Posted on by Jon Colgan
Here I am, doing a little Sunday reading, perusing the data CellBreaker.com has on how much Verizon has leeched off its customers in the form of sneaky little surcharges in 2014, and I can’t escape one staggering conclusion: those little guys add up.
On the low end, I calculate that Verizon has pick-pocketed its customers for an extra 6% of the sum ticket price of all of the bills in 2014 so far. On the high end, 42%.
Great Scott! 42%? What do these surcharges go toward?
Prior to 2009, not much attention was paid to surcharges. So, the FCC basically allowed cell phone carriers to charge sneaky little add-on fees for whatever they wanted–and carriers took miles on that inch. The surcharge fees used to be called descriptive things like “utility cost recovery” or “transportation cost recovery.” If you’re thinking that those make it sound like Verizon (and the other big carriers) simply passed on their light bills to customers, you’re right. That’s exactly what they did–cost of gasoline too, apparently.
Then 2009 rolled around, and the FCC couldn’t ignore anymore the deluge of consumer complaints about a number of carriers’ shady business practices. The FCC got involved and forced carriers to make some pro-consumer changes, but outlawing these surcharges was not one of them. So, carriers persisted but decided to disguise surcharges in order to keep public scrutiny from finding its way to this highly lucrative surcharge scheme. “Utility cost recovery” and “transportation cost recovery” became “administrative fee,” and new obscurely named fees also began showing up on customers’ bills–things like “regulatory cost recovery.”
That’s where we are today, wondering what these fee names mean and what the money goes toward, but more importantly, wondering why we have to pay them.
Insult dog-piling injury, solving this mystery isn’t merely about principle. With Verizon surcharges inflating your bill 6%-42% every month, Verizon is happy to leave you in the dark, but your bank balance isn’t pleased.
How does Verizon manage to always keep consumers in the dark?
You won’t find this calculation in any Verizon materials, like the customer agreement, for example. But I have seen traces of this dirty little secret in writing when some other (self-described) consumer-centric companies do Verizon’s bidding.
Like Best Buy, for example:
They sell a lot of plans and devices for carriers, Verizon among them, and Best Buy discloses this in print smaller than a preemie baby’s cuticle right below their advertisements for Verizon’s plans (whose fonts are larger than my wife’s Toyota Yaris). I only wish that this photo I snapped at Best Buy included a preemie’s cuticle; then you would see.
That 6%-42% range just about matches the sum I’ve calculated that Verizon overcharged customers in 2014, before those customers found CellBreaker.com, that is.