Carriers Reject Truth in Billing

Stay out of our bills. That seems to be the industry consensus regarding the FCC's recent action to mandate that wireless carriers put specific information and explanations on their customers' bills. The truth-in-billing action, which FCC commissioners passed April 15, targets the wireline industry, which has been harmed heavily by slamming and cramming activities. But wireless didn't come away rule-free, as many had hoped.

The order's requirements for wireless carriers are not extensive, but industry representatives are concerned about where these initial rules lead. The possibility of dictated wording on bills, mandated actions that go against the industry's competitive nature and even forced customer-service activities are all concerns. Carriers view these matters as choices they should make under pressure from competition, not the FCC. Another major concern is whether the FCC is changing its attitude toward the wireless industry.

According to the FCC, the bill requires carriers to include their names and contact numbers on the bill, and a uniform labeling of federal charges, if and when such requirements are adopted. The FCC also requires a way for customers to reach carriers at no charge.

"The first two requirements (service provider's name and contact number) happen anyway," said Todd Lantor, PCIA director of government relations. "The only portion that is different is forced standardization of terms, how you define federal charges. That's getting into commercial speech."

So far, few carriers have fully determined the action's impact because the FCC had not released the full order a month after the action. From initial reactions, wireless seems united against the ruling.

If carriers already meet most of the requirements, what is the big deal about the ruling? The action leaves the door open for the FCC to make further rules for wireless carriers. The FCC stated it would seek comment on whether the other truth-in-billing rules adopted for wireline carriers apply to wireless carriers. This comment raised red flags for the industry because it fears the rules are one step in a changing attitude toward regulating the wireless industry, which they don't want to happen.

A CHANGING TIDEWireless views itself as a different industry from wireline, one filled with competition that enables customers to change carriers if they are dissatisfied with service, which is not the case so far in the local wireline arena.

"The FCC recognized correctly that there is enough competition in the wireless industry that all of the rules were not necessary," said Carri Bennet, Bennet & Bennet law firm managing partner.

"Obviously, we are pleased that in some ways wireless was seen as a competitive industry," said Jonathan Marshall, AirTouch Communications spokesperson. "We think in principle some of these rules aren't going to kill us. But, it's important to take a stand on this. Wireless is a competitive industry, and billing is a competitive tool."

Industry officials said implementing rules threatens the spirit of competition in the wireless industry. Correctly determining what customers want is what makes companies in a competitive industry prosper or fail. Wireless wants customers to stay completely in control. The federal government's previous actions supported this view.

In its comments before the FCC, CTIA wrote: "Carriers have every reason to ensure that charges and services are clearly described to their customers. If consumers are not adequately informed, wireless carriers will lose them as customers."

Others agreed.

"If the customer is whining and complaining, it is going to behoove us to make changes," Bennet said.

Another concern carriers mentioned frequently in their rulemaking comments is the different attitude these rules take toward the industry than past regulations did. Because the federal government wanted wireless to be competitive, rulings such as the Telecommunications Act of 1996 were designed to let market forces, rather than government regulation, shape their activities. Adding regulations such as truth in billing goes against this spirit, carriers said.

The industry views the FCC as stepping out of bounds and into areas that former legislation prohibited them from entering.

"We are against attempts to standardize billing formats. It seems to us that the FCC is micromanaging the billing process," Lantor said.

The FCC's changing attitude may be the most dangerous for some carriers. If the ruling truly is one more item changing the tide of the federal government's approach to regulating carriers, they fear it may affect issues beyond billing. The FCC did not comment on carriers' fears.

NOT WARRANTEDMany carriers stated that high churn is evidence that these rules are unnecessary.

Bell Atlantic Mobile echoed the fact that customers force carriers to respond to their concerns because they have so many other choices for service.

The industry also cited proof that there is no need to regulate wireless bills. According to CTIA, the FCC noted at the meeting at which it adopted the truth-in-billing action that it had received more than 60,000 complaints about wireline billing practices in the past six months. The wireless industry's record on billing-practice complaints for the same period: 60 written complaints.

"Sixty complaints for an industry of 70 million subscribers is a clear indication that these rules are unnecessary and unwarranted for the wireless industry," said Jay Kitchen, PCIA president.

Other examples cited included the non-existent problem of slamming and cramming in wireless, which deeply affects wireline carriers and is a major impetus behind these rules.

TOLL-FREE REGULATINGAs part of the rule, the FCC mandated a toll-free customer-service phone number on the bill. A government body should not mandate what seems like an obvious customer-driven requirement for companies that wish to satisfy customers, carriers said.

One carrier representative said the rule discriminates against wireless in light of other competitive industries that are not forced to have toll-free customer-service numbers. For example, he said, many software companies do not offer toll-free numbers for customer support, which irritates customers; yet the government doesn't require them to offer such a number. It's a company's decision to offer a toll-free number, he said.

He added that the rules also could lead to additional customer-service requirements, such as which hours the service line should be open.

At this time, it does not appear carriers will have to bear catastrophic costs to abide by the rulings. Most already have met all the requirements.

"It's an innocuous mandate," AirTouch's Marshall said.

To wireless carriers, the issue is where this step leads. They believe they have the right to do business the way they see fit in a competitive industry. In past rulings, the federal government supported them. Some said change in this regard alters the playing field, which could stifle the freedom they enjoy in building business on their terms, not the government's terms.

In the end, carriers said the very people the FCC is trying to protect through the ruling -- consumers -- will lose because carriers will be unable to adjust to market-driven needs.

It may seem the industry is making too much of a few billing requirements, but wireless carriers said the FCC changed the rules of the game, albeit minor ones. Their concern is that changing a couple of rules could lead to more rules that, in the end, could change the game's entire landscape.