A California federal judge has rejected a class action case against Comcast for allegedly hiding modem fees as high as $15 a month when signing up new customers.

In 2010, Athanassios Diacakis made several calls to Comcast inquiring about cable service as a new customer. Diacakis claims several Comcast representatives offered a bundle of broadband, television and phone service for $99 a month. When he asked Comcast about any other charges, company representatives eventually admitted there was a $25 installation fee, but never mentioned any modem rental fees.

After Comcast installed service, Diacakis began receiving Comcast bills that included a previously undisclosed monthly modem fee of $10 and an extra “lease charge” of $5 a month associated with his broadband service.

Diacakis alleged in his complaint charging $15 a month for cable modem equipment was “outside and in excess of the specifically quoted bundled service” package he ordered.

As Below Your Means points out, renting a cable modem may be harmful to your wallet.

The plaintiff sought class certification to force Comcast to refund some or all the modem fees charged customers from 2007 to the present. His first effort failed in January 2012 on grounds of insufficient evidence. His amended complaint was rejected May 3 on similar grounds.

United States District Judge Saundra Armstrong ruled Diacakis failed on two separate occasions to produce convincing proof Comcast was actively deceiving customers with undisclosed modem fees.

Judge Armstrong wrote that Diacakis should have come to court with evidence beyond the spoken promises of a handful of Comcast salespeople the plaintiff identified only by their first names. She was swayed by Comcast’s arguments:

As Comcast correctly points out, the only evidence offered by Plaintiff regarding Comcast’s alleged practices consists of his limited personal experience in speaking with “Heather,” “Steve” and another unidentified Comcast representative in August 2010. There is no evidence that Comcast has employed any policy, custom or practice of intentionally failing to inform potential Triple Play subscribers that they will be subject to separate modem fees. To the contrary, the record presented thus far shows that Comcast trains and instructs its employees to inform customers and potential customers about all applicable charges, including those for leased equipment.

[…] As noted, he has made no showing that the representations or omissions during those calls were made pursuant to a standardized script or marketing practice. Indeed, there is no evidence that anyone other than Plaintiff was allegedly misinformed about the modem fees.

Armstrong also faulted Diacakis for not independently locating, scrutinizing, and verifying Comcast’s print or television advertising before he filed a lawsuit seeking to represent every customer paying them:

Comcast argues that Plaintiff is not an adequate representative because there is no evidence that he or anyone else was misled by its marketing and advertisements for the Triple Play package. Plaintiff does not dispute that he lacks such evidence. In addition, Plaintiff admitted during his deposition that he did not review any advertisements before contacting Comcast in August 2010 about bundling his services. Since Plaintiff could not have been harmed by any allegedly misleading advertising, he cannot adequately represent a class member who claims to have been harmed by Comcast’s alleged marketing program.

Phillip “I Shop Online” Dampier

Last week, JCPenney launched their nationwide redemption tour, apologizing to millions of ex-customers that fled the former retail giant, begging them to come back.

It took over a year for JCPenney to get the message that “disciplining” and “re-educating” customers to accept the wisdom of everyday higher prices with few sales and almost no coupons was hardly the door-busting success “miracle worker” CEO Ron Johnson originally had in mind. The ex-Apple executive was rewarded a $52.7 million signing bonus to take over JCPenney’s tired leadership and in return he dragged sales down 28.4% from the year before, with same store sales down 32%. Johnson’s new vision also steamrolled one-third of JCPenney’s online business.

The day those results became known, he confidently showed Wall Street he did not dwell in the reality-based community: “I’m completely convinced that our transformation is on track!” (For Kohl’s benefit anyway.)

Johnson also believed in a “less is more” philosophy in human resources, overseeing layoffs of 13 percent of the company’s workforce last April, with another 350 let go in July.

Despite the fact his all-new, rebooted vision of JCPenney was about as popular as bird flu, he stayed, even as customers and employees didn’t.

It wasn’t that the company didn’t know customers had a problem with all this. Many complained about the radical, unwanted changes at JCPenney, particularly middle-aged professional women representing one of the stores’ most important business segments. Company executives simply didn’t listen.

A year later, some of the same analysts that cheered JCPenney’s crackdown on discounting now wonder if the company will survive 2013. Many fretted about the real possibility the last customer to brave the “new era” of JCP might forget to turn the lights out when they left for good. Others were mostly furious the board let Johnson go.

Despite the tragic consequences, the conventional wisdom on Wall Street remains: Alienating customers with a revamp nobody asked for and “everyday pricing” designed to boost profits every day was not the problem, how Johnson implemented the strategy was. He just didn’t educate customers enough.

