By PATRICIA SABATINI
February 03, 2009
Among the top booby traps are "out-of-control" text messaging fees and pre-paid calling card scams, according to the San Francisco-based group's hit list of top cell phone issues released last week.
The group wants consumers to understand the pitfalls so they can avoid being stung when selecting a cell phone plan, executive director Ken McEldowney said.
While major wireless providers have made some consumer-friendly improvements in recent years involving disclosures and early termination fees, people continue to fall prey to "little-understood and poorly disclosed fees and penalties," according to the group.
Here are Consumer Action's top five cell phone issues and advice on how not to get burned:
- Mandatory contract extensions. Under a growing number of plans, consumers who try to replace a lost or broken phone are forced to restart their contracts from the beginning.
Since teenagers tend to break their phones more often, parents may want to put children on prepaid cell phones to avoid the risk, Consumer Action said.
Another alternative is to remove the SIM card from the broken phone and put it into a cheap, unlocked phone without reporting it to the cell provider.
- Rising text messaging fees. A member of the Senate Judiciary Committee, Wisconsin Democrat Herb Kohl, last year noted that many consumers are paying more than 20 cents per message, up from an average 10 cents three years earlier.
He accused the major wireless carriers of acting anti-competitively by raising prices in tandem. Consider signing up for a plan with unlimited texting, if it's affordable.
- Overage fees. Consumer Action cited one report showing fees of 40 cents a minute to 45 cents among major carriers for exceeding a plan's minute limit.
Most cell phone companies offer ways for customers to check their minute or message balance during the month to help avoid going over.
Consumers also may want to try a free service at www.overmyminutes.com that alerts people with a text message or e-mail when they are close to reaching their limit.
- Early termination fees. Faced with growing consumer backlash, a number of lawsuits and pressure from legislators, the largest wireless operators have revised their $150 to $200 penalty for terminating a contract by prorating the fees. Still, most of the prorating plans provide little relief in the first year of a contract, Consumer Action said.
"Under one plan, there is no reduction during the first six months of a contract and the penalty goes down by only $10 a month thereafter," the group said.
At another carrier, the savings only start during the last six months of the contract, forcing some consumers to stick with a carrier they can't afford to dump. That makes it especially important to read and understand the terms and conditions of a plan before signing up.
- Calling cards aimed at immigrants. Consumer Action called fraud and abuse "epidemic" among international calling cards, especially those aimed at immigrants.
"If the calling card functions at all, it may only work for a fraction of the promised time," the group said. It cited a U.S. Senate report that found the average card delivered only 50 percent of the promised minutes, largely because of undisclosed or poorly disclosed terms and fees, such as a 99-cent hang-up fee, or the practice of billing in 3- or 4-minute increments even when calls only last a few seconds.
Sometimes, cards are advertised in Spanish but make disclosures about fees on the back of the card in English.
"Try to go with a reputable company with a card someone else has used," Consumer Action's Sol Carbonell advised.
Some companies offer a toll-free number to call before buying the card to help explain fees and other charges, she said.
For more information about cell phones and choosing the right plan try www.consumer-action.org and search for "cell phones."
Distributed to subscribers for publication by
Scripps Howard News Service, http://www.scrippsnews.com
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