Wireless carriers like AT&T and Verizon Wireless have reneged on promotions offering customers free phones and “buy one, get one free” deals that leave customers on the hook for hundreds of dollars in equipment charges.

With the holiday shopping season about to begin, phone promotions will be heavily advertised. But those deals may be too good to be true, according to consumer protection groups.

The Better Business Bureau said the problems customers are reporting are serious, and growing. Since the beginning of this year, BBB president (Southern Piedmont) Tom Bartholomy said the group has received almost 6,800 complaints about wireless provider advertising, sales, and promotional practices.

“We’re talking hundreds of complaints about a similar type of situation,” Bartholomy told WSOC-TV. “[It] points to an underlying cause, an underlying concern, with those types of promotions.”

WSOC’s consumer reporter has been inundated with complaints from his North Carolina viewers about broken promises:

Rachel Seighman lives in Monroe. She said, “(I) wanted to try to get a cheaper plan for my family. So, I tried AT&T out.”  She said she got her bill and “it was going to be about $60 higher per month than they said.” So, she called AT&T.  “I was told that the price they quoted me at was not correct,” she said.

Cynthia Emrich lives in Stanfield. She took advantage of an AT&T “buy one, get one free” offer for a Samsung phone. But, she said AT&T charged her for both phones.  “So I call them and they said it would straighten itself out, and it never did,” she told Action 9.  She said she called the company every month for 2 1/2 years. “It was frustrating every month.”

Denise Reid lives in Fort Mill. She said she went with a Verizon “buy one, get one free” deal for an iPhone, but that the company charged her full price.  “They could not give me a reason as to why,” she said.  “No reason as to why.”

Joseph Mayberry lives in Hickory. He told Action 9 a similar story. All four customers said they tried to resolve things on their own but couldn’t. “I would call someone.  I would go through the long story of what happened.  I would get to the supervisor level.  I’ve got emails saying I would be credited back and a phone call would follow.  Never got the phone call,” Mayberry said.

Many customers are tripped up by the fine print in promotional offers that frequently contain complicated conditions and opaque language. Some insist company representatives assured them that the promotion was valid only to find out later they were misled. In fact many promotions contain strict provisions that, if not followed precisely, invalidate the promotion.

Here are some common tricks and fine print traps you may encounter getting your “free” phone:

1. Many “Buy 1, Get 1” promotions require the customer to activate and maintain a new line of service to qualify for a free phone, which can cost nearly $50 a month for a plan, including additional surcharges and taxes. Customers that fail to follow through on this condition or quickly terminate the extra line after moving the device to a different line on their account were often charged full price for both phones.
2. Some promotions require customers to sign up for a “device payment agreement” to qualify for the free phone. That is actually a contract to pay off a device with monthly installment payments at 0% interest billed to your mobile account. The free device promotion is often tied to the payment agreement. If a customer buys the first phone and pays for it upfront there is no payment agreement, and no free phone. Some promotions require customers to maintain a device payment agreement for up to 30 months. If a customer violates any terms of the promotion, such as paying the phone off early or selling it, the company might bill you for the “free” phone.
3. Some companies take months to begin crediting your account for the monthly installments that will appear on your bill. Customers will eventually see a monthly device payment charge and a corresponding credit in the same amount for your “free” phone. But until bill credits start to appear in 60-90 days, you are responsible for the installment charges.
4. “Free” phone promotions often conflict with other service plans and features. Customers that have signed up to receive a new phone every two years may have to turn in their “free” phone and walk away from several delayed reimbursement credits before getting they can obtain their next new device.

Many customers underestimate the true cost of complying with the terms necessary to get that “free” phone. That realization usually comes too late to return it, leaving customers with several hundred dollars in equipment fees — a costly mistake that could ruin any holiday.

It is important to carefully study the terms and conditions of all wireless device promotions. The written contract is valid, promises from overeager salespeople are not. Be wary when you see “device payment agreement” or “activate and maintain a new line of service,” or “promo credit applied to account over 24 mos w/in 1-2 billing cycles; promo credit ends when balance paid or line terminated/transferred.” If you do, it could mean you will need to set up an installment payment plan for that “free” phone, keep it on your account as a new line of service for at least two years, and avoid paying it off in advance or attempt to move the phone to a different account or provider.

If negotiating with your provider has failed to resolve a conflict over the promotion, taking your case to the media over the terms of a possibly deceptive promotion can be effective in getting what you thought you were promised. When these customers contacted WSOC-TV and the station took the complaints back to AT&T and Verizon, the company quickly gave all four customers their free phones.

