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Charter Watch: Goodbye TWC’s $10 Modem Rental Fee, Hello Spectrum’s $5 Wi-Fi Fee

Former Time Warner Cable and Bright House Networks customers in Florida, Ohio, Michigan, and Wisconsin were glad to see the end of modem rental fees, something promoted as a tangible deal benefit of the merger by new owner Charter Communications. But many of those same customers are now upset to discover that up to $10 modem rental fee has been replaced with a $5 monthly fee for “Wi-Fi service.”

LuAnn Summers, a Bright House customer in Tampa, wrote Stop the Cap! in February to complain her new bill from Charter/Spectrum included a $9.99 activation fee and $5 a month for something called “Wi-Fi Service.” The same fees have since appeared on bills for some customers recently switching away from their old Time Warner Cable service plans to new Spectrum pricing and plans.

Rich D’Angelo in Wisconsin recently took Charter up on its offer to switch away from his legacy TWC plan when his promotion expired in January.

“I was able to get a big speed boost and bundle it with Spectrum’s Silver TV package, which includes two of the premium movie channels I was paying TWC $15 each for every month, and my bill was only supposed to go up $10,” D’Angelo tells Stop the Cap! “Instead, it went up $25 and I feel lied to.”

Wi-Fi sticker shock.

D’Angelo retired his old owned Motorola SB6121 modem in favor of a new network gateway supplied free of charge by Charter because his new package didn’t work with his old modem.

“My 6121 modem was a real workhorse and I bought it right after Time Warner started charging modem fees, but it cannot support Spectrum’s fastest speeds in Wisconsin and I didn’t feel like buying a new modem when Spectrum gives them to customers for free,” D’Angelo explained. “This was the device they handed me and I was not offered any other option.”

Champagne Johnson in Columbus, Ohio also took advantage of Spectrum’s new pricing plans thinking she could save her family money and get better internet speeds from the cable operator that advertises it’s a “new day” for Time Warner Cable subscribers.

“New day but the same old lies and deceit,” Johnson writes Stop the Cap! “Do these cable companies only hire thieves? I was told the cable modem was included, but now I am suddenly getting charged for Wi-Fi, which is crazy. I called Spectrum up and they told me there is a charge if I use their modem for my Wi-Fi. I told them I don’t need their Wi-Fi because I have my own router that works fine and they told me it was included inside their modem and I had to pay for something I won’t use.”

Charter assumes if you use Wi-Fi, you want their Wi-Fi Service

We contacted Charter to learn more about this new charge and what customers can do about it.

It turns out the Wi-Fi charge and activation fee applies when you use a network gateway device provided by the cable company. We learned the reason so many customers are finding this charge on their bill comes as a result of slightly deceptive sales practices when customers choose a Spectrum internet service plan.

“Do you use Wi-Fi at home?” a Charter representative asked us when we inquired about pricing for a new Spectrum service plan to replace our existing Time Warner Cable plan. When we answered yes, the representative said they would send our “free equipment” and noted we would no longer pay a modem rental charge (despite the fact we had owned our own modem at Stop the Cap! HQ for years). “You can either pick it up in a cable store or we can ship it direct to you in a self-install kit.” That equipment was a “network gateway,” which bundles a cable modem and router into a single device.

Our readers confirm that Charter representatives did not ask them if they have an existing in-home router, which probably already provides Wi-Fi access in the home. Nor do they disclose that accepting a network gateway, which was also interchangeably referred to as “a modem” means they are agreeing to pay a $9.99 activation fee and $5/mo ongoing fee for “Wi-Fi service.”

We called three times this afternoon as were given identical information, and no disclosure of any Wi-Fi fees.

On the fourth call, we specifically asked about Wi-Fi fees and the representative told us they did not know the answer and left us on hold for 10 minutes before finally disclosing that Charter does charge both fees. When we asked how to avoid them, we were first told we could not waive the fee if we used Wi-Fi in the home, but a supervisor later clarified that it only applied to their gateway and we could specifically request a “basic modem” or have Wi-Fi disabled on a network gateway, and neither charge would apply.

“How are we supposed to know and understand that in advance?” Johnson asked us.

