The FCC's New Impact on Mobile Carriers

Today the FCC voted to start writing regulations to prevent "Bill Shock,"which could be a major burden for mobile carriers.


The new rules would require the likes of Verizon Wireless , AT&T, T Mobile and Sprint to send their users text or voice alerts if they're nearing their limit for calls or texts. The idea is to avoid that shock when a bill includes several thousand dollars of extra texts and fees.

Mobile carriers do *not* want these rules — the CTIA has told the FCC that they can self regulate- and the industry has spent millions of dollars on lobbying to make this point. With these new rules carriers will have to pay to contact many of their users on a monthly basis; that could come with costs carriers may pas along with users in the form of higher prices. Plus carriers are inevitably going to lose out on some of the millions they've been raking in on texting and calls that exceed subscribers monthly limits.

Another potential downside: this could open up carriers to even more lawsuits. Hearings back in 2008 on text message price increases sparked dozens of class action suits on texting costs. Shining the spotlight on bill shock could very well lead to consumer suits on this issue.

The carriers are on the defensive — Sprint says it sends alerts when customers incur more than $10 in overage charges. AT&T says it has tools for customers to monitor their data usage and receive usage alerts.

The FCC said it received 764 complains of "bill shock" in the first half of 2010. Is that enough to regulate?

Let me know your thoughts!

Questions? Comments?