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FCC Puts Bill Shock Proposal on Hold

FCC Chairman Julius Genachowski said Monday that the FCC will put its "bill shock" order on hold given the wireless industry's just-announced commitment to voluntarily provide customers with alerts about pending overcharges.

CTIA: The Wireless Association, with the support of Consumers Union and the blessings of the FCC, Monday released new consumer guidelines for wireless service. That came at an "Empowering Consumers with Technology" event at the Brookings Institute in Washington.

The FCC, spurred by instances of surprise bills of sometimes thousands of dollars, voted last October to propose requiring cellular carriers to provide usage alerts and other information to prevent so-called "bill shock."

Genachowski said Monday that CTIA has now pledged to institute the three main proposals of that proposal: 1) Send voice or text alerts when consumers reach their plan limits for voice, data or text which would trigger overages; 2) Send similar alerts for international roaming, and 3) Clearly disclose any tools they offer to let consumers monitor and manage usage.

The alerts will be free and automatic. Genachowski said the FCC would put its bill shock order on hold -- but leave it open and take a "trust but verify" approach to its monitoring of the CTIA effort.

CTIA President Steve Largent said that consumers would receive at least two of the three alerts by Oct. 17, 2012, and all the alerts by April 17, 2013.

The new proposal applies to all CTIA members. Genachowski said the FCC would take "appropriate action" for noncompliance, but did not say what that would be. He also said he expected there would not be any noncompliance issues.

Largent said it was not easy to institute the alerts, explaining the year-plus implementation timeline, though he said he expected companies to beat that deadline.

Genachowski and Largent also put in a plug for more spectrum for wireless, with the chairman suggesting that would be another consumer-friendly move."

While I do not think today's announcement guarantees closing the book on consumer worries over bill shock and unanticipated charges, it does represent good progress," Said FCC Commissioner Michael Copps. "The Commission has a duty to remain vigilant here. So I am pleased that the underlying docket and proceeding will remain open. Should bill shock remain a problem despite industry efforts, a future Commission will be able to adopt and enforce anti-bill shock rules."

Sen. Tom Udall (D-NM), who has introduced a bill shock bill calling for similar notification, was understandably pleased.

"Over a year ago, I offered a simple solution," he said in a statement. "Phone companies should alert a consumer before they go over their limit for data, text messages, or minutes. I was pleased to learn today that FCC Chairman Julius Genachowski and wireless companies have agreed to new guidelines to protect consumers from 'bill shock', including proposals from my legislation...[T]hese new guidelines are a big improvement to protect the growing number of Americans who depend on mobile devices."