“Considering more than 90% of Time Warner Cable customers were paying $10 a month for a modem without ever realizing or understanding they could buy their own and avoid that charge, how many Spectrum customers are proficient enough to tell Spectrum they want their network gateway set to bridge mode or want a traditional cable modem without router functionality? It’s clear Charter is going to make $5 a month from a whole lot of customers, and it should be disclosed up front. It even got me and I am a network engineer.”

Summers learned about the controversy of the Wi-Fi charge after googling the fee and discovered a Tampa Bay Times story about the fee.

Spectrum spokesman Joe Durkin told the newspaper the fee should not apply to customers Charter inherited from Bright House who already had internet service. He said Spectrum is reviewing cases the Times has brought to its attention to see if the charges were appropriate.

But that isn’t always the case for customers placing orders on Charter’s website or contacting customer service by phone. In both cases, Charter implied if you want to use Wi-Fi at home, you owe them an extra $5 a month:

Charter’s website suggests that you have to pay $5 a month if you intend to use Wi-Fi at home.

Getting the charges off your bill

Luckily, Charter is readily agreeing to customer requests to remove the charge(s) from customer bills and will supply equipment with Wi-Fi disabled (or not present when using a traditional cable modem). You may need to exchange equipment, however. If either charge appears on your bill, call and complain. While we no longer recommend customers invest in their own cable modems as long as Charter is providing them without a rental fee, we do suggest customers buy their own router and avoid ongoing fees for Wi-Fi service.

Also be aware that if you are still on a legacy Time Warner Cable internet plan, Charter will keep collecting that $10 monthly modem fee until you abandon your Time Warner plan for a Spectrum internet plan. You can still avoid the rental fee by buying your own modem. Charter’s list of supported modems is here.

Want the Best Deal from Charter/Spectrum? Cancel Your Service for a Few Days and Wait

Former Time Warner Cable and Bright House customers, listen up. A veteran Charter Communications customer who cut cable’s cord for good a few months ago reports Charter’s hard-line on extending retention deals to customers threatening to leave lasts only until you turn in your equipment and cancel your service.

DSL Reports reader mmainprize from Houghton Lake, Mich. wrote he dumped his $180/mo Charter Gold TV with Phone package for good after realizing just how much Charter was gouging him for service.

“I just went through my bills, and remember when internet was only $49 in mid-2015 before increasing to $52 in late 2015,” he writes. “So at the now current price of $65 you can see just how much it has gone up.”

When he called to tell them he was canceling service, they briefly tried to keep him as a customer by cutting back on his cable package for a lower price.

“Double play, Flex pack, you pick 20 channels, etc. At first the offer was internet and basic cable for $90 a month, then $74 a month for internet and “limited basic” (an unadvertised package of local channels, public access, educational and government channels, plus home shopping). I canceled all but internet.”

Within days the phone calls and letters started coming advertising discounts Charter wouldn’t dream of offering when he was still a TV customer.

“I get a call every day now (it is harassment) offering the same prices or lower than what I was offered when canceling,” he writes.

The first offer is $80 for a double play package of TV and internet service. But if you turn them down, they eventually pitch a triple play offer of $89 a month with TV, phone, and internet with free HD and DVD service (equipment extra).

The enticing offer on their website, promoting $29 a month for internet, $29 for TV, and $29 for phone service is available only to new customers. Existing Charter, Bright House, and Time Warner Cable customers cannot get those prices. You must pay more.

Those canceling service qualify as a new customer after a 30 day timeout period. Or skip that and sign up as a new customer under the name of another household member. If you are married, your spouse’s maiden name will suffice.

One thing is certain. Charter’s takeover of Time Warner Cable and Bright House is very unlikely to save most customers any money. Almost 90% of Time Warner Cable customers received discounts from a bundled service package or a retention deal. When those packages expire, your bill will skyrocket. This is exactly what Stop the Cap! told regulators in our opposition to the merger. Since 2008, we have shared one sage piece of advice with readers:

When a cable company comes calling promising you a great new deal, watch your wallet and run!

Corporate/Koch Brother-Linked Group Asks FCC to Repeal Charter/Spectrum’s Data Cap Prohibition

A conservative group funded by corporate interests and the Koch Brothers has asked FCC chairman Ajit Pai to answer its petition and move expeditiously to cancel the prohibition of data caps/usage-based pricing as a condition for FCC approval of Charter Communications’ acquisition of Time Warner Cable and Bright House Networks.

