Wireless services complaints find confusing path at FCC

The FCC isn't as effective as it should be in dealing with wireless complaints

The Federal Communications Commission has a lot of work to do when it comes to regulating the burgeoning wireless industry. 

For example, in 2008 of the 430,000 informal complaints it got from consumers, more than19,000 were directly related to wireless carriers services. But it is how the FCC handles, or doesn't handle in many cases, those complaints that has overseers more than a little concerned.

In a preliminary look at the FCC and the wireless industry, the Government Accountability Office said today that the FCC has not articulated goals that clearly identify intended outcomes of its efforts to address consumer complaints and lacks measures to demonstrate how well it is achieving intended outcomes. For example, FCC has a goal to "improve customer experience" with its call centers and Web site, through which consumers submit complaints, but lacks measures of customer experience.

Further, it is not clear if the intended outcome of FCC's complaint handling efforts is resolving consumer problems or fostering communication between consumers and carriers. Consequently, consumers may not understand what to expect from FCC's complaint process, and the effectiveness of FCC's efforts to assist consumers with complaints is unclear, the GAO stated.

FCC officials told the GAO that the agency's role in addressing complaints, as outlined in the law, is to facilitate communication between the consumer and the carrier and that FCC lacks the authority to compel a carrier to take action to satisfy many consumer concerns. Thus, it is not clear if the intended outcome of FCC's complaint handling efforts is resolving consumer problems, fostering communication between consumers and carriers, or both.

Furthermore, FCC has not established measures of its effectiveness in either resolving consumer problems or fostering communication between consumers and carriers. For example, FCC does not measure consumer satisfaction with its complaint-handling efforts.

Without clear outcome-related goals and measures linked to those goals, the purpose and effectiveness of these efforts are unclear and the agency's accountability for its performance is limited. And consumers may not understand what to expect from FCC's complaint process, the GAO stated.

And there are a number of areas that need fixing.  Key areas of concern from the GAO report:

Billing: Complexity of billing statements leads to lack of consumer understanding. Bills contain unexpected charges and errors.

Terms of service contract: Consumers are subject to fees for canceling their service before the end of their contract term (early termination fees), regardless of their reason for wanting to terminate service, effectively locking consumers into their contracts. Consumers are not given enough time to try out their service before having to commit to the contract. Carriers extend contracts when consumers request service changes.

Explanation of service: Key aspects of service, such as rates and coverage, are not clearly explained to consumers at the point of sale (when they sign up for the service).

Call quality: Consumers experience dropped or blocked calls as well as noise on calls that makes hearing calls difficult. Consumers experience poor coverage, which in rural areas may be the result of lack of infrastructure and in urban areas stems from lack of capacity to manage the volume of calls at peak times.

Customer service: Consumers experience problems such as long waits, ineffective assistance, and insufficient resolution to problems.

The GAO gleaned its information from FCC officials as well as interviews with 1,143 randomly selected consumers..

Some other interesting facts from the GAO survey/report:

-GAO estimates about 21% of wireless phone users who contacted their carriers' customer service were dissatisfied with how their carriers addressed their concerns; FCC's efforts to handle complaints are an important means by which consumers may be able to get assistance in resolving their problems. However, the results of our consumer survey suggest that most consumers would not complain to FCC if they have a problem that their carrier did not resolve. Specifically, we estimate that 13%of wireless phone users would complain to FCC if they had such a problem and that 34% do not know where they could complain.

-In response to the areas of consumer concern noted above, wireless carriers have taken a number of actions in recent years. For example, officials from the four major carriers, Verizon Wireless, AT&T, Sprint Nextel, and T-Mobile, reported taking actions such as prorating their early termination fees, offering service options without contracts, and providing Web-based tools consumers can use to research a carrier's coverage area, among other efforts. In addition, according to CTIA-The Wireless Association, the wireless industry spent an average of $24 billion annually between 2001 and 2007 on infrastructure and equipment to improve call quality and coverage.

-The GAO estimates that about 19% of wireless users wanted to switch carriers since the beginning of 2008 but did not do so. Then 42% of these wireless phone users who wanted to switch but did not because of the early termination fee.

The GAO plans to complete a full report in the fall and expects to make recommendations then.

The GAO has tweaked the FCC in the past.  Last year in fact it issued a report highly critical of the way the commission handled some of the 454,000 complaints it received between 2003 and 2006 saying the agency needs to improve how it tracks and responds to consumer, safety and service complaints.

The FCC didn't like the report disagreeing with the way its research was conducted and saying it already has implemented measures to address concerns. The FCC fields complaints on everything from unsolicited calls and quality of telecommunications services to indecent broadcast materials and number portability.

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