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Canadians File Class Actions Over Incoming SMS Fees

Posted by kdawson on Mon Aug 04, 2008 02:06 AM
from the unilaterally-changing-the-locked-in-contract dept.
dontmakemethink writes "CTV reports that over the last couple of weeks class-action lawsuits have been filed against two major Canadian cellular service providers, Bell and Telus, for imposing fees on incoming text messages. While there has been very vocal opposition to the introduction of the fees, those who cannot change providers due to binding contracts feel the situation is actionable in court. Some of those not bound by contract, such as myself, have given their service provider notice that they will charge the provider for having to contact them to have charges reversed for unsolicited texts. Because service providers are aware of the volume of unsolicited texts, we feel they are liable for the inconvenience to their clients for preventing spam charges, and more importantly under no circumstances should service providers profit from spam. We also feel that requiring us to buy text bundles to avoid the inconvenience of reversing spam charges constitutes extortion. They can charge me for texts when they stop the spam."
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  • by William Ager (1157031) on Monday August 04 2008, @02:14AM (#24463253)
    I can understand how this might be a breach of contract issue for customers with binding contracts, and I would certainly expect many customers, even without binding contracts, to cancel their service over this. However, I really can't see how a customer can consider themselves justified in arbitrarily billing a company for their time just because the company makes changes that they dislike, no matter how horrible those changes may be.
    • by Whuffo (1043790) on Monday August 04 2008, @02:17AM (#24463269) Journal
      If a company can arbitrarily bill their customers for incoming messages then what's wrong with the customers billing the company for having to deal with those unwanted messages? Show me in the contract where it says that customers will be required to pay for SMS spam...
    • by plasmacutter (901737) on Monday August 04 2008, @02:18AM (#24463271) Journal

      I can understand how this might be a breach of contract issue for customers with binding contracts, and I would certainly expect many customers, even without binding contracts, to cancel their service over this. However, I really can't see how a customer can consider themselves justified in arbitrarily billing a company for their time just because the company makes changes that they dislike, no matter how horrible those changes may be.

      explain to me how it's not justified? they're billing people for spam they RECEIVE, using the assanine american "per-message" system.

      People being held liable for unsollicited traffic they cannot control is criminally absurd, and if their regulatory bodies refuse to crush it in the womb, then I say billing phone companies for their time is an excellent proactive demonstration of, and against, that absurdity.

      • by purpledinoz (573045) on Monday August 04 2008, @03:23AM (#24463557)
        Also, isn't there an anti-trust issue here? It seems to me that there was collusion between Bell and Telus, who both decided to charge exactly the same amount for incoming text messages, at around the same time. Are Bell and Telus the same company?
        • by Anonymous Coward on Monday August 04 2008, @04:41AM (#24463945)

          Your responses suggest this is yet another case of the Land Of The Fee making some people more equal than others.

          When issuing a complaint to a firm in the UK, giving them a price list and then billing them for each letter you send (time to write, cost of postage) is well-known technique. If it comes to taking the firm to (usually) small claims court, these amounts may then be awarded as part of your win. And, contrary to all the "oh but they'll never pay" negativity, once you've won your case, if they don't cough up, the court gives permission to send bailiffs round and adds the cost of debt collection and wasting the court's time to the amount they owe. What often happens, if you're claiming a small amount and it's a big firm, is that they don't even turn up and you win by default [telegraph.co.uk] - if the big guys refuse to swallow their pride and pay up immediately, it's instant tabloid press fodder.

          So anyway, it's all part of increasing the risk for the firm if they fight you. It increases the likelihood that they acquiesce, content with the 95% who bend over and take it. Surely Canada, more recently severed from the motherland, gives its subjects similar recourse?

    • by Umuri (897961) on Monday August 04 2008, @02:20AM (#24463283)

      They aren't arbitrarily billing the company for their time because the company makes changes they dislike.

      They are billing the company for the time they spend getting their money back when the company tries to charge them for texts the company forwards to them without their permission or want.

      It's basically like me hitting you with a brick, then saying give me a dollar because you got hit with a brick

        • by BPPG (1181851) <bppg1986@gmail.com> on Monday August 04 2008, @02:59AM (#24463445)

          Dealing with the matter in the courts, or through cancelling the service, would make far more sense.

