Telecom Carriers Use Deceptive Advertising

theodp writes "Regulatory Programs Fee. It sure sounds like a government tax. It isn't. The latest addition to T-Mobile's monthly bill is merely the latest example of telephone companies passing their own cost of doing business to customers with an array of surcharges that one might easily mistake for taxes being collected on behalf of the government. With millions of subscribers at each company, these less-than-forthright fees add billions of dollars per year in extra revenue without raising advertised rates."

Comments

Deceptive, not illegal

[CptChipJew]

Although these tactics could be seen as immoral and lame, it doesn't look like they're actually breaking any laws. From the article, "Actually, T-Mobile's monthly charge of 86 cents is among the more clearly labeled.". As well, "though thankfully there's at least a footnote below owning up to the fees as Nextel's doing."

Like EULAs, they are taking advantage of the fact that nobody reads them.

Re:Deceptive, not illegal

[LostCluster]

For the record, the FCC's FAQ on the issue states very clearly that the USF is an obligation of the telecom carrier that they're allowed to shift onto their consumers, but they clearly don't have to.

So, basically, this is just a way for them to itemize it like it's a tax, when really its a tax on the telecom company rather than one on the consumer at the point of sale.

Just like the IDT ads claim, the big guys even try to pass their own property taxes off to the consumers by a fee.

Re:Deceptive, not illegal

[CptChipJew]

Of course, such is big business. When you buy a car, you pay a "transportation fee" for getting the car from the factory to the dealership.

When I was a kid I lived near one of Toyota's factories, and the same transportation fees applied at the nearby dealership than at the one near me here in Los Angeles.

I would hope that eventually the cell industry will become saturated with companies someday to the point of "No hidden fees!" advertising.

Re:Deceptive, not illegal

[TykeClone]

There are no taxes on businesses - All taxes are passed on to their customers. Telecoms just are kind enough to itemize it.

Re:Deceptive, not illegal

[LostCluster]

The costs of businesses are not always passed on to consumers. Sometimes they come out of the profits... that's taking money from the owners rather than the consumers.

If music piracy were to go down, do you really think we'd instantly see a price cut?

Re:Deceptive, not illegal

[TykeClone]

No I don't, but I also don't think that if corporate taxes go to 0% that we would see price cuts either.

In the last couple of years, we've been in an environment where most businesses have had no pricing power - near 0% inflation has made it so that no one could raise prices.

Now that the economy is starting to pick back up, prices will be easier to raise and I suspsect that most companies will be passing on the increased taxes of the last couple of years (you don't think that the states have been sitting idly by, do you?) on to consumers.

I think that a close to ideal tax structure (at least for businesses) would be a sales tax - that way everyone would be up front about what the government gets.

Re:Deceptive, not illegal

[Anonymous Coward]

"I would hope that eventually the cell industry will become saturated with companies someday to the point of "No hidden fees!" advertising."

I remember a Dilbert book that called these things "Confusopolys" - where the only way they make money is confusing the customer so much they pay for unnecesary stuff.

Scott Addams described it far better than I could. Anyone remember which dilber book this was?

Re:Deceptive, not illegal

[Anonymous Coward]

So, because it's not breaking any laws, and they're only innocently taking advantage of people not reading the 5,000 page included agreements, we should let this go?

Don't you get kind of fed up with companies taking advantage of people? Why is this so accepted in this country? Shouldn't we start doing something to companies that blatantly lie to costomers to gain their business? How long are you going to allow people to get screwed over and then point the finger at the individual because it's "their fault" they didn't take time out of their 50 hour workweek to deal with one-of-several-hundred companies bullshit lies?

Re:Deceptive, not illegal

[nolife]

I know saying the FCC allows this makes it all sound good but think about that concept big picture. What gives the FCC the right and or power to allow my cellular phone provider to modify the terms of my contract I have with that cellular provider? You can tell this story 100 different ways but bottom line, that is exactly what is happening here. I am paying MORE per month then my original contract states and it is not because of a federal or local tax, that money goes directly to the carrier with little to no oversight on what they can charge and for how long. The cost of doing business is exactly that. A contract is exactly that. The cellular providers WANT long contracts to tie you into the service but also want the ability to raise rates after that contract is signed but masking it as an add on "fee" to cover costs. Here is an idea for them. If they want the ability to adjust the fees based on the cost of doing business, then do not have such long contracts. What if my county raises the taxes they want for each cellular phone, can I deduct that exact amount I pay my cell carrier every month as a "cost of owning a cell phone"? If the government raises the minimum wage and now all CSR's at the cellular company make 25 cents more an hour, would they be allowed to add a few bucks to you bill as a federal minimum wage increase fee? Hell no.

Re:Deceptive, not illegal

[miu]

I think that a close to ideal tax structure (at least for businesses) would be a sales tax - that way everyone would be up front about what the government gets.

Sales tax only works if you have an exemption on food (probably qualified as just those things that can be purchased with food stamps) and a higher rate on luxury consumables. The reality is that every US state (48 of em) that has instituted a sales tax has started out with a 2.0% rate that can never ever ever be raised and an exemption on basic necessities.

In the majority of cases the rate is 5%+ within 10 years and the exemptions for basic necessities are gone. So sales tax winds up as an unreasonable burden on the poor and middle class.

Re:Deceptive, not illegal

[DrEldarion]

I would hope that eventually the cell industry will become saturated with companies someday to the point of "No hidden fees!" advertising.

I forget the name of it, but there is a telephone company that's advertising in the Chicagoland area that is doing just that. Don't think they're doing cell phone service yet, but that's how they're trying to lure customers in for regular service.

Re:Deceptive, not illegal

[jchristopher]

What gives the FCC the right and or power to allow my cellular phone provider to modify the terms of my contract I have with that cellular provider? You can tell this story 100 different ways but bottom line, that is exactly what is happening here.

If your carrier adds a fee (as T-mobile just did) you can cancel your contract without penalty. Of course, they don't exactly advertise this fact, but it has happened with both T-mobile and Sprint in the last year. Check out some of the threads on Fatwallet.com about this issue.

Re:Deceptive, not illegal

[jelle]

Actually, AFAICS, in the U.S.A., it is customary that items have a different 'price' than the amount of money necessary to purchase it.

It's not just telephone, wireless and cable bills.

I think that people just have become adjusted to the reality that when they need to make decisions, the dollar amounts mentioned are just rough approximations (xx plus taxes, fees, handling, adjustments). Which I think is indirectly contributing to the large number of people in trouble because of too much (credit-card) debt.

1) the price of items in the retail shops/supermarkets are not the price that you pay for them at the register, if the item has sales tax on it.

2) Tips, in the many places where tipping is customary. Given the level of math mastering by most people, how many people do you think will know off the top of their heads, immediately, the price including tips for that $11.95 sirloin? Sure, 15% is approximately a dollar for every 6 (16.6%), but $14 is only an approximation of the price if you tip exactly 15% (unless you adjust your tip to whatever is convencient for your calculating, which if you do that, you should also not complain about a $86 cent tax/fee/something on your wireless bill).

3) Mail-in rebates... (an advertising scam of its own)

4) The price on the window of an automobile, or even the price you negotiate in the 'office' is not the amount of money that you pay to purchase a vehicle (taxes and fees again). Actually, many people seem to buy/lease cars based solely on the 'dollars per month' that they need to pay for the loan/lease, and the vast majority of them don't know the total cash they actually lay down to own the vehicle.

5) The price on Internet shops is not the amount of money that you pay to purchase the item ('handling'...(and shipping))

6) When you purchase an item 'on credit' with your credit card and don't pay the credit card bill in will, then for that item you will actually be paying the 'price at the register' plus credit card interest.

7) The exact actual government tax rates (for income & property) for a calender year aren't published until the end of the year (around November).

Re:Deceptive, not illegal

[Planesdragon]

When I was a kid I lived near one of Toyota's factories, and the same transportation fees applied at the nearby dealership than at the one near me here in Los Angeles.

Did you buy a car from THAT factory, though?

And did you actually compare rates? Remember that if the dealer's close enough to get its car via truck (rather than ship-then-truck), the only differnece in transportation will be the actual mileage it takes to drive the longer distance.

Re:Deceptive, not illegal

[SagSaw]

Of course, such is big business. When you buy a car, you pay a "transportation fee" for getting the car from the factory to the dealership.

As far as I'm concerned, there is nothing wrong with these practices so long as the fees are disclosed to the purcahser before they have to commit to the purchase (or lease, other contract). In the case of the trasportion fee on new cars, it is listed on the sticker, and is a part of the sticker price.

This would be equivalant to the telco companies simply stating that $17.47 of your $59.99/month plan goes towards regulatory compliance.

Re:Deceptive, not illegal

[Anonymous Coward]

The reality is that every US state (48 of em) that has instituted a sales tax has started out with a 2.0% rate that can never ever ever be raised and an exemption on basic necessities.

That's fascinating ... do you have any links where I can read more about the history of this?

Re:Deceptive, not illegal

[Jameth]

"In the majority of cases the rate is 5%+ within 10 years and the exemptions for basic necessities are gone."

They usually get over 5%, but in all four states I've lived in, food has remained untaxed. I was under the impression that food sales were not taxed anywhere in the US. Or were you referring to some other basic necessity? Of food, shelter, heat, and water, only food is bought directly by the consumer; the rest are under property taxes or utilities.

Re:Deceptive, not illegal

[Kenardy]

Michigan exempts food for home prepartion (as opposed to a cheeseburger and a soda at a drive through window.) and, IIRC, prescription drugs.

Re:Deceptive, not illegal

[Jason1729]

The "transportation fee" only applies if you're stupid enough to pay it. It's one of the easiest to get waived. The other is "administrative fee" which is basically their advertising budge. Getting those waived is as simple as saying you're not paying them and getting up to leave.

Re:Deceptive, not illegal

[Anonymous Coward]

Of course;
When you buy an item in the store, who do you thinks pays for the rent, salaries, taxes and other fees. The consumer. Otherwise why be in business.

Re:Deceptive, not illegal

[hawaiian717]

In Hawaii, sales tax applies to everything. Even food purchased at a grocery store and medical services.

In theory, the sales tax to be paid by the customer is 4%, and the business pays 4% of what is collected, resulting in an effective tax rate of 4.167%. In reality, all business just charge the customer the full 4.167%.

Technically, it's not a sales tax at all, but a General Excise Tax.

This page has some further information: http://www.hawaii.gov/dbedt/hecon/he98sp/compare.h tml

Re:Deceptive, not illegal

[TheAntiCrust]

I remember hearing about confusopolies on the Dilbert tapes called 'The Dilbert Principle'

They were funny as hell, made at least one plane ride go by faster. Scott Adams is a seriously funny man.

Re:Deceptive, not illegal

[Anonymous Coward]

There are no taxes on individuals, either. All taxes are passed on to our suppliers. I'm going to start itemizing when I pay my bills: $20 for the doodad, minus $1 property tax, $3 income tax, $2 payroll tax, $1 sales tax, $2 interest tax; business gets $11 for its doodad.

Or, or, taxes always propagate throughout the economy regardless of direct application, but affect the application most directly. Yeah, that makes more sense. Plus it smells less like propaganda delivered from the boardroom via (R) politicians.

Re:Deceptive, not illegal

[tpengster]

There are no taxes on businesses - All taxes are passed on to their customers. Telecoms just are kind enough to itemize it.

It depends on the elasticity of demand. When demand is elastic, the producer bears most of the burden of the tax; when demand is inelastic, the consumer bears most of the burden. Phone service, i would guess, is inelastic.

Re:Deceptive, not illegal

[Blue_Wombat]

"Sales tax only works if you have an exemption on food"

Nope - sorry. Here (GST in New Zealand) we have a sales tax that applies to everything - basic food, medical equipment, electricity, caviar & french champagne. No exemptions and the same rate for everything. It "works" just fine - and works a lot better than complicated systems with different rates & exemptions.

Equity is a separate issue - but it "works" just fine.

Re:Deceptive, not illegal

[WoodstockJeff]

Sometimes they come out of the profits...

Umm... just where do you think the "profits" come from, if not the money charged consumers? With the trivial exception of the money used to start a business, you can not take any money from a business that didn't come from some consumer somewhere. It's a cost of doing business, and it will be passed on to the consumer in some form, or the business will die.

Re:Deceptive, not illegal

[Anonymous Coward]

They were to some extent or another. Each sales tax state decides what food is taxable and what isn't. Some have a lesser sales tax (say, 3.0% instead of 5.0%) on staple foods.

It's nice living in Oregon.

Re:Deceptive, not illegal

[miu]

do you have any links where I can read more about the history of this?

Current sales tax overview by state.

I can not find any single site with good historical data, but here are a few histories by state:

• Idaho
• Maine
• Texas

I'd list more, but most states don't provide an easy to read historical rate chart. In some cases you can get a breakdown of yearly sales tax receipts, but this is further complicated by the fact that they call sales tax something else, and it may be collected by 2 or 3 separate entities.

Re:Deceptive, not illegal

[CerebusUS]

Come to Virginia. We tax everything. (sigh)

Re:Deceptive, not illegal

[innocent_white_lamb]

If your carrier adds a fee (as T-mobile just did) you can cancel your contract without penalty.

But that would leave you without the service that they contracted to provide to you.

I'd rather see the carrier pay a penalty to the subscriber for non-performance of the contract. Or best, just have the carrier honour the original agreement as written.

Re:Deceptive, not illegal

[Anonymous Coward]

As long as television numbs the mind of the average "consumer" (we were people once, right?), your sentiment will fall on deaf ears.

Face it, most people no longer have the will to think for themselves.

Re:Deceptive, not illegal

[jafuser]

This is going from memory...

The concept is that after a long time spent squeezing the profit margins through competition, all of the companies are left with no room to simply just lower prices anymore, so they each create elaborate plans to make it sound like you're getting a great deal, when in fact, in the end you're probably paying the same no matter which company you go with.

Re:Deceptive, not illegal

[jafuser]

Most of the "basic necessities" type of food items go on untaxed, but I'm noticing as time goes on, snack foods, quick prep meals, fast food, etc are all taxed now.

I expect that pretty soon, everything but flour, milk, eggs, and unprocessed meat will be taxed.

Re:Deceptive, not illegal

[cft_128]

I'd rather see the carrier pay a penalty to the subscriber for non-performance of the contract. Or best, just have the carrier honour the original agreement as written

I'd like to see the carrier pay the same fee that I would have to pay them if I terminated the contract early. Not likely but I would like to see it.

Re:Deceptive, not illegal

[ForestGrump]

Rates varry by car model, but they are basically the same from one toyo dealer to the next.

This is because the cost averaged out among all buyers. Thus, it makes a "fair" playing field for the buyers (and it is up to the stealership to determine how much an ass they are)

Different models requre different transport criteria, thus, different transport costs. Some cars (like the 50k+) requre a closed transport, wheras your everyday civic is an open transport. Naturally, closed transports cost more.

