Last week, tens of thousands of AT&T customers lost cell phone service for about seven hours in a nationwide outage. While some feared that the company’s network went down because of a cyberattack, AT&T clarified that the outage was caused by “the application and execution of an incorrect process used as we were expanding our network.” Of course, the reason for the failure did not really matter to people who were unable to use their phones during an important time of the day.

In an effort to curb customer anger, AT&T quickly released a statement apologizing for the error. “No matter the timing, one thing is clear — we let down many of our customers, including many of you and your families,” said AT&T CEO John Stankey. “For that, we apologize.” Along with saying sorry, the company also promised to “make it right” with some customers by providing a $5 credit on their next wireless bill. “For the portion of consumer and small business customers most impacted by the outage, we are automatically applying an account credit to compensate them for the inconvenience they experienced,” the company said. According to AT&T, $5 is the “average cost of a full day of service.”

Consumer advocates were surprised by AT&T’s generosity. “It’s rare a company just gives the money back,” said Susan Weinstock, CEO of the Consumer Federation of America. “A lot of times, you have to apply for that, and of course a lot of people don’t know about it or don’t do it. That’s a huge problem.” Companies also do not often give out refunds across the board, which is the case with AT&T’s recent outage. Not only are Cricket wireless customers ineligible for the $5 credit, but so are people on AT&T’s prepaid and business plans. That’s why consumer advocates urge Americans to contact companies directly in order to receive what they deserve. “My advice to consumers is, if you were impacted by this, don’t wait for AT&T to make the determination” about your qualifications, said John Breyault of the National Consumers League. “Call and say, ‘I was impacted by this. I want to make sure I get the credit.’”

Questions:

1. Do you think AT&T’s $5 credit is enough to calm consumer anger over the company’s recent outage? Why or why not?
2. Why do consumer advocates advise people to call companies directly in order to seek out refunds?

Sources: Max Zahn, Jon Haworth, Josh Margolin, Jack Date, and Luke Barr, “AT&T Outage Caused by Software Update, Company Says,” ABC News, February 22, 2024; Rebecca Carballo, “AT&T Offers $5 Credit to Customers Affected by Service Outage,” The New York Times, February 25, 2024; Greg Iacurci, “In Wake of AT&T Outage, Consumer Advocates Say You Should Always Ask for Money Back if There’s a Blackout,” CNBC, February 28, 2024.