Michael Grubb on FCC "bill shock" plan: It could deliver a new jolt to consumers

MIT Sloan Asst. Prof. Michael Grubb

The major cell phone companies recently bowed to pressure from consumer activists and the Obama Administration and agreed to warn users via text message when they are about to exceed the limits of their calling plans. FCC Chairman Julius Genachowski and President Obama himself hailed the agreement. Consumers Union Counsel Parul P. Desai said, “Ultimately, this is about helping people protect their pocketbooks, so we applaud the FCC and the industry for this effort to do right by consumers.”

But would this move to prevent “bill shock”—those big, unexpected charges on monthly bills— really make consumers better off?

Read More »