New Bill Tries To Ban Obnoxious Hidden Fees On Broadband, TV

from the ill-communication dept

For years we've talked about how the broadband and cable industry has perfected the use of utterly bogus fees to jack up subscriber bills, a dash of financial creativity it adopted from the banking and airline industries. Countless cable and broadband companies tack on a myriad of completely bogus fees below the line, letting them advertise one rate -- then sock you with a higher rate once your bill actually arrives. These companies will then brag repeatedly about how they haven't raised rates yet this year, when that's almost never actually the case.

Despite this gamesmanship occurring for the better part of two decades, nobody ever seems particularly interested in doing much about it. The government tends to see this as little more than creative financing, and when efforts to rein in this bad behavior (which is really false advertising) do pop up, they tend to go nowhere, given this industry's immense lobbying power.

The latest case in point: US Rep. Anna Eshoo last week quietly introduced a bill that would require broadband and cable TV providers to include all charges in their advertised price. Eshoo explains the proposal as such in her announcement:

"Customers deserve to know exactly what they’re paying for when it comes to monthly cable and Internet service bills. Today, they’re sold a service for one price, only to be blindsided by higher bills at the end of the month from tacked on ‘service’ or ‘administrative’ fees,” Rep. Eshoo said. “These ‘below-the-line’ fees add up to hundreds of millions of dollars each year for cable and Internet service providers at the expense of consumers who have little to no option than to pay up. The TRUE Fees Act is commonsense legislation that brings transparency to consumers and empowers them when it comes to phone, cable and Internet fees."

Of course this bill is never going to pass this current Congressional body, which tends to go out of its way to protect these companies from anything even vaguely resembling accountability. The industry is likely to pull out all the stops, given the billions that are made annually from such bogus fees, and because the bill also prohibits forced arbitration clauses when cable TV or broadband providers make billing mistakes.

Again, this problem is rampant. CenturyLink has been charging its broadband customers an "internet cost recovery fee," which the company's website insists "helps defray costs associated with building and maintaining CenturyLink's High-Speed Internet broadband network" (that's what your full bill is supposed to be for). Comcast and other cable companies have similarly begun charging users a "broadcast TV fee," which simply takes a portion of the costs of programming, and hides it below the line. The names differ but the goal's the same: falsely advertise one rate, then charge consumers a higher price.

And again, efforts to do something about it always get killed thanks to industry lobbying and corruption. The FCC tried to at least mandate transparency as part of its now-dead 2015 net neutrality rules, which current FCC boss Ajit Pai dismantled for, you know, freedom or whatever. Of course you wouldn't need legislation like this if there were more competition in the telecom sector letting consumers vote with their wallets, but given Pai and other industry BFFs don't want to fix that specific problem either, being quietly, covertly ripped off will remain the law of the land for the foreseeable future.


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  • identicon
    Christenson, 11 Oct 2018 @ 4:05pm

    Contract Disclosure Pre-sale, too please!

    One more sleazy broadband/cell phone tactic:
    Contract not clearly disclosed before the sale is made.

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

    • identicon
      Anonymous Coward, 12 Oct 2018 @ 6:02am

      Re: Contract Disclosure Pre-sale, too please!

      "Contract not clearly disclosed before the sale is made"

      Thus making the contract null and void.

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

  • identicon
    Anonymous Coward, 11 Oct 2018 @ 5:17pm

    Prices of Politiicians

    American commercial airlines and hotels never ever play games with bogus fees or jacked up prices.

    It's the duty of U.S. politicians to control prices wherever they see fit. What could ever possible go wrong?

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

    • icon
      Chris-Mouse (profile), 12 Oct 2018 @ 5:27am

      Re: Prices of Politiicians

      It's not prices that need to be regulated, but how those prices are advertised. An ad saying the hotel room costs $100 per night should mean your bill in the morning is $100, not $100+$fee+$fee+$fee+$fee.

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

      • identicon
        Anonymous Coward, 12 Oct 2018 @ 6:10am

        Re: Re: Prices of Politiicians

        Back in the day, there was this truth in advertising law ... not sure what happened to that.