The transport cost is a minor thing in the grand scheme of MSRP, invoice and holdback.
-Grump

Re:Deceptive, not illegal

[Galvatron]

RI appears to tax food. Being a student, my local supermarket gives me a discount which largely offsets this, but most are stuck paying the tax.

Re:Deceptive, not illegal

[tehdaemon]

FWIW It was recently reported that about 2/3 of US companies paid no corporate income tax last year. Tax loopholes and creative accounting. No, I do not think that you would see any price cuts. There would not be all that much difference to begin with.

Re:Deceptive, not illegal

[Anonymous Coward]

Umm... just where do you think the "profits" come from, if not the money charged consumers? With the trivial exception of the money used to start a business, you can not take any money from a business that didn't come from some consumer somewhere.

You're missing the point, because there is a valid distinction between tax coming from profits and tax coming from consumers.

Suppose your state raises corporate taxes by 5%. Company A raises its prices by 5% to compensate; company B doesn't. In that scenario, company A is passing its taxes on to customers, and company B is paying them out of its profits. See?

Re:Deceptive, not illegal

[Anonymous Coward]

Man, sucks to be American. Let's look at how things are in Britain for comparison?

1) the price of items in the retail shops/supermarkets are not the price that you pay for them at the register, if the item has sales tax on it.

Sales tax is much, much higher here, currently 17.5% for most goods. However, the prices displayed are almost always inclusive of tax. (Even adverts, which normally display the untaxed price in big letters, usually give the price inclusive of tax in the small print.)

2) Tips, in the many places where tipping is customary. Given the level of math mastering by most people, how many people do you think will know off the top of their heads, immediately, the price including tips for that $11.95 sirloin?

Standard tip is 10%, not 15%. Makes the maths a lot easier. ;)

3) Mail-in rebates... (an advertising scam of its own)

Non-existant. People wouldn't stand for that sort of nonsense, they'd go somewhere else and buy for the lower price without the rebate crap.

5) The price on Internet shops is not the amount of money that you pay to purchase the item ('handling'...(and shipping))

Most internet dealers seem to offer free shipping within the UK on most orders. Okay, there have been some cases lately where people have been promised "no shipping charge" and then been billed for a "transportation charge" instead, but that hasn't generated much good publicity for the companies responsible...

Of course, the way things are going we're going to end up just like the US pretty soon. For the meantime, though, I'll gladly put up with the higher sales tax if it means I can enjoy an all-round higher level of honesty and openness from the companies I'm patronising.

Re:Deceptive, not illegal

[WoodstockJeff]

In that scenario, company A is passing its taxes on to customers, and company B is paying them out of its profits. See?

I think you're the one that doesn't see. Company A might be pricing closer to the bone than Company B, and can't afford not to pass their increased costs on.

Or, perhaps B is running at no profit... Since corporate taxes are based upon profit, a rate increase of 5% would not affect B, since 15% of zero is the same as 20% of zero. Since I run 2 corporations affected by such taxes, I am intimately familiar with their effects when profitable or not profitable.

Re:Deceptive, not illegal

[arakasi]

There are no taxes on businesses - All taxes are passed on to their customers. Telecoms just are kind enough to itemize it.

I don't know if you meant this to be funny or not. I don't know much about economics but what I have learned is that business cannot pass on all taxes to consumers. While all businesses will try to pass all taxes levied against them, there are few or no businesses that can pass on 100% of their taxes to consumers. They will try but the amount that they can actually pass on is largely determined by the elasticity (or inelasticity) of demand for their product. If demand is relatively inelastic, then the business can pass on much or perhaps all of the tax levied against them by increasing the price of their products (cigarettes are a good example of this). If the demand is relatively elastic, consumers will respond negatively to the price hikes and look for cheaper substitutes if possible or curtail their purchases of the product.

Re:Deceptive, not illegal

[juglugs]

Didn't Scott Adams work for AT&T? Perhaps he's used to hidden charges....

Re:Deceptive, not illegal

[betelgeuse-4]

Bah! 5%+ is nothing. Here in the UK sales tax (VAT) is 17.5%, which is charged on top of other taxes. For example, petrol duty is about 50p per litre at the moment, but with VAT that goes up to around 60p, so for the 80p you pay for a 1 litre of petrol (approx $5.25/US gallon) 75% is tax.

Re:Deceptive, not illegal

[Mr. Slippery]

you can not take any money from a business that didn't come from some consumer somewhere.

Money circulates. That's what it's supposed to do.

It's just as true that you can't money from a consumer that didn't come from some business somewhere (usually in the form of a paycheck), or that taxes on employees will be passes on to employers through a need for higher wages.

Re:Deceptive, not illegal

[Anonymous Coward]

The sales tax would be ideal for individuals as well. It has actually been proposed and it sitting waiting for the committee to approve it. HR25 the Fair Tax Bill. It would eliminate the IRS as an added bonus. It would eliminate all of the hidden payroll taxes like FICA so if you make $60,000 you will take home all of it. Used goods would not be taxed only new purchases at retail would be taxed. All households would get a rebate up to the poverty level every month so the poor would pay even less taxes than they do now. Go to www.fairtax.org for more information. Please take a look at the facts before saying it won't work. Most of your objections have been addressed in the FAQ's.

Re:Deceptive, not illegal

[gl4ss]

It's not 'deceptive' if it's not illeagal..

Donald Duck extra contract shit("i thought that was fly shit") isn't _really_ legal in any sensible country, well, at least in any country that rates consumer over the company(so yeah, with really lousy customer protection laws that might be 'legal', but then it wouldn't be deceptive, it would be just 'normal').

when you SELL a product that isn't what you advertise it as, then you ARE committing treachery on one level or another. You can't really go on selling meat pies as "Chicken burgers" with a really small print nexto it saying "Chicken burgers may be meat pies". It's just childish to assume that other people(the law) would take that kind of shit from you, and something you should only see in comics and cartoons. Hidden deceptive fees should not be tolerated! for a number of reasons, number one being that it makes it impossible for the consumers to effectively evaluate the price differences between service providers which is a cornerstone in a working money driven society.

Re:Deceptive, not illegal

[Anonymous Coward]

Try Shelby county in Tennessee where a tax of over 8% is applied to everything, even food.

Re:Deceptive, not illegal

[maraist]

Not usually true.. Simple economics, corporations are interested in profit maximization.. As the price of a good goes up, the quantity sold NECESSARILY goes down. The perfect price for a given audience is based on the aggregate demand curve (generally not a known equation, but rather can be approximated through polls/sampling/etc). From the demand curve, you can directly compute the marginal revenue curve (for straight line demand curves, the marginal revenue curve bisects it). You then take your cost curve, (which becomes more expensive as you produce greater quantities), and see where that intersects the marginal revenue curve. This tells you how many to produce (in a monopoly or in monopolistic-competition). You then can charge as high as the demand curve will allow for that quantity.

Now you can play dirty games when you lock customers in via licenses, since there is a barrier to exit, but even in this circumstance, existing customers have a demand curve, beyond which they will no longer accept your service, and you will certainly bar new customers from entering.

In any case, as you increase your costs (via taxes, fees, what-have-you), you raise the cost curve, BUT, the demand curve has NOT changed.. Moreover, presumably you previously chose a profit-maximizing position.. If you merely raise the price, and hold the quantity steady, then many of your customers will exit the market (as the demand curve REQUIRES). You will no longer be at a profit maximizing position, and WILL lose revenue.

Thus, in the face of rising costs (e.g. new taxes), you must recompute the intersection of the old marginal-revenue curve and the new cost-curve.. This will give you the new quantity to produce (which will be smaller than before).. You then choose the new price point on the demand curve at that quantity.

There are two types of customer-bases.. "elastic" and "inelastic". Elastic customers will exit the market at very small increases in price (say milk, gas, etc). In-elastic customers are essentially addicted to the produce (say medical drugs, cigarets, BMW's, etc). If you have an inelastic product, then you can pass on a greater percentage of your costs (possibly 100%) with little fear of losing customers. Especially if the entire market does the same, such that they can not substitute your product for a competetor.

If all gas stations or all cell-providers apply a $10 tax/fee to cell service, then subscribership should not go down much, since there are no alternatives for the "addicted" service.. However, you will necessarily exceed some house-holds' budgets, who will necessarily go down to a $30 + $5 plan, or simply drop coverage (paying the exit fees). Cell providers compensate by making their sub $40 services less attractive, which keeps more of their premium subscribers, but then completely alienates lower-budgeted brackets.

The key is that they are definitely monitoring the demand curves, and valueing out various scenereos. They know they what can get away with.. But the main point is that they do NOT just blindly pass along all costs.. What T-Mobile has recognized is that their particular demand curve can support a higher price, and that the best way for them to raise prices is to keep the deceptive $40/mo retail-price, and up it by nearly $10. The "new" taxes/fees are complete lies. It is deceptive advertising plain and simple.. NOWHERE does T-Mobile tell you that you are subscribing to a $50/mo plan when you sign up for their $39.99 plan. And this is what I think is wrong. They can morally charge what ever the heck they want for a service, but they should be honest about the costs. Especially with $150 cancelation fees.

On the other hand, my beef is probably because I'm use to a different sort of pricing tactic, called "sales" evaporation.. Retailers list a price MUCH higher than what the sell the product for.. They advertise the retail price all over the place, but when you get to the shelf, it's usually much cheaper.. So when the store wants to raise

Re:Deceptive, not illegal

[Low Key]

Actually, the trasportation fee is a flat fee that is a result of the Teamsters. You can thank them for this extra cost on vehicles.

Re:Deceptive, not illegal

[ibennetch]

Yeah, but the obnoxious part is that those fees are tacked on after your base price. So on my landline, the $6.85 local calling plan ends up costing me a grand total of: $20.83. What the heck? And in your example, the plan that was advertised as $59.99 really ends up costing at least $77.46 -- almost twenty bucks more per month than you expect when you sign up.

I'm just fed up with extra and hidden fees.

Re:Deceptive, not illegal

[liquidsin]

Yeah, honouring the original contract would be great. It's not like I can go into them and do what they do. "Hey, I just moved into a new house and my mortgage payments are higher, so we're going to be decreasing my bill by $3 a month. Thanks for your understanding." Your penalty idea would be nice. Or if you decide to go the cancel route, they should have to pay your number transfer fee so you can get service somewhere else. This whole "we're altering the deal now that you've signed it" scheme is total bullshit.

Re:Deceptive, not illegal

[Fulcrum of Evil]

As the price of a good goes up, the quantity sold NECESSARILY goes down.

No, it doesn't. If your original price is well below expectations, then people may reason that your product is somehow defective and not buy as much of it. This happened with an European speaker manufacturer - they sold high-quality speakers at a low price, but had disappointing sales. Afer they doubled their prices, their volume went up markedly. I imagine this effect mostly shows up in luxury goods.

Re:Deceptive, not illegal

[Anonymous Coward]

"In the last couple of years, we've been in an environment where most businesses have had no pricing power - near 0% inflation has made it so that no one could raise prices."

...in mason county michigan weve seen plenty of price increases for almost everything I can think of, all while the companies ruduce their costs AND tell the remaining employees about how "sales are up 152% from last year already!".

Re:Deceptive, not illegal

[LaCosaNostradamus]

Firstly, what's happening here is more deceptive than fraudulent. In short, it's predation upon consumer ignorance, and government has no responsibility for the contents of your mind.

Companies that take advantage of people like this should lose their customer base. Nobody needs a cellphone, dipshit. The demand for cellphones is at an appallingly insensible high point and people should right-size their needs. I see poor people walking along with cellphones. They are getting exactly what they deserve.

So, I blame the consumer. I already know businessmen are scumbags, but they are free to humiliate themselves in public with their slimy business practices. People put up with it since they are sheep. Stop being sheep!

Businesses that act like trapdoor spiders -- inviting people in with simple slogans them baffling them with conditions and other bullshit -- should lose their customers. A 5000-page "agreement" is an outrageous sign that they want to fuck you over. Learn to identify the signs and then shun them. Power comes from the people, not officials. We The People can shut down any business we chose ... without reliance upon the assholes in the legislature.

Re:Deceptive, not illegal

[SagSaw]

What makes the auto industry's "transportation fee" acceptable in my mind is that is is clearly disclosed as part of the sticker price. The telco industry's practice, at least in my mind, is unacceptabe because the fees are not normally disclosed ahead of time. I've never had a problem, however, asking exactly what all the fees are when I sign up for a plan. Usually, with a bit of prodding, they will give you the totoal.

Re:Deceptive, not illegal

[catfood]

about 2/3 of US companies paid no corporate income tax last year...

Depending on the details, this might not be such a bad thing. If this is counting every single corporate entity, no matter how small, it probably includes a few million self-employed people who have created their own C-corps for liability purposes.

In these situations it is common to give yourself a year-end bonus to reduce the corporation's profit (and hence its tax liability) to zero. That shifts the tax burden to the owner's personal return, where the rates are a little more advantageous, but taxes are indeed paid on that income.

I could easily believe that two thirds of US corporations are similarly situated in some way. You could also take into account those subsidiaries of larger companies, who pay out all their profits as "management fees" and such to the parent organization. Again, the parent corporation pays all taxes while the subsidiaries report zero profits. Taxes are shifted, not evaded.

Re:Deceptive, not illegal

[glrotate]

What gives the FCC the right and or power to allow my cellular phone provider to modify the terms of my contract I have with that cellular provider?

The Commerce Clause of the Constitution.

Re:Deceptive, not illegal

[Ben Hutchings]

Your contract almost certainly has a clause in it allowing the service provider to change it unilaterally by giving you notice. That seems to be standard practice for utility contracts here, anyway. You can at least cancel without charge if the changes are in the utility's favour.

Re:Deceptive, not illegal

[Ben Hutchings]

In the UK a business must advertise prices including VAT (possibly as well as the VAT-exclusive prices) unless it sells mostly to VAT-registered businesses.

However some shops have an annoying advertising practice of claiming to sell at "VAT-free" prices (illegal) or "paying the VAT for you" (required by law), which really means they reduced the selling price by about 15% to what the price would previously have been without VAT.

Re:Deceptive, not illegal

[Rich0]

Fairtax handles the exemption on essentials a little differently. They look at family size and calculate poverty income based on this. Then they figure out the sales tax if you spent that much income and mail out a rebate check every month - to everybody.

So, if you buy just the essentials of life you don't pay any taxes - not even on things which are debatable essentials like gasoline/cars. On the other hand, if you spend more than the poverty level of income you pay taxes on everything (so those filets you buy don't benefit from the tax exemption granted to mac and cheese).

And if you're frugal and spend even less than poverty level then you get some social assitance out of the deal - which is sensible.

