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Are You Ready For Higher Cell Phone Bills?

This article was written by in Consumer. 16 comments.


As more consumers in the United States are jumping on the smartphone and tablet bandwagon — personally, I contribute to this mess with one of the latest phones with Android software as well as a first-generation iPad — there’s less room in the limited airwaves for customers’ needs to access the internet and occasionally make telephone calls over mobile networks. Mobile carriers are doing what they can to preserve what remains of the spectrum, usually by increasing prices or limiting bandwidth.

The idea behind the peak oil movement is that in the future — and sometime soon — the world will not be able to efficiently produce as much oil as the citizens of the world need to consume, and due to the imbalance between supply and demand, prices for oil (and thus everything else that relies on oil) will skyrocket. Peak oil has been proven difficult to predict.

TabletUnlike peak oil, wireless carriers know how much spectrum they have left before they can’t support any additional traffic over the air. The situation is similar to real estate. There’s only so much available land for construction, and as the available land in any area with adequate demand is sold, the pressure of the lack of supply drives prices up. Dish Network, for example, has a significant amount of unused spectrum, and it would like to sell what it isn’t using to a wireless provider that desperately needs the spectrum to satisfy its customers.

As companies need to devote more of their resources towards increasing spectrum — whether through consolidation attempts in the industry like AT&T’s purchase of T-Mobile — or through buying spectrum from other owners at a high price — and as companies use pricing to limit customers’ use of the spectrum, the cost for a family or an individual to receive the same level of service is going to increase.

Save money on your cell phone bills

You can keep your cell phone bills in check:

  • Use a service like Validas to make sure you’re paying for the best mobile plan for you.
  • Compare prices across carriers. Don’t just consider the mainstream plans with the major carriers; pre-paid mobile phone plans could cost less.
  • Consider skipping internet-enabled devices. If all you need to do is talk, you can save yourself the expense of the latest high-tech phones and stay on a less expensive voice plan.
  • If you have other telecommunication services, like cable television and home phone, consider bundling these services to save money.
  • Call and ask for a discount. Sometimes, you can get a price break just by asking. Don’t threaten to leave, though, unless you’re willing to live up to that promise.

I’m currently paying over $100 per month for my mobile phone service with Verizon Wireless, which includes my phone with 4G smartphone service as well as a 3G service for my iPad through a separate device. How much do you pay for your mobile phone service? Are you prepared for this cost to increase in the next year or two as companies fight over remaining broadband spectrum?

Photo: @iannnnn
CNN Money

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Department of Justice Blocks AT&T Acquisition of T-Mobile

This article was written by in Consumer. 11 comments.

Earlier this year, AT&T announced its plans to acquire T-Mobile, a plan that would change the landscape of wireless service in the United States and pave the way for an industry dominated by two large players: the new AT&T and Verizon Wireless. Today, the U.S. Justice Department stepped in, issuing a complaint to block the acquisition.

T-Mobile is currently a lower-cost option for wireless service, and the acquisition would most likely result in less competition and higher prices. Earlier this year, the Department of Justice blocked a merger between H&R Block and TaxAct, and the move was questioned when deals like the one between AT&T and T-Mobile were allowed to continue. As we can see now, the government is attempting to take the anti-duopoly approach across industries.

The Comcast acquisition of NBC was a different type of acquisition, and the Department of Justice did not seek to block it. The unified company can now control media from their creation to delivery, and this type of vertical integration seems to not be seen as anti-competitive, even though it could result in increased cost for the consumer and content exclusivity where none existed before. Deals like the one between AT&T and T-Mobile or between H&R Block and TaxAct take a marketplace and offer the consumer fewer choices.

Cell PhoneSprint, the distant fourth player in wireless, lobbied the Department of Justice to block the merger. While the block may be in the best interest of consumers, it’s definitely in the best interest of Sprint, likely to be pushed out of the market after the proposed acquisition. If the shoe were on the other foot, and AT&T were to buy Sprint, T-Mobile would be the company seeking to block the deal on behalf of consumers.

