WASHINGTON-Even before the California Public Utilities Commission votes on a landmark bill of rights for telecom consumers, other states are signaling they too are ready to get tough with mobile-phone carriers.
The Nebraska Public Service Commission late last month said it will ask the state legislature in 2004 for authority to bring wireless carriers under the same billing and service standards that other telecom service providers must meet.
The New Mexico Public Regulation Commission recently told Alltel Communications and Cricket Communications Inc. (a division of Leap Wireless International Inc.) that charging for paper phone bills is a violation of a state consumer protection rule.
In June, Missouri Attorney General Jay Nixon reached settlement of a billing lawsuit brought against Nextel Communications Inc. and Sprint PCS.
It’s not only the states. Consumers are flexing their collective muscle as well.
Last week, a California group-the Foundation for Taxpayer and Consumer Rights-sued Cingular L.L.C. over the mobile-phone carrier’s service quality, business practices and advertising.
Later this week, Oct. 9, a federal judicial panel will hear oral argument here on whether 11 class-action lawsuits filed by consumers against Nextel and Sprint should be consolidated in a single U.S. district court. The same day, across the country, Cingular Wireless L.L.C. plans to appeal a $12 million fine levied against it by the CPUC last month.
Twenty state attorneys general are believed to be still looking over the mobile-phone industry’s shoulder, possibly considering legal action.
In Congress, Sen. Charles Schumer (D-N.Y.) and Rep. Anthony Weiner (D-N.Y.) are relentless in their criticism of mobile-phone service in the United States.
The mobile-phone industry is feeling the pressure from all sides, a festering problem it has tried to address by adopting a voluntary code of conduct. But it does not seem to have satisfied state and federal policy-makers.
“Voluntary efforts do not ensure adequate consumer protection,” said Anne Boyle, chairwoman of the Nebraska Public Service Commission.
Boyle and the CPUC’s Carl Wood are two of the most active and outspoken state regulators on holding mobile-phone carriers to greater accountability.
The Nebraska commission took the lead in developing a list of “Wireless Best Practices,” which was adopted in July at a meeting of the National Association of Regulatory Commissioners.
“As the wireless industry grows and users become more dependent on them, it is important that we ensure dependable service and accurate billing,” said Boyle.
In the commission’s annual telecom report, Boyle said wireless access lines grew 7 percent, while wireline usage declined during the past fiscal year (July1, 2002, to June 30, 2003). The same trend is playing out in other states as well. While that is good news for the mobile-phone business, it opens industry to heightened scrutiny from state regulators who are increasingly viewing mobile telephone service as a traditional utility.
California remains the major flash point for the mobile-phone industry, which warns in new studies that enactment of the bill of rights will increase subscribers’ monthly bills, cause job losses and drain billions of dollars from the state economy.
“This latest economic analysis confirms an inescapable conclusion-rules are counter-productive, costly and harmful for consumers,” said Thomas Wheeler, president of the Cellular Telecommunications & Internet Association. “The wireless industry has developed an alternate route-without all the potholes of costly regulations.”
Consumer advocates take issue with the studies, and they are fighting to prevent them being included in the record on which the CPUC will vote. Two previously scheduled votes on the bill of rights plan have been postponed. Given the controversy and high stakes, a vote is not expected until next month.
“The commission has no legal obligation to late-admit the biased ill-founded and prejudicial wireless industry filing. Should the commission admit this filing, consumer groups urge the commission to give it little or no weight,” stated Consumers Union, the Utility Consumers’ Action Network, the National Consumer Law Center and the Utility Reform Network.
