Big telecom companies feel the heat of consumer rage

A $19 billion class action against Canada’s major wireless companies over undisclosed extra fees can proceed, thanks to the Supreme Court of Canada. About 30,000 people have joined the case, says lawyer Tony Merchant.

The issue is the “system access fee” that wireless carriers routinely added to customers’ bills. They blamed the government for making them charge an extra $7 to $9 a month, giving the impression they had no choice in the matter.

This particular fee may be gone except for customers with older plans, but extra fees still linger on wireless bills. For example, Rogers started in 2009 to charge a government regulatory recovery fee .

However, new customers are no better off, since the major carriers simply increased their prices to replicate the fees they say went toward paying for their licenses and purchasing wireless spectrum, as well as maintaining and upgrading their expensive wireless networks, said a Toronto Star story.

Another class action suit alleges that Bell Canada was using illegal expiry dates on its prepaid wireless contracts. Lead plaintiff Celia Sankar says Bell’s seizing of customers’ credit balances contravenes Ontario’s Consumer Protection Act.

Bell is angering many customers again. Not only is it charging a $2 fee for paper bills, but it is cutting its bundle discounts to $4 per service (from $5).

Bundle discounts are supposed to keep you loyal to Big Telecom and reluctant to switch elsewhere. But one customer did the math and switched his Internet service to Teksavvy (even before the bundle discounts were reduced in June).

I’m getting lots of feedback about Bell’s double play. See a few comments below from disgruntled clients.

How can telecom companies raise prices for customers under contract? This is unfair, even unconscionable. A contract should be binding on both parties, not just one side.

Let’s hope that an enterprising lawyer sees abusive contracts as the next class action to fight in court.

There’s no such thing as a free lunch

The expression refers to American bars offering a free lunch to entice drinking customers in the 19th century. Economist Milton Friedman used it as the title of a 1975 book.

A free lunch usually has strings attached. But that’s not the case with my free personal finance seminar in Toronto, which offers free coffee, tea and cookies (oatmeal raisin and chocolate chip).

I’ve led this Financial Basics workshop at Ryerson University’s Chang School for a few years. The cost is underwritten by Ryerson and two government agencies, FCAC and IEF.

When I say there are no strings attached, I mean it. Most financial seminars are sponsored by salespeople who hope to get your personal information and flog their services.

“Free” real estate seminars fall into a special categpory of sleaze, says Moneyville writer Mark Weisleder.

This workshop is different. No one takes your name or tries to sell you anything. You can come and go without being harassed.

My goal as an instructor is to explain, answer questions, encourage saving and change behaviour. I hope you will be motivated to try a few new things in your daily life.

Gervan Fearon, Dean of the Chang School, subsidizes the seminar as a service to the community. He’s helping to transform it into a series of videos, underwritten by Ryerson and the FCAC.

So, if you can, please come to the 7th floor auditorium at 297 Victoria St. in Toronto (east of Yonge St. and north of Dundas St.) on Tuesday, June 19, from 5.30 to 9.30 p.m. Bring a spouse, friend or family member.

I’ll raffle off a few copies of The Wealthy Barber Returns by David Chilton (another freebie).

And if you want a meatier course, check out my Investing For Beginners class at University of Toronto. It starts on Sept. 13 and costs $325 for nine sessions.

Bell cut his $9,350 data roaming bill to $1,600

Russ Moyer took his iPad with him on a trip to Israel, but didn’t turn off the data roaming feature. His Bell Mobility bill was the highest I’ve heard of so far.

“I was charged almost $10,000 for the 10 days I was in Israel,” says Moyer, the president of Eagle Worldwide Ministries in Hamilton, Ont.

“I used my iPad to take pictures and write down my daily notes and plans. I didn’t really use it to surf the Internet while I was there.”

When he complained to Bell, he received a $2,000 credit on his $9,350 in data roaming charges. Hoping to get more, he contacted me.

Moyer already had a data plan for his iPad, covering travel in Canada and the United states. But he didn’t know that going overseas could be so expensive.

Also, he didn’t get any real-time messages from Bell about data roaming, either when he crossed the border or when the costs started mounting.

Bell has a warning system for residential customers (as does Rogers). But Moyer has a corporate account and didn’t get any warnings. Seems that Bell plans to start doing it soon for corporate accounts.

Fortunately, this minister ended up getting a bigger refund — and so did a travelling companion. I’ll let him tell the story.

Bell said they would apply an international data roaming plan to our account as if we had purchased it. In the end, with the discounted rates, and the previous $2,000 credit, our bill was brought down to $1,607.30.

Another minister who came with us had taken his iPhone and never used it, but was charged $4,000 in roaming fees. Bell brought down his charges to $706.53.

Wow, what a huge difference. This is more affordable and we’re glad to pay.

Data roaming complaints have diminished, but not disappeared, since I wrote this blog post a year ago. I still get a few, as you can see below.

Should wireless companies do more to tell people about the potential for high bills? Or is it a customer’s responsibility to learn how to travel safely with a digital device?

Please give me your views, plus tips on how you keep roaming costs down.