A number of pro-consumer deal conditions were included as part of the merger transaction’s approval, and won the support of a majority of FCC commissioners under the leadership of former FCC chairman Thomas Wheeler, appointed by President Barack Obama.

The Competitive Enterprise Institute (CEI) is hopeful that with Wheeler out of office and a new Republican majority at the FCC under the Trump Administration means the FCC will end requirements that Charter offer unlimited data plans, discounted internet access for low-income consumers, and start allowing Charter to charge fees to Netflix and other content providers to connect to its broadband customers. CEI has every reason to be hopeful, pointing out Chairman Pai is a fan of data caps on residential broadband service, opposes Net Neutrality, and recently effectively killed a Lifeline program that would have extended inexpensive internet access to the poor.

CEI:

As then-Commissioner Pai wrote in 2016, this condition is neither “fair” nor “progressive.” Instead, he called this “the paradigmatic case of the 99% subsidizing the 1%,” as it encourages Charter to raise prices on all consumers in response to costs stemming from the activities of a “bandwidth-hungry few.” Other problematic conditions include the ban on Charter charging “edge providers” a price for interconnection and the requirement that the company operate a “low-income broadband program” for customers who meet certain criteria.

The group is optimistic Pai will oversee the unwinding of Charter’s deal conditions largely pushed by former FCC chairman Thomas Wheeler, after Pai recently led the charge to revoke another condition required of Charter in return for merger approval – a commitment to expand its cable network to pass at least one million new homes that already receive broadband service from another provider.

Pai also opposed the low-income internet program, calling it “rate regulation.” The CEI claimed the requirement will “undermine Charter’s ability to price its services in an economically rational manner.”

“Hopefully, the FCC’s new leadership will seize this opportunity to take a stand against harmful merger conditions that have nothing to do with the transaction at hand—by granting CEI’s petition,” the group wrote on its blog.

Charter CEO Wins a Full Spectrum Pay Package: $98.5 Million for 2016

Rutledge is rich.

Thomas Rutledge, CEO of a greatly enlarged Charter Communications, was awarded a greatly enlarged pay package worth $98.5 million in 2016 – a 500% pay rise.

Rutledge won a compensation boost, in part, because of his willingness to continue taking Charter’s money for at least five additional years, until 2021.

Charter disclosed the pay package as part of a regulatory filing. One year earlier, Rutledge’s salary was $16.4 million.

Bloomberg News reports the person likely responsible for the considerable pay boost was John Malone, Charter’s largest individual investor and board member. His associate and confidant — Greg Maffei, CEO of Liberty Media, sits on Charter’s compensation committee.

Rutledge’s stock options, valued at $78 million last year, will vest if Rutledge can adequately please Wall Street and shareholders by getting Charter’s stock price up. Various hurdles are in place that will give Rutledge more options as the share price moves higher.

Rutledge’s 2016 compensation also includes $2 million in salary and up to $10.1 million in stock awards, plus a $7.65 million bonus.

Charter customers got a $5 rate increase for broadband packages that will eventually reach all customers.

In 2016, Charter Communications closed on its acquisition of both Time Warner Cable and Bright House Networks.

Charter/Spectrum Arrives in Northeast/Mid-Atlantic Region, Big Rate Hikes Sure to Follow

The last remaining parts of the country formerly served by Time Warner Cable are rebranding as Charter/Spectrum today, with the introduction of new service plans in upstate New York, western Massachusetts, Maine, and parts of the Carolinas.

“Redefining what a cable company can be,” as Charter Communications promotes to its customers, is a tall order for a cable company that is often loathed by its customers. Our readers have reached out to us all day to suggest, at least so far, Spectrum is the same old cable company, just with a new name.

“If I switch away from my Time Warner Cable plan to adopt a Spectrum plan, my bill will increase $40 a month,” complained Rochester, N.Y. resident June Patterson. “Even the customer service person I talked to said it would be crazy for me to switch plans.”

A customer in Albany, N.Y., reported their bill would increase by $30 a month. Another in Silver Creek, N.Y., claimed a $40 rate rise by switching to a Charter/Spectrum plan.

