Cellular Mobility Has Its Limits - Washington Post

[GoodmanR]

Cellular Mobility Has Its Limits
Contracts, Glitches Complicate Number Portability

By Yuki Noguchi
Washington Post Staff Writer
Saturday, May 22, 2004; Page E01


Linda Clausen really wants to end her six-year history as a Cingular Wireless customer, but she's bound by a contract until August, she says. It would cost her at least $150 to break her two-year contract.

"I've already spent enough," said Clausen, a social worker who said she's angry because she gets poor service near her Chevy Chase home, and she paid $250 for a phone that doesn't work. "I don't want to spend another penny."

There are plenty of consumers like Clausen who would love to count themselves among the 3.3 million mobile-phone users who've switched carriers and kept their phone numbers but are held back by long-term deals. Most analysts estimate that well over 80 percent of cell-phone users are under a contract and would have to pay hefty fees to leave their existing provider.

This helps explain why, nearly six months after the start of a rule allowing mobile-phone users in the top 100 cities to keep their numbers when switching carriers, far fewer than the tens of millions initially anticipated have taken advantage of the rules.

On Monday people in the rest of the country will be able to switch wireless carriers and keep their phone numbers. If the first phase is any indication, there will not be a mad rush but a gradual shift.

One of the reasons there have been far fewer participants is that cell-phone contracts can be confusing, consumer groups say.

"I think there is a lot of confusion as to how contracts work," said Janee Briesemeister, campaign manager for EscapeCellHell.org, a project of the Consumers Union. Every time customers change calling plans or upgrade phones, companies usually require them to renew their contracts, she said.

Before Nov. 24, when the number-switching rule went into effect, many cell-phone companies made a big push to lock in customers by offering rebates for new phones, discounts on plans or even bonus frequent-flier miles.

"I think the industry did a good job in the six to eight months prior [to the new rule] . . . so it wouldn't be this mad rush" to switch providers, said Terry Addington, president and chief executive of First Cellular of Southern Illinois, based in Mount Vernon, Ill. The small mobile-phone carrier invested $1 million to upgrade its systems to allow number transfers and so far has wooed about 350 customers and lost 250.

Also, many customers may have been scared away by tales of software glitches that meant switchers had to wait weeks or even months to get their new service, said analysts.
"It was probably one of the most publicized technology failures, so people heard stories and people said, 'I don't really need to do this,' " said Roger Entner, an analyst with the Yankee Group, a Boston-based market-research firm.

Steve Gasque, a Bethesda resident and a real estate agent, said he tried to switch his carrier from Nextel to Sprint, expecting the switch to go through in several hours. Instead, it took a month an a half, he said.

"Every other day, I'd be on the phone with customer service, and every day I'd get a different answer" for what was holding up the transfer, he said. He said he ended up paying both carriers during that period.

Such experiences were commonplace during the first two months; the Federal Communications Commission received nearly 5,000 complaints from consumers about their experiences, ranging from long delays to billing errors that resulted from trying to switch carriers. Between mid-March and mid-April, the total number of complaints dropped to about 400.

"The most surprising thing was the lack of preparation on the part of some major carriers. It takes two, right? So the process only works as well as the weakest link," said Pat Devlin, regional president of Verizon Wireless.

During the first two months, the most complaints -- 1,221 -- concerned AT&T Wireless Services Inc., which had problems with its new customer-relations software. It lost 367,000 subscribers during the first quarter, while the rest of the industry posted gains. In January, it put itself up for sale and struck a $41 billion deal to be acquired by Cingular Wireless LLC.

"The biggest impact [of the number-transfer rule] was that AT&T Wireless died," said Entner. Verizon Wireless, T-Mobile USA Inc., and to a lesser extent, Nextel Communications Inc. gained customers from other carriers, he said. The other carriers managed to hold on to the bulk of their customer base, he said.

Rural consumers could well experience problems when carriers in those areas start allowing their customers to switch numbers, said Travis Larson, a spokesman for the Cellular Telecommunications & Internet Association. Many rural carriers will be doing transfers manually, or via faxed requests, because they can't afford the complex software systems some of the bigger carriers have, he said.

But some carriers, like AT&T Wireless, expect the next phase to go more smoothly. "Now, we have six months of experience porting with other carriers. We believe that we're ready for this next round of numbers," said Rochelle Cohen, spokeswoman for AT&T Wireless. Software glitches and other problems "are largely behind us. We did encounter some challenges in the early days." Now the company is telling customers who want to switch that the process will take less than six hours.

But the barrier many customers in the Washington area seem to mention most frequently is their long-term contracts.

Wendi Betts, an Arlington hairstylist who says she gets poor reception on her Sprint phone, wanted to switch to Verizon Wireless months ago. But said she waited until her contract expired on May 13 because Sprint customer service told her it would cost her $200 to break her contract, and she decided "it wasn't worth it."

Likewise Connie Collins, a secretary at a Washington law firm, plans to switch Monday when her year-long contract with T-Mobile expires. The plan she shares with her 22-year-old son always runs over the 600-minute limit, she said.

"You know how the kids like to do the text messaging. My bill comes to $130 a month," she said with exasperation. But she's not willing to pay the $200 it would cost her to end her contract early, and she wants to keep the cell-phone number that's printed on her business cards, she said.

As Woodbridge resident Charles Butler stood in front of the Verizon Wireless counter at the Pentagon City Mall earlier this week, the Arlington County sheriff's officer scrutinized the contract. He said he is considering upgrading his old "dinosaur" cell phone for free in June when his contract is up. But the company will require him to sign a two-year contract to do that.

Right now, that makes him wary. "If someone comes up with something better than what Verizon has, I want to be able to switch," he said. "Two years is a long time to have a cell phone plan."

