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Group Presses For Truth in Cell Phone Billing
WASHINGTON -- A consumer advocacy group is pushing federal regulators to force cellular telephone providers to clear up their billing practices. The National Association of State Utility Consumer Advocates filed a petition with the Federal Communications Commission on March 30 demanding the FCC take a more active role in regulating what the association contends are misleading charges on monthly wireless bills. The group is composed of 44 government officials and consumer advocates in 42 states and the District of Columbia. The group has the statutory authority to represent the interests of utility consumers before state and federal regulators and courts. At issue are so-called federal recovery fees, which are used primarily to pay for costs associated with portability - the practice of allowing customers to keep their phone numbers after they change providers. Wireless companies have used the line item to cover all manner of expenses, including marketing and advertising costs, the organization charges.Typically, wireless phone companies lump the cost of portability along with other charges into a single line item under a generic name such as "federal recovery fee," the group said. Exactly how much of that fee is going toward number portability is difficult to gauge. The petition calls on the FCC to prohibit wireless companies "from imposing line items unless those charges are expressly mandated by federal, state or local regulatory action." The organization is also demanding that such line items coincide with a cost assessment by the FCC. Without oversight from the FCC, cell phone companies can continue to collect these fees for as long as they want, the organization argues."The FCC has exercised no review whatsoever on the size or the length of the fee; it is totally at the discretion of the provider," said Billy Jack Gregg, Director of the West Virginia Consumer Advocate Division. The association cites a study by the Center for Public Integrity released in October 2003 which detailed the billing practice. The Center reported that wireless companies had collected $629 million starting in January 2002 for number portability, a service not offered until Nov. 24, 2003. Since the Center's last report, wireless providers have collected another $308 million, bringing total collections for number portability to $937 million. Latest totals show that all major cell phone providers combined are collecting $94 million per month for number portabilityAlthough wireless companies are banking more than $1 billion a year to provide number portability, they will not disclose how many customers are actually taking advantage of the service. However, according to Roger Enter of the telecommunications consulting firm Yankee Group, only 4 million consumers have ported their number since November 2003. To date less than 4 percent of all subscribers have taken advantage of the service they have been paying for.The FCC is relies on companies to come up with their own estimates on what portability will cost and does not require these companies to make the information public. FCC filings and interviews with company officials indicate number portability is being used to justify the collection of hundreds of millions of dollars from subscribers. Since November, four of the top ten wireless service providers have raised the monthly line item fee to cover the costs of number portability. Two of the companies, Verizon Wireless and T-Mobile USA, Inc., have begun charging fees. "