A billion dollars scam
If you’ve been reading here before, you may know that I’m not a fan of cellphone contracts. Well a local TV program exposed yet another way network providers are trying to get every cent out of users’ pockets: the scam called “Network Service Fees”. You may be familiar with it if you have a contract, it’s that line on your bill that says fees or network access, or something like that, and usually is not a small amount.
Here it can easily be a $7.50 surcharge on a $25 monthly contract. The way it’s worded, you may think, and most people do, that it’s some type of government tax. That’s what the show investigated, and it turns out that’s not the case. Simply look at the full terms or contract on your provider site, and you may find out what these fees really are.
For all four providers here in Canada, these fees include simple things like network maintenance, providing service to rural areas, expending their campaigns, providing services of various types, basically, their day to day operations. It’s just as if your bill included lines saying they have to pay for heating, marketing, and so on, and charge you extra for it. Operating cost is something every business has. It has to be included in the base cost, not charged as some type of extra.
The most ridiculous charge is the “911 surcharge” which, at least here in Canada, can cost $0.90 per month per customer. Yet when asked, the Police department said that only the land-line providers pay them a tax for the 911 service. Cellphone providers do not. So that charge is completely false. What they actually mean is that you pay a surcharge to your network provider so THEY will agree to connect you to the 911 service if you ever need it.
The program ended with the funniest thing of all this. There’s a new virtual provider starting up in the region called Koodo Mobile who spends a lot of marketing dollars boosting that their service has no extra charge of any type. Yet who owns Koodo Mobile? Telus, one of the big Canadian providers charging these fees.
I agree 100%. Telus is probably hoping people will think “I really hate Telus, I hear Koodo is great! Lets pay the $100 early contract cancelation with Telus and move to Koodo!”, Little do they know, they are still stuck with Telus. I think Telus is trying to take over the market with this new company. Also, on the Koodo site, the fact they are owned and operated by TELUS is mentioned ONLY ONCE in small print at the bottom of an information sheet.
You see the ads on TV NO SERVICE FEES, Fat Free Mobility…
There are no service fees but like all companies you must by one of their phone to access their network.
None of their phone are free. But, you can get a Tab or and “I O U” they will take $150 off the price of the phone and add it to your account.
Now, you are responsible to payback that $150 dollars monthly, by adding 10% of your bill towards paying off the phone.
So, there is a monthly fee…hum, a service fee ?
Ok, so that is not so bad at least you know what you are paying for, right ?
Thankfully, after you are done paying off the phone the monthly fees stop…Nope
They will continue to take the 10% toward your next purchase of a phone.
Not too bad right at least you will always have a new phone…As long as you stay with them.
What happens if you leave ?
Well, your balance owing will be due, and if you have a positive balance it does not have a monetary value, in other words you do not get that money back.
Is it really Fat Free Mobility or just a creative way of charging a service fee ?