[Matt]

Originally Posted by GoodmanR Likewise Connie Collins, a secretary at a Washington law firm, plans to switch Monday when her year-long contract with T-Mobile expires. The plan she shares with her 22-year-old son always runs over the 600-minute limit, she said. "You know how the kids like to do the text messaging. My bill comes to $130 a month," she said with exasperation. But she's not willing to pay the $200 it would cost her to end her contract early, and she wants to keep the cell-phone number that's printed on her business cards, she said. "

I found this part interesting, of course. Although no coverage complaints were noted, I don't think Ms Collins is going to find a cheaper plan for more than 600 minutes and a better text messaging plan than TM, so I wonder why she is switching.....

[AnthroMatt]

Originally Posted by Matt I found this part interesting, of course. Although no coverage complaints were noted, I don't think Ms Collins is going to find a cheaper plan for more than 600 minutes and a better text messaging plan than TM, so I wonder why she is switching.....

Well, if her son is using over 1000 text messages ($7) then she could look at Sprint, which gives unlimited SMS for $10 (or $5 with a Vision plan).

What I don't get is why someone spending $130 month is afraid of a $200 ETF. The extra $70 is that much of a problem? Your point about coverage is good too Matt. I can see this same woman complaining about lack of coverage from her new carrier 10 months from now. People need to learn to balance price and coverage. Rarely will one company be perfect...there are always trade-offs to be made.

[Gamer03]

Originally Posted by AnthroMatt Well, if her son is using over 1000 text messages ($7) then she could look at Sprint, which gives unlimited SMS for $10 (or $5 with a Vision plan). What I don't get is why someone spending $130 month is afraid of a $200 ETF. The extra $70 is that much of a problem? Your point about coverage is good too Matt. I can see this same woman complaining about lack of coverage from her new carrier 10 months from now. People need to learn to balance price and coverage. Rarely will one company be perfect...there are always trade-offs to be made.

That is exactly right, AnthroMatt.

Especially trade-offs for the coverage area, even though it might not be the biggest coverage area in the nation, but if it covers your house and the areas you need it to better than the leading wireless carrier, then go for it!

[AnthroMatt]

So true. I don't know how many times I have talked to people at school that say they keep Verizon even though it doesn't work at their house because they have the best nnational network. Then I ask them how much they travel and they tell me never.

[Gamer03]

I kept telling my parents how good Verizon was, and when we tried them, even though they claim to have the "best" network nationwide, they were excellent at our house, but on campus, they were horrible both on campus and in the dorms.

[Matt]

I didn't know Sprint had unlimited SMS available (is their "real" SMS completely rolled out yet?)

[AnthroMatt]

Originally Posted by Matt I didn't know Sprint had unlimited SMS available (is their "real" SMS completely rolled out yet?)

Yeah, as long as you have one of their newer phones their "real" SMS is fully operational.

[bobolito]

Originally Posted by AnthroMatt So true. I don't know how many times I have talked to people at school that say they keep Verizon even though it doesn't work at their house because they have the best nnational network. Then I ask them how much they travel and they tell me never.

The same thing happens to many people who have switched to Sprint because their plans emphasize nationwide coverage. Many of them don't know how the other side of the Hudson River looks like. So I keep telling them why do you need nationwide plan when you can get more minutes for less with a regional plan. It makes no sense to pay for a national plan when you will never use all that coverage.

I convinced one of my friends to switch from Sprint to an AWS regional plan because he kept going over the 500 minutes he had with Sprint. Now, he couldn't be happier. He's not only paying less, but also got a free phone, he's getting 1200 min/month for the NorthEast plan plus free unlimited M2M and N&W, all for $39.99. Also, he's now saying that he didn't know AWS had such good coverage.

By the way, the Hudson River is the one that divides NJ and NYC.

[AnthroMatt]

Originally Posted by bobolito The same thing happens to many people who have switched to Sprint because their plans emphasize nationwide coverage. Many of them don't know how the other side of the Hudson River looks like. So I keep telling them why do you need nationwide plan when you can get more minutes for less with a regional plan. It makes no sense to pay for a national plan when you will never use all that coverage. I convinced one of my friends to switch from Sprint to an AWS regional plan because he kept going over the 500 minutes he had with Sprint. Now, he couldn't be happier. He's not only paying less, but also getting 1200 min/month for the NorthEast plan plus free unlimited M2M and N&W, all for $39.99. Also, he's now saying that he didn't know AWS had such good coverage. By the way, the Hudson River is the one that divides NJ and NYC.

And with Cingular and ATT's new emphasis on their national plans...the same will happen with them too. It's just great marketing by the companies. They can sell fewer minutes for more money. It's amazing how many people just like to know that they can use their phone in Boston, Seattle, San Diego, Honolulu, and New Orleans for free. Even if they have never travelled more than one state away.

[NYCDru]

My biggest problem with Reigonal plans is the fact that Nationals hasn't been local in the last 5 years and won't be ofr at least another two.

[bobolito]

What do you mean?

[NYCDru]

Originally Posted by bobolito What do you mean?

As in I need my phone to work well when I travel to Minesota this summer and next, Northern Cali the summer after that, along with everywere between NYC, Boston, Phili, and upstate NY.

[bobolito]

Your phone will work equally well regardless what plan you have. But since you travel, you are better off with a National plan so you don't have to pay roaming. However, there are a good number of people that are better off with Regional plans. Trust me, I know people that live in NYC and don't know how it looks like on the other side of the George Washington Bridge.

[NYCDru]

Originally Posted by bobolito Trust me, I know people that live in NYC and don't know how it looks like on the other side of the George Washington Bridge.

So do I, and its REALY funny sometimes.