Watch Out For The $10,000 Phone Bill

Our phones and computers are like internal organs sustaining our lives. We travel abroad and we want to stay connected. And we can -– it just may come at an enormous cost.

A university employee goes abroad and a computer, set to automatically update software, generates a $10,000 cellular bill for roaming data charges. Business travelers and vacationers alike, some wise to the very high voice rates of phone calls while overseas, get surprised when their smartphones and iPads run up bills of hundreds and even thousands of dollars when apps update everything from Facebook pages to stock quotes.

This week’s Middle Seat (click this link to read) looks at this major travel gotcha and what you can do to save lots of money and still stay connected when in roam. There’s a chart with tips and a rundown in the story of basic steps to take before you go abroad.

When I asked companies like AT&T and Verizon why there is such a difference in voice and data rates at home and abroad, the stock answer is that they have to negotiate rates with cellular carriers in each country. When you go outside your carrier’s network, you have to pay the other network as well. And yet local rates in those countries are far lower, the big companies themselves offer discount packages you can pre-buy, and there’s a growing industry of small carriers providing cheap roaming options.

The European Commission has declared voice and data roaming charges have “outrageous profit margins,’’ and is on the verge of capping rates for roaming within the E.U. at far lower rates than U.S. travelers typically pay. In the U.S., the Federal Communications Commission has gotten cellular carriers to agree to voluntarily provide warnings when consumers are about to run up huge costs, but the warnings aren’t specific and are easily ignored.

Because it’s not a core service, there’s not a lot of market pressure or competition on international roaming rates. But perhaps if millions of travelers pay more attention, cellular carriers will have to come up with something more reasonable.

Source: WSJ