Cable giants routinely advertise one rate then charge you another thanks to hidden fees that a
thoroughly-lobbied government refuses to do anything about.
Like the airline and hotel industries, the cable TV and broadband sector has a masterful knack for obnoxious, hidden fees. From fees for simply trying to pay your bill to broadband surcharges based entirely on fluff and nonsense, the industry has spent years advertising one rate, only to hit you with a significantly higher price once your bill actually comes due. A new bill being proposed by Senator Ed Markey and Representative Anna Eshoo is attempting to put an end to the practice.
The TRUE Fees Act requires phone, cable, and internet providers to:
- include fees, charges, and surcharges in the prices they advertise for service;
- allows customers to end their contract without early termination fees if their provider increases prices;
- prevents hikes on equipment fees unless providers improve equipment; and
- prohibits forced arbitration clauses for wrongful billing errors.
The House Legislation is co-sponsored Reps. Mark Takano (D-CA), Eleanor Holmes Norton (D-DC), Tim Ryan (D-OH), Earl Blumenauer (D-OR), Jamie Raskin (D-MD), Joe Courtney (D-CT), Donald S. Beyer, Jr. (D-VA), Janice D. Schakowsky (D-IL), and Mike Thompson (D-CA).
The duo’s Truth-In-Billing, Remedies, and User Empowerment over Fees Act — ‘TRUE Fees’ — would require cable TV or broadband providers to include all additional surcharges in the advertised price, helping consumers avoid sticker shock.
In recent years, the industry has been under fire for its misleading “broadcast TV” fees, which simply takes a part of the cost of programming and buries it below the line. In many areas consumers can pay as much as $12 per month extra just from this fee alone. Several class action lawsuits against cable giants like Comcast have yet to derail the practice.
With so many consumers on auto-payment systems, most will never realize that they’re suddenly paying a higher rate, something consumer groups say is entirely by design.
Matt Wood, General Counsel of Consumer Group Free Press told Motherboard in an email:
"Communications service customers are almost used to being hit by mysterious fees at the end of the month, never knowing what the true cost of service will be until the bill shows up—or, if they have automatic bill payment set up, maybe never really knowing about or even seeing these hidden fees increase. That's a shame, and they shouldn't have to accept it.”
Regulators and lawmakers have historically turned a blind eye to the practice across industries. For example, the hotel industry in the States routinely imposes resort fees also intended to misleadingly jack up the advertised price, a practice banned in many European countries. And anybody that’s flown lately is well aware of the wide variety of nonsensical surcharges that can quickly result in a far more pricey trip than you may have originally expected.
Wood said that instead of addressing this problem for what it is (false advertising), American leadership tends to treat such spurious surcharges as the height of capitalistic creativity. And when bills addressing the problem arrive, they tend to go nowhere thanks to industry lobbying. Consumer Reports has attempted to draw some additional attention to the problem via its “What the Fee?!” campaign, highlighting misleading charges like “regulatory recovery” fees (designed to trick users into believing government is to blame for higher rates), to soaring charges for antiquated cable boxes and DVRs that cost companies a pittance to provide.
Consumer Reports said of this latest legislative effort.
“This legislation is simple, straightforward, and effective. The TRUE Fees Act would address the out-of-control fee problem in the telecommunications marketplace and deliver much-needed transparency for cable and internet providers’ unnecessarily-complicated billing practices.”
The government’s apathy has come with a steep price for cable and broadband customer wallets. Many of these fees have been jacked upwards of 241% in just the last few years, leaving American consumers paying even higher rates for what’s already some of the most expensive cable TV and broadband prices in the developed world.