• March 29, 2005
  • By Coreen Bailor, (former) Associate Editor, CRM Magazine

Telecom Customer Complaints Are Rising

Cingular's October 2004 merger with AT&T Wireless did more than establish the nation's largest cell phone company: The merger produced the worst customer complaint record for 2004, according to information obtained by the Consumers Union from the Federal Communications Commission (FCC) through the Freedom of Information Act. More than 29,000 complaints were filed last year, with the total number of complaints about wireless phone service rising 38 percent from 21,357 in 2003, to 29,478 in 2004. The combined Cingular/AT&T logged a complaint rate of 288.9 per million customers, and AT&T Wireless received the worst complaint record for two consecutive years. Janee Briesemeister, senior policy advocate for Consumers Union, the nonprofit publisher of Consumer Reports, notes that Cingular and AT&T were not merged for the entire year, but that "the two companies for a while have been pretty high on the complaint meter, so combining them just made the situation worse." Cellular One received the second highest complaints per million with 264.3, followed by T-Mobile with 185.3, Sprint with 167.5, Nextel with 102.5, and Alltel with 76.2. Verizon had the best showing amongst national wireless companies with 75.5 complaints per million customers, but regional carrier US Cellular had the lowest complaint rate of all carriers with just 39.4 complaints per million subscribers. When further segmented, all the major cell phone companies received the most complaints about billing issues, followed by complaints about transferring phone numbers, service quality, contracts, and marketing. The data obtained by Consumers Union coincides with Consumer Reports' annual cell phone report conducted in September 2004 and based on responses from more than 39,000 subscribers in 17 cities to the Consumer Reports Web site. About 45 percent of survey respondents reported that they were completely satisfied or very satisfied with their cell phone service, 31 percent reported that their company's response to a service inquiry was very helpful, and 40 percent said that billing inquiry responses were very helpful. Additionally, about 70 percent of respondents who use a cell phone have had at least one dropped call in the week prior to the survey, and about 60 percent reported having a bad connection. "As you become more reliant and you're starting to spend more money on your cell phone, you want to get good coverage, you want to get a bill that you can understand and that's accurate, you like to get good customer service, and those things aren't happening for a lot of customers," Briesemeister says. "When they don't get satisfaction with their carrier, and they're stuck in a two-year [agreement with their] carrier they have no choice but to file a complaint." The FCC is the only regulatory agency overseeing wireless service, but according to Briesemeister several states have proposed legislation that gives states authority to deal with cell phone customer complaints. "The response from the cell phone industry has been that these bills are not necessary, that everything's great, and that the market is competitive and taking care of consumers, but numbers like these show that the market is not taking care of consumers, and that consumers do need some rules that cell phone companies have to follow." Related articles: Is 2005 the Year for Wireless CRM?
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