Consolidations and acquisitions can be good for the economy when there are major inefficiencies. Capitalists, for the most part, don’t want the government stepping in to block he progress of business and the growth of corporate empires. In theory, if one company gets so large that the consumer is left with poor choices, the market will eventually correct itself with new players willing to meet the neglected needs of the consumer. But when the cost of becoming a large enough presence in a market dominated by one or two companies is prohibitive, as it most likely is for offering cellular service due to the necessary infrastructure, blocking an acquisition might be a better solution than waiting a decade, a generation, or more for new competitors to re-shape the consumer landscape.

In its own words, the Department of Justice explains the decision:

The Department filed its lawsuit because we believe the combination of AT&T and T-Mobile would result in tens of millions of consumers all across the United States facing higher prices, fewer choices and lower quality products for their mobile wireless services.

Consumers across the country, including those in rural areas and those with lower incomes, have benefitted from competition among the nation’s wireless carriers, particularly the four remaining national carriers. This lawsuit seeks to ensure that everyone can continue to reap the benefits of that competition.

This isn’t the only acquisition of concern recently; Capital One was the winning bidder for ING Direct. Although the deal would make Capital One “only” the sixth largest bank in the United States when measured by deposits, the government and regulators are not taking this deal lightly, seeking more comments from the public.

Do you think the Department of Justice should block the AT&T acquisition of T-Mobile?

Photo: whiteafrican
Department of Justice

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Look At Your Medical Bills Before Paying

This article was written by in Health. 15 comments.

My dentist’s office is changing billing procedure. I should note that my dentist is not part of an insurance network. It may be a cliché, but I have heard people who say that any dentist who aligns his office with insurance carriers is one you want to avoid. That doesn’t mean that I have to pay the full cost of my visits; my insurance (currently Aetna with COBRA through my former employer) still covers almost all of what my dentist charges for semi-annual maintenance. I haven’t had any problems come up, but the insurance company would cover most of that cost, as well.

As long as I have been a patient of my current dentist, the office calculates what it expects my insurance to cover before I leave the office. They submit the bill to my insurance company, and I pay the estimated remainder. It’s often not much. Occasionally, the estimate is off, and the dentist credits my account or bills me for their underestimation of the insurance company’s reimbursement. This system has worked well, at least for me. It’s less money out of my pocket than if I had to pay the full bill myself and submit the claim to my insurance company after the fact.

Starting with my next visit, approaching within the next few months, this will be the new procedure. The office has decided that rather dealing with the insurance companies directly for payment, this will be the patients’ responsibility. Before leaving the office, I will need to pay the full amount on the bill, and when I get home, I’ll need to submit a claim to my insurance company. I’m not particularly happy about the change.

I’ll need to pay more out of pocket. While the dentist office has claimed that insurance payments come within just a couple weeks, now that payments are going to a patient rather than the dentist, the claims could take longer to process. If there are any disputes, I may have less leverage than a dentist, though I have more motivation to pursue the case. I don’t like the idea that more paperwork will be my responsibility, but it’s always my responsibility to ensure I’m paying no more than I need to.

I was reminded of my dentist’s procedural change by Cameron Huddleston’s article in Kipligner. She received a bill from her doctor that was higher than she expected. She called the office to confirm that the doctor did not submit a claim to her insurance. I would imagine that some patients blindly pay any bill they receive from their doctor’s office, assuming the amount listed is what they owe after the insurance company has already covered part of the bill. It’s good to be aware of the costs of services and to review the bills.

Kiplinger

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AT&T Acquiring T-Mobile USA: Today’s Mobile Phone Options

This article was written by in Consumer, Featured. 21 comments.

