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AT&T Quietly Adds Charges To All Contract Cell Plans

Posted by Soulskill on from the fee-added-because-reasons dept.

guttentag writes "The Wall Street Journal is reporting that AT&T Mobility, the second-largest wireless carrier in the U.S., has added a new monthly administrative fee of 61 cents to the bills of all of its contract wireless lines as of May 1, a move that could bring in more than a half-billion dollars in annual revenue to the telecom giant. An AT&T spokeswoman said the fee covers 'certain expenses, such as interconnection and cell-site rents and maintenance.' The increased cost to consumers comes even though AT&T's growth in wireless revenue last year outpaced the costs to operate and support its wireless business. The company has talked of continuing to improve wireless profitability. Citigroup analyst Michael Rollins noted that the new administrative fee is a key component for accelerating revenue growth for the rest of the year. He said the fee should add 0.30 of a percentage point to AT&T's 2013 revenue growth; he predicts total top-line growth of about 1.5%. Normally, consumers could vote with their wallets by taking their business elsewhere. AT&T would be required to let customers out of their contracts without an early termination fee if it raised prices, but it is avoiding this by simply calling the increase a 'surcharge,' effectively forcing millions of people to either pay more money per month or pay the ETF."

4 of 338 comments (clear)

  1. Surcharge by rwise2112 · · Score: 5, Insightful

    AT&T would be required to let customers out of their contracts without an early termination fee if it raised prices, but it is avoiding this by simply calling the increase a 'surcharge'

    I love the way there's always a loophole!

    --

    "For every expert, there is an equal and opposite expert"
    1. Re:Surcharge by Lithdren · · Score: 5, Insightful

      While true in theory, what ends up happening is you call to cancle because of the breach of contract, and you get yelled at and treated badly by their 'customer service' for 3-4 hours as you escilate up the chain trying to terminate your now null and void contract without paying the ETF, over 61 cents a month.

      Most people will just cave and either switch once the plan is over, or not bother switching at all, because the hassel of getting these jerks to do what is legal and right will end up costing you half a days wage when you take them to small-claims court to get it overturned by a judge because they dont even bother showing up in court.

      Oh but dont worry, if you DONT pay the ETF and ignore it, they'll send you to collections, where when you dispute the charge, will get added to your credit rating and affect you for the next 10 years or 7 years or whatever the hell it is, even after you get them to agree that the charges were wrong, unless you spend even more time writing letters and sending lawsuit judgement letters to the credit agencies to get it cleaned up. Even then, might not work.

      Companies need to get slapped across the face when they pull this crud, individuals are unable to fight this kind of stuff without sacrificing more than what its going to end up costing them if they just put with it, which is of course excatly why AT&T and their kin do this kind of thing.

  2. Ain't it great? by bradley13 · · Score: 5, Insightful

    "the new administrative fee is a key component for accelerating revenue growth for the rest of the year"

    So, have I understood this correctly? If you have a contract with them, they aren't violating it, because they aren't raising your rates. They're just adding a separate administrative fee. Reminds me of the game airlines play: your flight is cheap, but you have to pay the fees for the airports, for fuel, for your luggage, for having wings on the airplane...

    This is great for the bean-counters and marketeers, but it's unethical as hell. Why do big businesses lose their ethics? Does MBA stand for "Must Be an A**hole"?

    --
    Enjoy life! This is not a dress rehearsal.
  3. Re:Bend over... by hedwards · · Score: 5, Insightful

    You can blame the courts for that. It astonishes me the complete and utter lack of common sense in the judiciary. We're not all rich enough to be able to afford an attorney every time somebody asks us to sign a contract. We don't have access to a law library to look up the precedence over whether or not they're allowed to call this a surcharge.

    At the end of the day, the law needs to recognize that people can't sign away their rights. Especially in cases like this where the only competition also requires us to sign away our rights.