Network integration work has given Cingular Wireless L.L.C. a better grasp of how subscribers are using its network, according to company officials-and in some cases, that is leading to customers’ service being suspended due to excessive roaming.
Cingular’s terms specify that customers must live in a Cingular-owned network coverage area and must use at least 50 percent of their minutes on Cingular’s network. If a customer roams more than half the time for three months, they are violating their service agreement and Cingular can terminate their service. According to the company, such customers can cost Cingular an average of $500 per year more than a regular customer.
According to Cingular spokesman Clay Owen, the company looked at several options as it became aware of the problem: building out its network in certain areas, buying other wireless companies to extend its service or negotiating new roaming rates. He noted that despite having nationwide plans and being able to tweak its network in some instances to help combat the problem, “like every carrier, there are portions of the country that we don’t have a network in, don’t have spectrum in.”
While Owen declined to give specific numbers of customers that the excessive roaming clause would affect, he did say it was “less than one half of 1 percent” of Cingular’s subscribers-which, as of the end of the first quarter, would mean less than 279,000 people out of Cingular’s 55.8 million customers. The sort of subscribers most commonly affected, he said, would be long-haul truck drivers who are likely to be out of their home service areas for extended periods; college students, who may spend large amounts of time out of their local service area depending on whether their service area is at home or at school; and customers who live in places along the border of Cingular’s service areas and may frequently make calls while off-network. Owen said that Cingular has been contacting affected customers for as long as 90 days via text message and letters to notify them that they have violated their service agreement.
All of the top U.S. carriers offer some sort of roaming deal to their customers; some roaming costs are passed directly on to the customer, and others are not, depending on the service plan and roaming agreement. Cingular’s terms of service are hardly unique.
Sprint Nextel Corp. and Alltel Corp. specify in their customer agreements that they can terminate service unless customers spend the majority of their time on the respective carriers’ network. Sprint Nextel’s terms allow it to terminate if customers roam the majority of time in any given month, while Alltel’s gives customers leeway of up to three months. Verizon Wireless does not spell out a 50-percent rule in its terms of service, but does warn customers that it can terminate service for “good cause,” which could include excessive roaming. Although T-Mobile USA Inc.’s customer agreements do not specify a roaming limitation, the company does note that “we may terminate your service or change your rate plan at any time, with notice, if we determine … that your use of the service is excessive, unusually burdensome, or unprofitable to us.”
However, T-Mobile USA spokesman Peter Dobrow said that to his knowledge, the company hasn’t had any problems related to customers roaming excessively, although T-Mobile USA does include unlimited roaming with most of its plans.
Sprint Nextel spokesman John Polivka said that “very few customers consistently use a majority of minutes while roaming” and that Sprint Nextel did not turn their service off. Sprint Nextel includes roaming with some plans and offers it as a $5 per month add-on with others. Polivka noted that while Sprint Nextel can be sure of its customers’ experience while on its network, that doesn’t hold true for when they are on another carrier’s network.
While Cingular’s Owen said that most customers who violate the 50-percent roaming rule aren’t aware that they’re causing a problem, the rule is not entirely unknown to subscribers. A few bloggers and chat-room contributors even note that Cingular customers could exploit the rule as a way to get out of their service contracts while avoiding an early termination fee-since Cingular only charges the fee if customers want to cancel service, not if the carrier wants to nudge them off the network.
Owen confirmed that Cingular is waiving “all fees associated with termination of their contract” for affected customers.
“National rate plans are our most popular plans,” Owen said. “Undertaking this action is simply another way we can continue to offer these great rate plans at competitive rates for our customers.”
Jeffrey Nelson, spokesman for Verizon Wireless, said that if his company gets notification that a customer is making most of their calls from outside the carrier’s network, “what we’re going to do is talk to the customer and say, `Hey, what’s going on?”‘ He noted that such situations can occur with temporary work assignments for business people. “Maybe they’re not profitable all the time, but they’re our customer,” Nelson said. “That’s the risk that a responsible wireless company makes.”
Nelson added that if customers still legally reside within an area that receives Verizon Wireless service, they’ll be kept on even if in the short term they may be costing the carrier more money than it collects from them.
