There was an interesting announcement indicating that the Android system will be the first to allow carrier billing for all sorts of purchases. This opens the door to the inevitable: the phone company becoming your credit card and finance company.
This possibility became obvious to me years ago when the first blue tooth devices appeared and I thought that Bluetooth would somehow be the mechanism for this horrible idea. Instead it’s the near field communications (NFC) chips that will do it. The Nexus S Android phone was one of the first with an NFC chip installed standard. This means you can swipe your phone like a credit card to make a purchase.
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The mobile phone companies will partner with Visa and MasterCard. The card system will be incorporated into your phone and the billing subsystem will be the credit card companies, but the collection will come from the phone companies. Therein lays the rub.
I’ve discussed this over the years and let me reiterate. If the phone companies collect credit card debt, it will lead to you being ripped-off in one way or another—you can count on it. Years ago when modems were still being used, there were numerous online scams that resulted in your modem auto-dialing scammers in Romania or Bulgaria with those pay-per-minute sex lines or porn sites that cost $100/minute. People would get these horrendous bills for numbers they never actually called.
The scam was genius, as the software would disable the modem speaker, hang up a legitimate call, and silently dial Bulgaria, or wherever. This was an out-and-out scam, but the phone company did not care, claiming that International treaties meant they had to collect the money on behalf of the criminals. There was nothing they could do about it.
There was no doubt in my mind that the phone companies were complicit but said nothing could be done. You either had to pay or lose all phone service forever. When I saw this leverage, it became apparent that the phone companies would become the best bill collectors ever, and it was just a matter of time before the credit card companies teamed up with them. I mean, who can afford to be without any telecommunications service in this modern world?
So now we have the NFC chip and the emergence of “carrier billing.” It will be sold as a benefit “for your convenience.” It will be promoted as a good thing to help simplify your life. It’ll be one less bill to pay; you just pay the phone company for everything. Life will be great, they’ll say.
Then every so often you’ll be hit with some scam or other, and you’ll have no recourse—just like those old 900 number scams in the past.
And if you’ve ever tried to deal with AT&T, in particular, you’ll notice that it’s impossible to win. You will be totally screwed and spending far too much time fighting fraudulent charges and scams to get much else done. In the end, you’ll pay the scammers and wait for the next scam. All the while, the phone company will get a piece of the action.
Can anything be done to avoid this? Yes, you can get a pay-as-you-go disposable phone, although Congress and others would like these phones banned because drug dealers use them. They want them banned, so you can be screwed by carrier billing, as far as I am concerned.
The other thing you can do is pay with cash. At least for now, cash is still accepted. I don’t know how long that will last, though.
I do know that carrier billing is a bad idea and should be resisted at all costs. And I’ll write another whole column about the scams that will stem from the NFC chip itself.
Turn it off and never use it.
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