Washington And Oregon Fine CenturyLink For Completely Bogus Broadband Fees

from the gullibility-surcharge dept

For decades, broadband providers have abused the lack of meaningful competition in the telecom market by not only refusing to shore up historically awful customer service, but by raising rates hand over fist. This usually involves leaving the advertised price largely the same, but pummeling customers with all manner of misleading fees and surcharges that drive up the actual price you'll be paying each month. And by and large regulators from both major political parties have been perfectly okay with this practice, despite it effectively being false advertising.

CenturyLink (combined by the merger of Qwest, CenturyTel and Embarq) has been exceptionally talented when it comes to such fees. A few years ago the company began charging its broadband customers an "Internet Cost Recovery Fee," which the company's website explains as such:

"This fee helps defray costs associated with building and maintaining CenturyLink's High-Speed Internet broadband network, as well as the costs of expanding network capacity to support the continued increase in customers' average broadband consumption."

But the cost of maintaining broadband networks is what your entire bill is supposed to be for. Again, breaking out such additional bullshit surcharges and burying them below the line is designed to do one thing: help providers falsely advertise a lower rate. And while the "internet cost recovery fee" was only a few bucks per month, it's a fairly lucrative scam when spread across millions of CenturyLink's US broadband subscribers over the last five years.

With the federal government now largely comatose on such issues, states have been forced to step up to the plate and try to fill the void. As a result, Centurylink was forced to settle a lawsuit by Oregon's AG requiring it cease the practice and shell out $4 million to impacted consumers. That settlement comes several weeks after a similar settlement with Washington State's AG to the tune of $6.1 million:

"CenturyLink deceived consumers by telling them they would pay one price, and then charging them more,” Ferguson said. “Companies must clearly disclose all added fees and charges to Washingtonians. If you believe that a company has charged dishonest fees, please contact my office.”

In states where telecom regulatory capture is more prevalent (read: most of them), absolutely nothing is being done to thwart this practice, which extends to other fees like the misleadingly named "regulatory recovery surcharge" or the widespread "local sports surcharge" and $10 per month "broadcast TV" fees.

Keep in mind, these are precisely the kind of consumer enforcement actions the Trump FCC attempted to ban with its net neutrality repeal, which didn't just repeal net neutrality but attempted to neuter nearly all state and federal oversight of one of the least-liked and uncompetitive industries in America. The courts argued the FCC overreached, noting it can't eradicate its telecom protection authority, then try to ban states from stepping in to fill the void. The fact they even attempted the gambit should tell you all you need to know about the Ajit Pai FCC.

Filed Under: bogus fees, broadband, competition, consumer protection, extra fees, ftc, hidden fees, oregon, truth in advertising, washington
Companies: centurylink


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  • identicon
    Anonymous Coward, 13 Jan 2020 @ 6:55am

    This wouldn't have been prevented at all by the FCC's bullshit. It's about billing and fees, it's not about net neutrality in any way. There is plenty of legal precedent showing AG's can go after any service provider for exactly these kinds of actions. Nothing in the FCC repeal could have changed that.

    Good job cramming in the unrelated buzzwords though.

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    • icon
      Stephen T. Stone (profile), 13 Jan 2020 @ 7:09am

      This wouldn't have been prevented at all by the FCC's bullshit.

      Which bullshit is that, sir? There’s a lot being spread around by the FCC these days.

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

      • identicon
        Anonymous Coward, 13 Jan 2020 @ 7:15am

        Re:

        The FCC bullshit that is specifically referenced in the article which you are commenting on. The reclassification of broadband service by the FCC actually has nothing to do with this story.

        CenturyLink being a broadband provider doesn't even matter, technically. The issue was with their billing practices, not the broadband service they were providing.

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

        • icon
          Stephen T. Stone (profile), 13 Jan 2020 @ 7:26am

          The issue was with their billing practices, not the broadband service they were providing.

