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I'm actually struggling to understand this a bit. So an ISP needs to advertise a "$29/mo + local fees" plan as "$29/mo + $0-$80/mo in fees" I guess other than

I'm actually struggling to understand this a bit. So an ISP needs to advertise a "$29/mo + local fees" plan as "$29/mo + $0-$80/mo in fees" I guess other than making the advertising super annoying, I don't understand the ISP objection. Assuming every provider is faced with roughly the same kind of fees and it's a level playing field. > Providers are free, of course, to not pass these fees through to consumers to differentiate their pricing and simplify their Label display if they believe it will make their service more attractive to consumers and ensure that consumers are not surprised by unexpected charges. This is a surprisingly snarky response from the FCC. "If you are so worried about the label being confusing why not just raise your prices?" It's hard to believe that they are suggesting this seriously.

thefurdrake 3y ago
> I don't understand the ISP objection American ISPs operate under a confuseopoly paradigm of customer interaction. A confused customer is more likely to shut down and just pay the fees they don't understand. Forcing companies to enumerate each item that goes into the cost will allow customers to determine just how shitty a value proposition those ISPs are offering. These companies have been in full damage control mode for years, having earned themselves positions of significant scorn in the US already.
wolverine876 3y ago
It's an important point for the FTC to emphasize, IMHO: Businesses in many domains love to claim that any increase in their cost - taxes, suppliers, etc. - must be passed on to their customers. That is absolute ripe BS, and anyone who knows any economics, finance, or has run even the smallest business knows it. More bizarre is that consumers - and others who know better and have no vested interest in the BS - all repeat it.
- gotoeleven 3y ago
  Did you know that money doesn't come from a magic tree? And since it doesn't come from a magic tree, it has to come from customers or from profits. And a lot of these businesses have low profit margins to begin with (ie health insurance). Those businesses that are already low margin do have to pass the costs on to customers otherwise the risk adjusted return of their business is not worth it compared to savings bonds. Ultimately if the cost of doing business is higher whether its because the government has imposed additional fees or because your money tree died, the cost of the producing the product has gone up and this has to be an upward pressure on prices. Unless you're running a money tree farm which must be the "smallest businesses" you're referring to.
  - wolverine876 3y ago
    I'm sure you have some great ideas and we could have learned some things from each other. See the discussion below, for example.
  - ralferoo 3y ago
    > And since it doesn't come from a magic tree, it has to come from customers or from profits. As a fairly impartial outsider (I'm from the UK and the price we see advertised for broadband on the website after entering our address is the price we pay), I'd like to counter that by simply agreeing that yes, the obvious outcome is that the customer pays for the fees. However, that's not what this discussion is about. The discussion is about whether the customer is told the price will be $X and then they have to pay $Y where Y is considerably more than X. Instead of appealing to the magic money tree, companies simply need to be honest when they tell customers the price. They are free to keep the same prices, they just now need to say the price is $Y, and can choose to say that it's comprised of $X and then all these other things or just say it's $Y and leave it at that. The reason companies don't want to do that, is they want to compete on having the lowest number for $X and sneak as many extra charges into the real price $Y in the hopes that customers don't discover it until they're locked into a contract. Part of the problem is that the US has had this tradition for a long time with sales tax. Now I can understand online shops listing prices without sales tax, because it genuinely depends on where the customer lives. But in a regular real-world shop, they know exactly where the shop is and what the final cost of an item will be when it's sold, regardless of who buys it. You have the same thing with tipping - you buy food at a restaurant, and then get told some nonsense that amounts to "because we don't pay our workers a fair wage, we're going to add an extra 20% on top of the price we offered and on top of taxes and all the rest". With your money tree argument, I'm surprised you're not in favour of your restaurants advertising a steak at $20, then when the bill arrives it's $20 plus $30 for the ingredients, $20 for the cook, $10 for the dishwasher, $10 for the waitress, $10 for the supervisor, $5 for the parking lot because the company rents that from someone, $2 for the company's phone line, $2 for the gas and electricity used, $1 because they need to clean the tables between customers, $2 for the condiments you might have used, and and did we mention that we want 20% tip as well. Yes, this is all the cost of business, but the customer doesn't need to know all that - they are, after all, just buying a steak. The situation with broadband should be just as simple - "I want an internet connection. How much do you want to provide it to me?"
