Research Note 33 - Press Snippets On Telecom Costs And Billing Leakage
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Press Snippets On Telecom Costs And Billing Leakage
Tillotson Research Note 33, April 2005

  • Taxes On Cellular Phone Service Increasing
    There has been an 8 percent drop over the last four years in the cost of wireless, but taxes have increased by an average of 12 percent on bills. The highest taxes are in California, which has added 19.6 percent to the bill; Florida, 17.8 percent; and Virginia, which adds 17.1 percent. The fees include state sales taxes and E911 surcharges, federal and local government taxes. (Source Billingworld November 2002)
  • Residential Long Distance Costs Increasing
    Residential long distance service is costing more because telephone companies are finding ways to add new charges on the bill such as monthly minimum fees and setting the universal service fees charges at 10 percent or morer. We are also seeing an increase in per minute rates, long distance directory assistance, and calling card surcharges. (Source Bilingworld March 2003).
  • 22 States Suing For Deceptive Business Practices By Telecom Comapanies
    Currently, the Attorney Generals in 22 states are bringing court action against a number of major telecommunications companies for “deceptive business practices” based on discrepancies between their contracts and what they were telling prospective customers. Another group of wireless companies has settled out of court (for tens of millions of dollars) for misleading their customers with the way contracts and advertising media were written.(Source Billingworld April 2003)
  • Qwest fined $20.3 million for cramming and slamming
    The California Public Utilities Commission has fined Qwest Communications $20.3 million for cramming and slamming SBC Pacific Bell customers to Qwest-affiliated long-distance services. This fine, believed to be the largest levied to date against a long-distance provider, reflects unauthorized charges and carrier switching of customers, especially of Spanish or Asian descent, during 1999 and 2000. (Source Billingworld, December 2002)
  • Telephone billing system had over 3000 known bugs
    At the time I left, BA's billing system had over 3000 known bugs. The general consensus was that there was nothing that could be done to fix the bugs: No one really had a global understanding of the system's functionality, and very little knowledge or useful documentation existed with regards to any particular module and/or its interactions with other modules or systems. So, any fix had a high risk of widespread ripple effects. (Source: ZDNet forum post, Allen Vander Meulen, ex-IT Director of Bell Atlantic TeleProducts)
  • Customer carelessness cost $80,000
    Companies and organizations cannot always blame phone companies. Pricewater-houseCoopers had one client that paid $80,000 in monthly service charges over 18 months for 36 cell phones sitting in a crate in a warehouse. "It's not that clients are lazy," says PWC's Moore. "It's simply impossible to stay on top of it." (Source USA Today)
  • Failure to block premium calls $1,300 cost
    Eisai Research Institute, a drug research firm in Andover, Mass, thought it was on top of it when it banned employees from calling 900 numbers frequently used as sex, astrology and gambling hotlines. But Eisai forgot to put the same block on its fax lines. In 1 month, an employee ran up a $1,300 hotline tab. The company will say only that the worker wasn't calling a sex line. (Source USA Today)<
  • Federal Communications Commission Fines Telephone Co' For Slamming
    The following is a list of telephone companies fined by the FCC in 2000 for "slamming" (unauthorised switching of your long distance carrier)
    Amer-I-Net Services Corp. $1.36 million
    AT&T Communications, Inc.$640,000
    Brittan Communications International Corp. $1 million
    Business Discount Plan, Inc. $1.8 million
    Coleman Enterprises, Inc. $750,000
    Excel Telecommunications, Inc. $400,000
    Long Distance Direct, Inc. $2 million
    MCI WorldCom Telecommunications, Inc. $3.5 million
    Sprint Communications Company, LP $250,000
    QWEST Communications International, Inc. $1.5 million
    Vista Group International $680,000
    (Source Federal Communication Commission)
  • Billed at wrong rate $18,000 overcharge
    Embarcadero Systems, a network management firm in San Francisco, won an $18,000 credit for a T-1 line that was billed at the wrong rate for six months. And the company ducked a looming $30,000 penalty because it was about to miss a minimum service agreement. (Source, Network World)
  • Billed for old service $75,000 overcharge
    Refrigeration equipment and laundry services firm Mac-Gray upgraded its telecom network linking regional offices with its headquarters. But when AT&T upgraded the service, it continued to bill Mac-Gray for the old service as well. Mac-Gray, with 500 employees and $150 million in annual revenue, failed to catch the mistake for several months because the bill was so complicated, it says. AT&T reimbursed Mac-Gray — but only after Mac-Gray hired a consulting firm to handle its telecom services and to help with the dispute. The overcharge: $75,000. (Source USA Today)
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