          The issue was with the billing practices of CenturyLink for the broadband-level Internet access service they were (and still are) providing. One might think the FCC would want Internet access providers to stop nickel-and-diming people for that service. But the FCC effectively (and purposefully!) castrated itself in that regard. Now the states must do what the FCC can’t find either the authority or the courage to do: regulate companies that act against the best interests of the American public for the sake of increasing shareholder profits.

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

          • identicon
            Anonymous Coward, 13 Jan 2020 @ 7:47am

            Re:

            You're mostly missing the point. There's a vast difference between regulating a product or service and regulating the commercial activity of the provider of that product/service.

            Look up the laws that Oregon and Washington alleged that CenturyLink violated. They're not about broadband services, or broadband service providers, or net neutrality.

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

            • icon
              Stephen T. Stone (profile), 13 Jan 2020 @ 8:16am

              There's a vast difference between regulating a product or service and regulating the commercial activity of the provider of that product/service.

              The principles of network neutrality were supposed to regulate the commercial activity of Internet access providers. Under those principles, IAPs¹ would not have been able to pull these bullshit charges out of their metaphorical asses and slap them on consumers as an extra “tax” on Internet access. Such charges disproportionately affect the poor. They should be able to access the Internet just like everyone else; why should they have to pay more for that access, or for access to all the same sites that everyone else can visit?


              ¹ — Everyone else refers to them as Internet service providers, or ISPs.

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

              • identicon
                Anonymous Coward, 13 Jan 2020 @ 9:57am

                Re:

                Such charges disproportionately affect the poor.

                The cost of a new Ferrari disproportionately affects the 99%, too.

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

                • icon
                  Stephen T. Stone (profile), 13 Jan 2020 @ 10:24am

                  Your sardonic smugness doesn’t change my point, but go off, I guess.

                  Poor people spend a higher percentage of their income on bills compared to middle- and upper-class people. Extra “taxes” on those bills — like the fees mentioned in this article — only worsen that situation. The FCC could have prevented that with tighter regulations. That the states now have to do what the FCC lacks both the authority and the testicular fortitude to do says a lot about who the FCC cares about. (Hint: It isn’t poor people.)

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

                  • identicon
                    Anonymous Coward, 13 Jan 2020 @ 11:57am

                    Re:

                    You have a much stronger socialist leaning than I do. I have nothing against poor people and I'm not interested in screwing them. I am interested in fairness and take no issue with things like standard deductions on taxes, welfare for those not abusing the system, etc.

                    For background, I grew up in a rental house that cost $150/month in a neighborhood where rents started at $750. I never once wore name brand clothing, couldn't afford a haircut and barely got by at a survival level. Now I live in a very nice house in a nice neighborhood, drive a Porsche as my daily driver and want for nothing. I had no advantages and was never "lucky" in my quest for success, I worked hard for a lot of years to get where I am. If I can do it so can most* others.

                    Bottom line: I can't shed any tears for those who can't afford all the nice things. They could if they were willing to work for them.

                    Bottom bottom line: The ISPs are still raging assholes for their invoice trickery and should be fined as heavily as possible for such behavior (see above re: fairness)

                    • not all who are poor have much choice in the matter. Disabilities affect more than just mobility.

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

                    • identicon
                      Anonymous Coward, 13 Jan 2020 @ 1:02pm

                      Re: Re:

                      Bottom line: I can't shed any tears for those who can't stop sharing their sad sack story in order to justify their prejudices against the less fortunate.

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

                    • identicon
                      Anonymous Coward, 13 Jan 2020 @ 2:30pm

                      Re: Re:

                      I had no advantages and was never "lucky" in my quest for success

                      Depends how you define "luck."

                      Luck could be going to a school where your teachers care about you, or having parents that will help you with your homework or won't beat you or steal from you. Luck could be not having siblings to take care of, that prevent you from seeking higher education.

                      Luck can be not getting sick or injured, needing to take time off work and to pay medical bills. Or having a spouse, or a parent, or a child that needs care.

                      Luck can be ending up at a company where they don't need to lay people off when their competitors do, or having just enough seniority that you're not the one laid off.

                      In short, "luck" can manifest in any number of ways, many of which you only notice when you don't have them.

