Industry Indicators

11/01/2003

A 10-part list of industry principles and practices adopted by the CTIA will improve the nation’s wireless carrier service, the group says.

Among the promises participating wireless carriers would follow:
• Provide every new consumer a minimum 14-day trial period for new service
• Provide coverage maps, illustrating where service is generally available
• In every advertisement that mentions pricing, specifically disclose the rates and terms of service
• On billing statements, carriers will not label cost recovery fees or charges as taxes and will separately identify carrier charges from taxes
• When initiating or changing service, carriers will clearly state contract terms to customers and confirm changes in service
• Provide customers the right to terminate service for significant changes to contract terms.

Some of the carriers that have agreed to adopt the guidelines include Cingular, AT&T Wireless, Sprint PCS, Nextel, Alltel and Verizon Wireless. Wireless carriers that follow the CTIA guidelines can display a Seal of Wireless Quality/ Consumer Information.

Meanwhile, CTIA attached itself to a study by an “independent” consulting group that allegedly shows that wireless rules under consideration by the California Public Utilities Commission (PUC) would hit consumers in the pocketbook and damage the industry.

The Law & Economics Consulting Group concludes that California’s proposed wireless rules will be costly. Its study estimates the California rules would cost $288 million to implement and $709 million per year in recurring costs. The study concludes that California's consumers would bear the brunt of the costs—ranging from about $4 to $17 per customer, per month depending on the size of the wireless carrier and the area of service.

What the CTIA really doesn’t like about the California PUC rules is that wireless carriers would be required to provide “master contract” agreements. The California rules also instill a tougher advertising regime on wireless carriers that may promise the world but hide the details in fine print. “We have to offer different subscription models and multiple payment methods, including prepaid accounts, coupons and vouchers—and promotional bundles.”

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