WASHINGTON-Wireless billing may be about to come under some level of federal regulation, with U.S. telecom regulators poised to rule next week on whether regulatory recovery fees charged by mobile-phone carriers should be banned.
The Federal Communications Commission is expected to vote March 10 on whether wireless operators should be covered by a 1999 truth-in-billing rule geared to wireline carriers, and more specifically, whether wireless charges tied to government mandates like local number portability, enhanced 911 and universal-service fund contributions should be prohibited.
The National Association of State Utility Consumer Advocates, whose petition prompted the upcoming FCC ruling, said line items should be allowed only where they are required by federal, state or local government. In addition, NASUCA insists such charges should conform to the amount authorized by the government entity.
“This order will be pro-consumer, and we will work closely with the states as we go forward on this,” said an FCC official. “When the truth-in-billing rules were adopted, we had not received that many complaints about wireless bills. But over time we’ve received more complaints about wireless bills.”
Billing has been a lightning rod for controversy and fertile ground for litigation in recent years, with state attorneys general, state regulators and plaintiffs’ lawyers taking mobile-phone carriers to task on wireless billing.
In response, industry in September 2003 approved a voluntary code of conduct that, among other things, directs wireless operators to identify and differentiate carrier charges from taxes on billing statements.
CTIA, the national association of U.S. cell-phone operators, said it routinely audits members for compliance with the code.
“We’re hoping the FCC does not grant the relief NASUCA is requesting,” said Diane Cornell, vice president for regulatory policy at CTIA.
Cornell said prohibiting wireless carriers from breaking out government-related costs in bills is not consumer friendly.
Cornell noted it is not uncommon for other businesses to add non-government mandated surcharges to bills so that consumers can see exactly what they are paying for services.
Mobile-phone operators assert there is no need to embrace a prescriptive approach to billing, given the many choices consumers have as a result of the competitive nature of the wireless sector.
Critics of regulatory recovery fee billing have countered that complying with federal, state and local regulations is simply a cost of doing business.
The billing debate has raised a fundamental question about the reach of a 1993 federal law pre-empting rate and entry regulation of wireless carriers by states.
Cellular carriers argue the manner in which they structure their rates and recover their costs of adhering to government mandates is central to the rates they charge.
Indeed, the mobile-phone industry has duel objectives in the FCC proceeding. In addition to wanting to defeat NASUCA’s petition to eliminate regulatory recovery fees, industry would like the FCC to rule that states are pre-empted by federal law from preventing wireless carriers from recouping costs of government mandates in separate line items on bills.
With the FCC ruling imminent, a letter-writing campaign appears to have been organized to support the NASUCA petition.
“Phone bills should be truthful, easy to read and easy to understand. Instead, the long-distance and wireless bills are filled with surcharges with misleading names that imply the line items are mandated by law, when they are not,” Leroy Young, Menlo Park, Calif., told the FCC last week. “Because this practice is tolerated by the FCC, long-distance and wireless-phone companies are able to hide the true cost of service.”
Individuals from other parts of the country filed nearly identical comments with the FCC.