        Out of curiosity Has a look at the ftc website, lol - seriously?
        here is an excerpt:

        "When consumers see or hear an advertisement, whether it’s on the Internet, radio or television, or anywhere else, federal law says that ad must be truthful, not misleading, and, when appropriate, backed by scientific evidence. The Federal Trade Commission enforces these truth-in-advertising laws, and it applies the same standards no matter where an ad appears "
        https://www.ftc.gov/news-events/media-resources/truth-advertising

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

    • icon
      R.H. (profile), 13 Oct 2018 @ 2:00pm

      Re: Prices of Politiicians

      The current law says that airlines are required to state all of their fees before booking. Of course, the airlines are currently trying to get those regulations rolled back but, that's how the game is played.

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

      • icon
        That One Guy (profile), 13 Oct 2018 @ 7:08pm

        Re: Re: Prices of Politiicians

        For purely innocent reasons, if not completely altruistic in that removing rules mandating that they make a price clear before booking will make the customer experience vastly superior I'm sure.

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

  • icon
    takitus (profile), 11 Oct 2018 @ 6:17pm

    More of this, please

    On some issues, some elected officials do try to get things right and serve the people they represent. It's unfortunate that this bill will probably die, but, if it is killed, there will have been at least one congressperson who wasn't pandering to election sponsors.

    Rather than trying to win internet points with witty comments about corruption, we should encourage this kind of behavior from representatives.

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

    • identicon
      Anonymous Coward, 11 Oct 2018 @ 6:35pm

      Re: More of this, please

      The problem is that politicians only need to pander to us their constituents, once per election. The remainder of the time, the companies lobby them with money, gifts and future promises of positions on boards or at the companies in a nice cushy do nothing job.

      Until we make it illegal to bribe the officials and actually enforce it, nothing will change in our favor.

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

  • identicon
    Archillies, 11 Oct 2018 @ 6:18pm

    I am Century Link customer since long before they were CenturyLink. When I had a phone/internet bundle, the bill was a mess - pretty much as described in the above article. Since dropping all services but the internet connection, the bill now is a couple lines (the charge, the tax, and the total)- the cost is exactly what I was told it would be by support when the order was made and (so far) has not varied.

    Weird to have to admit that CenturyLink has done something right and I like it....

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

    • identicon
      Christenson, 12 Oct 2018 @ 8:00pm

      Re: CenturyLinkless

      At my house, the DSL upgrades have all been followed by a few months of unreliable service, with trouble always on their end, typically a config issue getting the central office DSLAM to actually talk to the internet.

      This is helped by the cooling fans under the router and the elimination of stubs inside the house.

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

  • icon
    Gary (profile), 11 Oct 2018 @ 6:29pm

    Transparency

    I hope no one here thinks that transparency like this is a bad idea, because it is enforcing limitations on the free market.
    Just saying, in a libertarian paradise such laws restricting a fee structure would be anti-Ryand and prohibited as a brake on the free market.

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

    • identicon
      Anonymous Coward, 12 Oct 2018 @ 8:16am

      Re: Transparency

      I hope no one here thinks that transparency like this is a bad idea

      My problem with this is that it's banning fraudulent/false advertising, for one specific case. That's already illegal. If laws already exist and aren't enforced, why should we create a new law or expect anyone to enforce it? If the law's not clear enough, fix it in a general way (e.g., say that advertising pre-tax prices is always illegal), then actually start enforcing it.

      Of course, Pai did revert the FCC's advertising rules on the basis that it's too burdensome for providers to have to tell people the real prices in advance...

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

  • icon
    That One Guy (profile), 11 Oct 2018 @ 6:54pm

    Step 1: Set bait. Step 2: Watch who make a grab for it.

    While the bill may be DOA due to the companies it would affect and how 'generous' they are with their money it's still worth bringing up, if for no other reason than to out the more obviously corrupt who will try to kill it.

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

  • This comment has been flagged by the community. Click here to show it
    identicon
    Richard Bennett, 11 Oct 2018 @ 7:19pm

    Bode lies again

    Drink!

