A Smartphone Owners Bill of Rights

Many smartphone owners are frustrated with the high prices they pay to wireless service providers, as well as the treatment they get from providers once they're locked into a two-year service contract. Americans have limited choices in mobile broadband devices and services, and mobile operators in the United States currently enjoy relative freedom from regulation.

By Mark Sullivan
Mon, November 09, 2009

PC World — Many smartphone owners are frustrated with the high prices they pay to wireless service providers, as well as the treatment they get from providers once they're locked into a two-year service contract. Americans have limited choices in mobile broadband devices and services, and mobile operators in the United States currently enjoy relative freedom from regulation.

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Because of those two conditions and in light of the billions of dollars that U.S. consumers spend on wireless devices and services, a bill of rights is necessary to protect consumers against mistreatment by service providers. Following are the standards, safeguards and solutions that we'd like to see.

1. Smartphone owners should pay for wireless services by the bit, not by the minute or by the message.

These days, voice, data, and messaging all travel the same way--as bits of data--over the wireless operator's network. Therefore, charges for all of those services should be based on the same thing, by "bits of data transferred."

Using that standard would help consumers in two ways. First, it would create a real relationship between the actual work (moving bits) the mobile provider does to deliver the service, and the price it charges. Second, with charges made on the same basis, consumers would have a way to make genuine apples-to-apples comparisons between the costs of voice, data, and messaging services, and ask questions about any pricing disparities.

Currently, providers keep the actual cost of delivering wireless services completely hidden from subscribers, and that cost has no bearing whatsoever on pricing. The classic example is text messaging: The provider incurs almost no cost to deliver texts, yet charges customers 20 cents per message, or $20 per month for an unlimited messaging plan. Consequently, text messaging has become a $100 billion business--larger than the music, movie, and game industries combined.

Service providers should be required to offer a pay-as-you-go messaging plan wherein customers pay based on the amount of bandwidth they use to send messages, not on the number of messages they send. Also, the cost of SMS fees should not increase more than 1 percent in any given year.

Under the bits approach, mobile operators would be free to sell services at whatever prices they chose, and in whatever bundles they wished--as long as they disclosed exactly how much a consumer would pay, per bit of data transferred, for each service.

2. Smartphone buyers should be protected against abusive charges when they exceed service-plan limits.

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