FCC Stats More than a Headline

Earlier this week the FCC released its most recent report on consumer complaints (http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-279478A1.pdf), and most of the headlines read something to the effect of, “Wireless and Wireline Complaints Increase”. If all you did was look at the headline and moved on, you would have been left with the distinct impression that it’s not that good ‘out there’, and the fact is nothing could be further from the truth.

 

Let’s break down the latest complaint report as it pertains to wireless, so we can really see what’s happening and what’s on consumers’ minds. In the area of Contract Early Termination Complaints, the number of complaints dropped from 513 in 1Q ’07 to 320 2Q ’07. That’s a 40% decrease. In Carrier Advertising and Marketing, complaints were down even more…. 504 in 1Q ’07… just 293 in 2Q ’07. In Wireless Billing/Rate related Complaints, guess what? Complaints are down there, too by 20%! And in the Total Number of Wireless Service Quality Complaints, the FCC heard from about 40% fewer consumers in 2Q ’07 than in the first quarter of the year. Adding up just those categories, there was actually an approximate 25% decrease in complaints from quarter to quarter.

 

So what’s up with the headline? Well, the FCC has another category of complaints: Telephone Consumer Protection Act. Until about two years ago, that category used to pertain exclusively to wireline. According to the FCC, the category covers complaints associated with autodialing, live or recorded telemarketing calls, and “unsolicited commercial e-mail messages to cell phones, pagers, and other wireless telecommunications devices.” There were changes made in the FCC’s reporting mechanism before the most recent quarter, and after those changes were implemented, TCPA wireless complaints went from 848 in 1Q ’07 to more than 3,000 in 2Q ’07. It’s not clear why, or if, the changes resulted in such an unexplained increase in the reporting, and we’ve asked the FCC to clarify the most recent number.

 

But, given the numbers, it appears that unsolicited text messages, phone calls or other communications resulted in the significant increase. These are not carrier-initiated activities or behaviors, and that’s an important part of this story. When one looks at the industry’s performance in terms of the historic reporting categories, there’s an impressive trend of improved service that illustrates the carriers’ resolve to listen to their consumers and respond. Changes in ETF and contract policies are a direct result of market forces, and proof that consumers are ultimately the most powerful and effective regulators.