Newsroom: Phone & Cell Phones

For Immediate Release

Washington, D.C. (September 17, 2007) – Consumers Union and the Consumer Federation of America are voicing their support for legislation introduced by Senator Klobuchar (D-MN) and Senator Rockefeller (D-WV), the Cell Phone Consumer Empowerment Act of 2007.

The bill requires that wireless companies notify consumers at the point of sale exactly how much they will pay for wireless service.

"Most wireless carriers advertise a price significantly lower than the bill consumers pay each month, adding mysterious 'regulatory charges’ and other junk fees. If this legislation is passed it would go a long ways towards eliminating those shenanigans," said Chris Murray, Senior Counsel for Consumers Union.

Mark Cooper, Research Director for the Consumer Federation of America said, "for most wireless users, their wireless company is also their local telephone monopoly, and nobody can offer the same bundle of wireless, local phone and high-speed Internet. The wireless industry will blow a lot of hot air trying to convince you that they’re so competitive, they don’t need oversight. One quick glance at their anti-consumer practices demonstrates otherwise."

The Senators’ bill requires accurate coverage maps with a level of detail sufficient to let a potential subscriber know whether their home or place of business would be covered by the wireless carrier. The bill also attempts to get mobile users better information regarding dropped calls and known coverage gaps through a reporting requirement.

Perhaps most importantly, this legislation would require companies to pro-rate Early Termination Fees (ETFs), so that a consumer halfway through his or her contract only has to pay half of the Early Termination Fee. "Contract extensions and early termination fees are the #1 consumer annoyance with the wireless industry—consumers are powerless to negotiate better terms with their cell phone carrier, but this bill would help to level the playing field," said Murray.

The primary improvement the groups would like to see in the bill is a strengthening of its’ "handset locking" study. Some wireless carriers are disabling (locking) consumers’ phones when they leave for another carrier, or refusing to activate a phone not affiliated with the network.

Cooper continued to say, "consumers spend billions of dollars every year on wireless phones, and are often forced to throw them in the trash when they switch carriers. We hope to work with Congress to end this practice immediately."

Please call Chris Murray at (202) 238-9253 or email murrch@consumer.org with any questions.

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