It’s not the first time the GAO has had something to say about the wireless industry, but their most recent concern was actually that the FCC wasn’t doing enough to protect consumers from the questionable practices of the wireless industry. Their criticism was two-pronged, saying that the FCC wasn’t doing enough to enforce consumer protection rules, or to educate consumers about available recourse when they encounter issues with their carriers.

But now the GAO is turning its spotlight on the industry itself. The office released a report last week (you can read a summary here) that says wireless costs have decreased over the last decade, even as the number of wireless subscribers has grown exponentially, increasing from about 3.5 million in 1999, to 285 million by the end of 2009.

The CTIA, a group that represents the wireless industry, took the report as good news. The group’s CEO, Steve Largent released a statement which said, in part:

“In finding that wireless consumers are seeing ‘lower prices and better coverage,’ today’s GAO report confirms what we’ve been saying for a long time—that the U.S. wireless industry is extremely competitive and continues to respond to increasing consumer demand by delivering real benefits for American consumers.”

But, the report didn’t say the wireless industry is competitive. In fact, it calls the industry “concentrated” because mobile phone users have fewer carriers to choose from today than they did ten years ago. According to the report, the four major carriers—Verizon, AT&T, Sprint, and T-Mobile—control approximately 90 percent of the wireless market, and make it difficult for smaller, regional companies to compete.

So what happens now? Well, now it’s up to the FCC to use the data in the GAO’s report to investigate further, and possibly take action. What kind of action? That remains to be seen, but it will be quite a while before any real change comes about.

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So far, AT&T is the only carrier to have done away with unlimited data plans for new customers, opting for limits and tiered pricing. The other three major carriers, including T-Mobile, are still, at least for now, offering unlimited data plans to their customers. However, one T-Mobile customer, Trent Alvarez, found out that T-Mobile will limit data usage under certain circumstances.

Alvarez claims he received a message from T-Mobile when his data usage exceeded 10GB in one month. The message informed him that his data speeds would now be capped at 50Kbps or less. Alvarez says he contacted the carrier and tried to have the cap removed, but T-Mobile refused, so Alvarez then filed a class-action suit claiming T-Mobile’s ads for unlimited data were misleading, and that the sales representative he dealt with gave him false information.

Yes, anything that says it’s unlimited should be unlimited. However, in the fine print of Alvarez’s—and probably all T-Mobile customers—it clearly states that the carrier reserves the right to throttle data speeds based on excessive or improper usage, or on network overload. Similar information is included on T-Mobile’s brochures, again in very fine print.

So really, it’s a question of proper disclosure. Did T-Mobile inform its customer that their data usage, even on unlimited plans, might be throttled? Yes, they did. Is it the customer’s responsibility to read their contract in full? Yes, it is. Would it be helpful if information were printed in a font size that people could actually read? Absolutely.

Another question is did one person using 10GB of data in one month really put that much of a strain on T-Mobile’s network? One person? Sure, there are probably several other T-Mobile customers using a lot of data as well. Were they all capped? What was the true and measurable effect on the network, and T-Mobile’s ability to service all its customers? T-Mobile is probably going to have to show how Alvarez misused the network, or caused a negative effect in order to justify their throttling measure.

The specifics of this case are very similar to the ones related to what the FCC is calling “bill shock,” where wireless customers unexpectedly receive huge bills for certain types of usage. Although the usage parameters are spelled out in the contracts, again, it’s done in very fine print, and usually covers multiple pages of the contract.

The FCC is investigating the major carriers for this practice, and some of them, like AT&T, have begun sending their customers warnings via text message when they approach their data limits. But how do you warn a customer on an unlimited plan that they’re approaching a mark that may bring about a limitation? I imagine that, like most of these class-action suits, this one will be settled out of court, and many of these questions may never be adequately answered. We’ll have to wait and see.

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Last Tuesday, San Francisco’s board of supervisors voted in favor of a law that will require handset manufacturers to openly display the amount of radiation emitted by their devices. Only one supervisor out of eleven voted against the measure.

If the city’s mayor, Gavin Newsom, signs the measure into law as he is expected to do, mobile device manufacturers will be required to post devices’ specific absorption rates (SAR) in retail stores.

