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FCC proposes to ban early termination fees for cable, satellite service contracts
(MENAFN) On Tuesday, the Federal Communications Commission (FCC) unveiled a proposal to prohibit early termination fees for cable and satellite service contracts.
Under the suggested rule, cable operators and direct broadcast satellite (DBS) providers would be obligated to remove early cancellation fees. Additionally, the proposal mandates that cable and DBS companies offer customers a prorated credit or rebate for the days remaining in a billing cycle after cancellation, as outlined in an FCC announcement.
“No one wants to pay junk fees for something they don’t want or can’t use,” FCC Chairwoman Jessica Rosenworcel stated in a declaration. “When companies charge customers early termination fees, it limits their freedom to choose the service they want.”
The suggested rule is aligned with the broader initiative of the White House, which aims to eliminate unnecessary fees. This effort is in line with President Joe Biden's July 2021 executive order, which seeks to promote competition in the U.S. economy.
As outlined in the executive order, cable television is identified as a sector where fees can impede competition, primarily because of the costs associated with canceling services or transitioning between service providers.
“Companies shouldn’t lock you into services you don’t want with large fees,” US Leader Joe Biden stated in a post on social media on Tuesday. “It’s unfair, raises costs, and stifles competition. We’re doing something about it.”
Earlier, the FCC had revealed plans to introduce Broadband Consumer Labels, providing consumers with easily accessible information regarding the functions and costs of broadband services, designed in a manner akin to a food nutrition label. Additionally, the agency has put forth the concept of 'all-in-pricing' for cable and satellite services.
This proposal aims to ensure that customers are presented with the complete service costs, inclusive of all fees, upfront and transparently.
Under the suggested rule, cable operators and direct broadcast satellite (DBS) providers would be obligated to remove early cancellation fees. Additionally, the proposal mandates that cable and DBS companies offer customers a prorated credit or rebate for the days remaining in a billing cycle after cancellation, as outlined in an FCC announcement.
“No one wants to pay junk fees for something they don’t want or can’t use,” FCC Chairwoman Jessica Rosenworcel stated in a declaration. “When companies charge customers early termination fees, it limits their freedom to choose the service they want.”
The suggested rule is aligned with the broader initiative of the White House, which aims to eliminate unnecessary fees. This effort is in line with President Joe Biden's July 2021 executive order, which seeks to promote competition in the U.S. economy.
As outlined in the executive order, cable television is identified as a sector where fees can impede competition, primarily because of the costs associated with canceling services or transitioning between service providers.
“Companies shouldn’t lock you into services you don’t want with large fees,” US Leader Joe Biden stated in a post on social media on Tuesday. “It’s unfair, raises costs, and stifles competition. We’re doing something about it.”
Earlier, the FCC had revealed plans to introduce Broadband Consumer Labels, providing consumers with easily accessible information regarding the functions and costs of broadband services, designed in a manner akin to a food nutrition label. Additionally, the agency has put forth the concept of 'all-in-pricing' for cable and satellite services.
This proposal aims to ensure that customers are presented with the complete service costs, inclusive of all fees, upfront and transparently.
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