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

  • icon
    Gary (profile), 11 Oct 2018 @ 8:09pm

    Bode

    Citation please?

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

    • This comment has been flagged by the community. Click here to show it
      identicon
      Ted Dibbly-Gullible, 12 Oct 2018 @ 11:56am

      Re: Bode -- "Gary" fell for fanboy trolling as "Richard Bennet".

      The real "Richard Bennet" has an "account".

      You are responding to sheer trolling by some other Techdirt fanboy. You added nothing worth anyone's time, either.

      This too is why your "account" looks like astro-turfing: you're quick to protect the site any way can, even to help the trolling.

      Also, you rarely make statements or any long comments, thereby appearing to narrow the amount of text that'd show up habits of word usage and so on. -- In any case, short comments as yours above are worthless. Try harder.

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

      • identicon
        Anonymous Coward, 12 Oct 2018 @ 5:11pm

        Re: Re: Bode -- "Gary" fell for fanboy trolling as "Richard Bennet".

        Trolling? I think not!

        Richard himself stated that fake comments using the names of others without permission were legitimate because only the ideas matter, which is why the FCC allowed bots to submit comments. Therefore the comment must have been made by the real Bennett.

        Unless you admit Bennett was lying, of course. Which we all know won't happen.

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

        • icon
          The Wanderer (profile), 13 Oct 2018 @ 4:30am

          Re: Re: Re: Bode -- "Gary" fell for fanboy trolling as "Richard Bennet".

          Now, be fair.

          The comment you're paraphrasing was referring to the fact that the FCC's comment period is intended to enable members of the public to provide the FCC with information it may not have had or analysis it may not have carried out, and therefore not only is the identity of the commenter irrelevant to the content (except insofar as it may make the content more or less credible), multiple comments providing the same information or analysis are redundant.

          It was not claiming to be a general principle that applies to all comments submitted anywhere.

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

          • identicon
            Anonymous Coward, 15 Oct 2018 @ 5:21am

            Re: Re: Re: Re: Bode -- "Gary" fell for fanboy trolling as "Richard Bennet".

            See, I might buy this explanation if not for the fact that the FCC argued that the sheer number of pro-repeal comments cemented their position. If the number comments providing the same information was redundant because the response was the same, why use the "number" as a damning point?

            Never mind that the "number" was inflated by bots, and NOT members of the public. And if redundancy of information was a factor, what good does it do for the organization to ask for pro-repeal comments if that's what they already intended from the start?

            Nah, Occam's Razor suggests that Bennett was being the Dick he usually is in a bid to draw attention away from the fabricated comments. Live by the sword, die by the sword.

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

            • icon
              The Wanderer (profile), 16 Oct 2018 @ 5:07am

              Re: Re: Re: Re: Re: Bode -- "Gary" fell for fanboy trolling as "Richard Bennet".

              Oh, the FCC may very well have claimed that, and if they did they're wrong.

              But as far as I remember noticing, Richard Bennett did not claim that.

              I was attempting to address only the specific claim that he had stated something (a broad generalization) which I do not remember him stating (in that broad form).

              I have no problem with people arguing against him, or even achieving epic smackdown; based on what I've seen of his behavior here, I think he's a toxic and moderately horrible person. I just prefer it to happen on the basis of what his actual positions and arguments appear to be (particularly when those positions and arguments are assertions of things which do appear to be actual facts), rather than on what seem to me to be distortions of those things.

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

  • icon
    scotts13 (profile), 12 Oct 2018 @ 3:43am

    One could fantasize, and require them to also disclose in advertising what the "real" rate will be after the "trial period". "Only $79 for the first six months, and $199 thereafter!" would raise some eyebrows.

    There difference is just that extreme for the two vendors in this area.

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

  • icon
    That Anonymous Coward (profile), 12 Oct 2018 @ 4:01am

    Someone is trying to get some last minute 'donations' before the elections....

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

  • identicon
    Fred, 12 Oct 2018 @ 9:38am

    The usual anti-corporate double-standard?

