Verizon, T-Mobile, and US Cellular lied on 4G coverage but will get away with it

Buried in the depths of a FCC press release, the authority has said Verizon, T-Mobile, and US Cellular exaggerated on 4G coverage maps but no punishments are being considered.

As part of the Mobility Fund Phase II, telcos were given federal support for rolling out 4G services to rural and underserved areas. This cash was supposed to bridge the digital divide, and as part of the agreement, the telcos were obliged to provide accurate coverage maps to ensure the cash was being spent in the right manner.

Following an investigation into the initiative, it was found Verizon, T-Mobile, and US Cellular misled the FCC on their 4G footprint. Data was presented to the Commission exaggerating the extent of 4G coverage, in other words, these three telcos were not spending federal money as promised. These telcos were effectively lying to the Commission and the general public.

Interestingly enough, the FCC does not currently have any plans to punish the trio, instead has created a new initiative to apply for federal funds. All three will be invited to apply for the Government hand-out. This is perhaps the latest example of a toothless watchdog, with the bureaucrats in charge in procession of the same spine as a lifeless slug.

The new fund will make $9 billion available to ensure 5G connectivity reaches the areas in the US which the telcos elect to ignore.

“We want to make sure that rural Americans enjoy these benefits, just as residents of large urban areas will,” said FCC Chairman Ajit Pai. “In order to do that, the Universal Service Fund must be forward-looking and support the networks of tomorrow.

“Moreover, America’s farms and ranches have unique wireless connectivity needs, as I’ve seen across the country. That’s why I will move forward as quickly as possible to establish a 5G Fund that would bring next-generation 5G services to rural areas and would reserve some of that funding for 5G networks that promote precision agriculture.”

The announcement of the 5G Fund for Rural America is the very press release the FCC decided to attempt to bury the findings of the report. Considering how much work has been done to disguise the Mobility Fund Phase II investigation, few should be surprised Verizon, T-Mobile and US Cellular will get away with ignoring rules and spending tax payer’s money in an irresponsible manner.

This is a saga which has been on-going for some time, after smaller, rural telcos complained the nationwide players were exaggerating coverage maps. These coverage maps helped the FCC determine who should get a slice of the $4.5 billion reserved for the Mobility Fund Phase II. What is being done to make sure the same abuses do not reoccur is unknown. It does appear nothing right now.

Telcos have shown on numerous occasions they cannot be trusted to act responsibly on their own, but when a watchdog ignores such flagrant disregard for the rules it simply encourages the telcos to push the definitions of right and wrong even further.

The FCC has failed the general public here, the very people it is supposed to serve.

Looking at the 5G Fund for Rural America, the objective is simple. Telcos prioritise deployment in areas which are commercially more attractive, the larger cities and major transport hubs. This is forgivable, these are commercial companies after all not charities, but the federal funds are designed to offset some of the extraordinary expense for network deployment. It is a reasonable way to spend federal dollars when managed correctly.

$9 billion will be set aside for the rural communities, which includes $1 billion which will have to be spent on delivering connectivity solutions for the agricultural industry. With an election on the horizon, this is a very intelligent move. In 2016, President Trump arguably won because he was able to mobilise communities and individuals who were feeling marginalised; in the digital world, farmers fit this description perfectly.

The question which remains is whether the same telcos can be trusted to appropriately spend their allocation of the $9 billion moving forward. Seeing as the FCC is currently proving itself as toothless, there doesn’t seem to be any deterrent to behave, which is an interesting position to be in.

UK MNOs accused of using handset subsidies to rip off their customers

Research from Citizens Advice reckons four million people in the UK are still paying back their phone subsidies after the end of their contracts.

This will come as no surprise to anyone who has reached the end of a postpaid contract that came with a subsidised handset. It’s universally understood that such things are part service contract and part financing on the device, but MNOs are generally deficient in contacting their customers when the contract period is over.

They do get in touch, but usually with misleading offers such as ‘free’ new handsets, when in fact they’re merely calling for the customer to initiate a fresh postpaid contract, complete with a subsidised handset. An honest exchange would also offer a SIM-only deal that would offer far more data for far less money in the absence of a new device.

Citizens Advice specifically calls out EE, Vodafone and Three, implying O2 does a better job on this matter. It reckons these four million mugs are being overcharged, on average, by £22 per month, which seems about right. It also found that most of the time we’re paying more for the handset by getting it subsidised by the operator than if we just bought it on the open market, but there’s no surprise there.

“It is unacceptable that mobile providers are knowingly overcharging customers for phones they already own,” said Gillian Guy, Chief Exec of Citizens Advice. “We’ve heard a lot of talk from government and the regulator but now we need action. Other companies have already stopped doing this so we’re looking for these three major providers to follow suit. In the meantime, consumers should check their phone bills to see if they can save money with a SIM-only contract or upgrade to a new phone.”

Like most studies accusing utilities of ripping off their customers this ultimately comes down to telling them not to be lazy and check their contract every now and then. It’s not difficult to give yourself a reminder to renegotiate your contract when it expires so those who don’t should receive limited sympathy. On the other hand, from an industry that constantly wrings its hands about churn, this is hardly an example of customer service best practice.

UK operators accused of ripping off loyal punters at the end of bundle deals

The UK Citizen’s Advice service has advised that UK citizens are getting rinsed by their operators when they come to the end of subsidised phone contracts.

One of the major reasons we sign up to two-year contracts is that we want a shiny new smartphone but haven’t got the cash to pay for one up-front. For decades operators have looked to entice customers by effectively offering to finance the purchase of said smartphone in return for a post-paid contract commitment. The total cost of ownership is invariably greater than buying the handset yourself and then going SIM-only, but that’s a price many are willing to pay.

But according to Citizen’s Advice, unless they specifically ask for a new contract, customers of Vodafone, EE and Three continue to be charged at the same rate even after their lock-in period has expired. In other words, even after they’ve paid the phone off they continue to be charged as if they hadn’t.

“Some of the largest mobile phone providers are routinely overcharging their loyal customers,” said Gillian Guy, Chief Exec of Citizens Advice. “Mobile phones are now an essential part of modern life, but the way that the cost of handsets are hidden within some mobile phone contracts gives phone providers a way to exploit their customers.

“It is clearly unfair that some phone providers are charging loyal customers for handsets that they have already paid for. It’s especially concerning that older customers are more likely to be stung by this sharp practice.

“Phone providers must now make sure that any customers staying in a contract past the end of a fixed deal have their monthly bill reduced to reflect the cost of the handset. Providers could make it much easier for consumers to compare prices by separating out the cost of handsets from the cost of services like data and minutes for all contracts, that way it would be much clearer what they’re paying for.”

To be fair to operators our experience is that they usually get in touch towards the end of a contract to dangle further smartphone carrots in a bit to get you to sell your soul for another couple of years. But if they don’t then Citizen’s Advice is right to say there should be an automatic reduction in the bill. That process is presumably so straightforward that it’s hard to give those operators that don’t do it the benefit of the doubt.

Here’s a summary of the findings. Citizen’s Advice offered no explanation of why O2 and the MNVOs weren’t apparently scrutinised. Perhaps they got bored and figured they’d made their point anyway.

Citizens advice operator table