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Plaintiffs From Seven States Sue Comcast For Misleading, Hidden Fees (dslreports.com) 81

An anonymous reader quotes a report from DSLReports: Back in 2013 Comcast began charging customers what it called the "Broadcast TV Fee." The fee, which began at $1.25 per month, has jumped to $6.50 (depending on your market) in just three years. As consumers began to complain about yet another glorified rate hike, the company in 2014 issued a statement proclaiming it was simply being "transparent," and passing on the cost of soaring programmer retransmission fees on to consumers. There's several problems with Comcast's explanation. One, however pricey broadcaster retransmission fees have become (and keep in mind Comcast is a broadcaster), programming costs are simply the cost of doing business for a cable company, and should be included in the overall price. Comcast doesn't include this fee in the overall price because sticking it below the line let's the company falsely advertise a lower rate. Inspired by the banking sector, this misleading practice has now become commonplace in the broadband and cable industry. Whether it's CenturyLink's $2 per month "Internet Cost Recovery Fee" or Fairpoint's $3 per month "Broadband Cost Recovery Fee," these fees are utterly nonsensical, and inarguably false advertising. And while the FCC can't be bothered to take aim at such misleading business practices, Federal class action lawsuit filed this week in California is trying to hold Comcast accountable for the practice. Plaintiffs from seven states -- including New Jersey, Illinois, California, Washington, Colorado, Florida and Ohio -- have sued Comcast alleging consumer fraud, unfair competition, unjust enrichment and breach of contract. What's more, the fee has consistently skyrocketed, notes the lawsuit. Comcast initially charged $1.50 when the fee first appeared back in 2013, but now charges upwards of $6.50 more per month in many markets -- a 333% increase in just three years.
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Plaintiffs From Seven States Sue Comcast For Misleading, Hidden Fees

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  • by hawkeyeMI ( 412577 ) <brock@b r o cktice.com> on Tuesday October 18, 2016 @04:34PM (#53103635) Homepage
    Based on what I've seen in other cases, it seems to me like those fees are broken out so that a finger can be pointed at someone else and used for leverage. In other words, "Don't like that cost? It's all the FCC's fault", or something like that.
    • Based on what I've seen in other cases, it seems to me like those fees are broken out so that a finger can be pointed at someone else and used for leverage. In other words, "Don't like that cost? It's all the FCC's fault", or something like that.

      Ahh, good ol' finger pointing.

      I'm certain that age-old tactic works every time to convince the consumer that their total cost of service is now magically worth it, you know because finger pointing and all.

      No no, seriously before you go, check out our new finger pointing feature. I know that other companies offer this, but we're the best at it...

    • I wonder how it would work if a company simply listed all the components of the bill honestly, including profit margin.
      $6.50 broadcast transmission fee
      $4.00 fee for fuckall
      $15.00 cable replacement for damage (like DUI into telephone pole)
      $35.00 profit to company.

      It'd be interesting.
      -nb

    • by Nahor ( 41537 ) on Tuesday October 18, 2016 @05:38PM (#53104107)

      They can still itemize the full price if they want to point fingers.

      To use the car analogy, when you get an estimate for a repair, they don't give you a base fixed price and then tack on extra in the end for parts and labors for the final cost. The estimate is supposed to be as close to the final cost as they can make it.

      So here Comcast could do the same:
            Service is $50 (includes a $6.50 retransmission fee and 10% CEO wallet padding fee).

    • Based on what I've seen in other cases, it seems to me like those fees are broken out so that a finger can be pointed at someone else and used for leverage. In other words, "Don't like that cost? It's all the FCC's fault", or something like that.

      I like to hold that finger and smash it with a mallet, hard.

    • by Zak3056 ( 69287 ) on Tuesday October 18, 2016 @06:45PM (#53104521) Journal

      Based on what I've seen in other cases, it seems to me like those fees are broken out so that a finger can be pointed at someone else and used for leverage. In other words, "Don't like that cost? It's all the FCC's fault", or something like that.

      FWIW, the finger needs pointing. There was an issue with Viacom vs Dish a couple of years ago where Dish stopped carrying CBS. Huge screams in the media and from customers, finger pointing by both sides, but in the end it comes down to this:

      In the past, the FCC mandated that cable and satellite companies carry broadcast stations in the local markets (not too big a problem on the cable side, but a big PITA on the satellite side). The deal was mandated carriage vs no license fees, and it was (in general) a fair one. Fast forward and the networks decided that since they were now entrenched, it was time to get paid by the evil cable/satellite companies "free riding" on their content.

