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Biden suggests prohibiting charges for cutting cable cords

by Michael Stark

FCC Proposes Banning Early Termination Fees for Cable and Satellite Services

On Tuesday, the Federal Communications Commission (FCC) unveiled a proposal to prohibit early termination fees for cable and satellite service contracts. The rule would mandate that cable operators and direct broadcast satellite (DBS) providers eliminate early cancellation fees. Additionally, the proposal would require these companies to provide customers with a prorated credit or rebate for the remaining days within a billing cycle after cancellation.

FCC Chairwoman Jessica Rosenworcel expressed the importance of this proposal, stating, “No one wants to pay junk fees for something they don’t want or can’t use. When companies charge customers early termination fees, it limits their freedom to choose the service they want.”

This proposal aligns with the White House’s efforts to eliminate excessive fees, as outlined in President Joe Biden’s executive order from July 2021 to promote competition in the U.S. economy. The telecommunications industry, particularly cable television, has been identified as a sector where fees can hinder competition due to the costs associated with canceling services or switching providers.

President Joe Biden took to social media to address the issue, declaring, “Companies shouldn’t lock you into services you don’t want with large fees. It’s unfair, raises costs, and stifles competition. We’re doing something about it.”

The FCC has also revealed plans to introduce Broadband Consumer Labels, providing easily accessible information for consumers about the functions and costs of broadband services, similar to a food nutrition label. Moreover, the agency has proposed “all-in” pricing for cable and satellite services, ensuring that customers see the total service costs, inclusive of fees, upfront.

FCC Chairwoman Rosenworcel emphasized the importance of facilitating competition within the media market, stating, “In an increasingly competitive media market, we should make it easier for Americans to use their purchasing power to promote innovation and expand competition within the industry.”

It is essential to note that Comcast is the parent company of CNBC.

This proposal by the FCC marks an important step in addressing excessive fees within the cable and satellite service industry, aligning with the White House’s broader efforts under President Biden to promote competition and consumer choice within the U.S. economy.

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