Three years ago, Time Warner Cable began charging subscribers a $3.95 monthly fee to rent a cable modem. Today, that fee has more than doubled to $8 a month.
The increase serves as one example of pricing problems in the broadband and cable industry, presidential hopeful Sen. Bernie Sanders (I-Vt.) and Sens. Al Franken (D-Minn.), Elizabeth Warren (D-Ma.) and Ed Markey (D-Ma.) say in a letter to Federal Communications Commission Chairman Tom Wheeler.
“Many Americans have very few, if any, options when it comes to choosing their local cable and Internet providers,” the lawmakers write. “As the telecommunications industry becomes increasingly concentrated, this lack of choice has resulted in huge price increases and often poor service for consumers.”
The senators add that consolidation will only increase if Charter completes its proposed merger with Time Warner.
Sanders and the others are asking the FCC to investigate the average prices people pay for broadband and cable in both rural and urban areas, among other items. The lawmakers say that a “lack of transparency in pricing” often confounds cable and broadband subscribers -- a point few consumers are likely to disagree with.
In fact, numerous observers have examined the industry's questionable billing practices including, famously, telecom analyst Bruce Kushnick.
Last October, in a widely circulated blog post, he dissected his monthly Time Warner Cable bill for “Triple Play” broadband/video/telephone service.
“When I signed up, less than two years ago, it was advertised at $89.99 and today, less than two years later, the actual price is 110% more -- now $190.77,” he wrote in a piece that appeared on Huffington Post.
He added that not only did his bill increase, but Time Warner tacked on a host of “garbage” charges, including a “regulatory recovery fee” of 69 cents, a “public access fee” of $1.23 and a “broadcast TV fee” of $2.25.
“Fact is -- you can never, ever get the advertised price because it doesn't include many of the fixed costs, like the set-top box, not to mention it is littered with pass-throughs of the company's taxes and fees, including the cable franchise fees,” he wrote. “To add insult to injury, there are a bunch of garbage, made up charges.”
The lawmakers pick up on this theme, suggesting that consumers should have more options, and that carriers should do a better job of explaining their pricing.
“We need healthy competition to foster innovation and ensure fair prices for consumers,” the senators write. “At the very least, Americans should be able to understand the price of the product they are buying and what their neighbors are paying for the same service.”