We see the same warped thinking in the broadband marketplace, particularly with usage caps, consumption billing, junk fees and the general ever-increasing price of broadband itself.

On providers’ quarterly results conference calls, the regular questions challenging leaders of the industry are not about providers charging too much for too little. The real concern is that your ISP is leaving too much ripe fruit on the tree:

• Where is the revenue-boosting usage caps and consumption billing, Time Warner Cable?
• Comcast: can’t you raise prices further on those recent speed increases to maximize additional revenue?
• Verizon: why are you spending so much on fiber broadband upgrades customers love when that money could have gone back to shareholders?
• AT&T: Is there anything else you can do to exploit your market share and make even more money from costly data plans?

The best ways a consumer can reward a good broadband provider include remaining a loyal customer, paying your bill on time and upgrading to faster speeds as needed. For Wall Street, the growing demand for broadband is a sign there is plenty of wiggle room for at-will rate increases, new fees and surcharges, contract tricks and traps, customer service cuts, and monetizing usage wherever possible. After all, you probably won’t cancel because the other guy in town is doing the same thing.

This is what sets the broadband marketplace of today apart from most retailers: consumers don’t have 10-20 other choices to take their business to if they are fed up.

Comcast or AT&T? Both charge a lot and have usage limits on their broadband service for no good reason. Your other alternatives? A wireless provider charging even more with an even lower usage cap. Or you can always go without.

While providers may tell you there is a healthy, competitive broadband marketplace, Wall Street knows better. When Time Warner Cable recently announced it would dramatically curtail new customer promotions and concentrate on delivering fewer services for more money, nobody bothered asking whether this would result in a stampede to the competition. What competition?

Although Google is delivering much-needed, game-changing competition in a tiny handful of cities, most Americans will not benefit because the best upgrades and lowest prices are only available where Google threatens the status quo. A larger number of municipalities are done putting their broadband (and economic) future in the hands of the phone and cable company and are building their own digital infrastructure for the good of their communities.

For everyone else, we can dream that one day, someday, the cable and phone company most Americans do business with will be forced to run their own JCPenney-like apology tour for years of abusive pricing and mediocre “good enough for you” broadband with unwarranted usage limits. Time Warner Cable went half way, but until competition or oversight forces some dramatic changes, we should not count on providers to actually listen to what customers want. They don’t believe they need to listen to earn or keep your business.

Giant telecommunications companies and their lobbyist friends are gushing their approval for President Obama’s latest pick — Tom Wheeler — to head the Federal Communications Commission. What do they know that consumers don’t?

AT&T

I’ve known Tom Wheeler for many years, and he is an inspired pick to lead the FCC.  Mr. Wheeler’s combination of high intelligence, broad experience, and in-depth knowledge of the industry may, in fact, make him one of the most qualified people ever named to run the agency.

Mr. Wheeler will face daunting challenges at the FCC.  Already the pace of technological change is clashing with outdated laws, antiquated rules, and approaches more rooted in the past than the present.  The dedicated career staff at the FCC are grappling with these challenges now.  If the pace of change is to continue, along with the investment and job creation that fuel it, the mission of the FCC in the 21st Century must be re-examined, and its rules and methods modernized.  In this situation, I can think of no nominee more talented or whose leadership skills are more needed. Moreover, Mr. Wheeler will be joining a complement of fellow commissioners who are equally formidable and well suited for this important moment in the FCC’s history.

On behalf of AT&T, I’d like to congratulate Tom Wheeler on his nomination. We look forward to working with him once he is confirmed by the Senate. I also want to congratulate Mignon Clyburn, who will take over as interim-chair of the FCC. She’s an experienced and independent policymaker, passionate about public service, who will lead the agency over the coming months with a steady hand.

— Jim Cicconi, Senior Executive Vice President

National Cable & Telecommunications Association (NCTA) — America’s largest cable industry lobbyist

We congratulate Tom Wheeler on his nomination as Chairman of the Federal Communications Commission. With his significant experience in both the private and public sector, Tom is an exceptional choice to lead the Commission during a time when the telecommunications marketplace is experiencing significant innovation and incredible change. We welcome the appointment of Mignon Clyburn as interim chairman as she is a distinguished and able public servant. We will continue working closely with the entire Commission as they tackle important issues facing America’s dynamic media, technology and telecommunications landscape.

— Michael Powell, NCTA President & CEO and Former FCC Chairman

Comcast/NBC

We congratulate Tom Wheeler on his nomination as Chairman of the Federal Communications Commission.  His vast knowledge of the communications industry, as well as his proven leadership, will be invaluable as the Commission sets its course for our nation’s digital future.  We applaud President Obama’s nomination and we look forward to working with the Commission under Tom’s leadership.

