Celebrating an Innovative Approach to Consumer Protection

Earlier today, FCC Chairman Julius Genachowski announced an agreement with CTIA-The Wireless Association under which users of cell phones, smart phones, and other wireless devices will receive automatic alerts before triggering overage charges for exceeding usage caps. We’ve all read about consumers who were surprised to receive bills in the hundreds or thousands of dollars after they or their family members unknowingly exceeded their limits. The FCC and others heard the difficulty consumers were having in recalling the details of their plans or tracking their wireless usage.

“Far too many Americans know what it’s like to open up their cell-phone bill and be shocked by hundreds or even thousands of dollars in unexpected fees and charges," said President Barack Obama. "But we can put an end to that with a simple step: an alert warning consumers that they’re about to hit their limit before fees and charges add up. Our phones shouldn’t cost us more than the monthly rent or mortgage. So I appreciate the mobile phone companies’ willingness to work with my Administration and join us in our overall and ongoing efforts to protect American consumers by making sure financial transactions are fair, honest and transparent.”

Equally impressive is how the parties reached agreement. The FCC led a collaborative effort to strengthen the wireless industry’s voluntary code of conduct and will hold it accountable through a website to be designed with input from stakeholders, including Consumers Union.

It is one more example of the Obama Administration’s commitment to smart disclosure – a low-cost, high-impact regulatory tool featured in the National Action Plan for Open Government the President announced last month – and the use of multi-stakeholder collaboration as noted in a recent OECD agreement on Internet Policymaking Principles.

Today’s announcement is the latest in a series of consumer protections that harness the power and potential of technology, data, and innovation.  From the model privacy notice for personal health records vendors, to a mobile app that accesses food, drug, auto, and product recalls data, to the forthcoming final opportunity to join over 20,000 people that have already “crowd sourced” feedback on a new mortgage disclosure form that should help Americans pick the product that is right for you.

Congratulations to CTIA-The Wireless Association and its members, the FCC, Consumers Union, and other stakeholders for working together to provide this important service that will help educate consumers and empower them to save money.