      The fact that it's a hidden fee is bullshit (the total should match the advertised rate + tax) but the fee definitely needs to be broken out separately, because charging to rebroadcast an advertising supported network in the very area they're giving the signal away for free is also complete bullshit.

    • I remember a few years ago (25+ years ago, give or take), when congress, in a fit of fiscal responsibility imposed a new tax on each phone line in America. It was brilliant, have the phone companies pay a per-line tax and when the consumer's bill went up, the telco was the villain, not congress.

      Only problem was, the cable companies broke out the new tax as a separate line-item on the bill.

      Congress critters got mad, demanded that the telcos bury the tax - they tried to make the new tax line-item illegal, but

      • "That was when (some) congress critters realized that when you tax a company, the customers, not the company, pays the tax." Factually incorrect. Econ 102 (Not 101) Taxes will distort the market. Both the company and the consumer will pay part of the tax. The breakdown % depends on how elastic supply and demand is.
        • To be fair in this example, you're dealing with a monopoly (the phone company) back before ditching the landline was feasible or possible for most people. Demand was pretty much totally inelastic, so they just slapped the tax onto the bill and everyone had to suck it up and pay it.

          But you're right, in most situations something like a tax will be paid for both the company and the consumer.

  • by whoever57 ( 658626 ) on Tuesday October 18, 2016 @04:41PM (#53103675) Journal

    Let's be clear, all these fees exist as a way to hide the true cost of the service.

    One that irritated me a lot was paying a property tax fee for a rental car at DFW airport. Why is this so bad? Because, had I not rented the car, the company would have still been required to pay that property tax. In other words, the tax wasn't directly tied to my rental of the vehicle. Why not charge a fee for the property taxes on their HQ? Or charge a fee for the salaries of the employee who checked me in and gave me the car keys?

    Taken further, every service is going to cost 1 cent and the rest will be "fees and taxes". Perhaps at that point the FTC might step in?

    • by rickb928 ( 945187 ) on Tuesday October 18, 2016 @04:59PM (#53103811) Homepage Journal

      "Let's be clear, all these fees exist as a way to hide the true cost of the service."

      Not really. They exist to inflate pricing while allowing an advertised rate that doesn't actually include what should be part of the service fees. Imagine subscribing to cable TV and discovering the set top box fee they didn't tell you about, and didn't volunteer. As if you were going to pull TV shows out of the back of the modem with your little finger.

      When I price service every year or so I just want a list of all the fees. The taxes are, around here, essentially identical rates, so I will pay anyways. It's ferreting out the fees that is tedious - and that's where they get another $10/month for the modem, or the box, or whatever. Even the remote.

      All I can expect is a consistent disclosure. And they will try not to, since neglecting to tell me about a $10 fee makes it appear they are cheaper, and if I sign, I'm committed. Usually. And I hate changing service, so heh, I sometimes tolerate a few bucks difference.

      But these fees are also often either unregulated or, again, in the dark.

      • by Bookworm09 ( 1321243 ) on Tuesday October 18, 2016 @05:42PM (#53104135)

        "Let's be clear, all these fees exist as a way to hide the true cost of the service."

        Not really. They exist to inflate pricing while allowing an advertised rate that doesn't actually include what should be part of the service fees.

        You are basically saying the same thing the OP said. The cable companies are artificially/fraudulently lowering the advertised cost in order to entice people to sign up. He just chose to phrase it differently.

        "hide the true cost of the service" == "allowing an advertised rate that doesn't actually include what should be part of the service fees"

        • by _merlin ( 160982 ) on Tuesday October 18, 2016 @08:20PM (#53105037) Homepage Journal

          Yeah, US badly needs an "advertised price is actual total cost" law. We take these kinds of laws for granted in the rest of the world, but I for one only really learned to appreciate it after visiting the US (for IEEE 802.11 working group). Hotels want a "resort fee" on top of the advertised room rates, lots of things have sales tax added on top of the listed price, there's the dreaded tipping game, i.e. underpay workers so we can list artificially low prices, and count on customers paying extra. It really needs to stop, as it creates anything but an open and transparent market.

          • I completely agree. The absolute worst offenders (that I'm aware of, anyway) are car rental agencies. Plan on the actual daily rate being about double the advertised rate. Unfortunately, there are a lot of people in the US who believe that any attempt to force businesses to be transparent like that is "socialism". It would be funny if it didn't have such pervasive and profound negative consequences.
            • Car rental companies are pretty bad, but whenever you rent a car using any travel service they give you an estimated total that is always within pennies of what you end up paying so it's hard to argue that you're a victim of deception in that case.
            • You don't have to accept all their add-on insurance and gas charges and stuff. Chances are your insurance will cover your rental, and if you pay using a credit card, it may, too.
    • Re: (Score:2, Troll)

      by avandesande ( 143899 )
      GOV is more worried about who uses what bathroom than actually doing things to help the average joe.
      • Grand Ol' Vatican?
      • GOV is more worried about who uses what bathroom than actually doing things to help the average joe.