                      I'd be very wary about attributing none of your change in circumstance to "luck." I'm sure you put in a lot of hard work, which is commendable. I'm certainly not trying to minimize the effort you put in to get where you are. But when people can work 80+ hour weeks, doing thankless, menial jobs, and still barely end up making ends meet... How much harder do you expect them to work to get where you are?

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

                    • icon
                      Stephen T. Stone (profile), 13 Jan 2020 @ 2:59pm

                      I had no advantages and was never "lucky" in my quest for success

                      Yeah, anyone who thinks this is bullshitting themselves. You can work your ass off and think you got by because of it, but without some form of luck or even a minor advantage over others, you wouldn’t have gotten as far as you did. You got lucky that someone saw your hard work for what it was, or you were able to work a little harder than someone else, or maybe you were advantaged in ways that might be called “privileged” (e.g., your race).

                      No one gets by on hard work alone. You don’t exist in a vacuum; neither does everyone else.

                      I can't shed any tears for those who can't afford all the nice things. They could if they were willing to work for them.

                      And what if a poor person needed to find or apply for a job over the Internet — should they have to pay a tax so they can get a job to make the money that would go towards paying that tax? Should they have to work a second full-time job to afford what should honestly be a public utility? Therein lies my point: “Taxes” (read: bullshit fees) disproportionately affect the poor because they don’t have the resources to pay those fees, and sometimes they don’t have those resources because they need those resources to get a job so they can pay the fees in the first place. The same logic applies to cars: A poor person might need a car to go to their job, and if their car breaks down, they’ll need to pay for repairs — but they might still need a car to go to their job, and in areas with no public transportation, that means either hitching a ride (which can’t always be guaranteed) or losing that job, which means losing the car for good, which means getting another job becomes a hell of a lot harder. And that is to say nothing of how poverty affects a person’s health (e.g., nutrition, access to decent health care), which can also affect how much and how hard they can work.

                      I know why you have little-to-no compassion for poor people, but that is something I can never do. Poverty is damn near always a failure of society to provide for its least well-off while some wealthy asshole becomes even wealthier. Someone can work three jobs, two of which are full time, and still live in a goddamn trailer park because their money-hoarding bosses don’t pay them more than the minimum wage. That is not immoral — that is capitalism working exactly as intended.

                      Also, quick aside out of curiosity: Ever hear of the term “temporarily embarassed millionaire”?

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

                      • icon
                        Wendy Cockcroft (profile), 14 Jan 2020 @ 8:57am

                        Re:

                        What Stephen says. Hard work alone won't get you a flippin' Porsche. I should know, I worked two jobs while in college. When I moved to London, I had to work two jobs just to get by. I'm in a decent situation now because I had the good luck to come across a job in Facilities when web design wasn't earning me enough to pay the rent. It started out temp to perm, 30hrs a week, but while there I had the good luck to have two supportive managers who were happy to take me full time. I worked my tail off and had the good luck to attract the attention of a senior manager who was willing to promote me to a more senior position. When that luck ran out, I found a new job in a company that was willing to pay me more for the same kind of work. Lucky elements:

                        • Spotted an advert for a well-paid part-time job
                        • Agency temp controller willing to put my name forward
                        • Nice bosses willing to employ me full time
                        • Nice higher level manager willing to promote me to a higher position
                        • Nice new employer willing to pay me more for the same kind of work

                        Yes, I worked hard but without those lucky elements I'd still be living hand to mouth. I've worked at jobs where the managers were awful and there was an embedded culture of bullying. I stayed for longevity because temps face discrimination because employers worry they will leave soon afterwards.

                        If you're doing well, AC, good luck to you, but I daresay a lucky break or ten was involved. The area in which you work has a lot to do with it, too. Admin pays better than waitressing, and niche industry admin skills pay better still. Well, that's me, and it's not enough for a Porsche so I daresay you're a manager or business owner in a market with few competitors. Lucky you, gaining those skills and spotting that gap in the market!

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

            • identicon
              Anonymous Coward, 13 Jan 2020 @ 9:40am

              Re: Re:

              There's a vast difference between regulating a product or service and regulating the commercial activity of the provider of that product/service.

