Reason Behind Regular Raise of Internet Service

Mon, Jun 28, 2021 10:39 PM Internet Bundles Broadband Deals Technology

You're not alone if you've noticed your broadband cost increasing month after month. Internet service providers are free to charge whatever they want and raise their prices whenever they want because broadband pricing has never been controlled. There was a time when the FCC considered establishing price regulation under Title II jurisdiction, but the truth is that the termination of Title II regulation has little to do with your broadband bill increasing.

Customers are typically unaware of these increases since they are so minor (i.e., a few dollars here and there). However, a handful of internet service providers have recently raised their prices significantly for their clients. There are a few causes that are causing these price increases, the majority of which customers have little control over.

First, the once-rapid growth of broadband has slowed as a fast internet connection has progressively become a necessity rather than a luxury. Next, in the broadband sector, there is very little true competition, and the main firms set the prices. Finally, internet providers are feeling the pinch as more and more customers opt for mobile service and Netflix instead of landlines and cable TV subscriptions.

 

Miscellaneous Fees are Getting Higher

Most individuals ignore the lengthy list of additional fees on their broadband bills because they have no idea what they mean. For example, regional sports fees and broadcast television fees may appear on your cable statement, whereas a DSL bill may include a county telecom levy or a state universal service fund fee. There are Federal Universal Service costs, also known as Universal Connectivity Charges, that are tied to ISPs' obligations to build out broadband infrastructure in rural and low-income areas. This is only the top of the iceberg.

All of these charges quickly pile up! According to some estimates, fees can add 20-40% to the basic rate of your service package, making that wonderful deal you signed up for seem less so. It's difficult enough to keep track of these expenses. It's even more difficult to keep track of them so you know when they go up.

Increases in these inexplicable fees are often what drive those tiny increases you won't notice until your monthly broadband bill has suddenly soared by $10 or $20, so you should monitor your bill each month. Do you have any questions about the purpose of a fee? If you have the time, contact your broadband provider and inquire. It's possible that you'll be able to haggle certain fees off your bill.

 

Rental Equipment is More Expensive too

Customers are not given a modem as part of a broadband plan out of the kindness of their hearts by internet providers. These are rentals (or rent to own in some circumstances), and they appear on client invoices as a modem rental cost or simply an equipment price. Some internet providers impose this cost even if a customer has chosen to buy their own modem and returned the company's equipment, or if the customer never had it in the first place. Maybe it's an honest blunder, but it's one that happens frequently. If you were charged a rental fee but never rented a modem, you might be able to get the fee deducted from your statement - but good luck receiving a refund.

 

Installation Sometimes Also Take Part

Some internet providers charge an installation fee when you sign up for a broadband service... even if there is nothing to install. Keep an eye out for this amount, which an ISP may slap on your initial bill even if they didn't have to make any adjustments or upgrades to your home to turn on service, and don't be shocked if it's a lot higher the next time you switch providers.

 

 

 

Regular Price Raising ISPs

Comcast has a reputation of slapping unjustified surcharges and penalties on its bills, but it hasn't stopped the firm from raising its service rates. They recently raised the price of standalone broadband and the rental of a cable modem. In certain locations, they have raised the price of their most basic internet-only plan (with 25 Mbps download and 3 Mbps upload speeds) to $75 (up from $65), and have increased the price of all bundled packages by $5 per month.

Frontier didn't make any significant changes to their package prices, but they did impose a $1.99 per month Internet Infrastructure Surcharge, which is one of those hidden taxes that most consumers won't notice right away. It's a cunning method to raise broadband rates without making the service appear more expensive on a detailed statement.

Cox, on the other hand, raised pricing across the board and introduced a one-terabyte data cap to consumers in the majority of the states it serves. Customers who had previously paid for unlimited internet service were transferred to capped rates. They can pay a fee for the 'new' unlimited add-on, which costs $50 on top of whatever plan they're currently paying for, but that would mean paying an additional $50 for the plan they already had.

 

What is the Government's Action to This?

It's unlikely that the federal government will intervene in broadband price regulation anytime soon. Contrary to common opinion, the cost of your broadband plan is unrelated to the loss of Net Neutrality, just as it had no impact on your bills when it was in place. There was no indication that Net Neutrality affected ISPs' ability to profit or drove them to raise their pricing. Similarly, no major internet providers have lowered their costs as a result of the removal of Net Neutrality.

All that has changed is that FCC authorities may be more lenient in the future when it comes to internet companies (who benefit from significant tax cuts) upping their pricing. Customers who believe they have been overcharged may only hope that state regulators check into the fees that broadband providers charge for their services. Comcast was recently sued by the state of Washington for allegedly adding $100 million in bogus surcharges to customers' bills, and other states may follow suit.

 

The Only Solution Might Be Competition

Did you know that only one in every five persons in the United States has more than one wired internet provider? Satellite internet is improving, and wireless may become more affordable in the future, but for the time being, many Americans don't have much of a choice when it comes to broadband, which means ISPs can charge whatever they want and hike their prices anytime they want. Smaller providers are gradually entering the market, but there aren't yet enough to drive down pricing.

However, the most potential competition might not come from new providers, but rather from point-to-multipoint 5G. Wireless providers like T-Mobile, Sprint, and AT&T may make a mint delivering wireless home broadband and undercut fixed-line internet providers in the process, pushing down wired broadband pricing, if this technology delivers as promised and providers price it competitively. It will be a win-win situation for the consumer.

So, who are the worst offenders when it comes to price hikes? The truth is that they're all guilty of inflating prices wherever and whenever they can. There may come a time when broadband internet is treated like a public utility, and companies are limited in how much they can charge for certain services, but for now, the best thing you can do is shop around for a provider and plan you can afford, and then be prepared to negotiate and switch when your new ISP decides it's time for the next big price hike.

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