        I think you are the one who is worried about the bathroom issue more than understanding what is being discussed.

        The issue here is that the corporation found a way to work around the systems/rules in order to charge (average) people a few more bucks each. Due to most people would let go a couple bucks a month fees, the fees were under radar for a while. However, more and more people had been being charged to the point when enough people said "enough is enough." Now, the corporation is being caught and will b

        • I don't care who uses the bathroom... this fee stacking has been going on for at least two decades or more and the FTC does nothing about it. I see our Don Quixote government running a 500b debt and accomplishing nothing.
    • It's not only the cable companies. Hotels charge hidden "resort fees". And UPS (and probably airlines, too) charge a "fuel surcharge" while fuel prices are near multi-year lows.
  • by Joe_Dragon ( 2206452 ) on Tuesday October 18, 2016 @04:44PM (#53103699)

    Just wait for the junk like DNS, DHCP, etc server fees on HSI.

    And they will say you must pay for them even if you use your own DNS or even have static ip.

    Right now they force people with static ip to rent there hardware + pay the static IP fees.

    Now if they move to IPTV will they force an HSI gateway on people and make tv only subs pay for HSI to get TV?

  • GAS stations show the full price why can't comcast?

    • GAS stations show the full price why can't comcast?

      Uh, GAS stations can be bullshit artists too.

      Dunno how many times I've seen an advertised price for gas that turned out to be the cash price, with any other form of payment coming out 10 cents more per gallon. And naturally this is not advertised clearly every time; you usually have to read the fine print on the pump itself to understand why the pump price is suddenly "wrong".

      • by dgatwood ( 11270 )

        That's nothing. There's one gas station [yelp.com] that I pulled into while running low on fuel that advertised one price, and when I looked more closely, it was a dollar more per gallon for using a credit card. I drove on and risked running out of gas just to avoid rewarding them for such egregious abuse.

        • I would have at least put a gallon in, to assure myself that I would make it to a better station. They probably make less money when you only put a small amount of gas in, because of fixed costs of the transaction.

      • I have only seen that for diesel. Truck tanks large enough to reward for cash purchases.
      • by sjames ( 1099 )

        In that case, they are charging you extra for something that actually costs them extra. The credit card companies actually do take a percentage of what you pay for themselves, they just hide the umbrella by charging it to the merchant rather than the cardholder.

        The real problem fees are the ones like Comcast hides that you will never not be charged.

  • by rickb928 ( 945187 ) on Tuesday October 18, 2016 @04:50PM (#53103749) Homepage Journal

    CenturyLink just increased my $1.99 per month "Internet Cost Recovery Fee" to $3.99.

    I grilled the rep trying to retain me about why this wasn't just a cost item, and should be part of the fee. But that's the wrong thing to do. The sales schelps are just doing a job. They neither know or care about the issue, they just want to hit their targets.

    I'll let them know with my wallet next week when i cancel. And continue the round robin between the two carriers here. I'm not very interested in satellite, so two is the number.

    • by Anonymous Coward

      You should just pay the basic fee and with your check (what's that?) state you do not want the 'Internet Cost Recovery Fee' service and see what they do? Worst is they cancel your service which is what you would do anyway.

      I so want to do this with the extra hotel taxes that are added. Didn't the USA revolt against UK for taxation without representations? These extra hotel taxes even if approved by local citizens are ususally only charged to visitors since that is who hotel rooms are designed/targeted to!

      • by jrumney ( 197329 )

        I so want to do this with the extra hotel taxes that are added.

        This worked for me (kind of) in India recently. I made an internet booking, which included taxes, but on checking in, they upgraded my room "at no charge". On checking out, they tried to charge me more because the tax was higher on that room. They tried to claim it wasn't them, it was the government and there was nothing they could do, so I claimed it wasn't me, it was the beancounters at my company who had preapproved the advertised rate and wo

      • You should just pay the basic fee and with your check (what's that?) state you do not want the 'Internet Cost Recovery Fee' service and see what they do? Worst is they cancel your service which is what you would do anyway.

        They'll sic Collection (tm) on you. Isn't capitalism wonderful? You can make money threatening people and ruining their credit over the phone for minute unpaid (fictitious) balance.

      • How about you go first with your smart idea

      • Didn't the USA revolt against UK for taxation without representations? These extra hotel taxes even if approved by local citizens are ususally only charged to visitors since that is who hotel rooms are designed/targeted to!!!