While scientific studies about handheld device radiation have so far been inconclusive, the Federal Communications Commission (FCC) does have a limit in place which states no mobile may have an SAR of more than 1.6 watts per kilogram.

Posting the information in stores, and being legally required to do so, would be a huge change in the wireless industry. Some consumer advocate groups have been lobbying to force handset makers to label their individual products with information about radiation, much the way cigarette packs carry health warning. Not surprisingly, wireless companies are fighting it.

Also like the warnings on cigarette packs, many people may simply ignore radiation information. But if it concerns you, use a headset or the phone’s speaker to talk rather than holding the phone itself up your ear. You can also turn the phone off when it’s not in use, although turning a device on and off, especially a smartphone, can drain the battery. There’s always a tradeoff, isn’t there?

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In January, Chairman Genachowski launched an FCC task force to address consumer concerns related to the wireless industry. One of those concerns is “bill shock,” which more and more wireless customers are experiencing. Bill shock occurs when a customer receives a huge wireless bill, much higher than their normal bill, for things like overseas roaming, or data downloads.

In Europe, wireless carriers are legally required to inform customers of extraordinary activity on their accounts. For example, when a customer begins to approach their data download limit, or their bill begins to rise above average amounts, European customers receive text messages from their carriers notifying them of the situation. This allows customers to either limit their activity, or at least be aware that they’re going to receive a higher than average bill the next time around. There is no such requirement in the United States, and the FCC wants to know why.

This past Wednesday, the agency published a survey which it says shows consumers are suffering bill shock at the hands of wireless carriers. In addition, the FCC is reversing a longstanding position which previously found the wireless industry to be competitive. The agency is now saying it’s “concentrated.”

The FCC has not yet taken any action against wireless carriers, or announced any new regulation, but it looks like that may happen in the very near future. For its part, the wireless industry is firm in its position that it is already doing everything in its power to keep customers informed, and to provide all the information customers need to manage their wireless bills. It feels new regulation is not necessary.

Steve Largent, CEO and president of the CTIA Wireless Association said in a statement:

“From prepaid to postpaid, subsidized handsets to unsubsidized, contracts with ETFs to those without, large, medium or small buckets of minutes and ‘all-you-can-use’ plans, consumers have an unbelievable range of choices. The industry does provide ’simple and easy to understand’ plans for every type of American consumer. Carriers go to great lengths to keep their customers satisfied and informed.”

The thing is, there’s a difference between providing information, and that information being understood by its intended audience. While customers are ultimately responsible for knowing how their contracts work, and keeping their own bills under control, page after page of fine print isn’t the most user-friendly method of helping customer understand those contracts.

What do you think? Does the FCC need to step in? Does the United States need regulation similar to that which exists in Europe for billing notification? Or do wireless customers just need to suck it up, break out the magnifying glass, and actually read their multi-page contracts? Tell us in the comments.

If you plan on signing up for new cell service soon, or it’s just been a while since you reviewed your contract, the FCC has published a list of tips to help consumers avoid bill shock.

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The Consumer Task Force was launched in January by FCC Chairman Julius Genachowski, and it’s now turning its attention to the issue of “bill shock.” The task force is chaired by Joel Gurin, Chief of the FCC’s Consumer and Governmental Affairs Bureau. According to Gurin, carriers in the European Union are required by law to send customers a text message when they start incurring roaming charges, or they come close to a preset data roaming limit. The task force is looking into why carriers in the United States don’t do the same thing.

By issuing a Public Notice, the task force hopes to gather information from consumers and cell phone users regarding how much knowledge they have about how to monitor their bills. They want to know what U.S. carriers are already doing to provide this information, or bill monitoring tools to their customers. They’re also asking whether cell phone usage information is equally accessible by those with disabilities.

Consumers are invited to submit their responses to the Public Notice via the FCC’s Web site. Responses must be submitted within 45 days of the Notice being published in the FCC register. This Notice was published on May 11, 2010.

If you’ve ever been a victim of bill shock, or you know someone who has, now is the time to speak up and take some action.

