Mobile Operators Say Inauguration Will Tax Systems, Provide PR Fodder

from the no-i-can't-hear-you-now dept

Apparently there are going to be a lot of people in Washington, DC, next month, for Barack Obama's inauguration. With up to 4 million visitors coming to DC, a city with a population of 1.1 million, there's the potential for a logistical mess. But at least one group is getting out ahead of things: the nation's wireless operators, which want to assure everybody that they're beefing up capacity ahead of the event... just like they do before every Super Bowl and other events where there are predictable swells in network traffic. So, even if you aren't traveling to Washington for the inauguration, rest assured that the country's operators are looking out for you, just in case. And, of course, that they're not missing out on any chance for some PR -- even if it really just highlights their own capacity limitations. One question, though: will any of them come back after the event to detail just how many calls didn't go through on their networks during the inauguration because of capacity constraints?

Carlo Longino is an expert at the Insight Community. To get insight and analysis from Carlo Longino and other experts on challenges your company faces, click here.

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Mobile Operators Go Unlimited... Just As ISPs Insist They Need To Charge Per Byte?

from the please-explain... dept

There was a ton of press coverage yesterday over the fact that one-by-one, Verizon Wireless, AT&T and T-Mobile all announced $99 "unlimited" calling plans, ahead of Sprint who had actually been rumored to be gearing up to launch just such a plan. There were a few different storylines that could make this interesting. For example, it's not clear why it's such a huge deal when regional operator MetroPCS has been offering unlimited calling for ages (at a cheaper price). Hell, AT&T Wireless (when it was run by current Sprint CEO Dan Hesse) launched a $99 unlimited calling plan almost exactly a decade ago.

However, what really struck me as interesting is seeing all of these companies rush towards "flat-rate, all-you-can-eat" pricing, just as broadband providers are insisting they need to switch from flat-rate, all-you-can eat pricing to metered pricing, which some pundits are insisting is a better system. So why is it that one group of companies is moving in one direction, while the other is going in exactly the opposite direction? There are a few factors, but the biggest is the competition issue. Mobile operators are doing so because they feel forced to by competitive pressures (which is evidence in those three companies all announcing plans on the same day, in part out of worries that the fourth would beat them to it). As has been pointed out over and over again, the same simply does not exist in the broadband world in the US to the extent that it does in the mobile space. Some might also point out that capacity questions are different for both sets of providers. Mobile phone operators likely have fewer capacity issues to deal with as a result of unlimited calling than broadband providers do with unlimited internet access plans. However, mobile operators certainly are no strangers to capacity issues -- and they mostly dealt with it by (gasp!) investing in infrastructure so they could support unlimited plans.

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Hiding Cell Phone Taxes Doesn't Make Them Go Away

from the hidden-taxes dept

The Supreme Court has declined to hear a case regarding whether cell phone companies should be allowed to list taxes as separate line items on customer bills. Apparently, certain state governments have begun passing laws prohibiting companies from listing taxes as separate line-items on customer bills, requiring them instead to build those costs into the base prices they charge consumers. Cell phone companies argue that this makes it impossible for them to establish uniform nationwide pricing because they have to adjust the prices in each state to reflect the varying tax burden. This seems to me to be a pretty clear-cut effort by state governments to avoid scrutiny of the taxes they impose. Voters ultimately end up paying these costs whether they're listed separately on the bill or not, so this seems like little more than an attempt by state legislators to avoid accountability. Taxpayers have every right to know what fraction of their bills are going to the government. With the Supreme Court declining to weigh in on the issue, the issue has gone back to the FCC for further consideration. I hope they'll continue to push for greater transparency. Of course, it should be noted that the companies hands aren't totally clean here. While phone companies should be allowed to list extra fees when they're actually required to hand the money over to the government, we've noted before that they shouldn't be allowed to label as "fees" money they're planning to keep for themselves.

Timothy Lee is an expert at the Insight Community. To get insight and analysis from Timothy Lee and other experts on challenges your company faces, click here.

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Verizon Wireless's Outrage Over Alltel Ad A Bit Misplaced

from the bad-timing-is-all dept

Having just run into its own problems with false advertising, Verizon Wireless is now suing competitor Alltel, claiming false advertising in its commercials. The ads, such as the one here, make fun of Verizon Wireless and other mobile operators for forcing people to extend their contracts whenever they make changes, and claim that one of Alltel's advantage is the lack of such requirements.

Verizon Wireless doesn't just claim that this is wrong, its spokesperson states: "Whatever merit this comparison may have to other carriers, in the case of Verizon Wireless, the supposed 'advantage' is pure fiction." "Pure fiction" is a pretty strong claim, and it would be a lot stronger if it hadn't been absolutely true until just a couple months ago. Verizon Wireless did, in fact, force people to extend contracts, and only stopped the practice back in October when Sprint got sued over doing the same thing. And, of course, the Alltel ads began running well before Verizon was pressured into making this change. So, while it's technically accurate that these ads are false advertising now, it seems a bit excessive to describe them as "pure fiction," when they were absolutely true until just a few months ago.