“Nobody would listen to me until [WSOC] actually reached out to them. And then within two hours, I got a phone call from AT&T,” Emrich told the station.  “If it wasn’t for Action 9, I would have never got that refund.”

AT&T claimed in a statement it honors all of its deals. Verizon tried to refer complaints about its promotions to the wireless industry lobbying group — CTIA. That group does not understand why Verizon did that and claims it isn’t familiar with cell phone promotions. Neither are most consumers.

WSOC-TV consumer reporter Jason Stoogenke investigates cell phone promotions that sound too good to be true. (3:36)

Verizon pulled out of a promo for a free iPhone for this North Carolina customer. Nobody knows why. (1:16)

Verizon messed up a promotion offering two phones for the price of one and left this customer out in the cold, telling him he needed to pay full price for both phones. (1:14)

Altice USA’s Optimum (formerly Cablevision) and Suddenlink are getting upgraded technology as the two cable companies face increasing demands for speed and broadband usage around the country.

“Over the last two years, the percentage of customers taking over 100 megabits of speed has risen to about 80% of our total customer base,” noted Dexter Goei, CEO of Altice USA. “Recently, we have shifted focus to growing the penetration of 200 Mbps services with about 80% of gross additions now taking these speeds or higher, reaching about half of our total customer base at the end of the third quarter, up from less than 5% two years ago.”

Goei noted that the average of all Optimum and Suddenlink broadband customers’ internet speeds has risen from 56 Mbps to 172 Mbps over the last 24 months, and this is increasing every quarter.

“Average data usage is now over 240 gigabytes per month per customer,” Goei added. “And this continues to grow over 20% per year.”

Goei

To meet growing demand, Altice USA is spending money upgrading its cable properties. The company is scrapping its coaxial cable network in the northeast and in selected parts of Suddenlink territory. In smaller communities that Suddenlink typically serves, the company will either bring fiber to the home service or upgrade the existing cable system to DOCSIS 3.1.

“The first objective is to have 1 Gbps broadband services available virtually everywhere,” Goei said. “For our legacy coax network in the Optimum footprint, we just need to do a Digital Switched Video upgrade now to move us to DOCSIS 3.1 and 1 Gbps speeds, which we can complete over the next few quarters. We just soft launched our fiber network in select areas of Long Island, and it is performing just as we expected so far, delivering a great 1 Gbps symmetrical single-play data service with the new advanced wireless gateway. The smart meshed Wi-Fi we’ve introduced is also doing extremely well.”

Goei says Optimum’s fiber network will be capable of delivering more than 10 Gbps speeds, as well as enhanced Wi-Fi, and improved system reliability.

“For the Suddenlink footprint, we already offer up to 1 Gbps services, so we will add further 1 Gbps capacity through some node splitting and CMTS upgrades,” Goei said. “We are also doing a QAM to IP migration on the cable plant to deliver future IP services. And with the move to DOCSIS 3.1, customers will have a uniform SSID across all of their devices, for an improved seamless Wi-Fi experience.”

The upgrades will mean Suddenlink customers will be more likely to receive 1 Gbps speeds even during peak usage times.

By transitioning video services away from the current QAM platform, IP video will free up additional bandwidth Suddenlink can devote to its internet customers.

Goei told investors on a quarterly results conference call that the five-year fiber upgrade project in the northeast may stretch into a sixth year due to permitting delays in some communities where Optimum provides service.

Some Wall Street analysts questioned Goei about the merits of a costly fiber upgrade, asking if it was necessary. Jonathan Chaplin of New Street Research suggested if cable systems were already capable of gigabit speed service under DOCSIS 3.1, any revenue benefits gained from offering gigabit service could already be realized without stringing fiber optic cable. Other Wall Street analysts wanted to know when Altice would deliver the next revenue-increasing rate hike on Optimum and Suddenlink customers.

The company acknowledged it lost customers after the last round of price increases last spring. Its biggest losses are coming from cord cutting. Altice saw 20,700 Optimum TV customers cancel service between July and September, with a total of 76,000 customers dropping service so far this year. But that won’t stop Altice from raising rates again. Goei anticipated the next rate hike will likely take place during the first half of 2019.

Altice USA is also working on its own cellphone service, which will be powered by its large Wi-Fi hotspot network in the northeast and rely on the services of Sprint to connect customers while away from Wi-Fi. The company did not release pricing or service information.

Property owners in New Zealand may have to trim back or remove trees if they are proven to interfere with Wi-Fi or wireless broadband services in the neighborhood, according to an interesting High Court judgment that could establish a wide-ranging precedent.

