Regulatory loopholes blindside consumers and carriers, Wiley panel says
By Tim Kridel
Jun 20, 2007 9:50 AM
Wireless carriers routinely shaft customers with cryptic fees that ought to be included in basic rates, the director of consumer affairs for Illinois Gov. Rod Blagojevich told a Wiley Rein conference Tuesday. His recommendation: The states or the feds need to step in because with every carrier doing it, customers can’t simply churn to avoid the fees.
“They’re looking for ways to get an edge on their income,” said Martin Cohen, who cited fees in the 75˘ range covering costs such as cell site construction. He likened them to buying groceries and being surprised with an extra refrigeration charge at the check-out counter. “These should be part of the basic cost of service.”
Other panelists agreed that the feds should step in—not just to protect consumers, but also to provide regulatory clarity and consistency.
“Compliance is challenging because we’re subject to so many rules,” said Michael Riley, senior counsel for Alltel.
Some panelists also are interested in another type of consistency: between companies that provide the same type of service but with different technologies. David Bartlett, vice president for federal government affairs for Embarq, said it’s unfair that Web-based application providers aren’t subject to the same rules as LECs, even though they provide substitutable services.
Bartlett and Cohen argued that new technologies such as voice over IP shouldn’t free companies from existing regulations, such as those covering consumer privacy. “A lot of consumers don’t understand how much of their information has been stored and is now being mined,” Bartlett said.
Although crafting a new regulatory framework for issues such as consumer privacy and truth in billing won’t be easy, some panelists argued that those challenges are no excuse.
“This is a transitionary period as we move from one paradigm to another,” Cohen said. “We need consumer protection as we did in the old world.”