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One of the most popular places for a cramming scam to catch you off guard is Facebook. The site has thousands of applications, games, quizzes, and ads that tout all of them. It’s not just Facebook, though. Those ads are all over the Internet, on gaming sites, or other Web sites that run banner ads. The most common way a cramming scam is run is through quizzes, for example, an IQ test. You see an ad for it pop up on your page, or you see that a friend just took the quiz, and you think it sounds sort of fun, so you take it too.

You spend maybe five or ten minutes going through it, answering all the questions, but when you get to the end, it doesn’t display your results on the screen. Instead, you get a message telling you that if you want to see your test results, you must enter your cell phone number, and the results will be texted to you. It may even tell you that your regular text charges and fees may apply. Maybe you have unlimited texting, or maybe you figure one text isn’t that big a deal, so you enter your cell number, get your test results, and go on about your business without giving it a second thought.

The next thing you know, there’s suddenly a new charge showing up on your wireless bill, maybe for $9.99 or so, for some sort of feature like “enhanced voicemail.” You don’t remember ever ordering any such thing when you signed up for your wireless service, or anytime since then. To top it off, there’s some company other than your carrier listed as the biller. How did some other company get permission to add a fee to your cell phone bill?

What happened was this: When you took that quiz online, there was some fine print that maybe you didn’t see or ignored. In that fine print was an explanation that by entering your cell phone number, you were signing up for a service, and would be charged a monthly fee on your existing wireless bill. Your voluntary entering of your cell phone number is your tacit agreement to accept that service, and the charge.

If you’re lucky, you notice the charge right away. But some people don’t really examine their cell phone bills. Depending on the type of plan or how many calls are made, a wireless bill can go on for several pages. Who really sits down and examines each and every line? Many people even have automatic bill pay set up, so they rarely even see the bill at all. By the time someone notices something is amiss, months or even years could have gone by, and they could have spent hundreds, or even thousands of dollars over and above their regular wireless charges.

This happened to a man named Mike Cunningham in Boston. Unbeknownst to him, his 10-year-old grandson had used his grandfather’s cell phone number to sign up for free video games on a random Web site. By the time Cunningham realized what had happened, nearly two years later, he had been charged a total of $567 by two companies—ILD Teleservices, Inc., and Enhanced Services Billing, Inc., for enhanced voicemail, and additional “vmail” services.

Upon discovering the charges, Cunningham contacted the two companies who both credited his account upon learning a minor had signed up for their services. But Cunningham was dismayed that his carrier, Verizon Wireless, first allowed these companies to charge him at all, and then did not refund the money, but credited his wireless account, preventing him from switching carriers. He said, “It’s like salt in the wound.” I can’t leave. I’m a captive audience.’’

Granted, cramming is a questionable practice at best, thievery at worst. But is it really up to Verizon, or any other carrier to prevent it from happening? It would be great if they didn’t allow these companies to piggyback on their wireless bills, but they do it for profit. Those companies pay wireless carriers a fee to use their billing systems. As long as AT&T, Verizon, or any other carrier is making a profit on a practice that isn’t yet illegal, albeit seemingly unethical, they’re unlikely to turn it down.

In addition, wireless companies are answering for questionable billing practices on a regular basis. It’s not always third party companies that charge for unused services. Sometimes, the carrier continues charging for services that have been canceled. In one instance, Verizon continued to bill a man who had passed away. T-Mobile began charging people to receive paper bills, calling it an effort to be more green. They later rescinded the policy. And Sprint got into a bit of hot water for charging people on limited spending accounts for not signing up for automatic payments. Not only that, the Federal Communications Commission (FCC) was recently taken to task by the Government Accountability Office (GAO) for not doing enough to protect consumers, in part from charges and practices such as these.

The other thing is, wireless customers—you—need to keep an eye on your bills. Don’t blindly pay them every month without taking the time to make sure the billed amount is correct, and that nothing extra that you didn’t ask for has been added without your knowledge or express permission.

Most kids are very Internet savvy these days, and can navigate the Web better than a lot of adults. But they are still naïve about billing, money, and sharing personal information. Talk to your kids, or grandkids, before you allow them to use the computer unsupervised. Better yet, supervise them as much as possible. No one wants, or has time, to stand over a kid’s shoulder every minute they’re on the computer, but you can at least check browsing histories to see where your kids have gone online, and there are programs that will allow you to block any sites that don’t seem to be on the up and up.