As short-range 5G wireless internet services become established, high frequency and millimeter wave-based signals depend on line-of-sight communications with end users. Trees and buildings can reduce signal range or block the signal entirely, rendering the service unusable. In this case, an appeals judge was asked to rule whether broadband users or property owners took precedence when a large stand of trees or a building in an adjacent yard made wireless reception more difficult or impossible.

Justice Sally Fitzgerald found that when alternative solutions like relocating a receiver cannot be found to mitigate reception problems, nearby property owners may have to take steps to protect neighbors’ access to Wi-Fi and other wireless services, under a new interpretation of Section 335(1)(vi) of the [Property Law] Act of New Zealand. Similar laws are in place in North America and European countries.

The decision could result in a dramatic increase in legal challenges from frustrated neighbors who cannot get good reception because adjacent property owners prefer a tree-filled landscape.

Justice Fitzgerald

Fitzgerald based her decision on basic property laws that make illegal anything that can unduly interfere with the reasonable use and enjoyment of private property. Such laws are used as a basis for noise ordinances, zoning restrictions, restrictions on commercial use of residential property, and placement of structures on or near property lines. This judge found no special distinction between physical objects or noise and wireless transmissions. But she did find reasonable limitations on what would constitute a valid complaint.

In this case, Ian and Karen Vickery brought the complaint against their neighbor Christine Thoroughgood, for interfering with their access to wireless internet by refusing to trim the trees on her property line. But the judge found a better answer than ordering a robust tree trimming. Fitzgerald found the Vickery’s already receive a suitable signal after placing a receiver on a pole located away from their home. Therefore, the judge ruled against the complaint by the Kiapara Flats couple, even though they preferred placing the receiver on their home.

Legal observers found the case precedent-setting, despite its low-key outcome, because this High Court judge has established a right of access to broadband that takes precedence over property owners’ landscaping and buildings. Under certain circumstances, a neighbor may be forced to trim, remove, or alter trees and structures on their land if a neighbor can prove it directly interferes with their right to access wireless signals like broadband in a way that cannot be mitigated.

From the decision:

I am satisfied, and Mr. Allan properly accepted, that undue interference with a Wi-Fi signal caused by trees could constitute an undue interference with the reasonable use and enjoyment of an applicant’s land for the purposes of s 335(1)(vi) of the Act.

From reviewing the evidence, however, I do not agree that the Judge erred in accepting independent expert evidence (in fact called by Mr. Vickery) which objectively contradicted Mr. Vickery’s personal evidence on the issue as to Wi-Fi signal.

The expert, Mr. Lancaster, explained that Mr. Vickery’s Wi-Fi service is a “fixed wireless solution”. He notes in his technical report that it works by having the internet service provider establishing a “broadcast site” in a prominent location and connecting to customers with clear “line of sight” to that broadcast site.

In this case, the broadcast site (provided by Compass Wireless) is located on Moirs Hill Road. Mr. Lancaster notes that “nominally the solution will service customers up to 30 kilometres away from the broadcast site subject to a clear unobstructed line of sight.” In this way, Mr. Lancaster confirms that trees could obstruct the otherwise clear line of sight.

At present, the Wi-Fi transponder (or receiver) at the Vickerys’ home is mounted on a pole a little distance away from the rear of the house. I viewed its location during my site visit and have reviewed the photographs in Mr. Lancaster’s report. With the transponder located in its present position (referred to by Mr. Lancaster as “Location A”), Mr. Lancaster states:

There is currently a clear signal to the installed dish and other parts of the property, the signal has remained good for the past two years since installation.

This current location, however, is not Mr. Vickery’s preferred location. He notes that the present location is in a particularly windy site and on one occasion the wind was so strong it blew the cable out of the back of the aerial. Mr. Vickery also noted that another much larger stand of pine trees on the Thoroughgoods’ land, some considerable distance away, are also impacting what is referred to as the “Fresnel zone” of the Wi-Fi connection in its present location.

Mr. Vickery’s preferred location is closer to and attached to the back of the house itself, where it would be easier for Mr. Vickery to service the transponder. At this location however, Mr. Vickery says the trees in issue will interfere with the signal.

Mr. Lancaster states in his report that he spent over two hours on site and only identified two other locations (other than the present location, Location A) which he would consider appropriate for an installation.

The first of these alternative locations (Location B) is on the northeast corner wall of the home — Mr. Vickery’s preferred location. Mr. Lancaster states “this is the location the Compass installers would have chosen by default and as a standard installation”. In relation to Location B, Mr. Lancaster states “it is obviously at risk due to close proximity to the existing tree/shrub planted boundary, being approximately three metres above ground level.” He states that to retain adequate signal at this location, a window would be required in the shelter belt hedge — the trees in issue in this case.

