Verizon Paying up to $90 Million in Data Refunds

Oct 06, 2010 — Allan Pulga

Verizon Wireless announced Sunday that it would pay up to $90 million in refunds to 15 million cellphone customers who were wrongly charged for data or Intenet use, making it one of the largest customer refunds in telecommunications history, reported Edward Wyatt of the New York Times (Oct. 3).

“The announcement came in a statement from Verizon Wireless as the company held talks with the Federal Communications Commission about complaints of unauthorized charges and in response to questions about a possible settlement of an FCC investigation into the issue,” Wyatt wrote.

“Verizon said in its statement that the customers would receive credits from $2 to $6 on their October or November bills or, in the case of former customers, refund checks.”

Apparently, Verizon customers without data plans were charged $1.99 on one or more occasions, either due to software on the phones or because they had accidentally launched the device’s browser. Wyatt reports that Verizon was aware of the issue for some time, as some customers complained about it, but “played down the issue” in a December 2009 letter to the FCC.

Michelle Maisto of eWeek reported (Oct. 5) that Verizon’s official response was that it had already dealt with the problems that led to the issue. “When we identify errors, we remedy them as quickly as possible,” said Mary Coyne, Verizon’s deputy general counsel, in a statement. “Our goal is to maintain our customers’ trust and ensure they receive the best experience possible.”

Maisto added that the FCC’s response was more uncertain, as the Commission wondered why it took Verizon so long to reimburse customers, let alone disclose much sooner that corrective actions were taking place.

In the end, however, Maisto notes that analysts do not expect Verizon will suffer much damage to its reputation. She points out that Verizon often scores high on customer satisfaction surveys.

“I really don’t think that this will be a big deal for Verizon except in the very short term,” said Ken Hyers, an analyst with Technology Business Research (as quoted by Maisto). “Even though about 15 million customers are affected, the amounts per customer are pretty small: $2 to $6 per subscriber. Provided Verizon moves quickly to identify and reimburse those customers, I think most will not be unhappy.”

Such a situation may actually work out in Verizon’s favor, Hyers added, “since most of those subscribers are apparently unaware that they are owed for improperly billed data fees.”

Topics: Wireless Trends, Mobile Industry

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