- legitster 3y ago
  > That is absolute ripe BS, and anyone who knows any economics, finance, or has run even the smallest business knows it. ??? Are you arguing that increases in costs are not passed on to consumers at all? It's also worth pointing out that the FTC is not just talking about passing along random costs - they are specifically talking about things like the Universal Service Fee (basically sales tax for ISPs) and local regulatory fees. Things that are assessed on customer billing.
  - wolverine876 3y ago
    > ??? Are you arguing that increases in costs are not passed on to consumers at all? Now that you point it out, I can see how it might be read that way. Beyond a doubt, in practice, many cost increases cause some increase in sale price, and that always will be true (and should be true). I'm objecting to the word must, in "must be passed on to their customers". Businesses have a choice, and making that choice every day is a fundamental task in business. I might also object to passed on, but that's a technicality. > It's also worth pointing out that the FTC is not just talking about passing along random costs - they are specifically talking about things like the Universal Service Fee (basically sales tax for ISPs) and local regulatory fees. Things that are assessed on customer billing. That conflates what is with what must be. The ISPs often do show it on customer billing, but they could aborb the costs and not show it. That's the point.
amflare 3y ago
If an ISP advertises $49.99/mo, then they need to itemize on the bill anything that makes the final charge greater than $49.99. Right now, ISPs generally have a "Fees" line, with no insight into what said "Fees" are, unless you jump through hoops to contact them. ISP are complaining (presumably because the increased transparency will make it harder to milk the customer) by trying to claim that itemizing the invoice will be confusing since they have to pass-through all these state and federal fees. The FCC is saying "tough shit", and if they want to keep it "simple" then they need to roll these fees into the sticker price. Basically, either itemize or be upfront. If the ISP doesn't want to itemize, then the bill must match the advertised price. If they want to keep the advertised price lower, they need to itemize all additional fees being added to the bill.
- legitster 3y ago
  This is not what the FCC in the article are saying at all: > Providers must itemize the fees on consumer bills, and we see no reason why consumers cannot assess the fees at the point-of-sale any less than they can when they receive a bill. The FCC's entire rule is to make providers itemize fees on advertising, just like providers are already doing on their bills.
- adrr 3y ago
  They are passing along fees like universal access fee. This is tax on the provider, not the customer. Some providers don’t pass it along like google fiber. It’s impossible to do price comparison if they don’t list out what random charges they are tacking on your bill. My google fiber bill is $100 for their $100 plan and that’s the way it should be.
bhhaskin 3y ago
ISPs are putting BS fees instead of raising their prices.
Macha 3y ago
A lot of those fees are not usage taxes or similar, but rather costs of doing business that an ISP has chosen to pass on to customers as seperate fees so they can keep the headline price low. It's like if your supermarket advertised their prices as $50, and then you go up to the till and it's $60 because they've included a "shelf stacking fee", and they claim that they can't just include that in their advertised price because their shelf stackers' wages vary by jurisdiction.
- legitster 3y ago
  > A lot of those fees are not taxes or similar, but rather costs of doing business that an ISP has chosen to pass on to customers as separate fees so they can keep the headline price low. This kind of fee hiding is already conclusively illegal for a variety of reasons and not at all what the FCC is discussing in this article. This is much more akin to how, a grocery store might have to disclose a liquor tax as part of the sales price instead of the sales tax.
az226 3y ago
No, FCC said at point of sale, not point of advertising.

