MVPDs Tacked on an Average $450 in Hidden Fees per Annual Subscriber Bill in 2018, Says CR

Cable providers bury the fees “deep in the fine print" of customer bills “in order to raise prices while leaving their advertised rates unchanged,” said the consumer group. Companies also often provide incomplete or inaccurate information about their fees to prospective customers, sometimes blaming the government for the charges, said the report.

“Cable companies are notorious for advertising a low price but charging much more by adding a long list of confusing fees to monthly bills,” said Jonathan Schwantes, senior policy counsel, Consumer Reports. The “sneaky fees” allow cable companies to “jack up their rates and disguise the true cost consumers pay each month.”

For years, MVPDs’ bills included a base package price, state and local taxes, and a few government-imposed regulatory fees that operators were allowed to pass on to consumers, said the report; the price consumers were billed “largely reflected the advertised price.” That changed 10 years ago when MVPDs began charging a base rate plus new line-item fees under descriptors such as broadcast TV fee, regional sports surcharge, HD technology fee and network access and maintenance fee -- charges once bundled in the base advertised price, it said.

The report found MVPD-imposed fees cost consumers $37 per month on average, adding 24 percent to the advertised base price. Bills analyzed by CR came from Comcast’s Xfinity, Charter’s Spectrum, Cox, Altice USA’s Optimum, Frontier, RCN, Verizon Fios, AT&T U-Verse, SuddenLink, Wow, Service Electric, Grande Communications, and ImOn.

Commenting on the CR report, the Internet & Television Association emailed: “Cable providers compete vigorously in a vibrant and crowded marketplace and they offer a wide array of applications, products and services tailored to their customer’s needs. These companies take seriously the responsibility to provide their customers with clear and relevant information related to the services they enjoy, and work diligently to develop and use consumer-friendly ways of conveying such information, including websites, apps, delivery of monthly itemized statements and more.”

CR estimated MVPDs could be making as much as $28 billion a year from charging company-imposed fees that are separate from taxes, regulatory pass-through fees imposed by the government and optional charges for premium services, it said. The average cable bill includes more than 13 line-item charges, it said.

CR supports the Truth-in-Billing, Remedies and User Empowerment over Fees (True Fees) Act introduced by Rep. Anna Eshoo, D-Calif., and Sen. Ed Markey, D-Mass., which would require telecom providers to list a single advertised price inclusive of all fees. Only taxes that vary by locality could be charged separately. The bill would also allow consumers to end their contract without early termination fees, if the provider increases fees; prevent arbitrary price hikes on equipment fees, unless the equipment is improved; and prohibits forced arbitration clauses for wrongful billing errors, CR said.

“Pricing for cable service should be fair and transparent so we can find a plan that fits our budget without having to worry about getting stuck paying hidden fees,” said Schwantes. “Congress should require cable providers to include all company and government-imposed fees in their advertised prices to make it easier to comparison shop and find the most affordable package.”

CR recently launched the “What the Fee" campaign to highlight “surprising fees” across industries. Consumers can share their experiences at WhatTheFee.com and learn how to avoid hidden fees, it said.