Thursday, December 13, 2007

Have you Ever Received an $85K Phone Bill? This Guy Did.

Canadian data plans are said to be high-priced in comparison to other developed countries, but I never thought this could result in an $85,000 bill! For one unlucky Bell Mobility customer, this was unfortunately the case. Piotr Staniaszek, 22, was shocked by an $85,000 cell phone bill after he unknowingly connected his mobile phone to his PC to download high-def movies and tons of other goodies. According to reports, he had an unlimited mobile browser plan, and he thought that using the phone as a modem would be included in this package.

On the one hand, Staniaszek should have double checked with Bell to ensure that he fully understood the terms of his service package. Bell's Mark Langton points out that Staniaszek would have received some sort of warning that indicated additional charges would apply. But on the other hand, shouldn't a company flag such strange activity and notify the customer right away? I'd think that when a customer's cell phone bill gets to a couple grand, you should probably start getting suspicious. What if Staniaszek's phone had been stolen and he wasn't aware of it?

Companies like VISA certainly make a concerted effort to contact you should any major purchase, or strange behaviour be apparent on your account. Why don't cell phone companies do the same? Of course, it's difficult to keep up with all of your clients all of the time, but then again, it should be a company's responsibility to protect its customers. Many companies are quick to contact you if a bill is even less than 24 hours overdue, so why isn't the same courtesy offered when the issue relates to the customer's interests?

However, many might argue that it's actually the customer's responsibility to monitor his own activity, and contact the company himself if he's not sure of something. I do agree, to an extent, that there needs to be a level of personal accountability; otherwise, there would be plenty of times where people take advantage of situations like this one, and the company ends up paying out of their own pocket.

In the end, Bell dropped the huge bill, and asked Mr. Staniaszek to pay just under $5,000 to match the best data plan the company has to offer when using your mobile phone as a modem. This is a relatively good compromise, but the young fella is still left with a five-thousand-dollar debt. Merry Christmas.

This leads to the bigger question: should large companies like Bell invest in systems that can immediately red-flag an account when it reaches a certain dollar amount, then contact the customer to verify that everything is OK? Or should customers simply take responsibility for their own accounts, and pay the price, as Staniaszek will have to, when they make mistakes?

26 comments:

Anonymous said...

The real issue is, why Data rates over 2.5G networtks in Canada are on average 50x the price of the comprable network in the USA at best.

Compared to Europe they are even more horrendous. Canada has the higest network charges on the planet by a longshot.

In addition, Unlimited plans that are not is a form a bait & Switch done by Canadian carriers.

If this subscriber had been on T-Mobile in the USA, his bill for the 2 months would have been approx $80, over a THOUSAND times less. Same handsets, same network technology, same continent.

I for one hope he fights it, and exposes the carriers shoody practices. Though, I will applaud Telus for steppig upto the plate recently and offering very comparable plans to the T-Mobile plans.

Lesson stay the heck away from Rogers or Bell at all costs.

Networx said...

Having been the "victim" of an almost $30,000 data charge for overages on my Rogers Aircard Cellular Modem I can sympathize with this guy. Fortunately for me it was a company account and the data rates were not fully explained by Rogers on sign up so I think they dropped the whole matter. From the carrier's point of view the problem here in Canada is that it costs just as much money to set up a nation-wide cellular data network as it does in any other country but Canada doesn't have the population, or customer base to support it to the point where Rogers or Bell can afford to offer true "unlimited" data plans. It's just not profitable enough. This is why we haven't seen the iPhone in Canada yet. Unfortunately, these same companies continue to flog everything from text messaging to watching TV on your phone as the latest "must have" features. The fact that these things can get insanely expensive isn't always pointed out. Carriers need to be much more clear about the limits of data plans and the crippling costs of even the slightest overage. Conversely, consumers need to be aware of what they're signing up for. Buyer beware has never been truer.

Viking said...

This summer I opened my phone bill to a $600 surprise. My son had plugged his cell into the computer to try and download pictures. The phone dialed home and installed some software and charged us $600 for the pushed software. Took 3 phone calls and some screaming for Bell to back down and disable the ability for the phone/ account to do data - something which they can do and don't advertise, only if you ask.
The canadian data rates are ridiculus, living close to the border I have often considered getting a US phone. The cost of a few long distance calls is far less than the benefits and all the cool options.
Drew. Niagara Falls.

Jason G said...

I am glad that this and other recent events have brought to the forefront the exorbitant prices Canadians are forced to pay for telephone, internet, cellular and media services.

