June 2008 Ringtone Trends
American cellular service provider AT&T is coughing up money to some of their subscribers as part of a recent class action lawsuit settlement.
The company hit a sour note with some of their subscribers who said that they incurred mysterious charges on their bills for ringtones, horoscopes and other content provided by third parties that they had never even ordered, let alone used! Vendors of ringtones and daily text-message services with horoscopes and jokes solicit customers to sign up by entering their phone numbers on web sites or by sending text messages. The charges, which can be hidden or poorly explained, show up later on cell-phone bills, often as recurring charges.
AT&T nets a portion of income from third party services (such as ringtone providers), whose fees are often hidden or poorly explained. In some instances, mysterious ringtone fees have even shown up on the bills of AT&T 3G laptop customers who can’t use it and didn’t order it.
It’s the first such settlement on a national basis in the United States and it could set a precedent for similar lawsuits. While AT&T still does not admit any wrong-doing, the settlement allows some of its 70 million customers around the country to claim refunds for any such charges incurred between Jan. 1, 2004, and May 30, 2008. There is no estimate of how much the settlement will cost AT&T, but it is known that the plaintiffs’ lawyers will receive approximately $4.3 million.
In order to ensure that something like this never happens again, AT&T now requires that all users respond to offers received from third party content providers with a text message. These content providers must now also send users monthly un-subscription reminders.
Perhaps AT&T will be able to make up this financial setback brought about by the lawsuit with their latest offering: the AT&T Ringtone A-List.
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