Nightly News   |  October 17, 2011

FCC, wireless carriers reach deal on alerts

Wireless carriers and the Federal Communications Commission have agreed to a new alert system that will warn customers when they’re going over their allotted minutes or text messages. NBC’s Tom Costello has more.

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This content comes from a Full-Text Transcript of the program.

BRIAN WILLIAMS, anchor: Now to a story about what we all pay for the privilege of being in touch and owning a cell phone . Under pressure from the federal government, the wireless industry has agreed to warn you before you've exceeded the monthly limits on minutes or text messages among other things. NBC 's Tom Costello has more on this new fine print.

TOM COSTELLO reporting: For Christina Cayoza it was a wake-up call her freshman year in college. With a boyfriend in another city, her first month's cell phone bill came in at $360, $300 more than normal.

Ms. CHRISTINA CAYOZA: For someone in college, especially, it was just so much money that I didn't have.

COSTELLO: In Wyoming , the Christofferson family's bill came to nearly $4800 after 13-year-old Dena sent out 10,000 text messages . Her father reacted by taking a hammer to her phone.

Ms. DENA CHRISTOFFERSON: I felt really bad and I have learned my lesson.

COSTELLO: They're not alone. Nationwide there are 300 million wireless users. In the past year, Consumer Reports magazine has conducted two surveys and found 20 percent of those asked had experienced cell phone bill shock. And the FCC found 23 percent of those had unexpected charges of $100 or more. Today, with the FCC considering regulations against excessive charges, the wireless companies announced they are acting on their own.

Mr. JULIUS GENACHOWSKI (FCC Chairman): The solution will give consumers the information they need to save money on their monthly wireless bills.

COSTELLO: The carriers have agreed that within 12 months they must warn their customers by voice, text, data or roaming alert if they're about to exceed their plan and rack up extra charges. Within 18 months they must use all four alerts to warn their customers. Consumer advocates are applauding.

Ms. PARUL DESAI (Consumers Union): To now have free tools and free alerts to let them know when they're about to go over, I think is a great step forward for consumers.

COSTELLO: As for Christina Cayoza , her college cell phone bill went to dad.

Ms. CAYOZA: He called me right quick to tell me how much I owed him and how quickly it had to be in his account.

COSTELLO: Call it Econ 101. Tom Costello, NBC News, Washington.