It is time for an open market. The only people who are happy with the current situation are Bell and Rogers both with Q3 Operating Incomes higher than last year; $679 Million (up 10%) and $984 Million (up 23%) respectively. When will the regulators step in and allow a truly competitive market to exist that will benefit all Canadians?

Googelit said...

I can sympathize with Piotr, as a fellow Canadian on a Rogers network I recently discovered Data Charges on my cell phone bill daily when I haven't been using any data services for at least 6 weeks, yet every day for the last 2 billing cycles there is a repeated data charge. All this while after speaking to several reps at Rogers and them blocking my data access completely I'm still getting billed for it. I'm sure glad that 611 is still Free... or is it? I should bill them for my time that I have been on with them and see how they like being billed for something. I'm slowly divorcing the convenience of cell phones altogether and will soon be able to completely disconnect and be without. I'm tired of being raked over the coals by these companies... I think should bring back pay phones in a strong way.

Sheodn said...

Everyone should be careful when dealing with Canadian phone companies. I have both a cell and home phone with Rogers. They keep extending my contract and when I complained they "made an exception" and canceled the contract on my home phone but not my cell. I asked for a copy of the contract but they will not respond to my repeated phone calls and letters. They have me captive. I only use my cell for necessary calls and will not add features for fear of what I will be billed for or what new contract Rogers can impose on me.

Anonymous said...

I just found out that pay phones are now 50¢..Double , man thats harsh..

sulo said...

we do not have enough competition in Canada-I got rid of my cellphone land line is better.I think everybody should do the same. maybe they would come up with some better deals. Getting A U.S.A. cellphone would not solve anything because of the roaming fees.another problem we have is the two year contracts. This is just my 2 cents worth.

John said...

My 90 year old mother was ripped off by Bell. We (the kids) had purchased her a pay-as-you-go phone from Bell for emergency use in her car. A plan through her credit card was set up to bill her $10/month automatically, so she would never be without service on the road. About tree years later while checking her phone, I found it to be out of service and was told by Bell that because the bill had not been paid, service had been discontinued. The problem turned out to be that about 4 months earlier, her credit card number had changed because of my father's death. Some how we had missed updating the cell phone account. Bell readily agreed that they send out no notices, either via the phone or by mail, to notify customers of account problems. Bell refused to do anything about it and as my mother never used the phone, there was a positive balance on her account of just under $300.00. Bell stole this money from my mother and refused to do anything about it. I even went up the chain of command as far at the CEO and was blatantly told the same story. Bell knowingly and willing rips off a ninety year old woman for an emergency phone with no notice. What if she would have really need the phone in an emergency! In my opinion Bell and others are out of control. Our government does nothing to protect Canadians form legalized fraud.

email: John@JcGilmour.ca
website: JcGilmour.ca
phone:(905) 964-0614 (a fairly happy Virgin Mobile customer)

Angry mother said...

Bell telephone ripped me off too . In Oct I asked to have my teenage daughters cell phone transfered to her own account .She wasn't able to pay the outstanding because her than account was deleted . Finally after 2 months I was sent a statement saying I was going into a a collections company for non payment . I tried to talk with Bell and the staff were extreemly rude . Nothing was explained to me properly from the begginning . I was given wrong information from multiple people .And even though I was a good customer they made me feel like I was the worst customer they had ever had . We need more competition in Canada maybe than Bell would provide proper customer service . They need to stop ripping off customers with these text messaging charges and various other scams that generate large income for them from unsuspecting young people . And if you want to buy your contract out that is another scam that should be illegal .

Anonymous said...

This guy's an idiot. I am sorry, but using your phone like that without getting any information is just like going to the states and do roaming and then say you thought it was included in your plan.

People don't bother to find out how to use their cell phones, their computers or whatever other devices they get. Unfortunately with the advances in technology, it would be wise to educate themselves.

You can bitch about your provider being expensive (yes cell phones are expensive in canada), about being ripped off, about not knowing, not being told not being whatever, however take some responsibility for your own actions.

Now had this guy been misinformed (which he wasn't, he decided to use the phone wihtout getting any information as to how much it will cost for the service)I would have sympathized but ignorance is not an excuse. Just cause you didn't know, does not stop whatever you don't know from happening.

People in north america always complain as if they are owed something... for god's sake, would you sign a lease without reading it? Why the hell don't people read their contracts when they sign up?

No one owes you shit.

I also like how people use as an argument that in the states it's less expensive.