          Dealing through the courts: No, that would not make sense. Lawyers cost money. The idea is to not spend more money. Being charged for received messages (plus a 'spam tax') is not just unpleasant. It costs money.

          And canceling the service (wrt the cases in question) would often mean canceling all cellphone service. In many parts of Canada, there is only one available telecom and no alternatives. The telecom industry here is made of just a few lethargic behemoths, and there's only a semblance of competition in the higher population density regions. No disrespect intended, but do you understand why people are feeling frustrated here?

    • by Doc Daneeka (1107345) on Monday August 04 2008, @02:26AM (#24463301)
      A major problem occurs when any industry initiates a round of the Prisoner's Dilemma. One company institutes a policy change and their competitors follow them in the chase towards decreasing the bottom line and increasing profits. How are costumers supposed to vote with their feet, money, etc. when all/most of the industry have the policy or are quickly working towards embracing it?
      • by polar red (215081) on Monday August 04 2008, @02:30AM (#24463329)

        this is why self-regulation does not work!!

      • by Doc Daneeka (1107345) on Monday August 04 2008, @03:17AM (#24463525)

        How are costumers supposed to vote with their feet, money, etc. when all/most of the industry have the policy or are quickly working towards embracing it?

        Break the chains of industry and make their own costumes!

        • by HadouKen24 (989446) on Monday August 04 2008, @03:52AM (#24463715)
          Actually, that is how the Prisoner's Dilemma works.

          There are basically two versions: one in which it only happens once, and the iterated dilemma, in which the prisoners are going to have to deal with dilemma over and over again.

          In the iterated version, altruistic strategies tend to work much better. That is, it will tend to your benefit NOT to screw over the other guy. Assuming that all prisoners act rationally, there will usually be relatively few confessions, though this only works if the exact number of iterations is unknown to the prisoners.

          The iterated version much more closely resembles telecom competition. The companies are going to have to "compete" for some time. It's to their benefit to behave most of the time in ways that look like cooperation, even if there is no actual collusion. If both companies adopt strategies of cutthroat competition, then they'll get much slimmer profits than if they don't. Given that they both understand this, and they are both (relatively) rational actors, they will be reluctant to set off a cycle that might lead to drastically lower profit.
  • What a rip (Score:3, Interesting)

    by Brain Damaged Bogan (1006835) on Monday August 04 2008, @02:14AM (#24463255)
    I'm glad this sort of shit doesn't happen in Australia, only the sender of an SMS/phonecall gets charged here
    • Re:What a rip (Score:4, Informative)

      by QuantumG (50515) * <qg@biodome.org> on Monday August 04 2008, @02:16AM (#24463267) Homepage Journal

      Heh, except for those stupid "send me a ring tone" things, where they charge you $4.99 per message and you have to call an unhelpful man in India you get it canceled.

      • .... you have to call an unhelpful man in India you get it canceled.

        That man is unhelpful because that unethical American/Canadian company told (hired/paid) him to be so.

          • Re:What a rip (Score:5, Informative)

            by kiddygrinder (605598) on Monday August 04 2008, @04:05AM (#24463775)
            even more amusingly, you can simply sign up someone you don't like via a website simply by knowing their phone number. good times.
          • Re:What a rip (Score:5, Informative)

            by Anonymous Coward on Monday August 04 2008, @05:49AM (#24464261)
            It's the same here. I work in a call centre for one of the main UK mobile phone networks (thus AC), and this is one of the biggest complaints I get. People call up asking why their credit is disappearing (I'm on the Pay As You Go department), and I explain that they've been receiving these texts which have been taking £1.50 a time.

            It's not the fact that someone can be charged £1.50 for an individual message, it's the fact that these companies can send out many messages at the same time and bill you individually for each message. I once spoke to a gentleman who had lost a total of £18 from 12 messages that he received at once. Thankfully he took the news well.

            In Europe, no provider can charge to receive text messages. Well, in theory they could, but would probably have a mass exodus of customers since the very idea of being charged to receive texts is a ludicrous one. Unfortunately though, this leads to the above situation where people don't realise that they're being billed £1.50 a time to basically receive crap to their phone.

