I Fear the Carriers, Even When They Bring Gifts

It's no secret that I'm not the biggest fan that the cell phone carriers have in this world. Everybody's probably heard -- or told -- a few horror stories about what the carriers can do to their customers through carelessness or simple incompetence. But most people would be surprised to know that the carriers' partners face a similarly bleak situation when it comes to getting respect.

One person in the employ of such a retailer -- anonymized to avoid any retribution by the carriers -- described to me the poor treatment that these resellers experience from the major providers. Among this individual's complaints was the fact that the carriers' standard anti-fraud systems are wholly inadequate, forcing the retailers to do their own fraud screening at extra inconvenience to both them and the customer.

Why? Because in the event of fraud, the carrier loses little to nothing. Just a few months of service at the most, which is a negligible cost to them, no matter what their bills may say. The retailers are the ones who are faced with having to carry the inventory, and in the event of successful fraud, losing the value of the hardware. Of course the carriers aren't encouraging fraud, but they also don't have as much of a vested interest in preventing it, and they aren't taking measures to protect their affiliates.

Back to the original example, and an example of where one promotion I myself recently participated in had gone off the rails due in large part to this sort of issue. The customer buys a phone with the offer of a free memory card and music service subscription, as well as an unlimited data plan. Simple, right? Not exactly.

Though offered through the retailer, the promotion was the idea and responsibility of the carrier, which in turn handed off fulfillment to a third-party company, called Young America, effectively making the whole thing three steps removed from the customer and anything approaching customer service. This, combined with the fact that not everybody buys a data plan, turns the whole thing into an exercise in frustration if anything went even the slightest bit wrong. The retailer was quite honestly not responsible for the promotion; the carrier didn't handle fulfillment; and the participation of Young America would be almost invisible to the end user.

Young America, for those not familiar, is the U.S.' largest processor of rebates and mail-in promotions, possibly because it has a reputation for never letting the consumer get anything that it doesn't absolutely have to give up. The company has been sued multiple times by state governments over tens, possibly hundreds, of millions of dollars in unpaid rebate money. Say the name "Young America Corporation" to any consumer affairs advocate and they're likely to either retch or pull out a knife.

One of the problems with that same promotion was very, very simple: the carrier inconveniently forgot to inform the retailer about the conditions placed on this promotion until a few weeks after it had started. You'd think that would be the sort of thing that even a multi-billion dollar corporation wouldn't forget.

A representative of the retailer I dealt with pointed out in fairness that the carriers' offers are, of course, typically designed around trying to make more money off of the customer, and that these companies aren't in the business of simply giving things away without some insurance that they're not being taken advantage of. I would contend, though, that there's a not so subtle difference between insuring your company's profitability and strip-mining your customers, your business partners, and your reputation as a company.

I always thought that the carriers' attitude towards their customers was just the typical disregard for people shown by any monopoly -- a term for which they qualify, so long as they continue to all operate by the same procedures, business models, and dubious ethical practices. But it's a strange kind of monopoly that throws its retail outlets under the bus as well. And if they're willing to do that to their supposed partners, it's no wonder that the rest of us so routinely get the pointy stick treatment.