This eliminates the need to argue over what is and is not essential - and reduces administration costs on businesses. I recall working at a retail store in high school and having to remember that clothes are non-taxable, with the exception of bathing suits, etc, and that food is taxable unless it is considered prepared, and I'm sure there are a million gray areas I'm not even thinking about...

Re:Deceptive, not illegal

[kmmatthews]

Can you point to any companies that don't attempt to anally assualt thier customers?

Only one I've found so far is my DSL provider - speakeasy. [http://speakeasy.net/]..

Re:Deceptive, not illegal

[Overzeetop]

As for business passing on the costs, I plan to do so myself. I have the opportunity to practice engineering (I'm a PE) in Tennessee. Now, I don't mind the annual registration fee of $70, though it's the highest of the 5 states in which I will hold a license. However, if you actually want to provide sevice as an engineer, there's an additional "professional privilege" tax of $400/year. All registered professionals pay it (doctors, lawyers, accountants...) in order to practice. I have already informed my clients that any time I'm needed to apply my TN seal, there will be a "professional privilege tax recovery fee" added to their invoice (A fixed fee plus a percentage of the total value).

Businesses get taxed...and we pass it on.

Re:Deceptive, not illegal

[gcaseye6677]

I don't believe a phone company can add fees to your monthly bill if you are under contract. Otherwise, what would stop them from charging you $100 a month on a plan advertised for $39.95 just by adding more fees? If they add a new fee, that should only apply to new accounts, or those whose contracts have expired. Common contract law says that you can't change the terms of the agreement without the consent of the other party.

Re:Deceptive, not illegal

[Eivind]

People are incredibly naive. I think that the demise of the traditional market has a lot to do with this.

Today people are used to shopping at supermarkets where $12.95 really means $12.95 and you're unlikely to get it even a single cent cheaper vy trying to haggle.

Thus, many people fails to consider the real power they as customers have when making larger purchases.

Spiegel here in Germany made a simple test earlier this year to see how much of a difference even minimal haggling make.

They walked into a few dozen auto-dealers saying one of the two following:

• I would like to buy a car. It'll be paid cash in full, can you make me an offer ?
• I'm looking for a new car, so I was visiting a few dealers looking for offers. I've had a few offers already, but I was wondering if you'd be able to make me a better one. What would you ask for a ?

Result ?

By hinting that you're comparing, and that the dealer will have to make you an actually competitive offer to have any chanse of getting a sale, the average offer in the dealers where they used tactic 2 was around 10% better than the average offer gotten with request 1.

That's a lot of money saved for saying a single sentence out loud.

Still, tons of people fail to do even this.

Re:Deceptive, not illegal

[Anonymous Coward]

for me at least

a cellphone is cheaper than a landline with long distance service and the equivlent number of minutes used per month.

i dont own a landline, and can't get dsl anyways.

How the hell is this news?

[00420]

Telephone companies have been doing this for many years.

One of the companies I worked for even listed the surcharges at the end of the taxes so that when people called the first five or so things they asked about would get an answer of "that's a tax, there's nothing we can do about it," that way they usually stopped asking before getting to the surcharges.

Most companies won't even list them though, they just put "Other taxes and surcharges... $X" on the bill.

Re:How the hell is this news?

[LostCluster]

The newsworthy aspect is because T-Mobile was the last major phone company, celluar or landline, to not be charging such a fee. Now, it's impossible to switch carriers to avoid such fees. It really can be said that everyone's doing it.

Re:How the hell is this news?

[cyberformer]

But they're not all charging the same fees at the same amounts, which makes it difficult to compare prices when all the companies only advertise the price excluding the fees.

Isn't there some code of ethics in the US?

[King_of_Prussia]

Where I come from, the consumer protection authority jumps all over companies who don't include fees like this in advertised costs. I bet sleazeballs like this charge a hefty early disconnection fee too...

Re:Isn't there some code of ethics in the US?

[Anonymous Coward]

Yeah, but Prussia doesn't exist anymore. Coincedence? I think not.

Re:Isn't there some code of ethics in the US?

[Anonymous Coward]

Yes... $150 ~ $175 early termination fee. Per line.

Five cents turns into 16.37 cents?

[LostCluster]

ABtolls.com maintains a database of phone rate planes, and does the consumer the favor of computing the true cost of a plan after all the USF and PICC fees are added in. This particular dial-around plan has to go down as one of the worst offenders. While they claim that the first three minutes only costs 5 cents, "regulatory fees" make that three-minute call cost 16.37 cents, more than triple the advertised rate!

Sure, that's only pennies of difference, but nickeling and diming in volume adds up.

Re:Five cents turns into 16.37 cents?

[Marillion]

I've heard people call it "Stealth Inflation." Real Prices have been rising for a while, but Advertised Prices haven't.

Another example is airline's fuel surcharge.

Re:Five cents turns into 16.37 cents?

[LostCluster]

It's interesting that gas stations have to display an "includes all taxes" price, while in several states such as California there is a sales tax based on a percentage of the true price as a component. In those cases, when the price goes higher, the tax per gallon tags along for the ride...

Nearly every other product in the marketplace is marked with a before-taxes price, and the tax is added when you hit the register...

Re:Five cents turns into 16.37 cents?

[/dev/trash]

Hell. When gas prices surged 3 years ago, I was assessed a 'temp' surcharge on my GARBAGE bill. Gas prices leveled off but the surcharge has been going up ever since.

Re:Five cents turns into 16.37 cents?

[linzeal]

So we have the likes of Adbusters expose the whatever marketing demon dreamed up the current scheme? Maybe someone should call George Segal and tell him they have found a cure for baldness at a secret location deep in Verizon Wireless HQ, and give him a 45 and some plastique and wait for him to come walking up to us and punch us in the face to know our dirty job is done?

Huh, dude get off the computer this is my slashdot account.

Re:Five cents turns into 16.37 cents?

[Alternate Interior]

And every day brings new record highs for gas prices. Gas prices have been a roller coaster for years. I'm not arguing the surcharge is right, in fact it seems like a basic business cost, but gas prices certainly haven't levelled off, and therefore, the logic is right.

Re:Five cents turns into 16.37 cents?

[Anonymous Coward]

hey, the federal phone tax was originally temporary to fund the spanish american war, so either that should be dropped, or the US should go back to war with spain.

or the govt should be forced to give the last 90 years of taxes back to the people that paid them. now that would be hilarious, adjusted for inflation of course.

there is no such thing as a temporary tax.
just ask the stupid milwaukees brewers. ( i hope the leave this state)

Re:Five cents turns into 16.37 cents?

[/dev/trash]

Three years ago they had leveled off for about 8 months. I get a bill every 3 months.

But anyway, it was a temporary thing, I guess taht means something different these days.

Cell phone taxes

[amspencer]

On my $30 bill with SprintPCS, there are about $7 in taxes. Most of them are local taxes. What I don't like is paying for portable phone numbers if I don't intend to move my number.

Re:Cell phone taxes

[whoppers]

I have two PCS phones and told them I won't move these numbers, so take the fee off and they have.

Don't worry

[RuneB]

According to the T-Mobile girl, you can always take your number to a better place!

Re:Don't worry

[`Sean]

> According to the T-Mobile girl, you can always take your number to a better place!

So you really can take it with you when you die?

Re:Don't worry

[Anonymous Coward]

I wouldn't call 'up my ass' a better place, necessarily. I'm sure that's where she'd tell me to put my number.

don't use Telecom use . . .

[Anonymous Coward]

Personal Telco

Less-than-forthright fees

[drsmack1]

These addtional charges represent the "less-than-forthright taxes" levied on the telecommunications industry by the Federal Government. I called and asked about it one time. One of them is Gore's "I invented the Internet" tax.

Re:Less-than-forthright fees

[Whumpsnatz]

Yeah, but it's actually a pretty puny piece of the overall robbery.

Big Fat Duh!

[mbrother]

Phone companies have been pulling this crap for years, banks too. Doesn't mean they should or that people like it. Tempted to try this on my next government grant budget, but will probably have an attack of integrity. Deceptive but not illegal is still sucky. And that's the technical term.

Re:Big Fat Duh!

[tomstdenis]

No, deception but not illegal is called "modern business". It's gotten to the point that to make more money than your competitor you don't make a better product [why? Standards are fairly subjective nowadays]. Instead you trap your customers into useless deadend contracts and then tact on this charge and that charge.

Banks are by far the most useless institution I've seen. For instance, I get paid via cashier cheques made out to my name. However, if I walk into another branch of the same bank I can't cash the cheque despite the fact every teller has a new-fangled computer with a 17" LCD monitor [which probably cost serious coin].

Every time I see a teller it costs money. Whenver I cash my cheque it costs me money [2% + fee to change from USD to CDN]. Whenever I take out money from non-branch ABMs it costs me money. etc, etc, etc.

Then you get into bank hours which are often anywhere starting from 9 to 11am and ending from 3 to 5pm totally useless for students and the employed.

Then you get into the stupid tellers. Who rarely follow procedure [one teller will cash your cheque without a hold another with a 20 *BUSINESS* days hold].

Then commercials tell you "you are first, we are here to put you first, if you are not first then we are not doing out job to put you first. You are the first important job we deal with because as our first customer you will get the first attention you firstly deserve" which are just trying to hide the fact that banks don't give a rats ass about customers. If they can find a way to make a buck off a customer [including raping you up the ass when you're not looking] they'll certainly try.

Personally if I could find another way to turn a cashier cheque into rent+school+bill+food I would do it in a heart beat.

Back on topic. Phone companies pretty much work on the same M.O. Using stupid commercials to blindside the customer into signing 3yr contracts for plans they don't need, can't use and wouldn't want given the option. 60 "anytime minutes", unlimited weekends, 0.30$/m net access, bullshit bullshit bullshit.

Personally I'd love to see a plan "you pick up da phone and you can talk", no net, no ring tones no stupid extras. Just a fucking phone. These "value added gourmet quality" additions are just there to cover up the fact that you pay too much for the little coverage/service you get. It's like adding salt to dog shit and calling it steak.

That's my rant and I'm sticking to it.

Tom

Re:Big Fat Duh!

[mbrother]

I have a credit union with direct deposit, very few fees, if any at all most months. I know I'm smart/lucky there. The direct deposit gave me 0.25% off on a car loan, too, at a decent rate already. The phone thing though...do you also get Qwest commercials where you are that intimate that their customers love getting their bills and phone calls?! Unbelievable...

Re:Big Fat Duh!

[innocent_white_lamb]

I strongly suggest that you talk to a credit union.

I used to have my business accounts at a bank and when they told me that they intended to deduct 2% from my cash deposits (real cash, not cheques or anything like that) for a "service fee", I told them that I was taking my business elsewhere. I walked down the street and got an account at the local credit union and have never regretted it. That was six years ago.

Re:Big Fat Duh!

[pantherace]

With banks there is an option: go to a Credit Union.

With cell phones, there isn't an equivilent of a Credit Union Association. It's a regulated oligarchy. (In the USA, anyone have providers other than TMobile(GSM), Criket(GSM), Sprint (CDMA), Verison(CDMA), Cingular(GSM), AT&T Wireless(GSM)? (I probably forgot one or two, and there are probably a few 'analog' providers around locally.)) The barrier to entry is very high, not only technologically & monitarily, but also beuricratically: the FCC.

I am pretty sure that the FCC would prevent any municipality from starting it's own wireless phone service, as I think there was a case where they did just that.

Re:Big Fat Duh!

[Fulcrum of Evil]

Banks are by far the most useless institution I've seen. For instance, I get paid via cashier cheques made out to my name. However, if I walk into another branch of the same bank I can't cash the cheque despite the fact every teller has a new-fangled computer with a 17" LCD monitor [which probably cost serious coin].

Let me guess - you bank at CIBC, right? If I got half the flak that you get, I'd be running off to a credit union.

Re:Big Fat Duh!

[LaCosaNostradamus]

My friend, I'm in a really bad mood and you are going to pay the price.

You are a complete fucking ass if you didn't realize that banks don't want your business. Banks only want companies and individuals with lots of money to be their customers. Everyone else can just go straight to fucking hell and die as far as they are concerned.

I should know. I work in a "super-regional bank" as an IT field tech. The bank is cutting costs to the point that within 2 years the customers are going to flee like locusts from flame.

Banks don't want tellers or branches. Tellers cost money, and the bank branch itself costs money to run.

Banks don't want low-volume checking accounts. There tend to be many thousands of these, and that just costs money to process them since it requires more of that unskilled labor, which like tellers, is a waste of money.

I knew the banking industry was a complete fucking wad when I went into a branch of a bank in 1997 with a check made out to me from one of their accounts, and they had the nerve to try to charge me $3 (now $5) to cash it. A check is a "demand payment" but the tellers asserted that I was not their customer. The bank blindly refused to acknowledge that their "customer" (the man who wrote the check) still expected the payment to be honored even when it involved the recipient wandering up and getting the money directly.

Since 1997, I stopped having a bank account, but had to get one since my employer only uses direct deposit. I remove the money every 2 weeks and keep it somewhere safe. God knows a bank account isn't safe anymore (I'm sure paypalsucks.com can give you some idea).

Not with AT&T

[Anonymous Coward]

I just signed up with AT&T wireless not a week ago. They were very clear and up front about the fact that it is not a tax, but it is used to cover the expenses of follosing the various regulations. I signed up anyway, knowing full well what they were doing.

They call it a "Regulatory Programs Fee", like Verizon does.

Maybe some other carriers have problems with this - and maybe AT&T has their own problems, I haven't been signed up long enough to know - but I can't at all fault them for this.

In all fairness, the article did not single them
out.

--Russell (not logged in because it's Sat. Night and I'm a lazy f*ck)

Re:Not with AT&T

[DAldredge]

But they don't include those fees in their TV, radio or print ads, do they?

THAT is what upsets people.

Re:Not with AT&T

[kidgenius]

Wow.

You actually chose to go w/ AT&T. Be prepared to be calling them up on a regular basis to correct your billing. AT&T was rated #1 for customer complaints, incorrect billing, and service. The two people I know with AT&T are itching to get out of their contracts b/c of the crappy service. Click here

Re:Not with AT&T

[mabu]

I just signed up with AT&T wireless not a week ago.

Congrats! You're now in bed with the Verisign of wireless; the Microsoft of Telcos. The most expensive wireless company on the planet, with nowhere near the best calling area or plans.

I researched all the companies over many years. One company I would never deal with is AT&T.

Re:Not with AT&T

[Anonymous Coward]

I should note that the actual choices that I had were limited. There were only two or three companies that even serve my area (Northwest Iowa). AT&T offered the best deal.

Whether or not I regret it... time will tell. I seem to have the kind of luck where I have good experiences where everyone else has bad... and vice versa. Has happened before.

--Russell

Re:Not with AT&T

[phoneboy]

The last AT&T Wireless ads I heard/saw mentioned the regulatory fee (fine print on the TV ad).

