Wireless Carriers Volunteer Consumer Code
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The nation's wireless carriers Tuesday unveiled a 10-part consumer code in hopes of staving off federal intervention. According to the Cellular Telecommunications & Internet Association (CTIA), the cell phone industry's major trader group and author of the plan, the voluntary code is to help wireless consumers to better understand their wireless services and rate plans.
Included in the code are provisions calling for providing new consumers a minimum 14-day trial period for new service and giving customers the right to terminate service for significant changes to contract terms.
The code also calls for carriers not to label cost recovery fees or charges as taxes on billing statements and for every rate plan or contract, carriers should provide consumers specific disclosures regarding rates and terms of service.
"Competition has always served wireless consumers better than costly regulations," said Tom Wheeler, president and CEO of CTIA. "Wireless complaint rates are lower than those of more regulated telecom sectors. So, dragging wireless down with heavy regulations is simply old monopolistic think, and only hurts consumers."
In February, U.S. Sen. Charles Schumer (D.-N.Y.) introduced legislation calling for a cell phone user bill of rights aimed at improving wireless service and making competition an "ingrained part of the wireless industry."
Schumer said the bill is intended to foster competition in the cell phone industry by improving disclosure and making it easier for consumers to choose plans. Schumer said he rejected a mandate-based approach out of concern that external "government fiats" would stifle innovation and investment in the relatively young wireless industry.
"Adam Smith had it right: competition is indeed a wonderful thing when it forces players to improve their performance. Sometimes, you need rules in order to set the teams in motion. This is what the Cell Phone Users Bill of Rights does," Schumer said when he ontroduced his legislation.
AARP, the Consumers Union, Consumer Federation of America, National Association of Regulatory Utility Commissioners, and the National Association of State Utility Consumer Advocates are endorsing Schumer's bill.
Wireless carriers endorsing the voluntary code include Cingular, AT&T Wireless, Sprint PCS, Nextel, ALLTEL, Verizon Wireless, Qwest and Spring PCS.