            In short, Jamster, Red Circle, Zamano , et al= Biggest pain in the arse for the UK mobile phone industry.
    • Re:What a rip (Score:5, Insightful)

      by ChoboMog (917656) on Monday August 04 2008, @04:08AM (#24463799)

      I'm glad this sort of shit doesn't happen in Australia, only the sender of an SMS/phonecall gets charged here

      All the more reason to be concerned...The fact that we were in your situation just a month ago shows how quickly you could end up in ours.

  • by get quad (917331) on Monday August 04 2008, @02:27AM (#24463309)
    Unlimited Data Plans Should Include Unlimited Texting. Period. Anything Else Is Criminal.
  • by TheJasper (1031512) on Monday August 04 2008, @02:38AM (#24463355)
    Regardless of whether people know in advance that they are being charged for incoming SMS this should be illegal. Smart people wouldn't agree to such a contract anyway. Basically someone has the right to take all your money without notice. It is no better than loansharking if you think about it.
  • Contracts? (Score:5, Interesting)

    by p0tat03 (985078) on Monday August 04 2008, @02:42AM (#24463377)

    Correct me if I'm wrong... but aren't contracts breakable without termination charges if the service provider changes the contract? There's a time limit on this, but it's fairly generous. I know people who got out of their Bell/Telus contracts recently precisely BECAUSE of the SMS fee.

    Now, the fact that all the wireless providers in Canada are dirty crooks is another story altogether. Quitting your contract won't help much, you'll just get gouged somewhere else.

    I think Canadian telecom (and to a lesser extent in the US) is proof solid that a laissez-faire approach to regulation and the institution of "free market" principles in an industry where the government GUARANTEES monopoly (via last mile, etc.) simply doesn't work.

    Jim Prentice is a corporate crony who should be kicked out of office, preferably thrown in jail for so blatantly selling out the Canadian people's interests. His broken-record touting of "free market will be best" on the telecom issue is laughably absurd for anyone who's had to pay a phone bill in the last 10 years. What a change the Conservative government has brought us. Now instead of the Liberals selling out the Canadian people little bits at a time under the table, the Conservatives are having a firesale blowout with no regard for public opinion.

    • Re:Contracts? (Score:4, Insightful)

      by nacturation (646836) * <nacturation@gmail. c o m> on Monday August 04 2008, @02:52AM (#24463417) Journal

      Correct me if I'm wrong... but aren't contracts breakable without termination charges if the service provider changes the contract?

      The problem is that people are agreeing to contracts which say they agree the provider can change the terms of the contract. Read the Slashdot (SourceForge) terms of service... they essentially say that SourceForge can change the terms, it's up to you to monitor them for changes, and 14 days later if you keep using the site it means you agree. They could change it and say that your full name and email address will be made public on every post unless you cancel your account. The only difference here is that with these providers you're bound to a contract and you've agreed in advance to whatever changes are arbitrarily made.
       

      • Re:Contracts? (Score:5, Interesting)

        by Carewolf (581105) on Monday August 04 2008, @03:35AM (#24463611) Homepage

        Such a clause in a contract is natually invalid. You can not agree to unspecified or future terms, in a contract you only agree to specified a terms, and specifying unspecified terms is not magic loophole any court accepts.

    • Yes and no. (Score:3, Interesting)

      Yes, if you want to change a contract you have to start a new one. This either means continuing the old one for its duration, termination by mutual agreement or more commonly by invoking a "we may terminate any time..." clause.

      Very often in practice however companies lawyers will have put a lot of small print in, saying things like "we can vary our charges and basis for charge at any time". This means that they can change the parameters of an existing contract without terminating.

      The changes may or may
        • by Chrisq (894406) on Monday August 04 2008, @05:12AM (#24464097)
          In my experience the best way is just to cross out the bits you don't like, photocopy it before sending it off and send it.

          I have only once had an "I'm sorry we cannot accept your business" response. When the mobile phone provider Orange set me a change in terms and conditions which said that accepting them would tie me in for another 12 months I crossed this out (I had already had a 12 month minimum term on sign up) and enclosed a note saying that I thought a further lock-in was unreasonable. They actually responded saying they accepted my contract on these terms!
  • by houghi (78078) on Monday August 04 2008, @03:06AM (#24463481) Homepage

    I can not understand why companies where allowed to do this in the first place.

    In normal countries paying for something you did not ask for would be considered fraud. But then I live in a country (Belgium) where generally the customer is more important then the companies.