Re:Not with AT&T

[Anonymous Coward]

Did they mention how much the regulatory fee is, so that you can compare them with other companies? Being told that there are unspecified extra charges is useless.

Re:Not with AT&T

[gcaseye6677]

What I noticed about AT&T advertising is that they advertise a really low rate, like $19.95 a month. But then when you look to see what this includes, it is a very stripped down plan (crappy phone, 100 minutes a month, small local area with roaming charges if you go out of it, you get the idea). If you actually want a plan from AT&T that would be useable for the average person, it ends up costing much more than their competitors. I guess they are just counting on people not to notice and compare. And they wonder why they suffer from an endless exodus of customers.

Re:Not with AT&T

[phoneboy]

They said $1.50 regulatory fee.

So who is supposed to pay for increased overhead?

[caffeineboy]

So what do you want? If the government mandates things like number portability and location, this makes a change to the company's bottom line. I don't see how this is different than a tax really.

I'd be more likely to call things like this "unfunded mandates". People groan about getting screwed by companies and then groan again when the companies charge them for services that they mandate.

Personally, I'm a little ticked by this way of recovering costs. I'm now paying monthly for other people to have number portability. This seems akin to having a monthly charge on my bank account for other people to use non-network ATMs. I don't like paying for non-network ATMs, so I don't use them. Similarly, I don't like paying to move to a new network, so I don't do it.

But honestly, if services are going to be mandated, we have to expect to pay for them. You can't really complain too much about .86. Have you seen what land lines charge per 'service'?

Lawsuit

[OneIsNotPrime]

I would encourage a class action lawsuit, but then l would probably just see this on my bill next month-

Regulatory Consumer Disloyalty Juris Prudence Fee - $14.86

Re:Lawsuit

[RubberChainsaw]

Regulatory Consumer Disloyalty Juris Prudence Fee - $14.86

And we'd probably have only gotten $1 back from the lawsuit in the first place..

:|

ultimate cell phone alternative no gimmicks!!!

[Anonymous Coward]

It's called....

Drums roll!!!!!!!

Quarters!!!!!, public phones are vailable everywhere.

Stop being a snob.

Save yourself to get beaten to death when your cell phones rings in public events restaurants,movies,concerts you name it.

Prove your geekiness making free phone calls from your public phone, still possible :).

and you have to stop your car to make/attend a phone call so what are you waiting for?

Re:ultimate cell phone alternative no gimmicks!!!

[Guppy06]

"Quarters!!!!!, public phones are vailable everywhere."

Please deposit an additional ten cents.

Re:ultimate cell phone alternative no gimmicks!!!

[Anonymous Coward]

Sadly, payphones are getting near impossible to find.

Re:ultimate cell phone alternative no gimmicks!!!

[Aero Leviathan]

Really? Where are they all going? Is there some sort of payphone-eating monster on the loose?

Re:ultimate cell phone alternative no gimmicks!!!

[Anonymous Coward]

They are being killed by it's natural predator:

The Cell Phone Companies or best known CePhoCo!!!

Re:ultimate cell phone alternative no gimmicks!!!

[Anonymous Coward]

The rest of the world calls them losers with nothing better to do; but sure I guess a payphone-eating monster would do as well.

I would not mind IF

[the_2nd_coming]

if the fees were associated with upgrades or costs incurred for providing me with service then I would not mind, BUT when they raise my rates because of a tax penalty or a cost involved in purchasing capitol, then I get pissed.

is there going to be a 2600 fee?

[multi-flavor-geek]

I fear the next addition on the list of fees could be a fee alowing the continuation of the carrying of 2600 hertz over the phone, not that most people would understand, but how many people would realize that the service that they are charging for has since been repolaced with a message bithing us out for 'attempting to compromise thier service' Hell they are charging us for use of the lines that they are running accross our properties for free, arrgghhhh.
Oh well, I am ranting, someone please stop me

Re:So who is supposed to pay for increased overhea

[TykeClone]

I'm now paying monthly for other people to have number portability. This seems akin to having a monthly charge on my bank account for other people to use non-network ATMs. I don't like paying for non-network ATMs, so I don't use them. Similarly, I don't like paying to move to a new network, so I don't do it.

Are you sure that you're paying for other people to use non-networked ATM's? Many times the owner of the ATM has a surcharge (to pay for the ATM) and your bank will have a fee for using ATMs out of the network - something that is directly proportional to your usage.

Some of these percentages are pretty high too!

[acadiel]

Looking at my last Nextel bill: Wife's phone plan charge was $17.59. "Taxes" were $6.66 to bring the total to $24.25. That's 37% in taxes. The * ones ("Fees Nextel elects to collect to recover its costs of funding and complying with Gov't mandates and initiatives") were $3.11, or a grand total of almost 18% of my wife's bill.

To break it down, the Federal TRS charge was only 0.073% (0.01). The Univ Serv Assessment was 1.25% (0.27). The Cost program recovery fee was a flat $2.83.

My account plan rate was $47.54. Taxes were $10.98 to bring the total to $58.52. That's 23% in taxes. The * ones were: TRS Charge: 0.073% (0.04), Univ Serv Assessment 1.25% (0.65) and Cost recovery fee ($2.83). Result? $3.52 in these charges, or only 7% of my bill.


What makes me sick is this:

I was paying $65.13 a month to Nextel plus a total of $17.64 in taxes and fees. (A 27% tax rate!!!!).

Take my last Cingular bill (I just switched). My monthly service charges were $47.97. The fees on the account were $6.52 on the line with a $38.98 charge, and $2.71 on the line with the $8.99 charge. That's only 19%! Cingular charged me 17% on one line and 30% on the other (well, the second one is skewed since it only has a $8.99 plan.)

Cingular charged me only $1.07 for the Federal USF, and 0.60 for the "Cost Recovery Fee". The rest was a Federal/State and 911 tax. On the other phone, they charged me .25 for the USF and 0.60 for the Regulatory cost fee.

I find it real sneaky how these providers are doing this.....

Re:Some of these percentages are pretty high too!

[LostCluster]

One thing to note is that the providers apply most of these fees on a per-line basis, so it's the customers with the cheapest monthly plans that end up with the highest percentage of their bills turning out to be fees and taxes.

Re:Some of these percentages are pretty high too!

[acadiel]

That's true - but if you look at the plain percentage for the whole account, Nextel was taxing me 27%, and Cingular only taxes me 19%. The same federal,state, and 911 taxes, but entirely different "optional" charges make up the 8% difference.

Bottom line: Nextel is charging me 8% more to make money.

Re:Some of these percentages are pretty high too!

[General Sherman]

"Taxes" were $6.66 Why, everyone knows, that's just the satan tax. The telecom providers have to pay it after they sold their souls to make picture phones popular.

That _is_ a tax - a corporate tax

[Whumpsnatz]

If you can't get the product (phone service) without paying that extra, then as far as I'm concerned, it's a tax, especially if you really do need the service.

When I add up all those outrageous charges, I calculate that taxes (by my definition) amount to about half the cost - if not more.

Really makes me want to totally disconnect. But then how would I complain on Slashdot?

More to the point, those charges only happen when the politicians allow (or encourage) it. Here in Florida, the politicos passed a bill that allows a 70% increase in basic rates. I'm taking names.

Re:That _is_ a tax - a corporate tax

[Anonymous Coward]

But if it is necessary for the service it should be part of the advertised service fee when you are comparing rates, not something you see after signing the contract.

What I Want to Know is ...

[Professor D]

Can I deduct my costs from the payment I make to the phone companies?

Let's see. If I write more than 5 checks a month, it costs me $5 per. I can pass that on to them. Oh, and don't forget the cost of the stamp. How about all the taxes I pay as a result of me making a living? Gas tax, income tax, sales tax, Social security ... I'll just deduct all that from my payment ...

What? Didn't anyone at the company notice the EULA they accepted by accepting my payment? I included it in the envelope and they accepted it by cashing the check.

Re:What I Want to Know is ...

[mbrother]

This kind of thing pisses me off, too. I don't mind THAT much (although I mind) credit card company late fees. I pay some too -- up to $39, because I'm a busy guy. But at least I've agreed to it and can punish that card by putting it in the "do not use" pile for a year, or usually calling to complain and threatening to cancel will eliminate the charge. But when you have different companies (like hospitals, or other companies that prefer to bill you down the line) assigning arbitray late fees and the like, it's just irritating.

Re:What I Want to Know is ...

[/dev/trash]

You pay $5 per after 5 checks a month? Whoa.

Re:What I Want to Know is ...

[Sancho]

The EULA in the envelope is not so good, but I've always wanted to try writing on a contract that they're going to have fees deducted, just to see what would happen :) If the grunt taking the order doesn't notice or thinks it's unenforceable, boy howdy won't they be surprised?

Re:What I Want to Know is ...

[TheMysteriousFuture]

Somebody did the very thing you mention...Not with their phone company but their gas (water, electric...something like that) company IIRC...Not sure but I believe I saw the link to the story on /. in a comment...maybe if I remember I'll dig it up...

Scrutinize, deny, withdraw

[tomstdenis]

Always scrutinize contracts, get things on tape if you have the time. When stupid charges pop up deny them. If they don't then withdraw absolutely every add-on [call display, voicemail, net access] that you don't need.

Not like you will "hurt" the company since there's always another moron to take your place but you can make "your" stand and at the very least have a lower bill to show for it [even if it still has a moron-fee] attached to it.

Tom

Re:So who is supposed to pay for increased overhea

[caffeineboy]

No, you misunderstand. The .86 on t-mobile is to pay for number portability and 911 location service, if I understand correctly. I don't use number portability, and I haven't used 911 location service (although I can see paying for this in case). I am sharing T-mobile's cost of other people using this service.

At my bank, I only pay ATM fees if I use non-network ATMs. If the government passed a law outlawing ATM fees, the administrative costs would probably show up in a similar way. Since they are allowed to charge for this service per use, I don't see any cost.

Re:So who is supposed to pay for increased overhea

[weston]

If the government mandates things like number portability and location, this makes a change to the company's bottom line. I don't see how this is different than a tax really.

It's a tax on people who patronize businesses who built crappy enough infrastructure or business models that number portability was a problem.

In the same way, of course, that a lottery is a tax on people who are bad at math.

Re:So who is supposed to pay for increased overhea

[LostCluster]

Number portablity was actually a break-even proposition for most of the cell phone carriers.

It turned out to be a knockout blow to AT&T Wireless because they botched an IT upgrade that ended up not allowing them to accept new customers during the critical moments when portability first opened up. All off the other companies, ended up just trading customers leading to higher customer satisfaction rates.

In short, this was one of the best advertising boons the cell providers ever had, as unhappy customers could move to a company that better serves them, and overall customer complaints went down.

Good rant, even better cause

[l0ungeb0y]

There is nothing wrong with what T-Mobile is doing.
And that's entirely what's wrong with the picture.

And while this may indeed be Yet Another Reason to Bitch to Government with some requests for some regulation, keep in mind there WILL always be loopholes for accountants (just as crafty as lawyers, just not as loathed (ever seen an accountant on CNN defending high profile clients?), so all it would amount to is a finger in the dyke.

What you need here is full disclosure... and correct me if I'm wrong, is already mandated THAT IF YOU ASK THEY MUST GIVE. So next time ask the sales rep to outline all the surcharges and taxes BEFORE signing up for service and do the obligatory second opinion from a competing carrier. But chances are they will be roughly the same.

Re:Good rant, even better cause

[Motherfucking Shit]

all it would amount to is a finger in the dyke

Hey, that's no way to talk about Catherine Zeta-Jones!

In other news....

[hta]

water has been found to be wet.

Can you spot the real taxes?

[profet]

Federal Excise Tax: $1.29
Federal Universal Service Fund: $0.56
State Gross Receipts Tax: $0.15
State Sales Tax: $1.76
State Telecom Excise: $1.00
County Surcharge: $0.05
County Telecom Excise: $0.79
MCTD Surcharge: $0.24
Local Sales Tax: $1.81
State 911: $1.20
County 911: $0.30
Regulatory Programs Fee: $0.86

Re:Can you spot the real taxes?

[mbrother]

I doubt it. If it isn't a tax, why not roll it into the monthly rate? It's very frustrating to see incomprehensible, mandatory fees on a bill you must pay to maintain service. Roll it into the monthly fee and let us eat our Soylent Green like happy cattle. We've got bigger fish to worry about.

Re:Can you spot the real taxes?

[blair1q]

I doubt it. If it isn't a tax, why not roll it into the monthly rate?

Because you might argue "Hey! You can't raise the rate! I have a contract!"

The telecom industry is now nothing more than a way to test out new, duplicitous business models on the pure act of calling your mom.

Re:Can you spot the real taxes?

[cft_128]

I believe if they actually add the fees while you are under contract you can use that to get out of the contract. Of course they don't have to pay you any contract termnitaion fees and you no longer have a the 'cheap' contract you wanted.

Re:Can you spot the real taxes?

[jo_ham]

I can't believe you pay for the privelege of calling 911.

Although I guess it weeds out those people who couldn't afford to be treated by the US healthcare system.

Re:Can you spot the real taxes?

[Overzeetop]

Federal Excise Tax: $1.29
Nope, cost of doing business
Federal Universal Service Fund: $0.56
Yes, they get billed, but it's another business cost
State Gross Receipts Tax: $0.15
Sneaky...a business tax passed on to the consumer (not a "real" tax)
State Sales Tax: $1.76
DING-DING-DING...this is a real tax, intended to be paid by the consumer.
State Telecom Excise: $1.00
Oh, sorry, another business tax, just like the FED one
County Surcharge: $0.05
Looks like a tower fee to me
County Telecom Excise: $0.79
FED, STATE, and CO...a trifecta of non-consumer-taxes
MCTD Surcharge: $0.24
Oh, please, "surcharge" is so 80s
Local Sales Tax: $1.81
Tax #2..were batting .200 with the real taxes now
State 911: $1.20
Hmmm...real fee, aimed at the consumer, but I'm going to say no.
County 911: $0.30
Ditto
Regulatory Programs Fee: $0.86
Oh, not even close.

I get 2 out of 13. Some are really taxes, but are intended to raise revenue from busnesses. Most business are expected to roll those into the cost of goods/services, adding only the sales taxes.

Re:So who is supposed to pay for increased overhea

[TykeClone]

Oops - sorry - too much beer :)

I agree that that's not right, but where a business can pass on taxes like that, they will.

There are no taxes on business - only consumers.

My Favorite Deceptive Cell Phone Advertising

[ctwxman]

Many cell providers advertise "no charge for roaming nationwide." The plan I'm on from Cingular features that. What is not said is, many of the places you could roam from in the days of paid roaming are now blocked from your phone! At home, on my "no charge for roaming nationwide" plan, I often get a full scale signal. But, when I try to make a call I am admonished, "Emergency use only."

