Telecom troubles, part three

November 4 2010 by Ellen Roseman

Telecom complaints keep streaming in. I’m hearing many laments about billing surprises when travelling with a smart phone or mobile internet device.

Customers are learning to turn off data roaming and find free WiFi connections in coffee shops and public places. Check out my Moneyville piece.

Premium text messages are still an issue. The Commissioner for Complaints for Telecommunications Services in his annual report says he resolves almost all the complaints that reach his office.

But what about the people who can’t get refunds from cellphone companies — or can’t even find out how to stop the pricey text messages? How did Canada’s telecom lobby group get the right to pass them along without restrictions? Have they improved the lives of consumers?

In a column this week, I talked about the new complaint agency and its mandate — now under review by the telecom regulator. There’s a public hearing later this month.

Why do we need an agency that can determine whether companies follow their own rules, but can’t review the fairness of the rules? This just institutionalizes the power imbalance that exists between consumers and telecom companies.

12 comments

  1. LM

    Nov 4 2010

    I can’t tell you the frustration I have suffered over premium text messages in the past few years, and I can’t BELIEVE no one has done a story about it.

    When our 16 year old daughter was 14 or so, she unwittingly “agreed” to receive premium text messages and I got the first outrageous bill for literally HUNDREDS of dollars.

    It has happened off and on over the past couple of years. Although I take responsibility as the parent for continuing to allow her to have the phone despite her abuse of it (my parenting issues are for another day, ha ha), I am constantly INCREDULOUS that these charges are allowed to occur, especially when ordered by a minor.

    The few times I have tried to contact these providers, I get the stock response of how they “ensure a minor does not order the service” by having them agree they are not minors…seriously??!!

    I am furious with the service providers who refuse to intervene, claiming they do not control any part of this, only that they are obliged to pass on the charges.

    How can they think consumers are so ignorant to believe the companies are not making money off of this also? What are they doing to protect MY rights as a customer?

    There is no way to prevent ANYONE from getting a hold of your phone and landing you in this cycle of ridiculous charges.

    It seems that once they get a cell number, they change THEIR incoming number as often as they want to continue sending messages. You can respond “stop” as often as you want, but they always manage to send more through. Sometimes I feel like I’m in the twilight zone!

    I’ve suggested to anyone who will listen (and the list is small!) that the very LEAST that should be done is to require a password before any premium text service can be commenced.

    The password would be chosen by the owner of the phone upon purchase. It would be so simple, and make so much sense…but oh, wait a minute, that would mean taking thousands and thousands of dollars out of the pockets of these ridiculous unscrupulous companies!!

    Thanks for letting me vent! I swear my blood pressure shoots through the roof whenever I get on this topic.

  2. FW

    Nov 5 2010

    Just wanted to let you know that after reading your article on premium text messages, I followed up on my bill with Rogers.

    After discussing it with the agent, he suggested a 50% reduction in the $48 charge. When I asked to speak to his manager, he put me on hold and then returned and reversed the entire charge.

    Of course they indicated this would be a one time deal, and I agreed. I didn’t realize what I signed up for when I entered an online contest (I think).

    After receiving the Rogers bill, I was shocked to realize the cost of $2 per message. I didn’t reply to these messages and deleted them, but didn’t know they were being billed anyway.

    I just wanted to let you know, that when I mentioned your article and the CCTS, the agent had a change of heart. So thanks for your timely article. It pays (literally) to subscribe to The Star. Thanks again.

  3. PS

    Nov 5 2010

    I think you’ll find that an organization like Zemgo receives virtually 100% of its revenue in a manner similar to that described in the article. Few, if any users, would consciously sign up for a program that costs $2 per text message.

    It’s a shame that organizations like Zemgo, which appear to rely on deception for its revenues, are able to pass through charges to users without any verification by the billing agent.

    In my mind, it’s very similar to negative option billing type issues that got Rogers into trouble a few years ago. We’ll bill you, you pay or else and we only respond to complaints, stonewalling as long as possible, hoping you’ll give up and go away.

    Why does this type of scam work and why are phone companies so eager to “pass through” the charges, implying they’re just an innocent billing agent?

    You can bet they receive a portion of every $2 charge through some type of rebate or, more likely, a revenue collection fee that comes off the top, so they are hardly an innocent or disinterested party in this transaction.