        • Re: (Score:3, Informative)

          The thinking is the person who chose the "final mile" should pay for the additional cost of that final mile. That is, if I choose to make myself available via a cellphone, it's not fair on my callers if I force them to pay for my choice in using a cellphone.

          Obviously this makes sense for phone calls, where it's not as if you have to answer a call. For SMS messaging, where you don't get a choice about whether to accept a message or not, it just plain doesn't work.

          In the US, cellphone operators have chos

  • by purpledinoz (573045) on Monday August 04 2008, @03:18AM (#24463529)
    The real problem is that the Cellular companies are pretty much a monopoly. It's the Government's fault for not allowing foreign competition and allowing all the wireless companies to merge. This issue is a clear sign for the government that competition is badly needed and we have no one to blame except the moron officials who allow monopolies. Bell, Telus, and Rogers are in the business of making money, and they are able to do this by reducing service and increasing fees.
  • Time to ditch SMS? (Score:3, Interesting)

    by knarf (34928) on Monday August 04 2008, @04:58AM (#24464039) Homepage

    SMS has been and will be milked until the cow is not just dry but parched. The difference between actual cost and price of SMS is ludicrous. And as that actual price only goes down, why to they raise the price to the customer (I know, because they can...)?

    Most modern phones can do GPRS or better... which, even though still overpriced, is quite a bit more affordable per bit than SMS. IM clients are available for many phones. Cost per message is radically lower, messages can be longer... What is missing? What would need to be added/removed to turn an IM client into a substitute for SMS so we can finally put that tired old cow to pasture?

      - it needs to start when the phone is turned on
      - it would be nice if the addressing scheme was compatible with phone numbers
      - it would need to keep open a data connection...
      - ...without incurring onerous fees...
      - ...or draining the battery...

    Many people separate their email provider from their internet access provider, the same should be doable with mobile communications. It will be hard to make it as efficient as the provider can but that can not be helped. It is imperative to build something over which the provider has no power - other than the usual contract clauses or IP blocking antics. Those can be ignored, circumvented by using another provider or fought in court if needs be.

    • Re:Why SMS? (Score:5, Insightful)

      by Gordonjcp (186804) on Monday August 04 2008, @02:28AM (#24463315) Homepage

      Because SMS is generally free, at least in the UK and EU. It's only in the US, where they don't really understand how phones work, that they charge to both send and receive messages.

      Show me one UK pay-monthly package that hasn't got at least 500 free SMSes per month, and I'll show you half a dozen more that do, often cheaper.

      • Not free in the EU (Score:5, Insightful)

        by Nicolas MONNET (4727) <(nico) (at) (altiva.fr)> on Monday August 04 2008, @02:57AM (#24463435) Homepage Journal

        In fact it's damn expensive, around 10 cents a message.
        That's because there is no real competition: in France, the three mobile operators have been fined over €600 million for anticompetitive collusion. There is room in the spectrum for a fourth operator, but Sarkozy's best bud with the existing ones (CEO godfather of his son) and since he's such a corrupt fucker, he is doing all he can to derail the allocation process.
        But he's a right-wing "free market" advocate! Right!

    • I think the real reason is market inertia. I have a free email address provided by service provider on my phone, and I also have secure access to my own IMAP mailbox, but I never use them for messaging to/from people's phones for the simple reason that most people don't have email set up on their phone.

      Since most people don't have it set up, most people don't think it's useful to have set up, and therefore don't bother with it. It's one of those things where it's only useful if it's widespread.

      SMS works eve

    • Re: (Score:3, Insightful)

      Honestly, why do service providers in the west still use SMS as a messaging service? I'm in Japan and we use actual Email addresses for messaging and you only get charged normal packet fees (the same price for packets as you pay for browsing the web).

      I think I answered my own question: money

      I think there are a lot more reasons for using SMS then money.

      1) You can find phonenumbers quite easily in the phonebook, the same cannot be said about email addresses. Furthermore, not everyone adds email addresses under the contacts, but it is likely they do add the phonenumbers.
      2) Not everyone has, or is willing to spend the money to get, a phone that is capable of sending and receiving emails.
      3) Not everyone has a clue on how to get email to their phone configured, even in the unlikely case they

      • Re: (Score:3, Informative)

        Considering that it costs me 45$ a month to add data to my plan, per phone (it's a family plan), and 15$ to add unlimited SMS for all phones, it's not even close regarding text/email.