Re:My Favorite Deceptive Cell Phone Advertising

[Anonymous Coward]

That is very interesting. Another thing to watch for is the phone to phone plans. Many carriers have a MUCH smaller P2P area usage area then regular coverage area. I currently have Sprint and they do not have a smaller area and neither does T-Mobile. Sprint also has a nationwide roaming plan called Free and Clear America. Bascially, if you have a signal, it will work. It is a $5/month add on and the roaming minutes used per month must be less then 50% of your total used minutes (you have to roam less then not roaming).

Re:My Favorite Deceptive Cell Phone Advertising

[grahamsz]

T-Mobile do that to me here.

I've got both a uk and a usa t-mobile sim card, and in my apartment i get one bar with my US sim card because my phone insists on staying on their network. My t-mobile uk phone gets an almost full signal since it roams quite happily onto a competitors network.

uh

[Peyna]

latest example of telephone companies passing their own cost of doing business to customers

Isn't that what companies do? You pay them to do some service or deliver some good, and as such you're always paying their cost of doing business plus some for their profit.

Re:uh

[Anonymous Coward]

Yup. But usually, they don't try to pass off their costs of doing business as ersatz taxes.

Re:uh

[fermion]

Most honest companies will estimates all costs and expected profits into a price quote. They will than add taxes to that quote . Most honest companies, like some car dealers, will even estimate the additional taxes and fees up front.

What the phone companies are doing is making the costs of service look cheaper than it is. They quote you $50, but in fact are charging you $55. The $5 is not going to an government agency. The $5 is revenue. It is what you pay for the private company for the service, which most of us would consider the real cost of the service.

The problem with this is that limits your ability to compare prices. Many mail order places use this shady tactic to make their inferior products seem less costly. For instance, a music service may list prices for CDs that are, on average, $8. However, after adding the handling fee, a fee that is in fact revenue to the company, the real costs of the CD may be closer to $12. Note that is not the shipping fee that is paid to the carrier, which may be as low as $1.50. By quoting an intentionally deflated price, they deceive consumers. Many of the shady mail order place, like fingerhut, play the same game. I believe UPS paid a fine for doing this with the insurance charge.

As an example, suppose car insurance companies were allowed to add a statutory loss fee that would pay the expected claims of the year. In this way the insurance company could quote you a price that would only cover their administrative costs, which might be 65%-75% of the real quote, and then add the fee onto that. When you compare prices, you would not be able to find the cheapest quote because of this large percentage that was unknown. The companies that were in fact the cheapest would tell you this missing bit. This might make these companies seem more expensive.

In the end there is no reason for a telco not to quote the actual money the customer will have to pay everyone month. It is generally going to be the same for all providersin a region.. In fact, them not doing this is costing the major telcos business. The smaller companies are doing one of two things. Everyone knows how much they pay for the land line every month, but not everyone know how much basic service costs. The small telcos are taking advantage of this. Some telcos are targeting the good customer looking to save a few bucks. These are quoting basic service that is one or two dollars cheaper the the major telco, but are doing it in such a way that it looks like this is all the customer will have to pay, therefore making the service appear much cheaper than it is. Other telcos are targeting the customers that don't always pay their bills. These companies set their basic service charge to the average amount the customer would pay at the major telco, and then add taxes on top of that. They advertise in such a way that it looks like the customer would be paying the same as if they went with the major telco.

Clearly it is deceptive and we should not tolerate it. If Walmart charged a two dollar store use fee on every transaction, fewer people would shop there.

excuse the subject line on my post

[l0ungeb0y]

Had one thing in mind when I started typing and while thinking it through changed tact. So the subject line is in fact bogus

Re:excuse the subject line on my post

[l0ungeb0y]

Rating an addendum to my parent post as off-topic?
Excuse me while I weep for both my lost karma and the sheer stupidity of the mod who wasted one of their precious points.

*sighs -- prepares for another mod down for typing this post*

And so now I must give the obligatory Animal House qoute:
"Thank you sir, give me another!"

Car dealers

[nycsubway]

My favorite thing at the car dealer is the "conveyance fee" that is pre-printed on the invoice for a car. They say "it's necessary, everyone has to pay it. It's state mandated." Of course none of it is true, but people will pay anyway, because they're not being told the whole truth.

It's not illegal, but its very sneaky. It's something that most people will miss, and when most people dont know they are being ripped off, then the government can take a closer look at it.

Re:Car dealers

[SpacePunk]

Actually, if they say "it's necessary, everyone has to pay it. It's state mandated." then it's a fraudulent statement, and, as we all know, fraud is illegal.

Re:Car dealers

[msim]

why is this moderated offtopic?
they were talking about car fee's, this guy mentioned *another* one in addition to the admin fee's, etc. that get slapped onto the cost of a car.

sheesh, Idiots.

Re:yeah, exactly, "cost of doing business"

[profet]

No one is saying they shouldn't make money.

The gripe is that they are using the old bait and switch tactic, by disguising extra fees as taxes.

So instead of advertising a plan for $50/month + tax...its actually $40/month + tax + B.S. charges.

overhead is fine, dishonesty is not

[David Jao]

But honestly, if services are going to be mandated, we have to expect to pay for them.

The complaint is not that we have to pay for them. The complaint is that these fees are not honestly disclosed to the customer until after the customer is already signed up, in many cases to a long term contract.

Without up front disclosure of the amounts of the fees, it is impossible to make an informed choice of telecom company based on what the service really costs. The practice of hidden fees also unfairly penalizes those companies that satisfy the mandates more efficiently and thus can charge lower fees.

In short, nobody minds fees. The problem is the way the telecom companies deceptively advertise their prices without the fees.

Re:overhead is fine, dishonesty is not

[/dev/trash]

This is okay if the fee exists before I sign up, but if it comes into effect after I sign up, how do they predict that?

Re:overhead is fine, dishonesty is not

[Anonymous Coward]

If you sign a contract to pay price X, you should pay price X, even if the company gets hit with more fees later on. (They were the one who wanted you to sign the 2 year contract, weren't they?)

Re:overhead is fine, dishonesty is not

[Shurhaian]

AT&T Wireless, I know, did not add the fee onto the services of customers under contract unless they did a rate plan change, at which time reps had a statement that needed to be read about it. Customers out of contract got a notice on their bill prior to it being added(previous invoice or something).

Other carriers, I don't know.

As for the grandparent's claim that these fees don't appear until you're locked into contract, I still call BS, at least where AWS is concerned. The RPF is mentioned in calling plan brochures and is listed online(in the footnotes along with other T&Cs, but there). Also, wireless carriers are obligated to give some sort of trial period before the contract is locked in. AWS, for instance, gives you thirty days. Stores that aren't owned by AWS, mind, can have truly draconian return policies for their equipment, but that's another issue altogether.

If you don't read the contract or the literature until after the fact, it's your own fault. Complain all you want, but there's no recourse for legal action - they did tell you so, you just didn't pay attention.

Fine.

[DAldredge]

All the phone companies have to do is advertize what they will charge you. As it is now, they lie and 'forget' to include all the fees/taxes when the advertize their prices.

It isn't that they all these extra fees, it's that they are saying their service only costs X when it really costs X+20%.

T-Mo will let you cancel your service without...

[outz]

a penalty if you do it during the first month after you receive the bill with this added fee. You just have to mention this is why you are wanting to cancel. I opted to cancel but could not find any better rates for what we're getting.

Seems what they want are better descriptions

[caffeineboy]

It seems that the real issue there is that the charges are named strangely. This is certainly nothing new.

I remember the first AT&T local service bill - charges like 'line charge' and 'access charge'... Why these are itemized on a bill makes no sense to me.

Even worse are medical bills. I got a bill with 25 different charges that looked like LOCKBOX 54345333453345 - $45.55. Why even break it down? It would be nice if there were some kind of 'transparency in billing' law that required bills to make some kind of dang sense.

Re:Seems what they want are better descriptions

[JimBobJoe]

I got a bill with 25 different charges that looked like LOCKBOX 54345333453345 - $45.55.

Dude, You just got reamed for paying the secretary's Citibank Mastercard bill.

Re:Seems what they want are better descriptions

[Mr. Piddle]

It would be nice if there were some kind of 'transparency in billing' law that required bills to make some kind of dang sense.

No, because, then, it would be much harder to exploit the elderly, Medicare, and Medicaid for every last penny.

Take some business classes

[Ruprecht the Monkeyb]

the latest example of telephone companies passing their own cost of doing business to customers

Oh good lord. All companies pass their cost of doing business on to the customer. Put down your copy of the Communist Manifesto and step away from it slowly. Companies don't pay for operating expenses, taxes, payroll, or anything else. It all ultimately comes out of the pocket of their customers. Or do you think these companies stole their money from leprechauns?

Re:Take some business classes

[DAldredge]

The fucking problem is that they ADVERTIZE one price know damn well it isn't the price they will be charging.

That is what pisses people off and it may be illegal.

Re:Take some business classes

[BCW2]

No it's not. They tack on the charges as tax and Govt. mandated fees. Since most of this actually is through regulation by the Govt. It is not repeat not false advertising. It's absolutly normal.

Re:Take some business classes

[DAldredge]

No, if it was only the goverment fees than it would be normal. They are including fees that they are pulling out of their asses.

Re:Take some business classes

[BCW2]

Thank you for a bit of reason.

Operating expenses, taxes, payroll, raw materials, building and equiptment depreciation, or anything else is actually the cost of putting something "on the shelf" for purchase. This is the operating expense that is deducted from the gross to leave profit.

Re:Take some business classes

[BCW2]

No they are not. It's just the wording that gets you riled up. Many fees are collected because the (Fed., State, County, or City) Govt. makes them. The Feds passed a law about listing these separately instead of a blaket 'fees line'. It was supposed to be less confusing. Then some marketing degree type got out his book of mumbo jumbo ways of saying something in the most meaningless way possible and..........

Re:Take some business classes

[DAldredge]

Wrong. Target doesn't list one price on their shelf for a product then charge me extra when I get to the front of the store. The telco's do. While Target does charge sales tax, it is the same at every store for the same class of good.

The telcos are free to recover what ever costs they would like from their customers, however they should not pretend that those fees do not exist when they advertize their prices. It they say it will be X per month, than it should be X + sales tax (if charged) per month.

Re:Take some business classes

[mrscorpio]

Working in the telecom industry, I can tell you this:

For the Federal Universal Service Fund fee (socialist policy that pays for welfare moms to have phone lines), the goverment says "You need to pay xx% to us for FUSF, but you can collect it any way you want, you don't have to itemize it" and many companies don't. Some companies incorporate part of it into what you're already paying. My company fully itemizes it. So judging by the fact that there's three different basic approaches to collecting for this tax, you can see why there's at least three different amounts you could pay. I should also add that the percent the government wants changes MONTHLY.

Chris

Re:Take some business classes

[cecirdr]

Yup...they all pass these costs on to the customer. But...if they had to roll these into the upfront cost so a customer had full disclosure, they they might actually have some incentive to swallow a little bit of it themselves to be more competitive.

With all of these charges hidden, they never have to really compete with each other. None of them ever need to entertain the idea of not passing on that measly 2 dollar charge so they out compete their rival. If the charges are all hidden until AFTER you sign the contract then, there's no incentive to compete.

Even if the customer goes to each company and asks for the fees and surcharges up front, companies know this is a minority of people who have this kind of free time to shop this closely. Ergo...they still have no reason to compete with each other and offer an occasional event where they don't pass along a particular charge to the customer.

When the customer knows all charges up front he/she can shop competitively and the companies might actually not pass along a cost in order to gain customers, or might actually have incentive to offer a SALE price. As it is now...they have nothing to gain since these charges are hidden.

Re:Take some business classes

[SuiteSisterMary]

But it *is* false advertising. Saying 'x minutes and x capabilities for 30 per month, plus 10 in gov't fees and what not' wouldn't be false.

Saying '30 per month, and you see those fuzzy white lines at the bottom of your screen? They're the fine print. Too bad you can't read them on NTSC resolution, they're there. Suckers!' however, is false advertising, and it's knowingly false advertising.

And it should be illegal. I appreciate the British system; what's on the sticker is what you pay, period.

Telecom companies deceptively advertise!

[Anonymous Coward]

In other news:

• Pope Catholic.
• Politician lies.
• Bear shits in woods
• Frog's ass watertight.

Itemized Bills

[Fiz Ocelot]

Just a thought, I bet if all of our bills for everything we buy were entirely itemized, we'd be quite outraged about these things a lot more often.

Simple example: What if Starbucks showed the actual cost of making that cup of coffee on the bill seperate from the markup at the register? People already know they're very expensive, but if they "really" saw it things would be different.

Now there is a lot of information you can get if you do some research into the company financial reports, but your average person is not going to do that.

Re:Itemized Bills

[Zebbers]

Umm no
the difference would be if Starbucks advertized a one dollar latte then charged you 2.00 at the register, due to surcharges

noones disputing the costs...etc but they should not be advertising plans as 29.99 when there IS NO WAY IN HELL THAT PLAN CAN BE THAT

Re:Itemized Bills

[angryelephant]

And what if Starbucks printed a price of $3.50 for a grande mocha espresso, but asked for $5.37 when you ordered one and then explained that it was "coffee ground disposal fee" that increased the price? I can tell you that I certainly wouldn't buy coffee there. Actually I don't now, but I would be even more disinclined to buy coffee there.

Re:Itemized Bills

[Fiz Ocelot]

Well my point is, once people really see how much they are getting ripped off for, I bet their choices of what they buy would change.

Re:Itemized Bills

[16K Ram Pack]

Simple example: What if Starbucks showed the actual cost of making that cup of coffee on the bill seperate from the markup at the register? People already know they're very expensive, but if they "really" saw it things would be different.

Alternatively, people could just shop around. Personally, I drink in a local cafe and spend much less on coffee than at Starbucks. Then again, for a lot of people I imagine that drinking coffee at Starbucks is as much about self-image than quality of coffee (the quality at Starbucks is good, though).

Re:Itemized Bills

[cyberformer]

Easyjet (the UK's worst, but cheapest, airline) does this. By law, it has to advertise the full price including all taxes and charges, so it uses the ads to complain about how much tax it has to pay. (Its main complaint is that taxes on plane tickets are a flat amount, not a proportion of the price.)

Then when you actually get your invoice, it's itemized with some creative accounting to show how much of the ticket price goes towards things like the credit card company's profits. They want you to believe that they'd like to give away air travel if only it wasn't for those greedy suppliers and governments.

Re:Itemized Bills

[Ben Hutchings]

That sounds like Ryanair, not Easyjet. Ryanair now has a ridiculously large wheelchair surcharge following the court case they lost. Easyjet seems fairly straightforward about its charges. You do have to pay extra for using a credit card, but you can avoid this by using a debit card. Seems reasonable enough to me.

