Those pesky wireless surcharges

Last reviewed: January 2010
January 2010 issue cover This article appeared in
January 2010 Consumer Reports Magazine.
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Illustration of someone looking at a cell-phone bill
Illustration by Gary Sawyer

Tacked onto almost everyone's cellular bill are official-sounding fees: a Federal Universal Service Fund Fee, or a Wireless Tower Mandates Cost.

But those surcharges aren't set by any government, and each carrier comes up with its own. That obviously hinders consumers in accurately predicting what that "$39.99 plan" might actually wind up costing every month.

Now the Federal Communications Commission is investigating the charges as part of its broad review of wireless service. In a recent petition to the FCC, a coalition of consumer groups, including Consumers Union, the publisher of Consumer Reports, says such charges mislead or even deceive because they can boost base rates by up to 30 percent with an unpredictable mishmash of fees.

In their defense, carriers say they disclose the charges in customers' wireless-plan agreements, on the back of their monthly bills, and on company Web sites. The disclosures make it clear that the charges are not mandated by law, the carriers say.

The consumer advocates say mere disclosure isn't enough. They're calling on the FCC to prevent carriers from imposing line-item charges for expenses that are, essentially, part of the cost of doing business.