In light of the independent expert evidence, I do not accept the Judge erred in concluding there was no undue interference with the Vickerys’ Wi-Fi signal. It is important to reiterate that not only does the expert evidence not indicate an interference, but the standard required by the legislation is an “undue” interference in any event. The expert evidence confirms this threshold has not been met.

Accordingly, while it is true that Mr. Vickery’s preferred location for the Wi-Fi transponder would be on the wall of the home, there is clearly an alternative location which is currently being used and which is considered by Mr. Lancaster to be adequate. There is also a further alternative and adequate location (Location C). And although this location would require cabling, this would not in my view be unreasonable in the circumstances.

I accordingly do not consider the ground of appeal concerning Wi-Fi has been made out.

“You’re giving it away… you are giving it all away!” — An unknown Wall Street analyst tossing and turning in the night.

America is simply not paying enough for wireless service. Thanks to dastardly competition introduced by T-Mobile and Sprint (potentially to be snuffed out in due course if their merger gets approved), wireless pricing is no longer a license to print money. Forced to offer one-size-fits-all affordable $40-50 unlimited plans, the prospects to grow Average Revenue Per User (ARPU) have never been worse because you can’t charge people for more service on an “unlimited plan” without admitting that plan is not exactly “unlimited.”

Wall Street analysts, already upset at the thought of carriers spending more than $100 billion on 5G network upgrades, are in a real tizzy about how companies are going to quickly recoup that investment. No matter that some wireless companies have profit margins in the 50% range and customers have paid providers for a service they were assured would keep up with the times and network demand. If there is to be a 5G revolution in the United States, some insist it must not come at the cost of reliable profits — so the industry must find a way to stick consumers with the bill.

It is not common for industry analysts to go public brainstorming higher prices and more customer gouging. After all, North Americans already pay some of the highest cell phone bills in the world, only mitigated (for now) by scrappy T-Mobile and Sprint. Mark Lowenstein, a leading industry analyst, consultant, and commentator, was willing to go public in the pages of Fierce Wireless, arguing “operators should be considering charging a premium price for what will hopefully be a premium service.” That is likely music to the ears of AT&T and Verizon, both frustrated their pricing power in the market has been reduced by credible competition from a significantly improved T-Mobile.

Lowenstein fears the prospects of a “race-to-the-bottom 5G price war” which could arrive if America’s wireless companies offer a credible home internet replacement that lets consumers tell the local phone or cable company to ‘take a hike.’ Since wireless operators will bundle significant discounts for those who subscribe to both home and mobile plans, telecommunications services may actually cost less than what Wall Street was banking on.

Something must be done. Lowenstein:

In mobile, there’s been premium pricing for premium phones. And Verizon Wireless, for a few years when it had a clear network lead, was sort of able to charge a higher price for its service (but not a premium price). But today, there isn’t really premium pricing for premium services. That should change when 5G really kicks into gear.

So how do you extract more cash from consumers’ wallets? Create artificial tiers that have no relationship to the actual cost of the network, but could potentially get people to willingly pay a lot more for something they will initially get for a simple, flat price:

One simple way would be a flat premium price, similar to the “tiers” of Netflix for a higher number of devices or 4K/Ultra HD.  So, perhaps $10 per line for 5G, or $25 for a family plan. Another approach would be more akin to broadband, where there are pricing tiers for different levels of service performance. So if the base 4G LTE plan is $50 per month today, for an average 100 Mbps service, 5G packages could be sold in gradations of $10 for higher speeds (i.e. $60 for 300 Mbps, $70 for 500, $80 for 1 Gbps, and so on). An interesting angle on this is that some of the higher-end 4G LTE services such as Gigabit LTE (and beyond) could get incorporated into this, so it becomes less of a 4G vs. 5G discussion and more of a tier of service discussion.

I would also like to see some flexibility with regard to how one can purchase 5G capabilities. For example, a user might only need those premium 5G features occasionally, and might only be prepared to pay that higher price when the service is being used. Here, we can borrow from the Wi-Fi model, where operators offer a “day pack” for 5G, or for a certain city, location, or 5G-centic app or experience. 5G is going to be hot-spotty for awhile anyway, so why not use a Wi-Fi type model for pricing?

Even better, now with net neutrality in the ash heap of history, courtesy of the Republican-dominated FCC, providers can extract even more of your money by artificially messing with wireless traffic!

Lowenstein sees a brand new world of “app-centric pricing” where wireless carriers can charge even more to assure a fast lane for those entertainment, gaming, and virtual reality apps of the future, designed to take full advantage of 5G. Early tests have shown millimeter wave 5G networks can deliver extremely low latency traffic to customers from day one. That kills the market for selling premium, low-latency add-ons for demanding apps before companies can even start counting the money. So assuming providers are willing to purposely impede network performance, there just could be a market selling sub-100ms assured latency for an extra fee.