Further, we commend the President’s appointment of Mignon Clyburn as Acting Chair of the FCC.  She has distinguished herself in her service as a Commissioner over the past three and a half years, and has demonstrated that she is well-suited to lead the agency.  She works passionately and tirelessly to ensure that the best interests of all Americans are given serious consideration in each matter before her.  We congratulate Chairwoman Clyburn on her well-deserved appointment as the first female chair of the FCC and look forward to continuing to work with the FCC under her leadership.

As current FCC Chairman Genachowski departs, we wish him the best and thank him for his very successful Chairmanship that has ensured the US remains the leader in the global communications marketplace.

— Comcast CEO Brian Roberts

Telecommunications Industry Association

He has the proven ability to transcend a broad range of industry perspectives to reach balanced outcomes.

— Grant Seiffert, president

CTIA – The Wireless Association — America’s top wireless industry lobbyist

Tom has a deep understanding of communications issues, a passion for hard work and creative thinking, a diverse background that spans the realm of the Internet world and a keen understanding of how mobile wireless broadband can drive our economy and innovation.

I can attest to Tom’s commitment to harness the power of communications technology to improve people’s lives, to drive our global competitiveness, and to advance the public interest,” Genachowski said. “The FCC’s role has never been more essential, and with Tom’s deep policy expertise and his first-hand experience as a technology investor, he is a superb choice to advance the FCC’s mission of promoting innovation, investment, competition, and consumer protection.

Wheeler

President Barack Obama will shortly nominate a former top cable and wireless industry lobbyist as his choice to represent the interests of the American people at the Federal Communications Commission.

Thomas Wheeler, who has been a telecom industry insider for at least 30 years and today serves as a venture capitalist, will have enormous influence over how the FCC manages the public airwaves, broadband, and wireless spectrum.

The Wall Street Journal reports this afternoon that President Obama may make a formal announcement as early as this Wednesday, with current FCC commissioner Mignon Clyburn serving as interim chair until Wheeler is seated.

Wheeler is expected to take a more industry-friendly attitude at the FCC. As Stop the Cap! noted after reviewing several years of Wheeler’s personal blog, the future FCC chairman would have approved the merger of AT&T and T-Mobile, considers Google, Apple and other technology companies challenging telecom public policy part of a “Silicon Valley mafia,” and praised AT&T’s chief lobbyist as a visionary that could define the wireless industry’s future.

Wheeler’s regulatory philosophy offers that mergers and acquisitions present an opportunity for regulators to impose certain temporary conditions on deals, offering the best opportunity to influence a short-term regulatory outcome. But such preconditions are often mild, quickly expire, and are predictable for the companies involved. When Comcast sought merger approval for its deal with NBCUniversal, one concession was to sell discounted Internet access for poor families — a service Comcast had earlier plans to offer but withheld as a bargaining chip during merger approval talks.

Comcast says gun stores need no longer apply to purchase ad time on their cable systems.

The Lake County (Fla.) Commission is calling Comcast’s decision to no longer accept advertising from businesses that promote gun sales “discrimination,” and they are calling on the Florida legislature to pressure the cable operator to change its mind.

Local gun shops in central Florida are angry Comcast has stopped accepting their advertising and say the operator has an advertising monopoly that guarantees their ads will not be seen.

“I’ve advertised over 20 years with Comcast,” Carey Baker of Peterson’s Gun Shop told WFTV. “My business has no other choice. I can’t advertise on any other cable company.”

Both Time Warner Cable and Comcast have ceased running advertising from gun shops after the Sandy Hook Elementary School shootings in Connecticut. Comcast said they simply adopted a pre-existing policy already in place at NBC after buying the network.

Many broadcast stations and networks also maintain restrictions on gun or ammunition-related advertising, some banning those commercials outright, others approving them on a case-by-case basis.

Some commissioners said the cable operator’s decision was just as unacceptable as not allowing a gun shop owner to eat in a local restaurant. But another commissioner dissented, claiming Comcast has the right to run its business as it pleases.

The matter of cable advertising is completely unregulated, and attempts by state or local governments to enforce ad content policies would likely be challenged in the courts by affected cable operators.

But Baker says local municipalities do retain some leverage, as they can deny the renewal of a cable franchise to those no longer seen serving the best interests of the community.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/WFTV Orlando Lake Co gun shop owner upset Comcast no longer allowing gun ads 4-24-13.flv[/flv]

WFTV in Orlando talks with Carey Baker, owner of a local gun shop that can no longer advertise on Comcast Cable.  (2 minutes)