AT&T, Verizon: More Pricing Transparency, Please!

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AT&T and Verizon are quietly changing their wireless plans in ways that may be expensive to subscribers. Consumers Union says they should do a better job of informing their customers.

Today Consumers Union, the nonprofit publisher of Consumer Reports, sent a letter to AT&T, Verizon and the Federal Communications Commission (FCC) suggesting that the companies should be doing a better job of alerting consumers to changes in their wireless plans.

Money Talks News obtained a copy of the letter sent to the FCC. Here are some highlights…

AT&T Wireless has dramatically changed its options for messaging plans. AT&T customers once had the option of purchasing a monthly messaging plan for $5 for 200 text messages. However, this option is now being eliminated, and minimal users of text messages now only have an option for the new plan at 1000 messages for twice the amount. AT&T Wireless also eliminated its 1500 message plan for $15 and is offering instead an unlimited plan for individuals for $20.

The overage charges for the former plans were 10 cents per message for the 200 message plan and 5 cents per message for the 1500 message plan. Now, the 1000 message plan has overage charges of 10 cents per message.

Despite these considerable changes, it is unclear whether AT&T Wireless will allow current consumers with the 200 or 1500 plans to continue on those plans, or if those consumers will need to change to either 1000 messages or unlimited messages when their contract is up for renewal.

AT&T Wireless also eliminated part of its upgrade discount program, which allowed its customers to upgrade their phone after two years and receive a discount of $50 or $100 off of the subsidized phone price. New customers no longer have this option and current customers’ ability to use this option is now limited, since they only have until July 23, 2011 to exercise this upgrade discount.

Verizon Wireless has also discontinued its discounted upgrade plan, New Every Two. Under the New Every Two plan, customers that were renewing their contracts received an additional discount on top of the subsidized price of the phone they purchased. Now, current customers can only redeem the New Every Two benefit one more time, and they will not be eligible for it after that.

The FCC is currently examining cell phone “bill shock” – fees and overage charges that can occur when consumers inadvertently go over plan limits for calls and/or data usage.

Consumers Union is urging the FCC to include guidelines “so that all carriers would be required to appropriately notify consumers of rates, terms of service, overage charges and other relevant information.”

We looked at this problem back in October with the post 5 Tips to Avoid Cell Phone Bill Shock. Our tips from that story…

1. Understand your “calling pattern” and ask your carrier for a plan that would be best for your kind of use.
2. If you don’t make a lot of calls, consider a pre-paid plan. Because you pre-pay, you can’t go over your limit.
3. If you’re going to use your cell phone outside the United States, find out beforehand what charges may apply. (The FCC offers more advice about this at Wireless World Travel.)
4. Ask your carrier to help you avoid bill shock – with phone or text alerts or by letting you monitor your account online.
5. If you’ve tried to resolve a billing issue with your carrier and couldn’t reach a fair compromise, complain to the FCC. Call the FCC Consumer Center toll-free at 1-888-225-5322 or file a complaint online.

Stacy Johnson

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