Bottom line, no one who makes a profit off of anyone’s complacency or lack of attention is going to protect or feel sorry for you when you fall victim to scams like this. Should they be allowed to exist? In my opinion, no. But until it’s illegal, until the FCC steps in and levies some kind of penalty on the wireless companies for allowing it, or forces them to stop partnering with these third party companies, you have to look out for yourself.

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That’s exactly what happened to Cynthia Lacy of Treasure Island, Florida. Her father, Bill Young of Calvin, West Virginia, passed away last June, and in trying to put his affairs in order, Lacy sent a copy of his death certificate to Verizon. But they kept sending bills, and it took months and media coverage to set things right.

Normally, when someone passes away, provided they’re the only person named on a service account, the account is closed, and any outstanding amount is written off by the company. It happens every day, and you would think customer service representatives, the employees who have the most direct contact with customers, would be trained on such matters. Maybe Verizon does train its employees on how to deal with customers’ deaths, but if they didn’t before, they most certainly will now.

Despite Lacy having sent Verizon a copy of her father’s death certificate, the company continued to bill Young’s account, and Lacy continued to pay it. But while she was paying the bill each month, she was also calling Verizon to repeatedly explain that her father was dead, and asking them to please update their records.

At one point, during one of these phone calls, a customer service rep asked for the account’s PIN. Lacy explained that she did not have this information as the account had belonged to her father. According to Lacy, the rep said, “Well, there’s nothing else I can do for you,” then laughed and hung up on her.

Without access to a recording of that call, there’s no way to confirm that the rep actually laughed at her, but Verizon isn’t denying it. After the incident, Lacy went to the media, contacting the Consumer’s Edge, a column published by the St. Petersburg Times newspaper. Once the issue became public, Verizon finally took appropriate action, closing the account and refunding all the money Lacy had paid.

A spokesman said the case was improperly handled, and that the rep who laughed at and hung up on her has been reprimanded and given coaching. They may be able to provide their reps with the knowledge of how to deal with a deceased person’s account, but no amount of coaching is going to instill any compassion in a rep who would laugh at a grieving person and treat them with such disrespect. Good luck with that, Verizon.

As for why Lacy continued to pay a bill she wasn’t responsible for, it seems that Bill Young’s account was for in-home service rather than wireless service, so the account was attached to his home, which was part of his estate. The family was trying to sell the home, but could not do so until all debts associated with it were either paid or canceled. So in addition to just being rude to Young’s family, Verizon was also holding up the sale of the home, making it impossible for the family to move on.

So if this was a landline and not wireless service, why write about it here, on a cellular blog? Because this case shows that the ignorance of any company’s customer service reps, or a company’s lack of policy and procedure in dealing with deceased customers’ accounts could happen again at any time, to anyone, with any kind of account. If Cynthia Lacy had had her father’s PIN, it might not have taken so long to get the issue resolved. Maybe, maybe not. But it’s still better to have more information in a situation like this.

Take some time to make a list of important details like account numbers, PINs, or anything you use to access your personal data. Keep a list of passwords you use to access Web sites like Facebook, Twitter, and your e-mail. Include your wireless voicemail access code, and your wireless account’s PIN. Because this information may change from time to time (you know it’s a good idea to change your password every so often, right?), it’s not enough to write it all down, seal it in an envelope, and put it in a safety deposit box. Consider keeping a document with this information in an electronic safety deposit box.

Sites such as Legacy Locker and AssetLock provide services that allow you to keep your online account information safe, but accessible to a trusted family member or friend should something happen to you. It may seem like extra work in addition to the standard procedures of preparing a will and taking out an insurance policy, but we live in the digital age. Collecting this information, and making it easily accessible upon your death will help your loved ones with the already difficult task of managing your estate. It’s one less thing they’ll have to worry about. And then when your spouse or child has to call a company like Verizon to cancel your account, they’ll have your PIN. Most of all, they’ll have a little more peace of mind.

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This question is at stake in a case in California, where a man accused of identity theft argues that the police had no right to search his cell phone. He alleges that the police searched his phone, and when they found something of interest they then obtained a warrant. That seems to me like going into someone’s house and then, when finding a bloody glove, obtaining an ex post warrant.