Look at the State if you want the Crooks

[s.fontinalis]

"New York State has collected $440 million since 1991 in special taxes on cellphones. But only about $30 million of that has gone to the program named on most cellphone bills as the purpose of the tax: enhanced 911 service, which can help police, fire and ambulance dispatchers locate a cellphone caller in need of emergency help"

http://www.nytimes.com/2004/05/10/nyregion/10pho ne .html

Every business does this, just not so obviously

[jbs0902]

companies passing their own cost of doing business to customers

You have to be kidding me!

Every company in the entire world since the beginning of time has tried to do this. Even St. Thomas Aquinas thought passing your cost of business on to your customers was OK. And, Thomas was the champion of the idea that a merchant should charge only just enough to cover his labor expenses (sacrifices).

The complaint that "companies pass their cost of business along" is the same as arguing that either (a) the company owes you something, and you should get something for nothing, or (b) the company's charges to you should be totally arbitrary and capricious and have nothing to do with want the service costs to provide. I'll admit that the cost-plus model of pricing is just a starting point, but the cost of goods usually sets the floor as to the price of the good.

From the article:
In truth, many of the surcharges like those imposed this year by DSL and wireless providers reflect real costs related to each company's compliance and payments in support of government-mandated "public goods."

So, these really are costs imposed by the government (i.e. taxes). The telco companies have just made the decision to let the customer know how much the government regulation is adding to the cost of the phone service. I fail to see how this is different from advertising the price of your goods non-inclusive of sales tax.

Is the argument against this that people should not know how much their government charges them in taxes? Granted the "tax included" pricing philosophy is easier to budget for, and I assume that is the "moral outrage" that the price you agreed to isn't what you are charged, but the rest is effectively sales taxes. It is annoying but talk to your government about it.

Re:Every business does this, just not so obviously

[DAldredge]

The telcos can still itemize all they want IF they tell people what they are doing. But they aren't, they are tacking on all these charges after the fact and not including them in the prices they advertize. This is different than sales tax in that sales tax is the same for all goods in the same catagory and doesn't vary from company to company.

Re:Every business does this, just not so obviously

[bug506]

I fail to see how this is different from advertising the price of your goods non-inclusive of sales tax

The difference is that the state government charging the sales tax doesn't let the company charge whatever they think is "reasonable" for a sales tax. The sales tax rate is the same across all companies in a given area.

Because of this, a customer can easily compare the prices from, say, Fry's and Best Buy. If Fry's advertises $18 for a DVD, and Best Buy charges $20 for the same DVD, I know the DVD will be cheaper at Fry's (even including the sales tax).

When Sprint advertises a plan for $48 and Verizon advertises a plan for $50, there is no easy way for me to compare these two plans. Both plans will charge me the same tax, but since they are free to set the regulatory fees to anything "reasonable," I can't be sure that Sprint is the better deal. Sprint may decide that $6 is a reasonable fee, but Verizon might decide that $3 is reasonable.

Of course, you could argue that Verizon should then match Sprint's fees and then lower their "advertised price," but that is exactly the problem. The companies would be competing on who could most conceal the real cost of their service.

These "hidden fees" may be less of an issue if the government set the actual fee (like they set the percentage of a tax). Then, you would know that all of the phone companies were charging the same rate, and you could actually compare advertised prices.

Re:Every business does this, just not so obviously

[PsiPsiStar]

Ya know, you start with 'you've got to be kidding me' but you seem to have halfway figured things out after a few paragraphs of typing.

Companies are advertising one price and charging another. Sometimes these extra fees are taxes and some times they are just designed to look like them so folks don't argue. If companies want to send notes to their customers telling them how much of the cost on their phone is taxes, wonderful. But it's dishonest for companies to collect more money than the advertised price, and should be illegal. If the government charges a special tax, that means merchants should have to roll that money into
into their advertised price rather than hide it. Likewise, adding exhorbinant 'shipping and handling fees' for mail order should be illegal. If you charge exactly the price of the shipping, so be it, but often 'shipping and handling' fees are simply a way of collecting more profit once the consumer has shopped around and thought they made the right decision.

If Mr. Aquinas starts selling cell phones, you let me know, okay?

Re:Every business does this, just not so obviously

[Overzeetop]

Usually it's not so bad, but this is getting out of hand. The hope is that you'll get pissed off at the Government, and complain to get the requirments removed. It's also known as Group Punishement.

It's a "sneaky" way of reducing the cost they advertise, making it more difficult to compare consumer plans. What if McDonalds started advertising $0.99 Big Mac meal, but throwing in a $1.50 "minimum wage compliance fee", a $0.83 "health inspection recovery fee", and a $2.23 "Adjusted market value surcharge", then add a $0.45 "franchise remuneration fee", a $.67 "potato and beef transportation adjustment", and a $0.23 "Owner compensation fee". Oh, and then tack on the 5% sales tax and 4.5% prepared food tax, just for good measure.

It's not about the fees which are assesed by the government for raising money from the consumer, its the business costs which would normally be paid by business which are being added on.

I don't charge a professional licensing fee to my clients. I don't add a surcharge for my insurance, though it is about 13% of my gross billables (I've never had a claim). Heck, I don't even charge mileage for site inspections. It's all included in my hourly rate. That will end soon, as I do plan to add a surcharge to recover the Tennessee "professional privilege tax" for my TN work. I don't live in TN, but have clients who may need my services there. Of the 5 states I will be registered to practice in, only TN has this tax, and it makes my registration there about 1200% more expensive than any other state, on an annual basis. Call me a hypocrite, but it's a significant cost increase for a single market...and I plan to pass it on.

The courts....

[InnovativeCX]

Several others have posted comments regarding the legality of such fees and the deception surrounding them. Not a lawyer, and I don't understand exactly where the line is drawn, but I can tell you that a lawsuit would hold up. Case in point: Verizon.

I'll be the first to come out against the obesity lawsuits against McDonalds -- Frivolous court-clogging litigation ranks quite highly on my list of pet peeves. By that token, suing your wireless carrier to recoup $2.93 per month to the tune of legal fees, court costs, and simply the time involved would be quite outrageous. However, were I to take up such a matter, it would be not for the money involved, but for the principle. I've no problem with a corporation recovering extra costs due to the imposition of federal fees and standards from consumers assuming such fees are small and reasonable. I do not appreciate being lied to or otherwise misled -- it is one thing to pass costs back onto the customer, but quite another to masquerade a cost as a state or federal mandatory tax.

In any case, Verizon made this mistake. I never had much of a problem with receiving a $40.21 bill for my $36 plan sans overage -- I've more or less accepted that I'm going to get screwed over no matter what. Apparently a few were a little more upset than I; in November, I received notification that I was part of a class-action lawsuit of fellow customers against Verizon and its affiliates dating back to 1993. Due to their engagement in such practices, the company has been ordered to pay these customers something like $20, offer free text messaging, or free wireless web for a period of time. Nothing required to claim it either...apparently it is all automatic.

So, as silly of an idea as a lawsuit may seem, litigation seems to be a viable option, assuming you have an incredible amount of free time on your hands and are bothered by such deceptive practices enough to take the issue upon yourself.

Of course, knowing T-Mobile, I'd be more likely to go after them for their lack of coverage or decent service than slight-overbilling ;-).

-Scott

Re:The courts....

[hawaiian717]

This kinda happened already, but to Cingular, not T-Mobile. The California state Public Utilities Commission fined Cingular $12.1 million last year after an agressive campagin resulted in poor service.

http://www.mercurynews.com/mld/mercurynews/busines s/technology/7070723.htm?1c

Re:The courts....

[Deliveranc3]

This is the kind of thing you get into in Asia.

Governments can't monitor this kind of thing and allow small companies any freedom meanwhile large companies won't change their policies without some pretty serious badgering.

Consumers need to educate each other about where the pain comes or we'll all start having to expect 20% cost of getting screwed tax.

A not-so-funny side

[Anonymous Brave Guy]

You laugh, but T-Mobile UK just started charging one pound per month just to send you an itemized paper bill.

That would seem less serious if I hadn't just caught them double-charging me for text messages supposedly included in my monthly allowance, based on the itemized records from previous months' bills.

Re:A not-so-funny side

[Yer Mum]

In the UK, if there's any increase in prices above the Retail Price Index, the company must inform you at least a month before they happen. You're entitled to cancel or port out from your contract there and then, even if you're only in e.g. month 4 of a 12 month minimum contract. Or you can threaten to cancel or port out and they may waive the charge.

But now you've missed the boat (you didn't cancel in that month so it's understood that you've accepted the charge).

The best thing you can do now is go to the website and sign up to My Account for itimised bills through their website and then cancel the paper bills and you won't be charged any more.

By the way, a good way of getting a cheap phone you've always wanted is keeping an eye on the mobile trade press for info about upcoming charges before they're officially announced, take out the contract with a ludicrously high monthly line rental so the phone's subsidised down to free or nearly free, get officially notified of the change in prices, and cancel.

Re:A not-so-funny side

[Anonymous Brave Guy]

Thanks for the tip, but I wasn't annoyed because the charges surprised me. I knew they were coming, and decided I still wanted my itemized bill. I'm not committed in any long-term contract anyway, so if they do something I find sufficiently offensive I'll simply walk away.

What annoyed me was that for several of the previous months, the company had made errors that would only have showed up on an itemized bill (and which added up to much more than the one pound per month the latter costs). T-Mobile's actions here stink of an attempt to cover such errors up, and thus to defraud their customers by a little bit every month as well as making an extra quid in a rather pathetic manner.

BTW, on-line billing is fine if you trust it, but in cases like this, I'd still rather have paper to fall back on. Also, only proper paper bills are acceptable for things like identifying yourself to a bank when you open a new account (as they're required to check your identity as part of the anti-laundering regulations these days). I think the trend towards asking people to have their bills on-line and not sending out paper is a bit pathetic on the part of utilities companies. It's a cheap cost-saving measure at the expense of the consumer, and given how often they screw-up, I think they should be legally required to provide written documentation of where their charges come from...

Headline.

[Raven42rac]

Instead of "Telecom Carriers Use Deceptive Advertising", shouldn't the headline read "Telecom Carriers Use Deceptive Billing "?

Telus

[Malicious]

I have a phone on Canada's TELUS TALK 30 Plan.

The idea is: $30/month for talk 30.
Great.
+$6.95 Network Licencing Fee
+$2.75 Taxes

Total is almost $40/month for a plan called '30'.

It's not as bad as it is in the states, but it's still deceitful.

Re:yeah, exactly, "cost of doing business"

[DAldredge]

Unlike the telcos, each of those companies you listed include those in the price you pay. IOW, they don't advertize one price and then charge you 20% more later.

Re:yeah, exactly, "cost of doing business"

[Awptimus Prime]

Damn telephone companies.. next thing you know, McDonald's will start charging enough to cover the health insurance costs for their employees, Radio Shack price mark-up will include their retail store expenses, and ISP's will start raising fees to cover the cost of their electricity. It's as if these companies are trying to make money or something.

Check this out, EarthLink was $19.99/mo until it began outsourcing it's call centers overseas. Even after getting the super-cheap labor, they turn around and raise rates to $21.95/mo.

Yeah, all of this is really good for the economy. But only if your name is Gary Betty.

Why is this here?

[BCW2]

1. There is a difference between advertising and billing.
2. All advertisments are lies to one extent or another. Some are smooth and some hit like a sledghammer.
3. 99.9% of prices advertised are before sales tax.

Add the fact that telephone companies (cell or landline) are the worst at this of any industry. Hell, they make electric and cable TV companies look honest, and most of us know better.

Why is this news? It's just business as usual in the good ol US of A.

Cost Recovery Fee

[Mr. Piddle]

That's my favorite one. It's just a matter of false advertising, where the true price is not what the customers think they are buying. It isn't uncommon for fees and taxes to make up 20% of a bill, which is just immoral.

Agreed.... it's false marketing

[rune2]

Here in Canada at the moment there is some controversy over cell phone companies who are deceptively marketing their phones by claiming that they have to charge a monthly "Network Access" fee that is supposably required by the government. In fact since the law covering this fee changed April 1 the government is actually only getting a small fraction of the amount that customers are being charged. Yet they're still pitching it to customers as a government fee.

TracFone

[kmsigel]

I use a great cell phone service called TracFone (www.tracfone.com). I pay $95 per year (yes, year!) for 150 minutes. They often run specials where you can get another 100 minutes free. If you refer a friend you get 100 minutes free (and so does the friend). If you need more minutes you can buy them for ~20 cents a minute or less. This includes all taxes. No hidden fees. No surcharges. Minutes roll over to the next year if you don't use them.

I suspect that traditional cell phone plans are good for very high volume users, but for me TracFone works great. I know this sounds like an advertisement, but I really do use and like the service.

P.S. If you want to sign up, let me "refer" you and we'll both get 100 free minutes. Just leave your email address in a reply and I'll sign you up for the offer. (You'll just get one email solicitation.)

Re:TracFone

[RoofPig]

So why are you trying to score more hundreds of free minutes on slashdot, Mister Low Volume?

Re:TracFone

[mrscorpio]

$95 for 150 minutes is a pretty horrible rate.

Re:TracFone

[Motherfucking Shit]

I pay $95 per year (yes, year!) for 150 minutes. [snip] Minutes roll over to the next year if you don't use them.

1980 called, and they want their cellular plan back. Am I misreading, or are you paying $95 for 150 minutes to use over a year's time? 2.9 minutes a month for $7.91 a month, and you call that a great cell phone service?

Please tell me that you meant to say you're paying $95/year for 150 minutes/month. Even at that, you can get twenty times the minutes for about four times as much. And if you don't need the minutes, you can buy a prepaid "emergencies only" phone to carry in your car's glove compartment for far less than $95!

Re:TracFone

[kmsigel]

So why are you trying to score more hundreds of free minutes on slashdot, Mister Low Volume?

I'm doing it so you can get 100 free minutes. It's not for me at all. ;)

Re:TracFone

[kmsigel]

$95 for 150 minutes is a pretty horrible rate.

Not if you are a low volume user. You can't get any sort of plan from a traditional cellular company for $7.92 a month including all taxes and surcharges. I've also looked at the prepaid plans at some cellular companies and they seem aimed at convincing you to sign a contract. They aren't as good as TracFone.

Re:TracFone

[kmsigel]

1980 called, and they want their cellular plan back. Am I misreading, or are you paying $95 for 150 minutes to use over a year's time? 2.9 minutes a month for $7.91 a month, and you call that a great cell phone service?

I'm guessing math wasn't your strongest subject in school. It works out to 12.5 minutes a month. I also said it is easy to get another 100 minutes free, plus 100 minutes for referring a friend. I've done that each year, so I've had at least 350 minutes a year for $95 a year. That's 29 minutes a month, which is more than I use.

