The $650 million telco swindle

There is no reason why phone and internet bills are so high in the US. Calling out the industry on cramming charges is a good start but it’s really barely scratching the surface. Why is “capitalist” America paying so much more for phone, internet and cable TV charges compared to “socialist” Europe and other parts of the world? It’s criminal and until Congress decides to support the consumers (not likely) they will continue to be screwed in the name of corporate profits.

Mysterious fees and services crammed onto phone bills are a “nationwide epidemic” for U.S. consumers, but a reliable source of revenue for some of America’s biggest telecommunications companies, a year-long congressional investigation has found.

A report issued Wednesday by Sen. John Rockefeller, D-W.Va., says that three firms — Verizon, AT&T; and CenturyLink/Quest — earned $650 million as their cut of cramming charges levied by third-parties since 2006.

Cramming charges — such as unwanted $10-per-month voicemail or Web design services — have been frustrating phone customers for more than 15 years, thanks in part to ill-considered rules designed to enhance competition in local phone markets. Consumers often don’t spot the small monthly fees, but even when they do getting refunds can be a nightmare: The telephone provider that sends the bills often refuses to issue refunds, instead referring consumers to the third-party firms, which are often unresponsive. The Federal Communications Commission estimates that 15 million to 20 million consumers are crammed every year. Rockefeller’s report says cramming could cost U.S. consumers $2 billion annually.

An American in Paris, France. BA in History & Political Science from Ohio State. Provided consulting services to US software startups, launching new business overseas that have both IPO’d and sold to well-known global software companies. Currently launching a new cloud-based startup. Full bio here.

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