Cellular Rates: Blame the PUC

The Dec. 4 letter from former Assemblywoman Gwen Moore (“High Cellular Rates Call for Action”) contains gross inaccuracies and misleading conclusions regarding cellular service rates.

Moore wrongly states that cellular service rates have not come down since service began a decade ago. The reality is quite the opposite. Cellular rates have dropped by an average of 12% to 20% in the last three years alone as cellular providers initiated rate programs suited to various usage levels.

The published commentary would lead one to conclude that cellular service is not a competitive marketplace and therefore prices are unreasonably high. This conclusion is false on both counts. Consumers have a choice of cellular carriers, as well as specialized mobile radio service, and are not shy about changing providers to obtain greater value or cheaper rates. Competition for discretionary income among various communication and entertainment devices adds to the mix, as does customers’ careful monitoring of their cellular minutes of use and the desire of cellular providers to penetrate the mass market. In addition, new competitors are entering the marketplace through the licensing of personal communication services.

Continued regulatory authority by the Public Utilities Commission will not help California’s cellular consumers. Cellular rates in unregulated states are 5% to 15% lower than rates in regulated states such as California.

Yet the PUC wants to maintain its rate-regulation authority over cellular service. The vast majority of states (42) agree with Congress that the Federal Communications Commission should have the authority to oversee rates for the country’s wireless communications providers and that the country would benefit from a seamless, national communications system that spans all states with uniform technology and minimal rate regulation. The PUC is one of only eight state regulatory bodies seeking to continue regulating cellular rates, and California’s request is the most stringent of these eight states.

The FCC needs to deny the PUC’s petition for rate control. The voters have spoken: Less government is needed.

MAGGIE WILDEROTTER

President

Cellular Carriers Assn. of Calif.