    Does the bill apply equally to the government?

    We're hit with 20% local/state taxes on prepaid telephone services. Cricket and MetroPCS manage to eat those charges and keep their retail price the same; they're actually hidden, unlike the distinct, discrete, and explicit below-the-line fees that you knowingly mislabel "hidden".

    Spectrum manages to keep a consistent charge on its broadband services through the entire extent of their term commitment. There are no additional charges, "hidden" or otherwise.

    It is hypocritical to insist that corporations are held to an absolute advertised price, no asterisk, if you then allow the government a free pass.

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

    • identicon
      Anonymous Coward, 12 Oct 2018 @ 10:54am

      Re: The usual anti-corporate double-standard?

      Your point makes zero sense.

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

    • icon
      That One Guy (profile), 13 Oct 2018 @ 12:11am

      Don't tell me the rate is $100 if 'must haves' make it $150.

      Is the government telling people that taxes are one rate, and then when it comes time to pay suddenly springing on them additional taxes that were previously not disclosed?

      That certain companies are paying the rates themselves without raising the prices does not make those fees 'hidden', it just means that the customer isn't the one paying.

      On the other hand advertising a certain rate only to tack on multiple other charges that raise it most certainly would qualify, as were they honest they would have included those additions into the advertised rate from the start.

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

      • icon
        The Wanderer (profile), 13 Oct 2018 @ 4:34am

        Re: Don't tell me the rate is $100 if 'must haves' make it $150.

        On the other hand (to all of the above, including your own "other hand"), a requirement that advertised prices for products which are subject to a tax rate which the advertiser can reasonably be expected to know at the time of the ad include the amount of the tax in the advertised price would not be unreasonable and might even be a good idea.

        It's irrelevant to the hidden-fees conversation, of course, with only the tangential connection that both of them relate to whether or not the price you pay in the end is the same as the price that was advertised.

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

    • icon
      R.H. (profile), 13 Oct 2018 @ 2:05pm

      Re: The usual anti-corporate double-standard?

      You seem to be arguing for the seemingly everywhere except for North America method of including taxes in the sticker price. That's fine with me as long as we do it for everyone including retail establishments. I'd enjoy going to a store and having to only pay the amount on the tag for an item and not having to calculate sales tax myself as I go.

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

      • icon
        The Wanderer (profile), 14 Oct 2018 @ 4:13am

        Re: Re: The usual anti-corporate double-standard?

        To play devil's advocate a bit: how would that work with things like online ordering (where they at least shouldn't know your location, and thus have any ability to calculate your local sales tax, before checkout time), or for that matter mail-order catalogs?

        The only sane outcome of that which I can see would be for such tax-rate-unknown sales channels to be permitted to advertise the pre-tax price - and that would put the brick-and-mortar stores which do know the sales-tax rate at an even bigger competitive disadvantage (because their sticker price would then have to be higher by comparison, even though it's no longer comparing apples to apples).

        Since this is (as you say) used so universally in other jurisdictions, I imagine there must be some solution in use, but I can't think of one that doesn't have at least that downside.

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

        • identicon
          Anonymous Coward, 29 Oct 2018 @ 2:56pm

          Re: Re: Re: The usual anti-corporate double-standard?

          Only Corporations pay tax. When you reach $X/yr, you must incorporate. Tax is paid where it is sold/shipped to.
          Take the public out of the tax equation. Let the Governments and Corps. settle it

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

  • icon
    jaack65 (profile), 14 Oct 2018 @ 9:28pm

    Where Do The Fee $ Go???

    With all the fees added on to my cable bill, the question is WHERE does all this money go??? Is it pocketed by cable companies? It sure has not gotten me better cable nor Internet services. As a matter of fact, things are worse than ever. Internet connections fail constantly, customer service has no talent beyond a written script to fix things. Anything beyond simple problems is unfixable. On the TV side, they can't tell whether a program signal is actually being broadcast on the cable line when a program just shows a blank screen!!

    CABLE COMPANIES are probably the most hated industry we must deal with. Why are the cable monopolies without oversight by localities?

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


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