Cell phone calls cost $3 per minute?
Filed under: Technology
The Utility Consumer Action Network reports that the average cell phone customer pays $3.02-per-minute for cellphone use.UCAN looked at the phone bills of 700 San Diego consumers to arrive at that figure, which is so high because of the large number of consumers who have cell phone plans that aren't well-suited to their needs, and therefore pay for minutes they don't need. After eliminating the biggest minute-wasting customers from the data, UCAN found that most consumers still pay between 50 cents and $1 per minute for cell phone use.
According to the study, the average customer uses only about a third of their "anytime minutes"
The specific numbers of the study seem dubious to me. If the average consumer spent $1 per minute for cell phone use and talked on the phone for an average of 20 minutes per day, that would work out to about $600 per month on phone bills -- Does anyone reading this have a cell phone bill that high? In 2007, JD Power reported that the average cell phone bill was $73 which, if that $1 per minute figure is right, would give people less than 3 minutes of phone time per day. That doesn't make sense.
In any case, the takeaway for consumer is this: Look at your cell phone bill regularly and see if you're wasting a lot of minutes each month. If you are, get a different plan.
Reader Comments (Page 1 of 1)
3-10-2009 @ 1:33AM
bruce Kushnick said...
Zak,
as the authors of the report, Teletruth is using a very straightforward methodology of calculating the cost per minute -- we examine each 'account using a formula
Total costs divided by total minutes equals cost per minute. --- and the data for the wireless was based on actual phone bills.
In our survey we found that about 1/3 of single line accounts make less than 10 minutes of calls -- -and they can have costs for their plan of $16.95 to $39.99 --- so, if a customer is making 5 calls and paying $43.00 counting all of the extra charges, their cost per minute is --- $8.60 a minute.
The FCC, for example, claims that a 1 minute call for wireless is about $.06 a minute. What the FCC does is to not examine the total costs as well as averages ALL users with all calls -- so, families making over 1000 minutes drown out the data for hundreds of low end customers.
By examining accounts, as well as break outs of the number of customers by call volume, the difference is a better representation of every customer, not simply the high volume customers.
UCAN and Teletruth are proposing is to have a per-minute box on both wireless as well as long distance, which also has the same problem. With AT&T's long distance service, we found that over 10% of the population pays over $1.00 a minute because of plan fees, etc... they make few calls but pay $10-$12 a month.
Bruce Kushnick, Teletruth
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3-11-2009 @ 2:17PM
Richard Rider said...
Cell phone calls cost $3 a minute???
This preposterous assertion from UCAN San Diego should have set off skeptical alarm bells in any reputable journalist and editor. It didn't.
This bogus story has been circulated around the nation. Newspapers, TV stations and blogs mindlessly published this story without any effort to fact check, or even to apply the giggle test (it fails miserably).
UCAN is a far left advocacy group, masquerading as a consumer organization. They favor nationalization of the utilities, and vehemently oppose deregulation, competition and the private sector in general. The study was a classic example of junk science, or, more accurately, junk research.
UCAN's "scientific study" (87 pages, no less!) http://tinyurl.com/b563dc
surveyed their OWN membership -- a group dominated by low income senior citizens sporting tattered Che Guevara T-shirts. A third of those who responded had signed up for cell phone service and then seldom if ever used it. And this is the polling sample on which UCAN tells the nation that we are averaging $3 a minute for cell phone calls (and a ludicrous $.55 cents a minute for land line long distance, I might add).
Pathetic.
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3-19-2009 @ 10:52PM
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