              And the FCC has authority over both as part of
              1) Promoting competition, innovation and investment in broadband services and facilities and
              2) Supporting the nation's economy by ensuring an appropriate competitive framework for the unfolding of the communications revolution

              Both of these things are intimately linked to the commercial activity of providers, and the FCC has a long history of regulating "commercial" activity.

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

          • icon
            Anonymous Anonymous Coward (profile), 13 Jan 2020 @ 7:51am

            Re:

            If there is a change in administrations with this years elections the new FCC might just try and reverse the courses laid down by this FCC. Of course, that will mean more lawsuits as telecom and broadband providers scramble to maintain their current preferred positions. Those will take several years, during which time that new FCC may or may not be able to correct all the bad things, including its self immolation, and set the course of communication businesses back on track, for the users rather than the conglomerates and their shareholders.

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

  • identicon
    Dave, 13 Jan 2020 @ 7:31am

    CenturyLink won't change its behaviour at all as a result of these fines. It'll just consider it yet another cost to pass down to its customers.

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

  • identicon
    Bruce C., 13 Jan 2020 @ 7:33am

    Remember folks:

    When selecting an ISP, the advertised rate isn't what they charge, that's their expected profit. All of their costs are passed onto you in below-the-line billing.

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

  • identicon
    Anonymous Coward, 13 Jan 2020 @ 8:41am

    But the cost of maintaining broadband networks is what your entire bill is supposed to be for.

    No; other reasonable costs would be:

    • building networks (so as to avoid charging people several thousand dollars in advance)
    • operating networks
    • interconnection/traffic payments
    • customer service
    • general overhead (e.g: payroll department)
    • advertising

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

    • identicon
      Anonymous Coward, 13 Jan 2020 @ 9:00am

      Re:

      And that's what the general bill, and advertised price, should be for. Not adding fake bullshit after the fact. And never mind they don't do things like actually build shit.

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

    • identicon
      Anonymous Coward, 13 Jan 2020 @ 9:17am

      Re:

      • Refilling the toilet roll dispensers

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

      • identicon
        Anonymous Coward, 14 Jan 2020 @ 6:16am

        Re: Re:

        It's strange that this got marked "LOL". Of course the service fee (not an add-on fee) would cover expenses related to having employees and offices, including providing washroom supplies.

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

    • identicon
      Anonymous Coward, 13 Jan 2020 @ 9:32am

      Re:

      "Reasonable costs" to invoice separately would be something you'd have to charge some customers for but not others. So, if some customers rent a modem from, but others buy their own, charging the renters a fee for the modem is reasonable. If some of your DSL clients also have phone service, and others don't, then charging the latter for use of the phone line (where the others are already paying for that as part of their phone bill) is reasonable.

      But if everyone who has your service pays, say, an "Internet Cost Recovery Fee" every month, then that should be rolled into the monthly rate, and advertised as such. Anything less is dishonest.

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

    • identicon
      Anonymous Coward, 13 Jan 2020 @ 10:00am

      Re:

      Every one of those is a cost of doing that particular business. Those costs should factor into what they charge for their services and be advertised as the cost of their service. None of those costs should be slipped into anyone's invoice after they've agreed to a lower price as a means to trick people into signing up for their service due to its "lower cost".

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

      • identicon
        Anonymous Coward, 13 Jan 2020 @ 10:24am

        Re: Re:

        Of course. Nobody disagreed with that. If your local grocery store started a refill-the-employee-toilet-paper-dispenser surcharge, people would start shopping elsewhere really quickly. It's handy to have an "elsewhere".

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

  • identicon
    bob, 13 Jan 2020 @ 10:30am

    someone screwed up in billing.

    Did centurylink forget to remove their bogus fees from the personalized bills of politicians and AGs of Washington and Oregon?

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

  • identicon
    Anonymous Coward, 13 Jan 2020 @ 7:25pm

    Finally the state governments learned that try as you might... you can't feed your stomach with Richard Bennett blowjobs.

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


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