“I pay $92.06 now for Starter TV and Ultimate Internet in the Ithaca area,” shared another customer on DSL Reports. “After going through two operators, the second one is telling me my price will go up to $125.”

That’s a rate increase of $32.94 a month — $395.28 more a year.

Customers are encountering new plans for television service, but many areas only receive one advertised broadband speed option: 60Mbps. In fact, most areas can also buy 100Mbps service, but it’s very expensive at around $100 a month with a $200 setup fee. Customers have to call to change plans to get either speed. Some customers in former Time Warner Cable Maxx areas have better luck getting the setup fee waived than those living in areas Time Warner Cable never had a chance to upgrade.

In Idaho, The Spokesman Review’s D.F. Oliveria reports Charter/Spectrum is even worse than what Time Warner Cable offered before:

Our new internet service provider, Spectrum (Charter Communications), the company that “merged” with Time Warner’s local cable, has come under increasing fire lately. Many consumers have been calling me about poor customer service, very slow and/or inconsistent internet speeds, higher monthly prices and no printed material available to consumers regarding offerings.

“Since the merger, my bill went up $20 a month and speeds have slowed significantly,” shared ‘Nic’ in northern Idaho. “It’s ridiculous.”

WFTS in Tampa reports former Bright House customers can expect steep rate increases from Charter/Spectrum. (3:21)

In former Bright House territory in Florida, customers saw bills skyrocket by as much as $182 a month, resulting in monthly charges of an unprecedented $305 a month. Charter Communications refused to deal with the affected customers until WFTS-TV’s “Action News” consumer reporter Jackie Callaway intervened and finally got the company to admit the bills were too high by mistake:

Bright House customers Ivan and Linda Sordo say the rate hike hit without warning. The Sordo’s typical bill of $141 shot up to $305 overnight and without warning. And Lillian Rehrig’s normally $123 bill more than doubled to $305. Rehrig says calls to Spectrum got her a partial reduction but no real relief. Her next Spectrum statement came in $120 higher than her old Bright House bill.

What happened in these two cases turned out to be a billing error, an error Spectrum’s owner Charter Communications corrected after we started asking questions.

“When you started speaking with them is only when I got anyone to respond.”

It isn’t known how many other Tampa area customers were also overbilled or if Charter was working to identify and refund those who did not pursue a complaint with a local television newscast.

Charter Communications did tell WFTS-TV the majority of the one million former Bright House customers in the area now being served by Charter/Spectrum will face rate increases of $20-30 a month on average as their current package with Bright House expires. Those customers switching from a grandfathered Bright House or Time Warner Cable package will also automatically lose any promotion those packages were receiving.

In North Carolina, Time Warner Cable is gone and apparently so are some customers’ $300 rebate cards. Time Warner Cable had a long history of customer complaints about its rebate programs, but Charter Communications isn’t too interested in helping customers meet the terms of those rebates and intervene when something goes wrong.

A Steele Creek couple told WSOC-TV Time Warner rejected their rebate after they configured autopay on their Spectrum account with the help of a Charter customer service agent. Despite repeated assurances from customer service, the transition to autopay did not take effect quickly enough and they missed a payment, which canceled their rebate eligibility. Countless hours of negotiations with Charter’s customer service representatives got the couple nowhere. But the promise of bad publicity on the local evening news made the difference, and a $300 gift card was promptly mailed to them. Many other customers simply give up.

WSOC in Charlotte covers the case of the missing Time Warner Cable gift card. Customer service was no help. (1:54)

In Southern California, Spectrum is busy raising rates as well. Hannah Kuhn (76) of Simi Valley saw her bill jump $46 a month after Spectrum took over from Time Warner Cable last fall. Nobody would offer an explanation and in return for her complaints, they evidently shut the grandmother’s cable service off. Most Time Warner Cable customers are enrolled in some type of bundled service promotion. As those promotions expire, Spectrum raises rates to the regular price it intends to charge customers going forward, ending Time Warner Cable’s practice of lowering rates when customers complain.

Most customers with a popular bundled service package rate combining broadband, phone, and television could see their rates rise between $250-360 a year.

Former Time Warner Cable customers across the northeast and mid-Atlantic woke up this morning to incessant advertising like this promoting a “new day” for cable service, courtesy of Charter/Spectrum. (:60)

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