised prices instead of tacking them on. Examples include T-Mobile Magenta/Magenta Plus plans and all Boost Mobile and MetroPCS plans.
Cellular “unlimited plans” are very limited. The cellular providers appear to have redefined the word “unlimited” to mean “limited in important ways that we’ll try to hide from you.”
Among the limitations often hidden in the small print of “unlimited” plans: When you stream video, the image quality might be intentionally decreased to a lower resolution. When you exceed a monthly data usage threshold disclosed only in the small print, your data speeds might be throttled to a crawl for the remainder of the month. Other hidden limits include restrictions on how much you can use a phone as a mobile hotspot.
What to do: Read your unlimited plan’s small print to determine what video streaming quality it provides…and when throttled speeds kick in. While many unlimited plans throttle speeds starting at between 20 and 25 gigabytes (GB) per line per month, Sprint Unlimited and T-Mobile Magenta don’t throttle data until usage exceeds 50GB in a month…and Verizon’s pricey “Get More Unlimited” plan doesn’t throttle data until usage exceeds 75GB in a month.