The potential of a Money Party only 5G can deliver is coming, but time is short to get the foundation laid for surprise toll lanes and “premium traffic” enhancements made possible without net neutrality. But first, the wireless industry has to get consumers hooked on 5G at a tantalizingly reasonable price. Charge too much, too soon and consumers may decide 4G LTE is good enough for them. That is why Lowenstein recommends operators not get carried away when 5G first launches.

“We don’t want to be setting ourselves up for a WiMAX-like disappointment,” Lowenstein writes. “The next 12-18 months are largely going to be ‘5G Experimentation’ mode, with limited markets, coverage, and devices. Heck, it’s likely to be two years before there’s a 5G iPhone in the United States, where iOS still commands nearly half the market.”

The disappointment will eventually be all yours, dear readers, if Lowenstein’s recommendations are adopted — when “certain milestones” trigger “rate adjustment” letters some day in the future.

Lowenstein sees four signs to start the pillaging, and we’ve paraphrased them:

• Coverage: Wait until 30-40% of a city is covered with 5G, then jack up the price. As long as customers get something akin to 5G one-third of the time, they’ll moan about why their 5G footprint is so limited, but they will keep paying more for the scraps of coverage they get.
• Markets: Price the service differently in each market depending on how stingy customers are likely to be at different price points. Then hike those prices to a new “nationwide” standard plan when 5G is available in the top 20-30 cities in the country. Since there may not be much competition, customers can take it or leave it.
• Performance: AT&T and Verizon’s gotta gouge, but it’s hard to do it with a straight face if your 5G service is barely faster than 4G LTE. Lowenstein recommends waiting until speeds are reliably north of 100 Mbps, then you can let rip with those diamond-priced plans.
• Devices: It’s hard to extract another $50-100 a month from family plan accounts if there are an inadequate number of devices that support 5G. While your kids “languish” with 4G LTE smartphones and dad enjoys his 5G experience, mom may shut it all down when the bill comes. Wait until everyone in the family can get a 5G phone before delivering some good old-fashioned bill shock, just like companies did in the golden days of uncompetitive wireless.

These ideas can only be adopted if a lack of competition assures all players nobody is going to call them out for pickpocketing customers. Ajit Pai’s FCC won’t interfere, and is even subsidizing some of the operators’ costs with taxpayer dollars and slanted deregulation to let companies construct next generation 5G networks as cheaply as possible (claiming it is important to beat China, where 5G service will cost much less). Should actual competition remain in the wireless market, all the dreams of rate-hikes-because-we-can will never come true, as long as one carrier decides they can grow their business by charging reasonable prices at their competitors’ expense.

Thune

Sen. John Thune (R-S.D.) slammed the Federal Communications Commission for its “unacceptable failure” to expand rural broadband service and close America’s rural-urban digital divide.

Thune’s comments were directed to FCC Chairman Ajit Pai, appearing Thursday before the Senate Commerce Committee the South Dakota Republican chairs. Thune complained rural broadband expansion has slowed in his rural state, something he blamed on the FCC’s “inaction.” Thune criticized the FCC’s cuts to the Universal Service Fund, implemented as part of an effort to reduce the FCC’s budget.

“The FCC’s failure to ensure sufficient and predictable funding jeopardizes the vitality of America’s rural communities, and makes it much, much harder for our witnesses and others like them to deploy broadband,” Thune said in his opening remarks. “This is simply unacceptable.”

Thune claims the FCC’s cuts have increased by almost 25%, and there has been no study undertaken to determine the impact those cuts have on rural broadband expansion.

“Rural Americans should never be left behind their urban counterparts,” Thune added.

Pai defended the FCC’s actions under the Trump Administration, claiming the Commission is allocating nearly $6 billion for Connect America Fund subsidies and additional money for rural wireless projects. Pai claimed the FCC is providing $340 million to bring 4G LTE service to tribal lands, with additional funds available when those rural broadband subsidies are exhausted. Most of the money is being paid to subsidize for-profit companies.

Pai also claimed his broadband policy reforms, such as repealing net neutrality and other deregulation will stimulate new private investment independent of the Commission. To help that expansion, Pai suggested the recently proposed rules to streamline new cell tower approvals and ease up on historic preservation and environmental reviews will speed rural rollouts.

But both Sen. Thune and Chairman Pai have steadfastly opposed municipal and public broadband expansion projects designed to close the rural broadband gap in areas where for-profit ISPs have refused to serve without subsidies.