        Oh no! Without those taxes on hotels and rental cars, who ever will the locals fund their newest billion-dollar sports arena?

  • That makes Comcast qualified for Vice President [slashdot.org].

  • I'm amazed there's no you-can't-sue-you-have-to-go-to-brinding-arbitration clause.
    • I'm amazed there's no you-can't-sue-you-have-to-go-to-brinding-arbitration clause.

      Per the article: "All eight of the plaintiffs in the suit opted out of the arbitration clause in their contract."

      • That surprises me. I've never heard of cable TV contracts being negotiable.

        • IANAL, but my understanding is that a contract is supposed to represent a meeting of minds. If the terms are non-negotiable, no meeting of minds is possible and the document is not a contract, even if it calls itself one. Please read and understand the beginning of this post before basing any actions on it.
          • by Anonymous Coward

            >If the terms are non-negotiable, no meeting of minds is possible

            False. Negotiable terms have nothing to do with a meeting of the minds, which merely has to do with both parties having an understanding of the relevant terms. In fact, non-negotiable terms bolster a meeting of minds, because standard terms mean that at least one party doesn't have to memorize, understand, or perform under a wide set of different modifications.

  • This is great. I can't wait til the obligatory settlement is approved and we get coupons or slightly reduced rates on additional services. They will settle, and whatever they pay out will not amount to much for the average consumer. Just like with Ticketmaster, where they got off with only having to give out some tickets to events of their choosing, many of which would have gone unsold anyway, and many consumers who were wronged got absolutely nothing. Unfortunately the only way to truly make things right a
    • by Anonymous Coward

      They will admit to doing no wrong and add a Class Action Settlement Recover fee to everyone's bill.

  • by Anonymous Coward

    You'd think stations would be happy Comcast et al. rebroadcast their content as their commercials reach more people. More people watching means higher advertising revenue. But no, these stations also get their rebroadcast fee too. How irritating.

  • So don't believe their fake arguments about regulatory costs.

    It costs much much less in places with a lot more regulation.

    Of course, those places don't overpay the top execs ....

  • Ship something by UPS and there's often more in additional fees than the actual delivery charge. There's also no collusion between them and Fedex. They just coincidentally raise their prices and restructure fees the same amounts and the same ways at the same time every year.
    • They just coincidentally raise their prices and restructure fees the same amounts and the same ways at the same time every year.

      Perhaps their fees and prices are recalculated the same because they are both dealing with the same costs, the same regulations, and the same business environment?

      The 'same day' thing, if true, likely evolved over time, as raising prices at different times likely cost the company that raised prices first business until the other followed suit.

  • by Anonymous Coward

    It's just small monthly fees.

    TV Fee: 39.95
    Fee Payment Fee: 1.50
    Fee Payment Fee Recovery Fee 1.25
    Fee Payment Fee Recovery Fee Levy: 1.25
    Fee Payment Fee Recovery Fee Surcharge 1.25
    Fee Payment Fee Recovery Fee Premium 0.25
    Equipment Fee: 9.95
    Equipment Fee Recovery Fee: 0.25
    Equipment Fee Insurance Fee: 0.25
    Government Fee: 0.25
    Credit Card Payment Fee: 0.25
    Non Cash Payment Fee: 0.25
    Late Payment Fee: 0.25
    Early Payment Fee: 0.25

    And people wonder why cable TV is dying...

  • sounds like a tax, doesn't it? It's suppose to. It's on my T-Mobile bill and it's a fee T-Mobile tacks on because they can and because they know most rubes will blame the gov't.
  • There is no inflation! There is no inflation !!!!! Give the seniors a .031 increase in Social security checks while Comcast raises a price 333% in three years. Then base the inflation rate with gasoline as a factor but only when gas prices go down. When gas prices go up make certain that they are not part of the index. Anyone feeling a bit screwed by all of this?
    • Then base the inflation rate with gasoline as a factor but only when gas prices go down. When gas prices go up make certain that they are not part of the index. Anyone feeling a bit screwed by all of this?

      You've conflated 'cost of living' with 'inflation', and gasoline has always been part of the cost of living calculation.

      I didn't notice many seniors complaining when SS payments went up because gasoline hit $4/gallon and drove the cost of living index up.

  • It is eminently fair and proper for a company to. Break out costs they have no control over.

    Freight companies, taxi cabs, and airlines all imposed 'fuel surcharges' when the cost of fuels skyrocketed up 100%+ a few years ago.

I cannot conceive that anybody will require multiplications at the rate of 40,000 or even 4,000 per hour ... -- F. H. Wales (1936)

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