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FCC slams Comcast with largest-ever fine for a cable company

Telco weeps as three hours of profits go up in smoke

Updated The US Federal Communications Commission is trumpeting the “largest civil penalty assessed from a cable operator” after it fined Comcast $2.3m for charging its customers for services they didn’t ask for and equipment they didn’t need.

The government regulator said Comcast had shown a pattern of “negative option billing,” where consumers were charged for products unless they actively told the telco they didn’t want them. In some cases, consumers complained that even when they did refuse them, they still got billed.

“It is basic that a cable bill should include charges only for services and equipment ordered by the customer – nothing more and nothing less,” said Travis LeBlanc, chief of the enforcement bureau.

“We expect all cable and phone companies to take responsibility for the accuracy of their bills and to ensure their customers have authorized any charges.”

Executives at Comcast must be shaking with fear at this cripplingly large fine. In its last quarter, the company reported net income of $2bn, meaning the stern action by government regulators cost it nearly three hours of profits – or about the same time as a boozy business lunch.

The company has not responded to a request for comment on the matter. Presumably it’s checking down the back of the boardroom sofa to see if it can find enough to cover such an onerous fine.

But it’s not all about money. The FCC has also ordered Comcast to institute a five-year plan to make its billing practices clearer and ensure that consumers know exactly what they're paying for. It also wants Comcast to offer a free service to block any additional charges on their accounts.

In the meantime, Comcast has said it’s more than doubling the number of states that will now have data caps for home users, although it’s careful not to use the word “cap” in the fluffy video accompanying the announcement. So far the video has 279 likes and 60,331 dislikes on YouTube.

Youtube Video

From the beginning of November, users will be capped at 1TB of data a month per household, with each 50GB over that costing $10, and a $200 limit. Alternatively you can pay Comcast an extra $50 a month and get proper unlimited data.

“A terabyte is a massive amount of data,” opined Eric Schaefer, general manager of communications, data and mobility services for Comcast. “More than 99 percent of our customers do not use 1TB of data in a given month. But for those who do use more, we have options.”

The key word that's missing from that first sentence is “now.” Sure, 1TB is a lot, unless you've got a largish family that streams a lot of content. But as we move to ever-higher content resolutions and massive VR and AR games that hog bandwidth, these caps should help fund many more FCC judgments to come. ®

Updated to add

Comcast has gotten in touch to point out that many of the issues raised by the FCC have already been dealt with, and says it is “laser-focused” on improvement.

“We do not agree with the Bureau’s legal theory here, and in our view, after two years, it is telling that it found no problematic policy or intentional wrongdoing, but just isolated errors or customer confusion,” a spokesperson emailed The Reg.

“We agree those issues should be fixed and are pleased to put this behind us and proceed with these customer service-enhancing changes.”

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