Understanding Bill Shock

On Monday, October 17 the FCC Chairman Julius Genachowski, the Consumers Union Parul Desai and the CTIA, wireless trade association, President and CEO Steve Largent announced a plan to help users avoid unexpected charges for wireless bills.  Under the CTIA’s "Wireless Consumer Usage Notification Guidelines," carriers will send alerts to customers when they near or reach monthly limits on voice, text, data services and international roaming charges.  (http://www.ctia.org/media/press/body.cfm/prid/2137) By October 17, 2012, participating carriers will provide customers with at least two out of the four notifications for data, voice, text and international roaming and by April 17, 2013 they will provide all of the alerts.

TEMIA’s Opinion
Proactive notifications are a good first step to avoid unexpected charges or bill shock for wireless services.  Some people might also suggest that another way to avoid bill shock for domestic use is to purchase unlimited plans for voice services and data, where it is available.  This approach may prevent bill shock, but it would lead to unnecessary expenses for most organizations because only a small portion of employees ever use enough services to merit having unlimited plans.  Other people might suggest that bill shock really occurs when people compare quotes for wireless service to the larger bills that they receive due to extra charges for Universal Connectivity Fee or Universal Service Fund (USF), Taxes, Federal Excise surcharges, Federal regulatory recovery fees and other government levies.  TEMIA members can help scrutinize the accuracy of bills including these hidden charges, and they can provide effective expense management strategies.

In Europe telecom carriers must halt mobile data service to customers when they reach 50 Euros (approximately $69 US) in charges within a month for overseas usage within the European Union.  While the EU also has mandates to reduce roaming fees, international roaming charges quickly add up.  Roaming fees and bill shock are more common in Europe, due to carriers’ smaller coverage areas and overlapping coverage that lead to unexpected handovers to other carrier’s network.  In some respects, the EU cap requires more effort to manage expenses and employees’ mobile devices with intervention and cap adjustments to ensure business travelers do not lose coverage when they travel.

Beginning on October 17, 2012 wireless carriers will be offering alerts on usage, but you don’t have to wait until next year to prevent bill shock and start saving money.  The best way to avoid bill shocks and unnecessary wasteful spending for organizations that pay bills on behalf of their employees is to follow TEM and WEM best practices.

This includes
•    establishing policies that limit unnecessary use of mobile services
•    use of TEM/WEM portals to manage procurement of wireless devices and service plans
•    optimization of service plans through analysis of usage to ensure that employees have the right plan
•    sourcing and contract negotiation to secure more cost effective plans
•    automaton of invoice processing to gain processing efficiencies and avoid late payment penalties
•    validation of charges on bills through TEM/WEM systems
•    better accountability and visibility through charge-back reporting of usage and mobile expenses
•    proactive measures using technology and optimal service plan selection for employees that travel overseas to avoid high roaming charges

“As the expression goes, realizing you have a problem is the first step to resolving it” comments Yannick Boissel, Professional Services Director at Anatole.  “And without the right tools in place, many organizations would miss even numerous and consecutive months of outrageously high billing due to roaming, or for that matter due to any common carrier errors, including billing for disconnected services or incorrect tariffs on calls. In other words, tools to provide the required mechanisms to alert companies of exceptionally large spend amounts, whether monthly or in real-time, are critical to gaining control and solving the issue.  Thankfully TEM solutions like Anatole’s offer a range of such tools in addition to consulting services that can help companies adopt best practices, including those suggest by TEMIA.”

TEMIA members (http://www.temia.org/about/members) have the technology and professional services to adjust employees’ plans to maximize savings and avoid unnecessary expenses, and they can help manage carriers’ alerts when they become available.  TEM and WEM can help organizations proactively manage fixed and wireless expenses.  This can have a real impact on the budget, and drive savings to the bottom line.

About TEMIA
The largest Telecom Expense Management (TEM) service providers founded TEMIA, the Telecom Expense Management Industry Association, in 2006. Since that time, TEMIA has grown to 38 members with international corporate headquarters managing over $36 billion of telecom and data spend.

TEMIA's mission is to raise awareness and knowledge of the values and benefits of TEM solutions, to improve the quality and value of TEM solutions through the development and promotion of open industry standards, and industry knowledge among TEM Solution Providers, business partners, telecom service providers, and enterprise clients.

For more information about TEMIA, visit, http://www.temia.org.