        You're getting a text, buddy, whether you can receive email on your phone or not. I'm not wearing gold pants, yanno.

      • As a Canadian, I feel this is just us imitating the American way of doing things. However, it's unfortunate that we can't take full credit since he's a new immigrant and likely wasn't a citizen yet.

        In other news, it strikes me as odd that you find the fact that children saw it the most disturbing bit about this. The children will be fine. The victim won't be.

          • Besides that if it had been in the US, the cops would have shot him

            If it had been the US, one of the other passengers would have shot him.

            • by das3cr (780388) on Monday August 04 2008, @06:45AM (#24464539) Journal

              If it had been the US, one of the other passengers would have shot him.

              As would have only been proper!

              • by pnewhook (788591) on Monday August 04 2008, @08:26AM (#24465561)

                If it had been in England, the police would have shot some Brazilian guy who was nothing at all to do with it.

                And Bush would have said "Oh my God! A brazillion people were killed on a bus! How many is that anyway?

              • by tha_mink (518151) on Monday August 04 2008, @09:37AM (#24466583)

                Yes, and a gunfight would have broken out, resulting in not only the one dead passenger by the killer (that would have happened regardless), but several other dead passengers caught in the crossfire of inexperienced gun wielding idiots.

                Right. And that would have been a MUCH better news story than just *one* lousy decapitation. That's why the US is the world media leader. More action, better suspense, and a deadlier final outcome.
                U-S-A! U-S-A! U-S-A! U-S-A! U-S-A!

              • by A nonymous Coward (7548) * on Monday August 04 2008, @11:31AM (#24468441)

                Yes, and a gunfight would have broken out, resulting in not only the one dead passenger by the killer (that would have happened regardless), but several other dead passengers caught in the crossfire of inexperienced gun wielding idiots.

                You ought to look up some conceal carry stats and get some knowledge before shooting off your mouth (pun intended).

                CCW permits require training and include a background check of some sort. You don't just start carrying and get away with it (except in, I believe, Vermont and Alaska, and they strangely don't have humongous crime problems). Then there's the interesting fact that off-duty cops have a worse criminal rate than CCW holders.

                You need to stop reading the nanny state press (both right and left) and starting looking things up for yourself.

                  • by A nonymous Coward (7548) * on Monday August 04 2008, @12:19PM (#24469331)

                    You are wrong. There are 2+ million crimes yearly in the US prevented by use of a gun, most of those without firing it.

                    Most gun deaths in the US are criminals on criminals, and those people are criminals only because of the War On (Some) Drugs.

                    Doctors' bad handwriting alone is responsible for 7000+ deaths a year in the US. Medical mistakes in the US kill 200,000+ a year. Cars kill 40,000+, more than guns.

                    Where's your outrage about cars and doctors? Wheress your outrage about the War On (Some) Drugs?

                    Refusing to face facts is a good sign of cowardice. What exactly about guns scares you so much, so irrationally, when cars and doctors kill far more people, and when most gun deaths are criminals anyway?

    • Re: (Score:3, Interesting)

      Because I can't stand talking to you. Telephones are for emergencies of the catastrophic sort only, e.g. "I'm on fire, please send help", "Wife is in the emergency room with a burst appendix", etc.

      If it's anything less important than that, then you're a dick for using the phone.

      • Re: (Score:3, Informative)

        The post seemed straightforward and logical to me. You can't be charged for incoming text if text messaging is disabled on an account. Some providers make it easier than others to disable text service on a phone. Sprint is mildly annoying to disable, T-Mobile is no-thought-required easy. No experience with other providers, but it's still possible. Non-chargeable system texts still come through.

        The people who get screwed are those who use texting but don't have unlimited plans.

        • You can't be charged for incoming text if text messaging is disabled on an account.

          A rather drastic solution. Applying that logic, you can't be charged for anything if you don't have a phone. Is it really an unreasonable request to be able to recieve genuine messages but not spam - and at my own expense?

      • Re:(shakes head) (Score:5, Insightful)

        by Piranhaa (672441) on Monday August 04 2008, @04:08AM (#24463803)

        -2 Missing point..

        There's not even a way to OPT OUT of texting entirely. The consumer is stuck with the service whether or not he or she even wants it.

        How stupid is that?