Bill would rein in cellphone firms

Calls fade out or break up. Calls are dropped altogether in mid-conversation. These are the afflictions of cellphone users. And as dependence on the devices grows, so does the annoyance level.

Now Michael W. Morrissey, the Senate chairman of the Joint Committee on Telecommunications, Utilities, and Energy, is putting forth legislation to impose new regulations on cellular phone companies to make them more responsive to consumers.

The bill, drafted by Morrissey, would force the companies to issue semiannual public reports detailing their signal strength, their dead zones, and gaps in coverage, along with the number of dropped calls.

In addition, the legislation would allow customers with poor service to terminate their contract with their cellphone company without having to pay hefty penalties. Consumers would pay only a pro-rated share of the early termination fee, based on how long they have had their service; currently, customers who wish to get out of a service contract are usually required to pay the full termination fee.

There are no similar laws in effect anywhere in the country, according to industry officials.

"Like everybody else, I'm generally frustrated with the level of service," said Morrissey, a Quincy Democrat and a frequent user who said he chalked up almost 5,000 minutes last month.

"I bought my daughter a phone to use in school in Pennsylvania and it didn't work -- it's worked lousy for the last couple of years. You have no idea when you buy the phone if you're going to get service."

Under his bill, consumers could establish that they are receiving poor service by complaining to their cellphone company about five or more dropped calls in a month. They would then be allowed to cancel their contract.

Consumer advocates praised the bill, saying there is overwhelming public support.

"He's getting at absolutely one of the biggest problems consumers have," said Deirdre Cummings, consumer program director of MASSPIRG. "Cellphone companies sell primarily two-year contracts, and if you want to get out, it costs between $170 and $300. The frustrating thing is consumers can't get out of a contract when they're stuck with a phone that is bad."

The bill faces uncertain prospects in the Legislature. A spokeswoman for Senate President Robert E. Travaglini said it was too early to comment.

But many legislators have expressed general interest in asserting more oversight of the cellphone industry.

Last year, six senators and 16 House members sponsored a Cell Phone Users' Bill of Rights, a more comprehensive piece of legislation put forward last year by MASSPIRG.

In addition to the regular service reports that Morrissey is seeking, the bill aimed to provide consumers with more information in marketing materials and on their bills, and would have allowed them to cancel service without penalty during a trial period, and prohibited contracts longer than a year.

It was fiercely opposed by the industry, and it died in committee.

Any new effort to regulate the providers is likely to generate equally strong opposition.

"The overwhelming amount of public support for some significant change in the cellphone industry was tremendous," Cummings said. "But at the same time I have to say that each and every company showed up at our hearing and there was so much pressure by the industry it did not come of committee."

Cummings said a 2005 survey of about 900 consumers found they were "incredibly frustrated with two things -- billing problems and quality."

An industry spokesman said the wireless companies are dead set against any local regulation.

"We're concerned with any type of state initiative like this that has the potential to destroy the national wireless policy," said Joe Farren, director of public affairs for the Washington, D.C.-based CTIA-The Wireless Association, the industry group that represents the cellular telephone industry.

In 1993, Farren said, Congress created a national wireless industry -- a model that has provided "enormous consumer benefits," he said. The policy calls for limited regulation under the assumption that a thriving competitive market will force companies to improve their service -- without government intervention.

Over the past decade, he said, service charges have dropped 80 percent, while the range of services has dramatically expanded -- a cellphone can now be a camera, an Internet access point, an MP3 player, or an address book.

"These things happen because of the competitive industry where consumers have choices," he said. "What we don't want to do is dismantle the national policy and cause carriers to set up separate business operations in 50 different states to comply with 50 different rules and regulations. That will increase costs and cause consumers to be confused."

Farren, who said he was aware of no similar law in the country, said companies assess early termination fees to recoup the cost of the phones, which they give away almost for free, and to keep monthly service charges reasonable. "This is a vibrant, high-tech industry," he said. "The last thing we want to do is try to regulate it like a rotary phone that's stuck to the wall of my mother's kitchen."

Several companies active in the Massachusetts market declined to comment yesterday on the legislation, saying they had not seen it.

Michael Murphy, Verizon's New England region's public relations manager, said the company recently became the first national company to prorate its early termination fee -- $175. For each month completed under the contract, the termination is reduced by $5.

According to Murphy, the company also provides service coverage maps and allows customers to try out their service for 15 days. Customers who decide to switch carriers pay only for the service used during the trial period.

"Our company has the highest customer loyalty/lowest customer turnover in the industry," said Murphy in a written statement.

John B. Taylor, manager, public affairs of Sprint Nextel Corp., said: "We're strongly opposed to state-by-state regulation of this kind because it leads to a burdensome patchwork quilt of big government regulation that ultimately increases costs for the consumer."

Morrissey voiced optimism that the bill would pass. "I think my colleagues will take a hard look at it. If they are like me, they are getting calls from constituents about service quality," he said.

Under the bill, consumers who complain to their cellular phone company about 5 or more dropped calls in a month will be allowed to cancel their contract, and pay a greatly reduced penalty.

Andrea Estes can be reached at estes@globe.com