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New law requires cable, satellite TV companies to disclose hidden fees

A Comcast XFinity cable technician.
A Comcast XFinity cable technician. (Photo: Pixabay, Graphic: The Desk)

A new law that goes into effect on Sunday requires cable and satellite companies to disclose all programming and administrative-related fees when a customer signs up for service.

The rule is part of the Television Viewer Protection Act (TVPA) signed into law late last year.

The law requires cable and satellite companies to disclose all supplemental fees, including equipment rental charges, per-line charges, broadcast TV fees and regional sports fees, when a customer signs up for service. It also requires companies to use their best efforts to inform customers about government surcharges and taxes.

“The law took action to prevent consumers from signing up for a pay-TV service, only to realize, once it was too late to cancel without a penalty, that they’d be charged hundreds of dollars a year in unexpected fees,” Jonathan Schwantes and Jenna Leventoff with the advocacy group Public Knowledge wrote in a blog post on Tuesday.

After being notified of the fees, if customers feel the charges are too much, they can cancel their service within 24 hours and void their contracts without penalties. The law applies only to customers who sign up for new service or renew their contracts after December 20. Cable companies must also disclose when a customer’s promotional rate is scheduled to end when bills are sent electronically.

While it protects customers who sign up for service from being hit with fees that weren’t disclosed in promotional prices, it doesn’t prevent cable or satellite companies from charging more in regional, sports or administrative fees later on down the road. Customers who are locked into a contract at the time of a price increase would still be required to pay those fees or break their contracts, which typically requires payment of an early termination fee.

For Internet subscribers, the law eliminates the practice of cable companies charging equipment rental fees for modems and routers that are owned by customers. Some companies, like Comcast and Charter/Spectrum, don’t charge customers who want to use their own equipment, but a few — specifically, Frontier Communications — did.

Frontier said it charged the fee to cover the cost of supporting customer-owned equipment on their network. But representatives have long told Frontier’s customers that they could not support or repair customer-owned equipment, which challenged the validity of the rental fee. Frontier said it would begin complying with the law when it takes effect on Sunday.

“This common sense correction will permit consumers to continue to use their own equipment, and not be forced to pay for something they neither asked for nor needed,” Schwantes and Leventoff wrote.

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About the Author:

Matthew Keys

Matthew Keys is the publisher of The Desk and reports on the business and policy matters involving the broadcast television, streaming video and radio industries. He previously worked for Thomson Reuters, Disney-ABC, Tribune Broadcasting and McNaughton Newspapers. Matthew is based in Northern California, has won numerous awards in the field of journalism, and is a member of IRE (Investigative Reporters and Editors).