By Sara Jerome - 05/28/10 02:37 PM EDT
The survey also provided ammunition for Sen. Amy Klobuchar (D-Minn.) to tout her bill that would regulate the structures of early termination fees. “The FCC’s consumer survey confirms what we have known for a long time — that confusing early termination fees undermine competition and result in less consumer choice,” she said this week.
But the wireless industry pushed back with reminders that consumers have a menu of billing options, ranging from pre-paid to unlimited. In a Q&A, Guttman-McCabe questioned why the FCC has not highlighted industry efforts to help consumers figure out their bills and whether billing rules are a solution in need of a problem.
SJ: Is the FCC’s characterization of the wireless industry — and its use of the term “bill shock” — fair?
CGM: I don’t think the high-level messaging is fair from the FCC right now. I think at the same time, carriers are aware that it isn’t good to have customers surprised by their bills. But the FCC misses the fact that the Better Business Bureau says we solve 97.4 percent of concerns. … We have put a ton on the record about how consumers can stay up to date and aware. The FCC has put out two releases and they have not mentioned any of that. … With all the press that was following this they could’ve gotten the word out and [educated] consumers.
SJ: What does that reflect on the FCC’s behalf? Ideology, politics?
CGM: I don’t know, to be honest with you.
SJ: How highly does lobbying against new billing rules rank among the many other issues CTIA has its eye on?
CGM: The reality is that when you have an FCC that seems as active as this one, you don’t get to pick and choose clearly. There’s net neutrality; the Title II debate is something that would have a dramatic sea change for the industry, and we think it’s completely misguided. But the reality is we have to continue to educate on this issue as well. And we have to work on spectrum issues. To us, it’s all important. The same arguments we raised [on] net neutrality are what we raised [on billing]: what is broken?
SJ: What is the worst-case scenario for new regulation on billing?
CGM: Our concern is that the commission will try to micromanage this area, where carriers are competing to provide customers information and a range of services. … Look around the communications space, is there any other market that they regulate that has even remotely the same range and choices?
SJ: What is the next step for CTIA in opposing new billing regulations?
CGM: For us it’s about constantly continuing to educate policymakers — Senator Klobuchar, [FCC] Chairman Genachowski. … Senator Klobuchar is focused on early termination fees, but she should know there are a lot of places in the world where they do not subsidize handsets — that’s an option, not an option 80 percent of consumers in America would want.
SJ: What consequences would you see if her bill passed?
CGM: When you artificially insert regulation into a market that’s working, no one knows exactly what will happen. … Innovations slows because you’re not changing handsets as often, for example. Our argument is, “What is necessary here?”