On the subject of ridiculous wireless data pricing

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That $99 Aspire One deal we covered late last year – Aspire One + two-year AT&T DataConnect plan – has both RadioShack and AT&T in hot water after a lady signed up for the deal and tallied up more than $5000 in overage charges within her first month.

According to the class-action lawsuit:

Although the customer service summary informed plaintiff and other consumers that their first bill might be higher than expected because of a $36 activation fee, one month’s service billed in advance, and prorated charges and fees for the month when the customer signed up, neither plaintiff nor other consumers were informed, nor could they have reasonably discerned from the paper work that wireless Internet usage exceeding 5GB per month would result in astronomical charges running into the thousands of dollars.

So yes, she blew way past her 5GB-per-month limit – around 10GB over. But is $500 per gigabyte in overage charges fair here? Five gigabytes for $60 per month, then one extra gigabyte costs $500? Come on. Sure, AT&T and all the other wireless companies can charge whatever they want for overages but don’t they have a responsibility to clearly state how much such overages cost? Instead, we’re greeted with tricky math.


When are we going to get rid of this $0.00048/KB nonsense? How’s your average consumer supposed to know how to convert kilobytes to gigabytes? Is the RadioShack employee expected to explain how and why AT&T gives you five large gigabyte-units of data per month but then starts charging you in fractions of a penny for every one millionth of one gigabyte you go over? That’s like a gas station saying fuel costs $0.00048 per eye dropper of gas even though your tank is measured in gallons. How many eye droppers in a gallon? Who knows?

Look how stupid this sounds:

Salesperson: Yes, ma’am, you get five gigabytes of data per month which, at 1,048,576 kilobytes per gigabyte, equals a grand total of 5,242,880 kilobytes for you to use. Now, if you go over your 5,242,880 kilobyte allotment, you’ll have to pay an amount that doesn’t even tangibly exist in hard currency — $0.00048 – for each kilobyte you go over.

Customer: What makes up one kilobyte?

Salesperson: Well, nothing any more. That measurement hasn’t really been used for anything in years. So you’d never really go over by one kilobyte. It’s much more likely that you’d go over by hundreds or thousands of kilobytes at the very least. Just going to Google is around 50 kilobytes, which would cost you about two and a half cents.

Customer: So they give me five gigabytes for $60 per month, which is $12 per gigabyte. What happens if I go one gigabyte over?

Salesperson: That extra gigabyte costs about $503.

So I’m guessing that’s where this “astronomical charges running into the thousands of dollars” argument is coming from. Should she have read the fine print? Absolutely. Should the salesperson have explained to her that going one gigabyte over would cost her more than eight times her monthly bill? Probably, but there’s a chance that a) the salesperson didn’t do the math to figure out that it costs $503 to go over by a gigabyte or b) the salespeople are instructed to sell stuff, not break down overage charges for everyone. It may very well have been a combination of the two.

The bigger question: Is it fair for wireless companies to charge $60 per month for a five-unit set of something and then hide unbelievable overage charges disguised as fractions of a penny behind a veil of tiny units a millionth of the size of the units they’re selling in the first place?

Seems kinda shitty. Why not just use this chart instead?


After all, voice plans are made up of minutes and it’s clearly stated that for each MINUTE you go over, you have to pay a set amount, say 45 cents. Not that you have to pay $0.0000075 for every millisecond you use after your initial minutes are up. That’d be crazy.

To be fair, AT&T’s data connection software tells you how many kilobytes you’re using and you can set yourself up for alerts when you get close to your limit. But again, the whole kilobyte model makes for a fuzzy-at-best case of how much real data you’re actually using. And you certainly don’t see a clear monetary tally anywhere in the connection software. I’m pretty sure that if most people saw how much it cost them every time they checked their e-mail or, even worse, streamed a YouTube video after they’d blown through their 5GB limit, they’d shut the computer off and lock it in a safe place until the end of the month.

The suit against AT&T and RadioShack is a class-action suit that “accuses AT&T Mobility and RadioShack of common law fraud and violation of state consumer protection acts in connection with allegedly false, misleading and inaccurate advertising of the netbook DataConnect plan,” according to RCRWireless.com. The plaintiff, Billie Parks, is seeking recovery of the charges she had to pay, a cancellation of her contract, damages due to the affect of the charges on her credit score, an injunction against any additional charges, and court costs.

[RCRWireless.com via Consumerist]

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