Yes it is, just because there's more customers! Canada is the 2nd largest country in the world with the lowest density in population in the world. Translation : You can not serve nearly as many people in Canada as you could in the U.S. Following the logic of some people here, it is also not fair that the American dollar was stronger than the Canadian for a very long time, it is not fair that it's cold in Canada and that it would be perfectly justifiable to go and rob a store and then use as an excuse at your trial the fact that you did not read the criminal or civil codes.

As far as I'm concerned, the goal of every business out there (including my own business), is to make money, how they set their pricing is their own decision to make, if you're not happy, don't sign up.

Oh and please take a moment to read your contracts and that includes all of them, be it car contracts, leases or something as stupid as a cell phone.

Ignorance is definitely not bliss.

Anonymous said...

Yes, phone companies do rip people off. People rip people off. I'm not defending phone companies at all, but we're just touching the tip of the ice burg here. It's just what most businesses do. It's called consumerism guys.

Anonymous said...

Disclaimer - I work for a phone company.

I have to be honest, I am completely frustrated by the media and consumer apathy being generated by this story. As a consumer, I know full well that is it MY accountability to understand what my contract says, and what the rates are relative to that contract.

This particular consumer decided to download the equivalent of 10 High Def movies and thought that he was going to pay $50 for it. I agree that the rates in Canada are higher than the rest of the industrialized world, but the customer should have used common sense and some basic math skills to calculate his bandwidth charges.

Ignorance to the law does not offer reprieve, so why is he able to throw his hands in the air and claim ignorance in this case? I don't fault the phone company for this one. I realize this is going to be an unpopular response, but I had to get it off my chest.

Anonymous said...

The same thing happened to me with TELUS....

They claim I owe them $1400 because the mail program they provided me with my PDA kept contacting the server once the 3-month free trial ended. There is no usable data plan available, as they all have rediculous constraints and outrageous pricing. No unlimited data plan is available, at any price! HOW CAN THEY SELL A INTERNET ENABLED PDA/SMARTPHONE WITH NO DATA??

This is pure thievery and the CRTC must intervene.

The good news is paid what I figured I actually owed them, and told them to get lost.

Anonymous said...

The guy had an unlimited data plan. Data is data. Ones and zeros. The fact that data was being streamed through the phone or being used by the phone is a subtle point.

In fact, I have asked cell phone salespeople about the difference and they are not even sure half the time.

But, here's the rub.

On modern cell phones, voice is digital. That means, if you have an unlimited voice plan as many do, it costs the phone company the same to move the voice as it does the data.

In fact, it is probably less costly to move the Internet data than the voice data because no interface into the land based voice system is needed. The internet data is just sent directly to the Internet.

We are being ripped off. This man in Alberta is still being ripped off at $3000 dollars. He could have talked and used more data with voice, and ended up paying less.

Other countries vary from $3/month to $20/month for unlimited data.

$80000 is evil. $3000 us unbelievably outrageous. If they lowered it to $300 it would still be gouging.

Anonymous said...

There are laws in Canada against price gouging and if this happened to someone in a position to sue then Bell would see some legal heat.

It's more unreasonable for Bell to charge him $85,000. Than it is for the customer to download 10 Movies.

The problem here is Bell market's unlimited browsing/downloads and fail to tell you if you hook the wires up in a different way then it's not unlimited and the bill will go from $50 to $85,000.

If they plan to charge those rates then they should require their customers to sign contracts which clearly state they are liable for bills upwards of $100,000.

This is not a case of consumer responsibility. Anyone who says so does not understand contract law. For example you could not get an illiterate person to sign away their life.

Anonymous said...

No joke, Oct. 2006 I got charged almost $30,000 for exactly the same thing -- Bell, Calgary and using my phone as a modem -- on a student plan. No warning... no sympathy. I got off the hook only after 9 months of negotiations and the help of the Alberta Government Consumer Services (thanks guys). At that time Bell just got a warning because they couldn't prove if it was Bell's fault or if the phone retailer misled me with misinformation. They obviously didn't learn...

Anonymous said...

Do you think the bad publicity is worth it? If this even convinces 10 customers not to go with Bell, then Bell loses. An average customers bill is about $50 a month, which is $600 a year. 10 users is $6000 / year. I actually think the fallout from a bonehead PR move like this is much, much higher. They'll probably lose 1000+ new cutomers this Christmas, which is $600000. Eat that Bell.

Anonymous said...

First - the user's fault (not getting informed - just believing he knows all he needs without reading the contract/manual/etc...)

