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Cell Contracts Anger Travelers
The Travel Technologist · September 15, 2000

How does Cellular One become Cellular Two? Ask Kent Withrow, and he'll tell you the unbelievable story of multiplying carrier contracts.

The Austin, Texas, software designer recently inked a one-year agreement for wireless service in Chicago with Cellular One - or so he thought.

"I'd been on the plan about 14 months when I decided to move away from Chicago and cancel my cell phone there," he remembers. "So I called up customer service they said, 'Oh, you're on a two-year contract so that'll be $300 to get out of it.'"

The Cellular One representative offered to let him out of the remaining ten months if he could fax over the original contract. He did.

"I called up and got another customer service agent on the phone and got him to go find the fax," says Withrow. "He agreed that it said one year for me. Then he said, "Hmm, let me look in the system. It looks like somebody crossed out the box that says 'one year' and checked the box that says 'two years' before it was scanned into the system."

Cellular One did not respond to questions about the incident. There have been no other reports of involuntary contract "extensions" as far as I can tell, and in fairness to the company, these incidents appear to be quite rare.

But Withrow's experience underscores a problem that many frequent travelers face with wireless companies: confusing, misleading or even indecipherable contracts for service that often end up serving the carrier rather than the customer.

Take the experience of Dane Thomas, a Stockholm information consultant who cancelled his AT&T wireless plan early when he moved to Europe.

"I got hit with a cancellation charge that was equal to the amount remaining on a one-year contract," he recalls. "Since I had signed a month-to-month instead of a yearly contract, I had no idea why I was being charged."

Turns out that one of the times he called to change pricing plans, he was inadvertently switched to a 12-month plan. "If they had told me what they were doing, I certainly would not have agreed to it. They claimed that there is a clause in the original contract that allows them to make such a change without explicitly informing the customer or getting a signature," he says.

Fortunately, his credit card agreed with his version of the story, and despite repeated attempts by AT&T to bill him, he prevailed.

I'm not highlighting these high-tech horror stories in order to embarrass the wireless companies, but to raise two important issues to corporate travelers.

First, there's the contract conundrum. Why are the agreements for wireless service so restrictive? For the answer, I turned to Dave Cotton, a cellular consultant based in Lawrenceville, Ga.

"Most contracts run for a year or more because of the problem of 'churn,' which is industry terminology for turnover," he says. "You have to note that most contracts have 30-day clauses, where you can get out of it within the first month if you're not happy. The one-year contracts basically pay off the phone, which you're getting for free."

He says contracts are meant to keep customers where they are for a fixed amount of time and are not meant to penalize wireless users who change their mind, just cover the company's expenses. That's reassuring to know.

But the more troubling issue is that of the carrier's seemingly shady business practices. In fairness to the wireless companies, the creative contract interpretations appear to be sporadic. Nonetheless, some readers feel that the wireless industry harbors a less than subtle agenda that puts profits above everything else.

"The ledger is still stacked on the side of lying and cheating rather than building customer confidence, and as long as we have limited alternatives, [the wireless carriers] will keep laughing all the way to the bank," gripes Thomas.

Jerry Alexandratos, a Frederick, Md., traveler, echoes his sentiments. "When I've signed up for service, the [carrier] has gotten the majority of my orders wrong - for example, overcharging for items after I gave them our discounted prices, charging for extra batteries I never ordered or received, and signing people up for the wrong calling plan," he says.

Tim Vasquez, a software developer based in Norman, Ok., says that's the reason he refuses to sign up for cell phone service. "The companies continue to stiff customers with formidable contracts, nebulous terms, and predatory pricing plans," he complains.

As I study some of the contracts offered by the major cellular phone providers, I can see both sides of the argument. A customer will try to interpret a contract to his or her advantage; a wireless company will put its own spin on it. Who's right?

I think the carrier has a built-in advantage: it gets to write the contract. But there are also industry standards that force most of these agreements into a uniform mold. I think consumers have an advantage in that they can always take their business elsewhere after their year is up. Or, like Thomas, they can involve their credit card companies if they don't like the results they're getting.

Far more troubling is the abuse that some users are reporting. Whether that's part of a pattern - and as I've already written, I think and hope it isn't - or just one or two isolated cases remains to be seen.

E-mail me with your opinions at chris@elliott.org. As always, please include your full name, city of residence and what you do for a living.

Christopher Elliott is a travel commentator and author of A Bridge to Nowhere: A Year in the Florida Keys. All e-mailed questions may be edited, condensed or republished at the site's discretion. The Travel Technologist appears weekly on this site. This story was also published on Biztravel.com.