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Suggestion For Mobile Phone Operators: Be Upfront And Honest About Plans

from the and-people-might-actually-like-you dept

It's no secret that many, many people dislike mobile phone operators. Why? Well, beyond the issue of dropped calls, it appears that people are sick and tired of of the way mobile services are pitched to them. The operators hate giving people a clear picture of what they're actually getting. Details of the plans remain hidden or not clearly explained and there are always hidden gotchas -- like how your "unlimited" service isn't really unlimited. So, here's a simple suggestion for mobile operators: Be the first to be totally upfront about your plans and services, remove any high pressure sales techniques, stop making it difficult to compare plans, phones and service and dub yourself as the customer friendly mobile operator. Then see what happens. Of course, some mobile operators have taken steps in this direction over the years. They're a lot more open about where various deadspots are than before and they've tried to be more open about specific features and plans -- but the problem is that this "secretive" mentality exists up and down throughout the organization. If a company makes it clear policy from top to bottom that openness, clarity and customer satisfaction are keys, it would capture the interest of an awful lot of people.

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Xero Really About To Be Bought? But, Why?

from the what-value-does-it-have? dept

You may recall the bizarre tale of Xero Mobile, a company that was formed out of the ashes of Gizmondo, the UK gaming handheld provider whose spectacular failure revealed all sorts of sketchy details involving executives taking ridiculous salaries and buying themselves luxury cars (which one former Gizmondo exec famously crashed last year). There were all sorts of questions about whether or not Xero was simply an attempt to repeat Gizmondo, which lost investors an awful lot of money with stories of potential riches from a handheld gaming device that would make money through ads. Xero's plan was almost identical, though it would support mobile phone service via ads, rather than a gaming device. Xero followed Gizmondo's strategy, raising a lot of money, and even doing a reverse merger to get its shares publicly traded. Of course, the company never seemed to get very far, other than the occasional highly promotional press release. The latest news, however, is that the company may get bought by UK mobile content provider Rok. This comes after another rumored acquisition a year ago. Of course, it's still not clear why anyone would want to buy the company. It doesn't appear that it ever launched a service -- so there's no clear benefit at all to buying it. As with Gizmondo, you have to wonder if there's really more to this story than what's coming out in the press.

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After All That Fuss, AT&T No Longer Claiming It Has The Fewest Dropped Calls (Perhaps Because It Doesn't)

from the why-let-facts-get-in-the-way dept

We've joked about ever mobile operator claiming it has the "best" network in some way or another, with each using slightly different descriptions to explain how their's is the best. Sprint and Cingular apparently got into a legal spat about the whole thing, with Cingular wanting the courts to say that claiming it had "the fewest dropped calls" is accurate. Eventually, the Better Business Bureau had to weigh in on which silly marketing claims Cingular could use. The latest, however, is that following all of this legal positioning, AT&T (the rebranded Cingular) is dropping the ad campaign that claims "the fewest dropped calls" perhaps because it's not a claim that can be substantiated well. A variety of studies have shown AT&T's wireless service ranking pretty low on the reliability scale. That said, the whole "dropped call" thing is becoming less and less of an issue. All of the various mobile operators have greatly improved their networks over the last few years, and dropped calls seem to be increasingly rare on any carrier. Sure, they still happen, but with much lower frequency -- so perhaps AT&T is phasing out the campaign because it's just not a big deal to most people any more.

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Faking Death To Get Out Of Mobile Phone Contracts

from the you-think-maybe-there's-a-problem? dept

The introduction of local number portability was supposed to force mobile operators to improve their customer service, since now it would be easier for upset customers to simply jump to a competing carrier. Instead, it seems to have only increased the use of early termination fees that the mobile operators charge if you leave a contract early. To be fair, often these ETFs come into play when the customer has purchased a heavily subsidized mobile phone -- which sounds fair. However, the number of irate mobile users who find themselves facing huge bills just because they want to switch mobile operators suggests that the practice isn't doing much good for the reputations of mobile operators. In fact, it's so bad that some folks are willing to play dead in an effort to fool mobile operators into canceling the contract without charging the ETF -- though, as we've noted in the past, there have been times when even death wouldn't get you out of paying. It would seem to make sense for mobile operators to be a bit more understanding. Verizon Wireless, to its credit, prorates early termination fees, so the closer you are to the end of your contract, the less it costs. It's unclear why the other mobile operators haven't come up with anything similar. Perhaps they really think that locked-in but pissed-off customers are better than happy, loyal customers.

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