Ravenwood - 08/26/04 06:15 AM
If you wonder why your $39 cell phone plan ends up costing you $50 a month it probably has a lot to do with line items. You might assume that most of those taxes and fees are for mandates imposed by the goverment. But in the case of some mobile carriers, they could be a clever way for carriers to keep you from weighing competing plans equally.
The fees aren't taxes, though they may look that way on your bill. Wireless, long-distance and local phone service companies use fees like these chiefly to recoup normal business expenses, including property taxes and the cost of posting their rates on the Web.Given that T-Mobile recently changed accounting practices and started counting fees toward their revenue, I wonder if there will be any SEC implications too."The explosion of line items has made it all but impossible for consumers to compare rates and shop around," FCC Commissioner Michael J. Copps said in March. "You need a lawyer and an accountant -- preferably both -- to root out what you're being charged for and why."
It doesn't help that cell phone providers are heavily regulated semi-monopolies. If a store charged me $11 in un-posted fees on top of a $39 advertized price, I'd drop the item at the cash register, leave, and never come back. And if I got angry, I'd call the state Attorney General's office, because "bait and switch" is illegal. But it's enough of a hassle switching providers that people are likely to put up with being screwed...
It would also help if either political party would side with consumers instead of corporations in cases like this. It's false advertising, bait-and-switch, and give or take some unintelligible fine print it amounts to one party revising a contract as soon as they get the other party's signature. A small independent store that tried this would be forced out of business even if the customers didn't leave. The politicians wouldn't have to tread new legal ground to do something about where large corporations are concerned - if they wanted too. But they are too busy defining the rituals to be followed when they accept bribes - I mean campaign contributions - and trying to exclude outsiders...
Posted by: markm at August 26, 2004 5:07 PMSome stores already do that. Think about it the next time you buy tires or get your oil changed. Every place I've lived has had a mandatory "disposal fee" tacked on to the base charge. I don't know if the fee makes up for an unfunded government mandate or not, but it's pretty common across all retailers.
Posted by: Ravenwood at August 26, 2004 6:21 PM(c) Ravenwood and Associates, 1990 - 2014
