As Time Warner Cable Defends Merger Plans, It Keeps Gouging Customers With Obnoxious New Sneaky Fees

from the surcharged-to-death dept

For years now, the broadband and TV industry has hammered its customers with all manner of creatively sneaky fees, buried below the line to jack up consumer prices -- while leaving the advertised price alone. It's clearly false advertising, though regulators have seen fit to ignore these practices as business as usual -- even though many of the fee names have become increasingly, aggressively ridiculous. CenturyLink, for example, charges its users a $1 "Internet Cost Recovery Fee" and a $1.55 "Non-Telcom Services Surcharge" -- both fees are little more than pure profit and entirely untethered to logic or any actual service rendered.

Other ISPs happily charge customers a non-government mandated "regulatory recovery fee," purportedly to counter ambiguous government regulation -- despite a decade of being deregulated. The latest obnoxious fee trend is a "broadcast TV fee" that has been showing up on many cable customers' bills over the last year. This too is little more than the cable company breaking out a portion of programming costs and burying it below the line -- again to give the illusion of a lower advertised price.

Despite the fact that Time Warner Cable is putting on a polite face to get its $45 billion fusion with Comcast approved, it's certainly no exception to this aggressive sneaky fee parade. The company was just sued for billing shenanigans and the vast difference between promotional and real world prices. Undaunted, the company informed customers this month that it's socking them with a new $2.75-per-month sports fee, as well as bumping its broadcast TV surcharge from $2.25 to $2.75. Like most cable operators, Time Warner Cable is quick to blame broadcasters for the increases:
"Time Warner Cable said broadcast fees have risen more than 60% in the past two years and that the cost of cable sports channels has increased 91% since 2008. The company said the charges only represent a fraction of what it pays to programmers."
Amusingly unmentioned is that Time Warner Cable itself owns Time Warner Cable Sports Net and SportsNet LA -- two sports channels directly responsible for some of the highest sports programming costs in the nation. Despite blaming programming costs, Time Warner Cable is also quick to bump its monthly modem rental fee from $6 to $8 (though, fortunately users can buy their own modem to avoid this charge). All in all, it's part of the cable and broadband industry's ingenious plan to self-immolate and mindlessly raise rates in the face of competition from disruptive new viewing options.

These costs not only are an assault on customers in uncompetitive TV and broadband markets, but they skew all policy conversations on industry pricing because they're historically not included in price analysis. In other words, all of those studies that already indicate how U.S. consumers pay significantly more for broadband and television aren't even including this layer of creative pricing fat companies pile on top. One can only guess the new heights of obnoxious fee creativity obtainable by a larger, combined Comcast and Time Warner Cable. Ready for the "Shut up, it's because we can" fee?

Filed Under: fees, sneaky fees
Companies: time warner cable


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  • icon
    lucidrenegade (profile), 30 Dec 2014 @ 2:55pm

    I'm waiting for the "Failed Merger Cost Recovery Fee".

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 30 Dec 2014 @ 2:56pm

    They also charge for the modem lease fee. They jacked up the cost to $8.00 a month from $5.99 a month.

    reply to this | link to this | view in chronology ]

  • icon
    Mason Wheeler (profile), 30 Dec 2014 @ 3:41pm

    So what exactly is the problem here?

    It sounds like you're complaining about the prices themselves. I see nothing wrong with them charging whatever they feel like charging; that's just basic capitalism. Buyer and seller agree on a price, and everyone's happy.

    The real problem, IMO, is when they advertise one price and then charge another. In polite company, that's known as "deceptive advertising." Among people more willing to speak the unvarnished truth, words like "lies" and "fraud" will get used. The buyer and seller agreed on one price, and then a different price actually gets charged.

    IMO if the monthly bill comes out to $60 and the ad said $40/month, that's a problem. The bill coming out to $60 isn't problematic in and of itself; it's the fact that the customer was lied to and defrauded with regard to what the bill would be.

    reply to this | link to this | view in chronology ]

    • icon
      Dirkmaster (profile), 31 Dec 2014 @ 8:13am

      Re:

      When you are a monopoly, even a government established monopoly, it's a problem.

      I say we give them a choice: either remain a monopoly, and be heavily regulated, or dissolve all agreements that establish them as a monopoly to promote/allow competition.

      reply to this | link to this | view in chronology ]

      • identicon
        Ismail, 31 Dec 2014 @ 9:33am

        Re: Re:

        Good luck with that, since SCOTUS declared money as free speech. CTIA would have enough in their slush funds to squash any semblance of that idea, even though it's a good idea.

        reply to this | link to this | view in chronology ]

    • icon
      Karl Bode (profile), 31 Dec 2014 @ 9:44am

      Re:

      It sounds like you're complaining about the prices themselves. I see nothing wrong with them charging whatever they feel like charging; that's just basic capitalism. Buyer and seller agree on a price, and everyone's happy.
      I'm not sure you read the piece. It's not necessarily the price I complain about (though the lack of competition does drive prices up, obviously), it's the fact they're engaged in false advertising by advertising a price, then covertly jacking it up with buried, confusing, and misleading fees. I mean you say:
      "The real problem, IMO, is when they advertise one price and then charge another."
      And you say:
      IMO if the monthly bill comes out to $60 and the ad said $40/month, that's a problem.
      When that's precisely what I'm complaining about.

      reply to this | link to this | view in chronology ]

  • icon
    Ben (profile), 30 Dec 2014 @ 4:02pm

    fractions!

    The company said the charges only represent a fraction of what it pays to programmers
    2/100 may be a fraction, but so is 100/2; guess which one they would choose.

    reply to this | link to this | view in chronology ]

  • identicon
    vider, 30 Dec 2014 @ 6:43pm

    DTA

    and lets not forget the .99 for the rental of the dta to start in january there was not even a charge and now it is going to be 2.75 a month per box not the .99 they have promised over a 2 year period. There has to be something that can be done about this it is just wrong.....

    reply to this | link to this | view in chronology ]

  • icon
    toyotabedzrock (profile), 30 Dec 2014 @ 8:02pm

    So because the FCC allowed the cable companies to buy content companies they are now using the content companies to jack up rates on each other via collusion or malice while customers pay.

    reply to this | link to this | view in chronology ]


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