Second - the gouvernment's fault (not enough, read 'almost inexistent', competition for better prices)

Third - The company's fault (not getting 'warned' about this kind of activity - like the credit card companies)

Fourth - The society's fault (jumping without proper education, into all kind of gizmo offerings)

BTW - see the Rogers/Google issue a few days ago regarding the Rogers warnings (pushed into the third party web pages) for the Internet users reaching the quota...

Just my thought...

Doolittle said...

I was in the exact same situation before... but with Roger's Fido Co. I went off of pre-paid and onto a monthly plan. I went over my minutes and ended up with a few hundred dollar bill. When I asked Fido what was the reason I was not notified I was told "Oh, we do have a notification when the occurs when you are near your limit." I asked why I didn't receive it. I was told "Well it's not activated on the account." It is free for customers though I was not informed at the time that I needed to bring it up to them and have it activated. I brought this up at our Sunday dinner tonight after hearing of this story and it seems that cellphone service providers have a really, really bad rap; like the mafia and how they do business.

Anonymous said...

what about trying to call up the telco to try and change your data cellphone account but instead get rudely disconnected by the automated front end system several times in a row

Anonymous said...

The fact that Bell Knocked $80,000 off of the phone bill, indicates thier awarness of serious flaws within its system.

Anonymous said...

As mentioned Bell should have notified the customer. Visa does this and I am sure they have more customers than bell.

Bell should pay everything but the first 500$ for not notifying their customer.

JET said...

Yes, I agree that such an enormous bill is gouging but, as typical of a Canadian society, let's blame someone else. You smoke, sue the tobacco companies. Get fat, sue the fast food chains. Get a $80,000 telco bill, sue the telco company, or at the very least call the media so we can all jump on the David and Goliath story. But whatever you, don't take any personal responsibility. That would be un-Canadian. Play the victim. That's a much easier route and seeing from most of the comments posted to this story, it's considered acceptable behavior. I say make the idiot pay.

Anonymous said...

I agree with JET. If you're stupid enough to insist on not reading your contracts, or have someone (you trust) read them for you, then beware.
To the opposite side of this issue, what if the guy KNEW what he was doing and figured "what the hell, I'll just cry FOUL to the media and bad mouth my carrier publicly (btw, in the U.S. you would be sued for libel doing this)and then they'll eat most or all of this on just my "promise" that I won't do it again".
Now, Bell and Rogers and EVERY OTHER carrier has just opened themselves up to a plethora of "I didn't know, so I'm not responsible, and besides, you ate $80k on that other guy's bill, so eating $5k on mine should be no problem" whiners who now have a precedent to fall back on. NO. Enough is enough! Many of you are saying TELCO ripped him off!!!! Why don't you even TRY to look at it from another possible perspective, that of the TELCO getting screwed over by some coniving fraudster??
IF you were in Bell's situation, and some customer of yours chewed up $85k of your services and then says "sorry, I didn't know.... so I ain't paying" although you have a fully documented contract, would YOU "eat" the $80k as a gesture of good will or would you sue the s.o.b. to get what's rightfully yours?
.... and by the way, I do NOT work for ANY telecomunications company, BUT I AM tired of everybody blaming all of their problems on someone else. Take responsibility for your actions!! Grow some balls for Pete's sakes!!!!

KADC said...

Cell phones are luxury items, not necessities, and as such, carriers should be free to charge whatever they see fit for their services, and the onus is on the consumer to decide if the services offered are worth the price. If you feel the price Canadian carriers are charging is too high, then don't purchase a cell phone, and if you do, then that was your choice to make and you have no reason to complain.

No reason to complain, that is, unless the terms of service are misleading.

There are several comments about taking responsibility for reading the contract, and I agree with this in principal; however, this ignores what, to me, is the larger issue of potential misrepresentation on the part of the carrier and its agents.

One of the basic tenants of Canadian civil law is that ALL parties to a contract should have a REASONABLE understanding of the terms of a contract. If this service was advertised as offering "unlimited data transfer", it was certainly a reasonable expectation that this was, in fact, the case.

Surely it is reasonable for anyone to believe that entering into a contract for "unlimited data transfer" means exactly that, and further, it would be reasonable for the carrier, knowing that there are exceptions to said "unlimited data transfer", to anticipate potential "misunderstandings" and ensure that these contrary conditions are emphasized in order to prevent "misunderstandings" from occurring.

In this case, at best, the carrier failed to make clear what is an obvious contradiction to "unlimited data transfer".

Does that excuse the customer from having signed a contract without ensuring they fully understood all the terms of the contract? No, but it's very difficult to believe that the carrier didn't expect something like this to happen either.