How stringently should we handle the search of a cell phone? Again, with the advances in technology we’re seeing more and more personal information stored in this single electronic entity. Shouldn’t that be held to the same standard as a home? I’m inclined to think so. Though, on difficult topics like this I’m sure others will disagree. I’m open to hearing arguments to the contrary.

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Verizon initially applied the doubled ETF to 46 devices, including its current big seller, the Motorola Droid, several popular BlackBerry devices (including the Storm, Pearl, Curve, and Tour), the HTC Touch, and even a few netbooks. The original list of devices also included some multimedia phones. Those devices—10 of them—have now been cut from the list, leaving just the smartphones.

On the one hand, it could seem like Verizon is trying to appease the FCC, and to a lesser degree, its customers, by taking these devices off the high ETF list. But is it really a genuine attempt to apply the $350 ETF in a fairer way? Or is it a token gesture?

Doubling ETFs to recoup subsidies might be understandable if the math worked out. But it doesn’t. The ETFs are prorated. They decrease by $10 per month for the life of the contract, which is the standard two years. So, by simple multiplication and subtraction, that deducts $240 from the ETF. Why, at the end of a contract, is there still $110 remaining? Logically, shouldn’t it zero out by the end of the two years? This makes switching carriers, even just a few months away from the end of a contract, unpalatable for customers. And maybe that’s the idea.

In addition, Verizon changed its story midstream. What started out as recouping subsidies became subsidies and other expenses, some of which could fall into the category of “cost of doing business.”

Consumers and consumer advocacy groups have been questioning ETFs since wireless carriers began charging them. Admitting they’re being used for more than just the cost of a phone attached to a prematurely canceled contract hasn’t done much to bolster their validity. Just the opposite. If Verizon doesn’t come up with better answers, or more accurately, a better solution, the FCC may decide ETFs in general—not just Verizon’s—warrant a closer look.

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All those tweets and status updates on social networking sites ask people to text a certain number in order to donate $10 to Haiti earthquake relief. Sounds easy enough, and $10 is affordable for most people. It takes less than a minute to complete this transaction, and when you see a tweet or status update from someone you know, it lends a certain amount of credibility to the information.

You might not think twice about whether the plea is valid or not because it came from a friend or family member. But you’re making a big assumption, which is that the person who is providing the information has already checked the source to be sure it’s coming from a valid charity or organization that can provide relief, and not from a scammer.

We want to trust our friends and family, but even the smartest people are sometimes taken in by what appears to be a valid request for information or money. And $10 isn’t a lot of money to most people. If it were a scammer, they’d be asking for a lot more money, right? Not necessarily. A scammer can ask for just a $10 “donation,” and if enough people comply, they can very quickly make thousands of dollars.

Before you start punching keys on your cell phone, do a simple Web search to ensure you’re donating to a legitimate organization, and that the money you donate gets where it’s supposed to go. If a certain text number is being linked to a particular organization like the Red Cross, go to that organization’s Web site to confirm it. If you should find that the text number you received is fraudulent, take another moment to at least inform the person who provided it, if not disperse it via Facebook or Twitter yourself.

Also, it may interest you to know that as of this writing, Verizon, T-Mobile, and AT&T are not charging for these charity texts—but Sprint is. AT&T was, but earlier today reversed their position. They’ve gone so far as to say they will also remove text charges on accounts for donations made yesterday, essentially making all text donations made by AT&T customers free.

Sprint, on the other hand, has said they customers without text plans will be charged for the charity texts. A spokeswoman told MSNBC, “If a customer does not use any of [the available texting] options, standard text messaging charges will apply, but they can switch to [a texting] plan at anytime without extending their contract.”

This is particularly disappointing. Sprint offers unlimited text messaging plans, or 300 text messages per month for $5. Sure, that’s pretty reasonable. But if someone doesn’t already have the plan, it’s because they didn’t want it for some reason. Sprint is saying its customers have to sign up for a texting plan they didn’t want in the first place in order to make one $10 donation to charity. And that’s not very charitable at all.

Update: MSNBC is now reporting that Sprint has joined the other three carriers, and is no longer charging for text messages sending donations to Haiti.

MSNBC has compiled a list of valid charity organizations accepting donations and assistance in Haiti. Please help if you can.

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