How Wireless Providers Are Quietly Screwing Over Some Customers

Illustration for article titled How Wireless Providers Are Quietly Screwing Over Some Customers
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In April, Verizon will begin charging its customers a surprisingly high fee if they intend to pay their monthly bill over the phone with a representative. It’s an overlooked practice that’s spreading among big telecoms and provides huge profit potential while eliminating needs for human personnel. All the while, those who likely can least afford it pay the price.


For anyone who’s grown up with technology as a constant part of their life, the idea of preferring to wait on hold and process a payment with a human being that probably hates your guts sounds like madness. But there are still people who like (or feel the need) to do it the old-fashioned way. That’s becoming increasingly difficult with the big wireless carriers who want everything to be handled online or through automated systems. Now that Verizon has jumped onto the bandwagon, three out of the four major wireless carriers charge some sort of fee for the inconvenience of speaking paying through a human.

Verizon’s $7 fee falls right in the middle of its competitors, with T-Mobile asking for $8 and AT&T asking for $5. The only one of the big four that doesn’t yet charge a fee is Sprint. When we called Sprint to confirm its policies, a representative was surprised that other companies charge a fee, and they said that Sprint found forcing automated services just resulted in increased entry errors.

I’m a Verizon customer, but I wouldn’t have known about this change because I do my payments online. But a colleague recently mentioned that her elderly aunt was frustrated to be notified she’ll no longer be able to pay her bill over the phone with a person without paying up. It stands to reason that elderly customers are likely to be the ones most affected by this, as well as people who might have a disability, customers who don’t have internet access, or those who just don’t like technology all that much. Some people like the comfort of knowing a bill is paid and getting the reassurance of a human representative who can be held accountable. Other people don’t like auto-drafting payments for fear of not having enough money in their account when the bill comes due.

We reached out to all of the wireless carriers to ask if they could provide any demographic information or just tell us the percentage of customers who use the pay-with-a-human system. The only company to address that question was T-Mobile; a spokesperson wrote to us saying only that, “It’s a very small percentage of customers who pay their bill over the phone.” They added, “Customers always have the option of avoiding the charge by paying their bill online.” A Verizon spokesperson simply told us that this new policy “is similar to other companies,” and they outlined the other payment options. AT&T did not reply.

Unfortunately, pay-by-phone fees are an under-studied subject. Last year, the Consumer Financial Protection Bureau (CFPB) warned companies that they could face legal repercussions if they’re found to be “misleading consumers about the purpose and amount of certain pay-by-phone fees or keeping them in the dark about much cheaper payment options.” The warning was less about a specific bombshell case and more about potential red flags the agency was seeing. When we contacted the CFPB to ask if it might be able to give us some statistics on the number of Americans who pay their bills by phone, we were told it’s a fairly new issue and that the best way to get answers would be to file a complaint with detailed inquiries. Likewise, a spokesperson for AARP told us that they don’t have any data on this subject.

In 2017, benchmark data from ACI Worldwide and Aite Group found that 56 percent of all bills are paid online, with only 42 percent of seniors using online payment systems. Thirty-one percent of seniors pay by check, and 40 percent use snail mail.


In the absence of broader data, it seems reasonable to use the 65 or older population as a way to understand how a $7 fee can be a fountain of cash for a wireless carrier. Pew research found, in 2017, 42 percent of Americans 65 and older now own a smartphone, a number that’s way up from its 2013 level of 18 percent. And 67 percent of that segment of the US population uses the internet in some fashion. Still, close to 16 million seniors claim that they never use the web.

In 2014, Jeh Kazimi, founder of Breezie, a tablet-based service that helps digitally isolated adults get online, outlined some of the issues that seniors face in getting up to speed with new tech. Of course, physical and cognitive issues can be a big problem, and the ever-changing learning curve creates a major hurdle. But there are other less obvious issues like fears of their personal information being online, and a reluctance to ask for help “for fear of being a nuisance, looking silly, or getting a patronizing response.”


Let’s just do a little hypothetical number-crunching focused on seniors as an example of the kind of money to be made off of these fees.

According to the 2015 US census, there were 47.8 million Americans over the age of 65, which is about 14 percent of the population. And the country is only getting older. By 2060, that demographic is expected to rise to 98.2 million and comprise roughly a quarter of the total population.


Let’s say that only 10 percent of the elderly who never use the web pay a phone or cable bill over the phone with a human rep. That’s 1.6 million people paying out an average fee of $6.60 per month. Over the course of a year, the big wireless carriers could hypothetically collect $126 million. To put that in perspective, that’s almost three times chipmaker AMD’s net income for 2017. For a company like AT&T with a net annual income of $29 billion, that’s a drop in the bucket. But that kind of cash certainly helps automate their service while they lay off thousands of workers and reap huge tax benefits.

Again, finding an accurate number would be a lot easier if the telecoms would just tell us how many people use phone payments, but for whatever reason, they don’t want that information to be public.


The telecom vampires see a way to make a buck off of people and they’re going to take it.



It’s become a common practice almost everywhere. A fucking fee to pay your fee.

Everything in America is a scam.