thefurdrake 3y ago

> I don't understand the ISP objection American ISPs operate under a confuseopoly paradigm of customer interaction. A confused customer is more likely to shut down and just pay the fees they don't understand. Forcing companies to enumerate each item that goes into the cost will allow customers to determine just how shitty a value proposition those ISPs are offering. These companies have been in full damage control mode for years, having earned themselves positions of significant scorn in the US already.

wolverine876 3y ago

It's an important point for the FTC to emphasize, IMHO: Businesses in many domains love to claim that any increase in their cost - taxes, suppliers, etc. - must be passed on to their customers. That is absolute ripe BS, and anyone who knows any economics, finance, or has run even the smallest business knows it. More bizarre is that consumers - and others who know better and have no vested interest in the BS - all repeat it.

gotoeleven 3y ago
Did you know that money doesn't come from a magic tree? And since it doesn't come from a magic tree, it has to come from customers or from profits. And a lot of these businesses have low profit margins to begin with (ie health insurance). Those businesses that are already low margin do have to pass the costs on to customers otherwise the risk adjusted return of their business is not worth it compared to savings bonds. Ultimately if the cost of doing business is higher whether its because the government has imposed additional fees or because your money tree died, the cost of the producing the product has gone up and this has to be an upward pressure on prices. Unless you're running a money tree farm which must be the "smallest businesses" you're referring to.
- wolverine876 3y ago
  I'm sure you have some great ideas and we could have learned some things from each other. See the discussion below, for example.
- ralferoo 3y ago
  > And since it doesn't come from a magic tree, it has to come from customers or from profits. As a fairly impartial outsider (I'm from the UK and the price we see advertised for broadband on the website after entering our address is the price we pay), I'd like to counter that by simply agreeing that yes, the obvious outcome is that the customer pays for the fees. However, that's not what this discussion is about. The discussion is about whether the customer is told the price will be $X and then they have to pay $Y where Y is considerably more than X. Instead of appealing to the magic money tree, companies simply need to be honest when they tell customers the price. They are free to keep the same prices, they just now need to say the price is $Y, and can choose to say that it's comprised of $X and then all these other things or just say it's $Y and leave it at that. The reason companies don't want to do that, is they want to compete on having the lowest number for $X and sneak as many extra charges into the real price $Y in the hopes that customers don't discover it until they're locked into a contract. Part of the problem is that the US has had this tradition for a long time with sales tax. Now I can understand online shops listing prices without sales tax, because it genuinely depends on where the customer lives. But in a regular real-world shop, they know exactly where the shop is and what the final cost of an item will be when it's sold, regardless of who buys it. You have the same thing with tipping - you buy food at a restaurant, and then get told some nonsense that amounts to "because we don't pay our workers a fair wage, we're going to add an extra 20% on top of the price we offered and on top of taxes and all the rest". With your money tree argument, I'm surprised you're not in favour of your restaurants advertising a steak at $20, then when the bill arrives it's $20 plus $30 for the ingredients, $20 for the cook, $10 for the dishwasher, $10 for the waitress, $10 for the supervisor, $5 for the parking lot because the company rents that from someone, $2 for the company's phone line, $2 for the gas and electricity used, $1 because they need to clean the tables between customers, $2 for the condiments you might have used, and and did we mention that we want 20% tip as well. Yes, this is all the cost of business, but the customer doesn't need to know all that - they are, after all, just buying a steak. The situation with broadband should be just as simple - "I want an internet connection. How much do you want to provide it to me?"
legitster 3y ago
> That is absolute ripe BS, and anyone who knows any economics, finance, or has run even the smallest business knows it. ??? Are you arguing that increases in costs are not passed on to consumers at all? It's also worth pointing out that the FTC is not just talking about passing along random costs - they are specifically talking about things like the Universal Service Fee (basically sales tax for ISPs) and local regulatory fees. Things that are assessed on customer billing.
- wolverine876 3y ago
  > ??? Are you arguing that increases in costs are not passed on to consumers at all? Now that you point it out, I can see how it might be read that way. Beyond a doubt, in practice, many cost increases cause some increase in sale price, and that always will be true (and should be true). I'm objecting to the word must, in "must be passed on to their customers". Businesses have a choice, and making that choice every day is a fundamental task in business. I might also object to passed on, but that's a technicality. > It's also worth pointing out that the FTC is not just talking about passing along random costs - they are specifically talking about things like the Universal Service Fee (basically sales tax for ISPs) and local regulatory fees. Things that are assessed on customer billing. That conflates what is with what must be. The ISPs often do show it on customer billing, but they could aborb the costs and not show it. That's the point.

amflare 3y ago

If an ISP advertises $49.99/mo, then they need to itemize on the bill anything that makes the final charge greater than $49.99. Right now, ISPs generally have a "Fees" line, with no insight into what said "Fees" are, unless you jump through hoops to contact them. ISP are complaining (presumably because the increased transparency will make it harder to milk the customer) by trying to claim that itemizing the invoice will be confusing since they have to pass-through all these state and federal fees. The FCC is saying "tough shit", and if they want to keep it "simple" then they need to roll these fees into the sticker price. Basically, either itemize or be upfront. If the ISP doesn't want to itemize, then the bill must match the advertised price. If they want to keep the advertised price lower, they need to itemize all additional fees being added to the bill.

legitster 3y ago
This is not what the FCC in the article are saying at all: > Providers must itemize the fees on consumer bills, and we see no reason why consumers cannot assess the fees at the point-of-sale any less than they can when they receive a bill. The FCC's entire rule is to make providers itemize fees on advertising, just like providers are already doing on their bills.
adrr 3y ago
They are passing along fees like universal access fee. This is tax on the provider, not the customer. Some providers don’t pass it along like google fiber. It’s impossible to do price comparison if they don’t list out what random charges they are tacking on your bill. My google fiber bill is $100 for their $100 plan and that’s the way it should be.

bhhaskin 3y ago

ISPs are putting BS fees instead of raising their prices.

Macha 3y ago

A lot of those fees are not usage taxes or similar, but rather costs of doing business that an ISP has chosen to pass on to customers as seperate fees so they can keep the headline price low. It's like if your supermarket advertised their prices as $50, and then you go up to the till and it's $60 because they've included a "shelf stacking fee", and they claim that they can't just include that in their advertised price because their shelf stackers' wages vary by jurisdiction.

legitster 3y ago
> A lot of those fees are not taxes or similar, but rather costs of doing business that an ISP has chosen to pass on to customers as separate fees so they can keep the headline price low. This kind of fee hiding is already conclusively illegal for a variety of reasons and not at all what the FCC is discussing in this article. This is much more akin to how, a grocery store might have to disclose a liquor tax as part of the sales price instead of the sales tax.

az226 3y ago

No, FCC said at point of sale, not point of advertising.