For Immediate Release

Organization Profile: 

Moira Vahey, Free Press, (202) 265-1490 x31

Consumers to Telecom Industry: Tell Us the Truth

Groups urge FCC to end dishonest advertising and deceptive billing practices

WASHINGTON - Six public interest organizations filed comments with the Federal
Communications Commission on Tuesday encouraging the agency to protect
consumers from misleading, confusing and harmful advertising and
billing practices by phone, cable and wireless providers.

The comments highlight some of the most egregious examples of these
practices. Service providers often go to great lengths to create
deceptive ads and to impose introductory rates, hidden monthly fees and
surcharges that conceal true service quality and cost. Such practices
harm consumer choice and limit the effectiveness of competition. The
consumer groups argue that current protections are insufficient and
urge the FCC to require meaningful, not misleading, disclosure.

The organizations signing the comments are Free Press, Consumers
Union, Media Access Project, Public Knowledge, Consumer Federation of
America, and New America Foundation.

Read the comments here:

"When consumers have the facts, they can make informed choices,"
said Chris Riley, policy counsel of Free Press. "Consumers are being
bombarded with inconsistent and incomplete information when shopping
for service providers or plans, and then they are baffled by misleading
and confusing bills once they sign up. Customers invest a lot of money
in these services and spend a great deal of time using them. That's why
the FCC must ensure truth in billing and must establish clear
disclosure rules so that consumers do not fall victim to the dubious
and misleading practices of their phone or Internet access providers."

"The Commission can and should adopt stronger consumer protections
for a broad range of services typically ‘bundled' together by
providers, including voice, video and broadband Internet access
offerings on both wireline and wireless platforms," said Matt Wood,
associate director of Media Access Project. "Competition between
providers depends on the free flow of truthful information to potential
and existing customers. The Commission has ample jurisdiction and
justification to adopt rules requiring the disclosure of the actual
costs and limitations of service plans."

"Today, a consumer needs an accounting degree to navigate the terms
of service and understand what they're actually paying for," said Joel Kelsey, policy analyst with Consumers Union. "Otherwise, it seems like your phone and cable bill can change month to month."

The misleading practices commonly used by the phone and cable industry include:

  • Internet access services are being labeled with theoretical
    "maximum speeds," rather than actual speeds. These actual speeds can
    lag behind advertised rates by 50 percent.
  • New "PowerBoost" services advertise even faster speeds, but
    do not guarantee that consumers will get faster service despite higher
  • Service providers often deliberately obscure the real cost of
    services with misleading advertising that hides fees, surcharges,
    promotional periods, early termination fees and bundling requirements.

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