California is about to pass a so-called telecommunications bill of rights that would force telephone companies to provide timely and consistent service, even to customers who are late paying their bills.
State Public Utilities Commissioner Carl Wood said his team has drafted the final version of a Telecommunications Consumer Bill of Rights, which could become law as early as September. The proposed law, the first of its kind in the country, would require all phone companies, including wireless, local and long distance, to be upfront about the quality of their services and provide the utmost customer care, including a 24-hour, 7-day-a-week hotline with live operators.
Among other provisions, companies would have to disclose key rates, contract terms and conditions, and prices clearly on all print material, advertising and websites. Any "written solicitations by carriers or their agents" must be "unambiguous, legible and in the equivalent of 10-point type or larger," the bill states.
In addition, customers would be given 45 days to cancel their contracts without penalty.
And, in the part of the bill that is perhaps most disputed by the industry, companies would not be able to tack on any late fees to bills in dispute. They also would be required to offer basic telephone service even when customers don't pay their bills in full.
"Let's say you owe $35, and you only have $12 and send that in," Wood said. "They may be able to cut off your long distance, but they still have to give you basic service."
The cell-phone industry lashed out at the PUC's rules.
"This is like a re-run of Titanic," said Tom Wheeler, president and CEO of the Cellular Telecommunications and Internet Association, an industry trade group. "No matter how many times you replay it, the ship always sinks at the end. No matter how many times you propose state regulations, it always comes at a cost to consumers."
Wheeler said the proposed law would saddle the industry with additional paperwork and costs and make it less likely to want to offer Californians discounts and other perks. Instead, Wheeler suggested the PUC wait for an industry-led initiative to protect consumers -- which CTIA doesn't plan to release until September.
"The CPUC should allow the (industry's) Consumer Code to go into effect and judge its success before taking actions that could result in outrageous increases to California wireless consumers' monthly bill or damage to the California economy," Wheeler said.
Wood, however, pointed out that the PUC has been rewriting this piece of legislation for three years now. The industry could have introduced and even tried out its Consumer Code during that time, he said.
"They've had an awful long time to prove they can eliminate these problems by themselves," Wood said. "Complaints about cell-phone service are the biggest group of complaints we see here."
The PUC originally drafted the bill in response to the volume of complaints it received from customers regarding their phone companies. Two years ago, 31,345 California residents filed grievances with the state. Most of the complaints -- 57 percent of them -- stemmed from billing disputes. Another 17 percent of the complaints had to do with unauthorized fees and services, while 9 percent of the people griped about poor service. The remaining 14 percent of the problems were lumped together by the PUC under the "other" category.
New Mexico and Arizona are considering similar laws. But California is closest to regulating the industry this heavily.
The law may improve customer service in the industry, said Alan Reiter, president of consulting company Wireless Internet & Mobile Computing.
"There are often a lot of 'gotchas' that consumers don't think about when they buy their cellular phone service, such as, if you get a new contract and buy a new phone, you often get a discount," he said. "If you turn in a phone because you don't like it, do you get a discount on your second phone? Sometimes a carrier will give you a discount on the new phone, sometimes it won't."
This law would force carriers to disclose that information upfront, he said.
Wood said he is confident the PUC will pass the bill on Sept. 18, although other commissioners still have a chance to introduce their own versions of the proposed legislation. Once it passes, the law would become effective immediately, he said.
