Getty Images | Alex Wong
President Joe Biden this week criticized cable-TV companies for imposing “junk fees,” as the Federal Communications Commission proposed new rules that would crack down on hidden fees charged to providers. on cable and satellite video.
“My administration’s top priority is lowering the cost of living for the middle class, and that includes cracking down on companies’ use of junk fees to hide the real cost from families, who pay more consequences,” Biden said in a statement. on Tuesday.
As Biden said, the FCC is “proposing a new rule that would require cable and satellite TV providers to give consumers the full price for the service they offer going forward.” The proposed rule would force companies like Comcast, Charter Spectrum, and DirecTV to publish more accurate rates.
Biden continued:
Often, these companies hide additional junk fees in customer bills disguised as “broadcast TV” or “regional sports” fees that actually do not charge for additional services. These fees really add up: according to one report, they increase customer fees by almost 25 percent of the price of the base service.
FCC Chairwoman Jessica Rosenworcel first floated price transparency rules for TV services offered by cable and satellite companies in March. That effort gained momentum on Tuesday when the commission approved a Notice of Proposed Rulemaking (NPRM) seeking public comment on rules that would force video providers to offer a fair price for advertising.
Misleading “Broadcast TV” and “Regional Sports” charges
“Consumers who select a video service based on an advertised monthly price may be surprised by unexpected fees related to the cost of video programming that increase the amount of the bill,” the NPRM said. . The practice of cable and satellite TV companies to list “Broadcast TV” and “Regional Sports Network” fees separately from the advertised price “can be potentially misleading and could be interpreted as a government-imposed tax or fee, rather than company-imposed service fees increase,” and make it harder for customers to compare providers’ prices, the FCC said.
The docket is available here, and comments will be accepted for 60 days after the NPRM is published in the Federal Register. The FCC said its proposal “requires cable operators and DBS [direct broadcast satellite] providers to clearly and transparently display the total cost of the video programming service.”
The FCC is also seeking comment on whether it has the authority to impose similar requirements on other types of video providers. But Rosenworcel reportedly said in a congressional hearing that the FCC’s authority under US law does not extend to streaming services.
The FCC has voted to require broadband providers to display labels with exact prices and other information about Internet service plans. As we reported last week, Comcast complained to the FCC that listing all monthly broadband fees is too difficult and it wants the commission to change the broadband label rules before it takes action.
A TV pricing transparency rule would force Comcast to be more honest with advertised prices for video service as well. Comcast’s Broadcast TV and Regional Sports Network combined rates add about $40 to a customer’s monthly TV bill.
The advertised price must be the price you paid
The FCC is still operating with a 2-2 partisan deadlock over the Senate’s refusal to confirm Biden’s nominee Gigi Sohn. Biden is trying again for the nomination of Democrat Anna Gomez.
The FCC is required to implement broadband labeling rules in a 2021 law passed by Congress but does not face a similar requirement to prevent misleading TV prices. Even if the NPRM on TV pricing transparency is approved by the FCC, Rosenworcel may ultimately need a Democratic majority to impose strict pricing rules for TV service after the comment period.
“Consumers deserve to know what they’re paying for when they sign up for a cable or direct broadcast satellite subscription,” Rosenworcel said Tuesday. “No one likes surprises on their bill. The advertised price of a service should be the price you pay when your bill arrives.”
Right now, TV providers “hide a bunch of junk fees that are separate from the top-line price of the service,” Rosenworcel also said. Although the FCC likely won’t try to regulate the advertised prices of streaming services, Rosenworcel said his proposed rules would make it easier to compare traditional pay-TV prices with alternatives to online.
“Programming cost increases should not be described as taxes, fees, or surcharges,” he said. “The ‘all-in’ pricing format we are now proposing will allow consumers to make informed choices by allowing them to more easily compare competing providers and evaluate the programming costs against alternative programming providers, including streaming services.”