This weekend, AT&T announced its plans to buy T-Mobile USA for $39 billion, pending regulatory approval. The new company would be the leading mobile telephone (and data) service provider in terms of customers. With the new AT&T soaking up 39% of the mobile market, and with Verizon Wireless at a close second at 31%, this would create an effective duopoly.

This could be good news for AT&T customers who are frustrated with dropped calls, slow data downloads, and spotty 4G service. T-Mobile’s network is easily combined with AT&T’s, as they both function with the same GSM technology.

The U.S. Government Accountability Office, in a study that is proactively cited by AT&T executives strongly in favor of the merger, says that services prices for the consumer have fallen from 1999 through 2009, a period which has seen consolidation of wireless carriers. However, the GAO has recommended to the Federal Communication Commission that regulators should do more to increase competition among carriers and to increase transparency regarding fees and prices.

If the deal goes through, and considering the FCC’s encouragement of mergers and acquisitions recently I expect it will, Verizon Wireless will likely follow suit with a renewed bid for Sprint-Nextel.

Those with basic mobile needs might want to consider alternative options. The big wireless carriers get a lot of attention, but some of the smaller, independent companies can offer basic services at a lower price point. Some of these smaller companies are owned by the major networks or use the major networks’ infrastructure, so they might not be as independent as they first appear. For example, Boost Wireless and Virgin Mobile simply resell use of Sprint’s network.

Pre-paid plans are popular, and for many, cost less than a contract. Most of the mobile providers use slightly different branding for their pre-paid plans, perhaps because they believe the target market is different than for contract-based customers. In fact, since mobile phone companies often require credit checks before customers can be approved for a plan, those without a credit history or with a damaged credit history may be required to enroll in a pre-paid program with an initial deposit.

Financial analysts and consumer groups all have something to say about this deal. Consumer Reports looks at the effects a deal might have on customers: T-Mobile users will likely see rate hikes and Sprint customers who are generally more satisfied than customers of AT&T or T-Mobile will likely be pushed out of the market, but coverage for AT&T and T-Mobile might improve. The fact that the two carriers to be merged operate on different wavelengths, even if they use the same technology otherwise, might hinder coverage consolidation in the short term. Read more from Consumer Reports.

Analysts seem divided. Some think the mobile industry is overdue for consolidation. Others believe fewer choices is not good for the consumer or wireless device vendors and infrastructure suppliers. Read more from the analysts.

What type of mobile carrier do you use? Do you think this acquisition will be beneficial or harmful to the mobile communications industry?

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Mobile Payments Could Be the End of Credit Cards

by Flexo
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In my wallet, plastic is king. I use my credit card for almost every transaction, though in rare cases I still go for cash. Like many others in this country and around the developed world, I also carry my cell phone around with me everywhere I go. Cell phone technology is progressing quickly, and this ... Continue reading this article…

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Verizon Wireless Kills “New Every Two” Discount

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The year 2000 was not an easy one for me. I had hardly any money thanks to a low-paying non-profit job and student loan debt. Even when not spending much beyond the necessities, I wasn’t improving my financial condition. I was moving around from apartment to apartment; by 2004 I would had lived in seven ... Continue reading this article…

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CitiBusiness® / AAdvantage® Visa® 30,000 Bonus Miles Offer

by Flexo

CitiBank, one of the premier credit card lenders in the US today, has developed a new credit card offer for small business owners that need to travel. For a limited time, the CitiBusiness® AAdvantage® / Visa® is awarding new cardholders 30,000 bonus miles, enough for a domestic round-trip ticket. The only requirement to qualify for ... Continue reading this article…

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Safe Donations to Victims of the Earthquake in Haiti

by Flexo

Yesterday, a magnitude 7.0 earthquake struck Haiti, with the center only less than ten miles from Port-au-Prince, the capital of the country. Of course, the news of the devastation has been everywhere in the media. Major landmarks have been destroyed by the disaster, including the Presidential Palace and the Port-au-Prince Cathedral. Haiti is a poor ... Continue reading this article…

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