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Consumer Advisory Bulletin- May 2008

How to Choose a Cell Phone Service
– and Avoid Cell Phone Pitfalls

Are you shopping for cell phone service for the first time, or considering a new plan? The basic approach is to determine your calling needs, shop carefully, and avoid pitfalls.

How to choose cell phone service and avoid problems:

  • Study which kind of service best fits your calling needs.. There are local, regional, or national plans, family plans for two or more phones, and pre-paid plans. Consider which plan is best for the time of day and number and length of calls you will make. (You pay a hefty charge for using minutes that exceed your plan, so study the details.) Many plans offer far more minutes for night calls, but “night” may not begin until 9 p.m. Plans may offer free minutes for incoming calls, or for “mobile-to-mobile” calls from others who have the same cell phone company. For more tips and information about the many choices available, check out the links below -- especially if you are a first-time shopper for cell phone service (also known as “wireless” or “mobile” phone service.)

  • Determine which company offers you the best service. Ask friends and neighbors which companies have worked out best for them. Check the “home calling area” and where “roaming charges” apply for different cell phone companies. (Outside your home area, the phone may not work, or you may incur costly roaming charges.) Ask to see a “coverage map,” especially if you travel frequently -- but remember, the map will not indicate holes or ‘dead zones’ and is no guarantee of service.

  • Ask to test the cell service for a trial period (often 15-30 days). Be sure you get a good signal where you need it -- at home and work, and places you visit often..

  • Check for complaints about providers.. Call the Attorney General’s Office or the Better Business Bureau, and ask your friends and neighbors about their experience.

  • Know that you are entering a contract with termination fees. Most cell phone service plans are for two years -- and require you to pay a $150-200 termination fee per phone, even if you move out of state, move to an area with poor service, or simply change your mind and cancel your service before the end of the contract. Ask if termination fees can be pro-rated, i.e., reduced proportionately to the amount of time you have had the service. (If you are concerned about contract duration and termination fees, you might consider a pre-paid plan offering a set number of minutes and no contract duration, usually with inexpensive, no-frills phones. Some people use pre-paid plans for kids, emergencies, or temporary situations.)

  • Know that changing your calling plan or getting a new phone usually renews your contract and termination fee period for another two years.

  • Know that contract termination dates may not coincide with your billing cycle. Here’s why that is important: If you are changing cell phone service providers, you probably will not receive a refund for unused minutes or service in that billing cycle, even if you “port” your old cell number to the new service, and the original service is dead. Tip: activate your new service at the end of the billing cycle of the old service, even if that is a little later than your termination date.

  • Compare phone warranties, and consider hazard or loss insurance, especially for expensive cell phones. Most cell phone contracts do NOT provide you with a free cell phone if your initial phone is lost or damaged or simply fails to work.

  • Watch out for web sites that advertise “free” ring tones, games, chat lines, text messaging or graphics. When kids or others visit these web sites and put their cell phone number in to retrieve the “free” item, many times they also are authorizing the company to debit their or their parents’ cellular account a monthly service fee.

  • For many consumers, cell phones are a source of convenience and security, but they also raise many consumer questions and complaints. The tips above are some of the most important points to understand about choosing cell phone service. We encourage you to read up even more – go to the web sites listed below, especially if you are considering cell phone service for the first time.

    To file a complaint, contact the Attorney General’s Consumer Protection Division, Des Moines, Iowa 50319. Call 515-281-5926, or 888-777-4590 (toll-free.) The web site is www.IowaAttorneyGeneral.org.

Links to More sources with good information about choosing cell phone plans:

1. Federal Communications Commission

2. AARP

3. Wireless Guide

4. Wireless Advisor

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