Please tell me that you meant to say you're paying $95/year for 150 minutes/month. Even at that, you can get twenty times the minutes for about four times as much.

You read me right. 150 minutes per year. Twenty times the minutes doesn't do me any good if I don't use them. That's the trap cellular companies try to get you to fall into.

And if you don't need the minutes, you can buy a prepaid "emergencies only" phone to carry in your car's glove compartment for far less than $95!

TracFone is prepaid service. Please show me one that is "far less" than TracFone and has the same (or similar) features. TracFone works anywhere in the US (roaming is double the rate), long distance is included no matter where you are, caller id, voice mail, call waiting, etc.

Re:TracFone

[Anonymous Coward]

Well the OP was talking about emergency calls, not just a regular cellphone. You can get a phone that dials 911 free in any area, with nationwide coverage, no roaming, plus lets you make non emergency calls, for $33.00. here. Beats $150.00 if all you need is something to use in case of emergency.

Re:TracFone

[kmsigel]

I am the original poster, and I was not talking about only making emergency calls.

New Trend In Slashdot Headlines?

[spoonboy42]

Hmm... is Slashdot headed towards simple, concise headlines which state things which are completely obvious to any human with more CPU power than a raddish? Here are some suggestions, if that is the case:

1. SCO pursuing meritless litigation.

2. A robot will replace you in 6 years; awesome!

3. Darl McBride Paternity Test Result: Satan

4. An Indian will replace you in 6 months; outsourcing must be stopped.

5. RIAA Extorts Money From Filesharers

6. Survey: Mac users have overwhelming desire to fsck Steve Jobs

7. People starting to get sick of hearing about SCO.

8. Politicians may be corrupt

9. RMS is pissed off about something

10. Star Wars movies ain't what they used to be

11. Earth doomed, more at 11:00

12. Blah, blah, SCO, blah, blah, blah

Re:New Trend In Slashdot Headlines?

[Anonymous Coward]

You left out:

13. Spam continues

14. Microsoft is evil

15. Check out this cool XBox mod that turns it into a toaster!

16. New worm exploits Microsoft vulnerability

Re:New Trend In Slashdot Headlines?

[Anonymous Coward]

17. People on /. sometimes make lists that are then appended by others.

18. The other people then try to be funny in their extensions

15. Check out this cool toaster mod that turns it into an XBox!

21. People on /. can't count straight.

Re:New Trend In Slashdot Headlines?

[Anonymous Coward]

53. ...
54. Profit!

t-Mobile is A-OK in my book

[valmont]

Every month i get a picture of Catherine Zeta-Jones with my mobile phone bill. As far as i'm concerned they could charge me another $20, I wouldn't peep. Rename it to Catherine fee. She's like the most beautiful woman on the planet *and* I get her in the mail every month! OMG.

Joking aside, i'm insanely happy with the t-mobile service. I've found their customer service stellar and the deal i have is pretty sweet: 1000 anytime minutes + unlimited nights and weekends: $40/month. I'm shellin' another $10/month for unlimited t-zones, which gives me unlimited texting, email sending/receiving (pictures, sounds and all), basically unlimited data transfer.

anyhoo. Go Catherine! :D

Re:t-Mobile is A-OK in my book

[jelle]

"1000 anytime minutes + unlimited nights and weekends: $40/month."

Hmm, in my area the "$39.99 plan" (which actually after taxes&fees is closer to $50) only includes either 600 + nights + weekends, or 1000 but no free nights and week-ends. The 1000 + nights + weekends if $60/month.

Where do you get a deal like yours?

Re:t-Mobile is A-OK in my book

[valmont]

well the deal was very short-lived, it was like a special the reseller-dude at the mall had access to. with taxes, Catherine fees and all that stuff my bill comes right at $60. But yeah he was telling me that normally it's only 600 minutes per month. i got very lucky.

Re:t-Mobile is A-OK in my book

[Anonymous Coward]

Dear T-Mobile Customer:

Thank you for your suggestions regarding additional fees and surcharges. While the management here at T-Mobile feels that most customers would not benefit from your proposed 'Regulatory Catherine Zeta-Jones Supplement Fee', we have considered the situation and decided that in this particular case, such a fee can be specially provided for such a loyal customer as yourself.
Beginning next month, you may be happy to observe the new $25 charge on the bottom of your bill.

We thank you for your input, Mr. Valmont, and encourage future correspondence from our loyal clients.

- T-Mobile, Sales and Customer Relations Office

speaking of deceptive bills

[mabu]

One thing that blows me away. Sprint does this; I wouldn't be surprised if other carriers do as well, but when I get my statement, I get a list of the phone calls and time used, but I don't get a total. No total of minutes?? WTF is that? It seems like this is an obvious attempt to keep you from looking at whether or not your total monthly usage would make a different plan more economical. Now maybe you can hit some buttons on your phone and get totals, I don't know, but it seems ridiculous for a carrier to list all your calls, yet not sum it all up in a total!

Re:speaking of deceptive bills

[davidstrauss]

Sprint does this; I wouldn't be surprised if other carriers do as well, but when I get my statement, I get a list of the phone calls and time used, but I don't get a total.

T-Mobile gives me the total time and better: if I type *MIN* on my phone and hit send, it sends me a text message with the time accrued, broken down into categories. This is a free service, too.

Re:speaking of deceptive bills

[nolife]

For Sprint dial *4
A call to this number used to use minutes from your plan but recent post on a non Sprint Sprintpcs news board indicates that is not the case anymore and it is a free call.

hmmm....

[Chuck Bucket]

although this is no big surprise, I really need to look at my next tmobile bill.

(que the Catherine Zeta-Jones sound byte) "Get more!"

get more undocumented fees is apparently what she was squalking about.

PcVB

In other news...

[geminidomino]

Axis powers surrender to the Allies.

Water found to be wet.

Dewey beats Truman.

Don't forget

[NeuroManson]

The other brilliant ripoff you get with Comcast (technically a telecom). Do you want broadband? Forget getting it at the advertised prices. Instead, you have to pay for a cable feed ($15 for minimal cable TV, which you may like watching if you hardly stay home, otherwise you're paying $30+ for basic).

So they may advertise $29 for the high speed internet special, but in actuality it's $50 or more. And THEN after the special ends, you're paying more like $90 a month. Quite a leap from $30, ain't it?

Cellular providers aren't much better, but these bait and switch tactics should be investigated and prosecuted to the fullest extent of the law.

Keep this in mind

[PMB917]

As somebody who works for T Mobile I would like to point out that one of the main reasons for thes new fees is WLNP or number portability. This whole situation was forced upon the TELCOM industry way too fast, and these fees are the only way that these companies can comply with new regulations.

Prepaid Plans

[vxvxvxvx]

I'm happy to report my virgin mobile "plan" still requires me to "top up" $20 every 90 days and doing so adds $20 to my virgin mobile account, none deducted for various fees. I'm sure they pay the same fees as everyone else, but it's hidden from me which is really the way it should be. I don't care what they pay to deliver the service to me, I only care what the service costs me.

I complained

[DoorFrame]

I wrote a letter to complain to T-Mobile when they added that fee a month or two ago. I had been so happy about the fact that they DIDN'T have that fee when all the other carriers added it with Number Portability that I felt let down. They got my letter a month ago, and surprise, I haven't heard anything back from them. I guess I didn't really ask for an answer, just expressed my dissatisfaction. Oh well. I still get a far better service at a far better price than I had when I was with AT&T.

That's the way business works

[DerekLyons]

. The latest addition to T-Mobile's monthly bill is merely the latest example of telephone companies passing their own cost of doing business to customers with an array of surcharges

Companies have always passed along their costs of doing business to the customer. (Profit = price charged to consumer - costs of doing business.)

Re:That's the way business works

[mrscorpio]

Actually, Profit = Price Charged - Cost of Doing Business - Wholesale Price of Good (or Total Cost of Labor for Services Rendered), but who's counting? :)

Re:That's the way business works

[plusser]

Comming soon, fully itemised bill, complete with a breakdown of the cost of every single component in the phone, plus prining costs, plus postage plus handling....

Network Licencing Fee is pocketed by Telus NOT tax

[Anonymous Coward]

Most plan in Canada got charged with "Network Licencing Fee", but they are all pocketed by the carrier and not a tax

All taxes are not passed on to consumers.

[glrotate]

It's called tax incidence. Basic Econ 101 stuff. The amount of a tax born by the buy and seller is determined by the relative elasticity of supply and demand, ie how easy is it for them to produce compared to how bad do you want it.

Like EULAs

[Anonymous Coward]

Exactly, they're just like EULAs and that's exactly why they shouldn't hold up in court.

Face it people, nobody reads EULAs except the bored and curious and neither will ever go to court over them.

We need new legislation covering "fine print." If it isn't obvious at the time of purchase it should be considered a SCAM!!!

Re:So who is supposed to pay for increased overhea

[Waffle Iron]

I'm now paying monthly for other people to have number portability.

You don't really need to be so uptight about number portability fees. In a little while it will greatly enhance competition between carriers. More competition will bring the base monthly rates down a good deal more than this surcharge. It's going to save you money in the long run even if you never switch.

Re: Telecom Carriers Use Deceptive Advertising

[Anonymous Coward]

...and in other news, the office of President Truman has announced the detonation of a so-called "Atom Bomb" at Hiroshima.

No, that's not the main reason

[Anonymous Coward]

The main reason is that your employer is corrupt. If I am going to pay $57.00 per month for a $39.00 plan, then advertise it at $57.00. Any other action is unethical. The fact that it is commonplace is irrelevant.

And I bet the T Mobile spent most of the "Regulatory" fees on laywers trying to fight the regulations.

Re:No, that's not the main reason

[Anonymous Coward]

Actually no, they didn't. I don't think T-Mobile spent very much money on litigation at all, instead they had the first working implementation of WLNP out of all the tier 1 carriers.

Also, T-Mobile is the LAST of the big five wireless companies to implement such "Regulatory" fees.

Get the government out of it!

[rice_burners_suck]

With millions of subscribers at each company, these less-than-forthright fees add billions of dollars per year in extra revenue without raising advertised rates.

Reminds me of shrinking food products with prices that remain the same. Like the Kudos bars that grew increasingly smaller until their producer should have been ashamed to release something so ridiculous. Or other candy bars that shrink, retaining the price of the larger predecessor, only to be re-released at the original size, under the title of "king size."

But instead of blaming businesses, it would be wiser to lobby the government to reduce some of its restrictions on business that make it so expensive for businesses to operate. This will ultimately cause the prices of products and services to come down (competition), and therefore put inflation in check.

When government gets involved, everything gets expensive.

Speaking as a Canadian...

[Mark_MF-WN]

Speaking as a Canadian, and paying 15 fucking percent sales tax where I live, I can assure you that sales taxes are the LAST thing any reasonable economy should implement. It drives off tourism, makes price-gauging more difficult, and is virtually impossible to eliminate once it's in place.

I'd happily pay a bunch of extra income tax and deal with higher prices, if it meant eliminating the PST and GST.

Re:Speaking as a Canadian...

[Anonymous Coward]

Speaking as a Canadian, and paying 15 fucking percent sales tax where I live...

Aww, diddums. Come to the UK, it's 17.5% here. Although most reputable businesses advertise prices with VAT already included, so it doesn't really register much.

Haven't seen it hurting tourism, either. I believe foreign visitors can apply for a rebate anyway if they keep their receipts.

Silver lining...

[crazyhorse44]

some people have reported that you may be able to use a fee hike to your advantage. since it is a modification to your existing contract, you may be able to reject the fee and have your contract cancelled without paying an early termination fee. YMMV

Well Said

[PotatoHead]

I have tried to deal with these companies. Bought the whole individual thing. What did I get?

- "new" non-preferred customer status. Longer hold times, etc...

- Almost nothing.

- Loss of a lot of time that could have been better spent.

Today, I seek small businesses that are run by people who actually want to do business. Local is great, but the Internet makes that less of an issue.

I also have been more political lately. I have found, over the last couple of years, that doing simple things, like calling your senator, representitive, city and local school counsils, actually can make a difference. You don't see it today because not enough people bother to make the effort.

Sure, some things have to be purchased from the ones taking advantage, and some laws must be endured today. However, there is also a lot that does not.

It takes less time to look for the right people to do business with than it does doing battle with the wrong ones. Sadly, it is far easier to just get screwed over than it does to do anything about it.

More of you should be choosing to at least vote with your feet where it makes sense. Those of us wanting to see things change could use the help.

Gee

[jfern]

I thought the taxes on my T-mobile bill were 18.9%, now I find out that they're only 16.4%.

Proof?

[mbourgon]

I just googled for "states without sales tax" on Google, and came up with all 5 of them:
"Alaska, Delaware, Montana, New Hampshire, and Oregon are the five states that currently do not impose[...]"

Given that your 48 number is wrong, even though I'd love to believe you I must doubt you. Do you have some proof of the numbers?

Thanks.

Re:Proof?

[miu]

You are right, I spaced Montana and Delaware. Alaska might not have an actual sales tax - but they provide enough Use Fees or the like (and sometimes allow municipalities and counties to collect a sales tax) that I would say they have a sales tax in reality.

As far as hard numbers, here is a previous post earlier in the thread.

Well duh

[Julian Morrison]

You tax or regulate a business, it is going to pass the cost on to one or more of the following:

- Workers, as a reduced "pay pool", maning fewer jobs or lower pay

- Shareholders, as dividend cuts (if it pays dividends at all)

- Capital, by liquidating assets or buying less new ones

- Customers, as price rises, quality decreases, less availability, etc

You can't tax "big business", because it's just an abstract standing-wave in a sea of human action and human wealth. Sooner or later, in the end, it's humans who get screwed. The "shareholders" are you, through your pensions and investments. The assets not being bought are the stuff you make and sell. It's you who'll be pushed onto the dole, or not hired. It's you who'll pay more, or get worse stuff, or less of it.

Seems to me that the telecom companies were just being honest. If you want cheaper bills, vote cuts in tax and red-tape.

"It's not a tax..."

[IronChef]

I used to run a small business. I remember one bizarre conversation that I had with my accountant at our first tax time...

ME: So we don't have to pay a tax on that then?
ACCOUNTANT: Right.
ME: So what's this big fee, payable to the government, that you have calculated?
ACCOUNTANT: That's not a tax. That's a levy.

Oh, it's not a tax, it's a LEVY! I feel so much better... Let me sign the check.

[Your blood pressure just went up.]

Regulations ARE taxes

[jgardn]

Whenever the government makes a new rule about what a free people are allowed to do, it costs businesses and consumers real time and money.

Take for instance the tax code. A small part of the taxes we really pay ends up in the pockets of tax professionals and publishers. The tax professionals help us make sense of the rules the publishers have to publish and propagate.

