TELECOM Digest OnLine - Sorted: Verizon and Sprint to Cut Fee For Cell Phone Service

Verizon and Sprint to Cut Fee For Cell Phone Service

Marcus Didius Falco (
Wed, 17 Nov 2004 00:25:47 -0500

Note that this is effectively another cut in the price of cellular service.
Sometimes they cut the price by adding minutes or adding features. This
time they're cutting fees. Right now, for most carriers, the fees are $4 to
$5 per month, which can be a very substantial percentage (10 to 15 per cent
or even a bit more) of an average bill (under $50).

Verizon and Sprint to Cut Fee For Transferring Cell Numbers

By Yuki Noguchi
Washington Post Staff Writer

Verizon and Sprint wireless customers will get a small break on their
bills soon. The companies have decided to eliminate or reduce a
40-cent-per-line monthly charge imposed to allow customers to transfer
their phone numbers to new carriers.

The small surcharge has provided the companies with tens of millions
of dollars in extra monthly revenue, and Verizon Wireless and Sprint
PCS Group said they don't need as much to continue offering the number
transfer service.

Starting with bills scheduled to go out next week, Verizon Wireless
will eliminate the number transfer fee for its 42 million
customers. Sprint PCS, the nation's third-largest national cellular
carrier, will cut its fee to 25 cents effective this month. Sprint PCS
had initially charged $1.10 for the service before a reduction to 40
cents in June.

Cell phone companies charge regulatory fees to comply with various
government rules requiring them to offer services such as emergency
911 calling from a wireless phone. Allowing customers to transfer
their number between carriers is one of those government requirements.

"In this heavily taxed industry, we do not advocate adding anything
unnecessary or extraneous to our customers' monthly bill," Dennis F.
Strigl, chief executive of Verizon Wireless, said in a statement.

Verizon Wireless is also looking to hone its appeal to customers. "I
think without a doubt it makes us more competitive, when you look at
some of the fees that some of these other companies charge," said John
Johnson, a spokesman for Verizon Wireless.

Sprint PCS spokeswoman Lisa Ihde said the company is always evaluating
its fees but not with the intention of using its fee structure as a
marketing tool.

The Federal Communications Commission does not set a limit on how much
cell phone carriers can charge customers to cover the cost of
complying with rules.

Cingular Wireless, which recently acquired AT&T Wireless Services
Inc., charges between 56 cents and $1.25 a month, depending on the
state, to cover number transfers and 911 calling. AT&T Wireless
customers will continue to pay a $1.75 monthly fee until Cingular
unifies the two networks. T-Mobile USA Inc. charges its customers 86
cents for number transfer and 911 calling. Nextel Communications
Inc. charges $1.55 a month to cover all of its regulatory fees.

"We call on all wireless providers to reduce or eliminate these fees
as well," said Janee Briesemeister, director of a cell phone consumers
rights project at the Consumers Union. "We've always questioned
whether the fees being charged for number portability were covering
the actual costs of switching phone numbers or were simply being
charged to pad profits."

Copyright 2004 The Washington Post Company

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