    Be assured that wireless companies don’t just collect money and send it off as a goodwill gesture without a very comprehensive arrangement in place outlining terms, conditions and the revenue sharing formula.

    It would be very simple for Rogers to set up the following auto e-mail upon receipt of a 3rd party billable e-mail…………

    Hello, this is Rogers billing department and we need your authorization to accept a new charge or charges to your account.

    Zemgo has indicated you agreed to accept a $2 charge per text message and Rogers is required to secure your explicit approval for this charge and any future charges from Zemgo

    If we do not receive verification from you to accept these charges to your account within 48 hours, Rogers will decline all Zemgo billing to your account indefinitely and advise Zemgo of your decision accordingly.

    Now this is a type of negative optioning that actually works for the customer.

    As you might imagine, I’m not a big fan of Rogers or any of the telcom companies and I currently have contracts with Bell, Rogers and Telus.

    I think there is a great follow-up story here in that all telecom companies pass through these type of charges. They’re a huge source of revenue and I think most, if not all, telecom organizations know how the process works.

    They seem to be OK with it, as long as they get their revenue and can hide behind “we’re just passing the charge through” message.

    I’m just a frustrated consumer with too few choices and a toothless regulatory body that does not seem to take my best interest to heart.

  4. Geoff

    Nov 5 2010

    Man, though I agree that these companies are somewhat predatory, perhaps the lesson here should also be READ THE FINE PRINT. Not one of these complaints talks about taking any personal accountability. Guess what people? I’m walking around without receiving pricey text messages because I don’t sign up for contests, jokes, games, etc without reading the contract I’m agreeing to. Now it would be one thing if they didn’t say waht the costs are, but I know that they do say what the costs per month are. If my son did that, he’d soon find how quickly a pay as you go phone goes to $0 if he’s stupid.

  5. Charles in Vancouver

    Nov 5 2010

    Regarding data roaming – on a recent trip to the US I obtained a T-Mobile SIM card and used it in my unlocked smartphone. They have a prepaid data offering of $1.50 for an unlimited data day pass. If you have a phone with AWS 3G (e.g. a phone from WIND, Videotron or Mobilicity) you will get 3G speeds on their network but after 30 MB of usage in the day you’re throttled down to a slow speed. This is fine though because really you’re travelling to see a destination, not your phone! If your phone does not have the AWS 3G band you’ll only get EDGE speeds, but for many travellers the important thing is not getting whacked with ridiculous data charges.

    AT&T GoPhone has prepaid data on a SIM too but not as cheap. You can buy a bundle of 100 MB for $20. You will get 3G on most Canadian unlocked 3G smartphones (from Bell/Telus/Rogers), but they reduce the 3G speeds for prepaid customers.

    Another data option is to buy a Virgin Mobile USA prepaid MiFi hotspot. This creates a Wifi signal which you can use on your smartphones and computers. The main downside is you’re buying a piece of equipment that will only ever work in the USA.

  6. Potato

    Nov 7 2010

    Hi Ellen, your first link to moneyville has a malformed link (http://http//…).

  7. Ellen Roseman

    Nov 7 2010

    Thanks, Potato, you’re right. I’ve fixed it now. Always like getting tips from readers when something isn’t working.

  8. Blank

    Nov 10 2010

    Premium texts are a pain. many customers don’t know when they sign up for contests online or through TV for ring tones, wallpapers, jokes etc. they are signing up for premium text services. Unfortunately when the bill comes it’s a shock on how much this can cost since it’s a daily occurrence of texts ranging from $1 to $2 a day if not more.

    The way to opt out is to reply the message and text “STOP” and you should get a confirmation that the service will no longer be received.

    I use to work in the telecom industry and had these complaints all the time and though because at the level I was at I was unable to resolve the issue. Most customer service departments are nice enough to help out it really is a collaborative effort. If the customer calls in kicking and screaming it really doesn’t start off your case in a positive manner and give you the help you need.

    reps respond better if you talk to them calmly. it’s their job to help but understand their situation when they get people yelling at them on a daily basis. it’s not the best way to start off your day.

    for customers I’d suggest asking questions ahead of time when you travel. that’s what customer service is their for. ask about fees when you roam while texting, calling, data etc. if it’s a mandatory service you need. Most companies have travel packs that you can get for the month that can reduce costs significantly depending on usage.

    if you don’t ask you will never know. can’t always put 100% of the blame on the telecom industry.