Why can't the federal government set a few priorities (outlined clearly in the constitution), get those priorities done, and leave the rest of us alone? Why do we need a Big Brother to tell our phone companies how to behave? I am sure the phone companies know a lot more about the telecom industry and their consumers than any group of overpaid and underworked bureacrats will ever hope to know.

Re:Regulations ARE taxes

[LaCosaNostradamus]

Why can't the federal government set a few priorities (outlined clearly in the constitution), get those priorities done, and leave the rest of us alone?

Because no bully leaves you alone when you whine that you want to be left alone. The whine itself gives the bully the spur to continue abusing you. Stop whining and start fighting.

Does any locality beat Berkeley for taxes?

[jfern]

I'm just counting the Berkeley part of the tax. It's a flat 7.5% on all utilities. Berkeley is not a liberal city when it has such a regressive tax like that.

Somewhat Bemused

[GumphMaster]

I assume I'm not the only one that visited the original article site and was presented with a pop-up ad for NextTel when they left :)

Expect NexTel to be adding two more "taxes":
1. Coercion Misdirection Levy - for ads served to people after reading an article explaining how the company jacks up profits under the guise of "taxation".
2. Geographic Locale Fee - for ads served to people they can't service (I'm in Australia).

Telecom Carriers Use Deceptive Advertising...

[Max Threshold]

And in other news, the sky is reported to be blue. Film at 11.

Seriously though... I don't have a phone, not even a land line. And no, it's not because my credit's so bad I can't get one. I despise the lying, thieving telcos so much that I'd rather suffer the minor inconvenience of not having a phone than give them a bloody red cent.

Now, if only I could learn to do without my car... :-/

Canada Rules?

[headpushslap]

In Canada we have to pay similar surcharges, and do the dance with the Freedom of Information Act to actually discover what fees are charged where and by whom.

However, in Canada, you cannot charge these fees and mislead customers about where the money goes. The Government of Canada is Trademarked and fees which are collected cannot be ascribed to the TM Entity without consent.

Roundabout, but at least I know where my money is going

Son, you're not that tricky

[Anonymous Coward]

"The "transportation fee" only applies if you're stupid enough to pay it."

Actually the transportation fee is not a dealer based fee and represents what the dealer pays to Toyota (or the regional association) to get the car delivered to him.

When you say that you get it "waived", you're merely being naive. Cars are routinely discounted from the sticker price; in fact except for hot cars every car is available for less than sticker, and sometimes considerably less than sticker.

Therefore if a car costs $20K, and transportation is $500, they may say, "Oh Mr. Jason, you're a hard bargainer, we'll sell you the car for $20K and 'waive' the 500 transportation fee", you're really getting ripped off.

Advertising fees are a bit fuzzier in that dealers in certain areas actually pay this fee, but you as a consumer don't know how and why. I always consider them illegitimate because advertising is a cost of doing business; its like GM charging you extra because they had to mow the lawn outside the corporate office.

Other fees are lies, such as "dealer prep". A dealer has to "prep" the car to sell it. Why would you pay extra to get what the dealer is obligated to provide? An old one that used to be a rip off was "undercoating" later became "rustproofing". A common one today is "administrative fee" or "papework fee". In my county, the dealer is limited to $25 for this fee.

All fees to a certain extent are deceptive, the primary difference is transportation fee is right on the Mulroney and is more legitimate, and is an actual cost to the dealer.

Re:Son, you're not that tricky

[Anonymous Coward]

What makes you think he is paying the sticker price? He never stated that. If you negotiate a price and then they add on a bunch of fees, obviously it is just a deceptive way of renegotiating the price.

Re:Son, you're not that tricky

[Jason1729]

As the AC said, I negotiate the best possible price before we even start talking extras. The dealers walk right into that because the purpose of the extras is to artifically raise the price so you're left feeling like you got a better deal than you really did. They don't want to mention the extras until you've agreed on a base price.

You don't have to pay these charges

[Anonymous Coward]

For most people a cell phone is an ego thing. Now people can reach you anywhere. Riiiight. How many of you need to be reached anywhere?

If you have a cell phone and don't need one, discontinue service and put the phone in the car. You can still use it to call 911 after you terminate your service. Just remember to keep it charged.

Oregon Sales tax is 0.00 percent.

[Futurepower(R)]

"It's nice living in Oregon."

Because the Oregon Sales tax is 0.00 percent.

What about the 51st state?

[Anonymous Coward]

What about the 51st state? Does Iraq have a sales tax?

Wrong

[Libertarian_Geek]

Most public companies keep around the same profit level, or improve it, your correct there. With that being said, they are usually forced (by the market) to turn that profit into increased dividends on their stock or reinvest it into othe areas of the business which either turns into hiring more employees or building and improving infrastructure (making the business larger or more competative). Most publicly traded companies don't just add a fee or increase a charge on a product to double an exec's pay. Even if they did, those execs are consumers, and the money wouldn't exactly be put in a mayonaise jar buried in the back yard. It get's put back into the economy and taxed by our government (again). People who make large sums of money spend large sums of money, or invest in business who spend large sums of money.

Now, I guess it's time for the raging /. socialists to "let me have it".

Maybe Cheaper for customer though, right?

[IBitOBear]

It seems to me that these fees aren't all bad. The tax seems (big disclaimer there) to be computed on the "plan cost" and by moving the recovery fees into a non-taxable line item they should be saving the customers a slight amount of money over the total bill that would be paid if it was just the fee and the tax.

This is the opposite of the "rebate" where you pay sales tax on the whole ammount for the privelege of getting $100 back in the mail next quarter.

I could be wrong.

It depends on how the math is done.

Re:So who is supposed to pay for increased overhea

[Anonymous Coward]

"You can't really complain too much about .86. Have you seen what land lines charge per 'service'?"

yes, you can complain, this is how it starts, when they get away with it, it will go up from there.

they make it up on tires

[Anonymous Coward]

The nonprofit I work for has the MI sales tax exemption. That means when we need to reshoe the Chrysler minivan we get a set of 4(!) Goodyear UltraGrips for $80.00, installed and balanced. What, you paid $420? The difference is state sales, use, and excise taxes, bunkie. I know what the price would be if we were exempt from the federales, but I won't tell you because you'll spend the whole day crying. I'll give you a hint, a bottle of gas line antifreeze for a federal agency is 10 cents.

Even with gas 2.149, our price is 1.56.

You have no clue what's going on. Sucks to be you.

Ridiculous

[tkrotchko]

" If the government mandates things like number portability and location, this makes a change to the company's bottom line. "

Well, of course it does. Every regulation does that.

Does the restaurant you go to have a surcharge for "meeting government health regulation excise"? Do you get to charge your boss at work a "Commuting cost excise" because the subway raised the cost of tokens?

There are all kinds of fees that business have to endure, ranging from rent, salaries, taxes, and all kinds of compliance with legal and regulatory mandate. That doesn't make it legitimate to pass this cost on as it were a tax.

I'm all for businesses doing what they want; I think they can charge the fees; I think they should be allowed to charge fees for "the boss wants more money fee". But I'm also in favor of fees being explicit as to their purpose and the advertised price being an accurate reflection of what you're going to be charged.

In other words, if your cell phone is advertised at $20/month, then that should be the price. Not $20 plus $2 for "fuel pass along". In that case the price should be advertised as $22.

That shouldn't even be a controversial concept.

No, you're completely wrong

[Anonymous Coward]

"So, these really are costs imposed by the government (i.e. taxes)."

No, its the cost of compliance with a mandate. Read what you wrote again.

They're saying "This tax costs some amount. It costs us $5/month to comply with collecting the tax. Well, yes. Of course. But why is that any difference than "$5/month for costs associated with collecting payroll taxes". Answer: There is none, this just looks more "official" and "beyond their control".

Don't defend the indefensible. It makes you look trite.

March of the elephants

[wytcld]

It's really wise for the Republican-controlled FCC to encourage this because then we all look at these bills and say, "Wow, we're paying so much in taxes! We need relief." So we end up voting against the political party that "wants to raise taxes" rather than against the party that wants to help corporations get away with anything and everything.

200 minutes a year

[Anonymous Coward]

I have wireless internet access, I travel al lot and use a phone on the road for room reservations totalling 200 minutes per year.

Any other wireless plan is $55/month, the TracPhone rate is $135 per year. The per minute charge is dreadful, but the total cost is good. Mine includes voicemail, access to K7 account, and call ID.

I have no landline. TracPhone can be a money saver.

Dont You Just Love the Extra Fees

[Anonymous Coward]

While everyone is ranting and complaining, I would love to throw my rant out.

I have a wonderfully cheap sounding cell plan from Cricket. It's wonderfully crappy local coverage only. But hey, it's only 29.95 a month right?

Now lets add in all the special "fees" and "taxes" and the "company pofit margain" and the bill comes out to 45.65 a month.

Now I don't want to claim that they are being deceptive about their advertising or anything... But that extra $15 they tack on could pay half of what my bill "should" be.

In other news...

[gwayne]

Sun rises in morning
Smoking leading cause of cancer
Masturbation causes blindness

Look at it as an opportunity

[kaphka]

Disclaimer: I'm a happy T-Mobile customer, I know nothing about the current situation, and I have not read my contract, nor do I intend to. (Nor do I believe I'm bound by an intentionally obfuscated contract, but that's another matter.) Oh, and IANAL.

I signed up for Sprint PCS around January 2003, with a one year contract. I was generally satisfied with the service, but inevitably, other companies started offering better deals. (Specifically this, which was even cheaper at the time.) I didn't mind that too much... Sprint had given me a fancy phone for free, and in return I was willing to buy their service for a year.

However, around June, Sprint raised my rates. Actually, they restructured all of their charges in confusing ways, but the result was a net increase of about $0.80 per month. They blamed the increase on the new number portability requirements, and frequently referred to it as a "tax" (though the fine print in the new contract stated explicitly that "this is not a tax.")

Now, I couldn't care less about the $0.80, but hey... we had a contract. I had already gotten what I wanted out of the contract (the free phone,) so I was only sticking around to fulfill my original commitment. Apparently Sprint, however, wanted to void that contract, and that was fine by me.

It took about three hours on the phone to sort it all out. I won't recount the whole battle, but I will share one tip from my experience: no matter who you talk to, the first words out of your mouth should be, "I want to cancel my account." Once I learned that, it only took a few minutes with an underling and her supervisor before they agreed to release me from my contract.

Actually, I think Sprint made a tactical error. If they had offered to remove the surcharge (or give me a credit to offset the surcharge,) I'm not sure I could have still insisted that the contract was void. Apparently that's the deal they made with some people, but in my case, they just let me go.

So, as I said in the subject, customers who are hit with a surcharge like this should see it as an opportunity, not an annoyance. All of a sudden, you're free to go service-shopping again. Have fun.

This is problem with American business ethics

[swb]

It's wholly focused on technical legal compliance rather than compliance with the spirit of laws as well.

It reminds me of a little kid eating cookies before dinner when he's been told that cookies are for after dinner. When caught, the kid complains of his innocence by saying (a) these are biscuits, not cookies, or (b) our dinner was late tonight, and technically it's after dinner for most people, or (c) since cookies are food, and we eat food for dinner, then I was actually eating dinner.

All the answers are technically right and perhaps within some kind of technical compliance, but clearly the goal wasn't compliance with the idea that you don't eat cookies until after dinner, it was compliance aimed at justifying his own desire for cookies.

There was a great article in a business mag about two months ago detailing this thinking. They were talking about tax shelters, and it's considered a valid defense to demonstrate that your lawyer said it was OK, and lawyers are making bank with this long, technical analysis that claim that the shelters are OK. Due to some case obscure law, lawyers are immune from prosecution for providing advice (even if the advice is flawed and designed to further an essentially fraudulent activity). If the tax shelter user is caught, he pays back taxes with penalties, but no criminal charges are filed because he can wave his "legal compliance" memo like a Get Out of Jail Free card, pay the fine with his illegal windfall, and move on to the next shelter scheme.

Business needs to stop figuring out how they can perpetrate fraud while still being in technical compliance of the law, and actually figure out how to do business while being in the spirit of the law.

Deceptive pricing

[Archibald Buttle]

In the UK it is illegal to hide tax charges when prices are quoted. Prices quoted by vendors have to include all applicable taxes.

That meant that back in England for my mobile phone bill my talk plan was advertised as 25 pounds per month, and that's exactly what I paid.

I'm now living in Canada, and my mobile talk plan was advertised as $60 per month for two phones. Not bad, except the actual bill comes in at about $100 per month. Just like in the USA there's a whole load of surcharges and taxes that aren't included in the quoted price.

It really annoys me that when I see a price quoted I don't know what the actual price will be. It gets really confusing since there's variable rates of tax that apply.

Pricing without quoting what the actual price will be seems like very deceptive business practice to me. It creates a bad impression, since it seems like businesses are out to con you.

Economic Reality Check

[Anonymous Coward]

Any business, in order to survive, has to cover all of its costs, and the only way to do that is by passing them on to the customer. Unless you want some government to pass them onto its taxpayers instead.

Itemizing the expenses is potentially useful for the customer and the citizen, because some of those costs are government imposed. When citizens realize how much certain government regulations are adding to prices, they can better judge the regulations value.

UNION: The folks who brought you the weekend.

[Anonymous Coward]

Yes, because here, on Slashdot, the randroids can't pass up an opportunity to union bash.

It's OK if a CEO stuffs the board of the company with his friends to assure himself of a $50K/yr raise - Well, that's just capitalism at work - but the idea that the people who actually do the work might get together and try to make things better for themselves, hey, that's highway robbery!

Put down the Kool-aid Camelbak and take a deep breath. If collective action for monitary gain is good for the goose ( The whole point of a corporation is group action, right? ), it's good for the gander( If work is paid for, then Work==Money, right? What's wrong with pooling your (Work/Money) to get a better deal?).

Roaming Fees

[Renraku]

Roaming fees are so bad here in Knoxville, that if you have a cellphone registered for my town, and go three minutes in any direction, its considered to be roaming. In Knoxville, its even worse. Usually driving to one quadrant of town is enough to cause roaming fees to kick in. So let me get this straight. We gotta pay for the phone. We gotta pay for the service in using the phone. We gotta pay for the taxes that the government has imposed upon the carrier. We gotta pay for using the phone outside of our 'normal habitat' which basically equates to paying extra for using our phones outside of a three mile radius. We gotta pay for the CEO's daughter's wedding. We gotta pay for his dog's new penthouse. Its so easy for them to tag extra charges onto us, and if we throw up our hands and say we've had enough, we have to pay extra to drop the contract. Why can't anything be done about this? Why can businesses write one-way contracts that give all the power to the company while screwing the consumer who should have the lion's share of the power. After all, it is the money of the consumer. Unless you wanna go RIAA and say that everyone using a landline is stealing from cellular carriers.

Good definition of confusopolies

[macshune]

I found this link to a good def. of confusopolies. Can't seem to track down the actual comic, though, unless I buy the book.