    Even though I’ve been out of the telecom industry for a year now I’ve noticed many companies are taking more proactive approaches to communicate with their clients. the use of social media is becoming prominent and people can voice their concerns or ask questions via twitter, Facebook etc. the response times for these mediums are pretty quick from what I’ve noticed.

    also it’s a good way to get in touch with a human as oppose to navigating their atrocious touch tone/voice functions.

  9. Dave Ings

    Nov 12 2010

    Hi Ellen,

    The low contrast light grey text on a white background at Moneyville is not, uh, ergonomically sound. As a result I don’t read yo anymore. Please post back here more often – we miss you! – or encourage the Star Webmaster, who should know better, to fix it. (I tried to post a comment to this effect at Moneyville, but as others have noted, the new comment system fails regularly).

  10. Bill 133 in Ontario

    Nov 18 2010

    Ellen asked:
    “Why do we need an agency that can determine whether companies follow their own rules, but can’t review the fairness of the rules?”

    I’d offer:
    Because the *infringement* of a contracting party’s right to contrive terms that are acceptable to both them and the contract’s other party … is no trifling thing.

    (To clarify the level of authority inherent in the CCTS consider the hierarchy: gov’t -> CRTC -> CCTS.)

    CCTS is too far down the chain to have any massive authority like that … and probably rightfully so.

    To solve this issue:

    CRTC probably has some power here … perhaps CCTS should report back to CRTC on the intractable problems and encourage the CRTC to enforce some consumer protections?

    Then again the CRTC became yet another “captured regulator” a long, long time ag0- http://en.wikipedia.org/wiki/Regulatory_capture. Pre-internet days.

    In a way, all these levels of opportunity for *regulatory intervention* are simply the *symptom* of a larger problem – “standard form contracts”.

    So how does one solve that ‘big-picture’ problem?

    Well, for ONTARIO:

    Most interestingly, of late, there has passed First Reading a private member’s bill in the Ontario legislature, where that bill is Ontario’s version of Quebec’s recent Bill 60 – protecting cellphone users from surprise charges, mandatory phone unlocking at contract end, unclear contracts, changing contract terms, etc.

    There’s a good writeup here:

    http://www.howardforums.com/showthread.php/1685529-News-Ontario-politician-wants-more-consumer-protection-from-high-cellphone-fees

    Including further down which gives:

    – Instructions on how citizens can get the email address of their MPP and send am email saying they support this bill.

    – A link to read the actual bill itself (it’s mostly quite comprehensible and not too large at all).

    I think you’ll like Ontario’s “Bill 133”, Ellen 🙂

    And that’s the crux of all this – if we have *better Consumer Protection Legislation* then the need for CCTS or CRTC involvement would be diminished.

    Follow that HoFo link folks, and send an email to support this solution to the *originating problem*.

    Of all consumer-protection things that have a chance of coming to fruition, this private member’s bill, having just passed First Reading, is a horse worth betting on and investing a little time in.

  11. mk

    Dec 1 2010

    jam the phone lines, tell the service provider that you belong to a new consumer group of 1 million strong ,that most recently has voted for a consumer revolt! to shut the bloody things off,after a week or two the telecom market would drop like a rock ,you have to make big moves when dealing with these corporate robber barons ,in hope that they would wake up and discover who controls the horizontal and vertical in the publicly owned air waves “telecom-zone” get your dirt out of my ditch we have a failure to communicate get your corporate pin head on right!.it’s the B.S.hand shake especially from rogers wireless.i think they need a little class action attraction.you just have to get down in the dirt with them and give em the boots,and don’t forget to phone your MP OR MLA ON A REGULAR BASIS AND COMPLAIN THATS WHY THEY GOT ELECTED .

  12. Martha

    Jan 26 2011

    These premium texts are such a horrible cash grab. We feel we are being held hostage.

    Tried “stop” advice the first month & the 2nd month the charges were doubled.
    Does this mean we have to cancel our texting plan?

    Thought it was just Telus, but see it is everywhere…Millions of dollars to be made by this invasion.

    SO SO frustrating. Nothing short of robbery.