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July 6, 2015

Sprint’s New Pitch: (Not Quite) All-In Pricing Plan

Filed under: Electronics,Internet,Telephone — Edgar (aka MrConsumer) @ 5:44 am

  Could it be that some of the top executives at the cell and cable companies have been reading our latest rants in Mouse Print* about deceptive low-ball pricing and unexpected additional charges and terms. Probably not. But, as if to say “we can hear you now,” Sprint started a big promotional campaign last week touting its new “all-in” pricing plan.

Sprint’s CEO put it this way:

“If you went to a restaurant that advertised a cheeseburger for 99-cents, but when you show up, they said it’s an extra $2 for the bun or $1 for lettuce, you would feel misled. Yet, that’s what the industry has been doing with its wireless plans. Why can’t everyone just advertise the full price of both the plan and the smartphone – an All-In plan? That was the idea behind what we’ve created.”

As part of the campaign, Sprint produced this extended commercial that pokes fun at its competitors who double-talk customers about all the extra charges they impose.



Wow. One monthly price for service and the phone.

Not so fast.

*MOUSE PRINT:

Sprint $80 a month

The $80 price you see is not the price you pay. Taxes, surcharges [including USF charges of up to 17.40%(varies quarterly), up to $2.50 Admin. & 40¢ Reg. /line/mo. & fees by area (approx. 5-20%)], roaming fees are still extra, and there is a $36 activation fee. Although this screen doesn’t say it (a prior one does in small print), this is for the lease of a phone. So you don’t own the phone, and will have to pay $200 at the end of two years if you want to keep it.

And here’s a new one: apparently Sprint is capping/throttling the speed of streaming videos to just 600Kbps — more like the 3G speeds that it uses on its prepaid service for videos.

So much for advertising a price that is “all-in.” Thanks, Sprint.

UPDATE: This video streaming restriction caused outrage among Sprint users and watchers, and within 24 hours Sprint backtracked removing that throttling of video speeds.

• • •

June 29, 2015

You May Not Own Your New Cellphone

Filed under: Electronics,Telephone — Edgar (aka MrConsumer) @ 6:07 am

  If you are about to get a new cellphone from Sprint or T-Mobile, you better read the fine print, because you may not actually be buying that phone. You may only be leasing it.

MOUSE PRINT*:

Sprint ad

That’s right. Sprint is turning back the clock to the 1950s when you paid a monthly rental fee to Bell for your black landline Western Electric telephone. The difference: you are responsible for repairs if you don’t have a costly protection plan or warranty, and that old phone really sounded good.

For the iPhone 6, $20 of your monthly payment for 24 months is a lease payment, because under this plan, Sprint owns the phone. What happens after the lease ends?

  • You can turn in the telephone, get a new one if you want, and pay its monthly lease payments.

  • You can continue leasing it at an undisclosed monthly cost.

  • You can buy it outright for an undisclosed “purchase option price.”

  • The first option assumes your phone is in “good working condition.” If it isn’t, or if you lose the phone during the lease term, you owe the balance of any yet-to-be-paid monthly installments plus the “purchase option price.”

    If you opt to buy your Sprint iPhone 6 at the end of the lease, they will charge you $200 according to a local Sprint representative. That makes the phone slightly more expensive than buying it outright to start.

    Not to be outdone, effective this week, T-Mobile joins the leasing world also, by offering Jump on Demand. It is an 18-month lease program that allows you to upgrade your phone up to three times a year. T-Mobile, however, adds all kinds of penalties if the phone you turn in is not in working order.

    *MOUSE PRINT:

    You could be charged up to $750 in fines for the following:

    Cracked Screen Damage fee – $250
    Liquid Damage fee – $250
    Device does not power on fee – $250

    There are a whole bunch of other terms and conditions in both the Sprint and T-Mobile lease programs. It is getting to the point that you need a Ph.D. in cellphonery to understand all the choices, options, and terminology.

    • • •

    June 8, 2015

    The Price They Advertise is Not the Price You Pay

    Filed under: Electronics,Internet,Retail,Telephone — Edgar (aka MrConsumer) @ 6:08 am

      Enough is enough. Isn’t it time that cell and cable companies stopped advertising seemingly low monthly prices for their service, while tacking on a multitude of junk fees, undisclosed charges, and taxes that significantly boost your bill?

    Recently the Huffington Post did an exposé, using Verizon FiOS’ new pick your own channel bundle for $74.99 as an example. When you added all the other charges, you actually had to pay over 60% more than the advertised price.

    *MOUSE PRINT:

    Huffington Post
    Click to Enlarge

    There were equipment/HD fees, FDV administrative fee, broadcast TV fee, regional sports fee, franchise fee, USF fee, federal/state/local taxes, etc. There could also be installation fees, activation fees, and early termination fees depending on the offer.

    Verizon is certainly not alone in tacking on all these fees. Comcast and Time Warner are equal opportunity offenders, as are the wireless cell companies.

    Is it any wonder that these types of companies rate low in customer satisfaction surveys and on trust indices?

    Maybe there needs to be a requirement, like airfares, that a single all-inclusive price must be the amount advertised, and not these bait and switch prices.

    • • •

    May 4, 2015

    Keurig 2.0 Coffeemakers Have a Built-in Detective

    Filed under: Electronics,Food/Groceries,Retail — Edgar (aka MrConsumer) @ 6:04 am

      KeurigThe maker of Keurig coffee machines, the ones that use those little (and expensive) K-Cups to brew a single cup of coffee, must have a clever bunch of engineers in their employ. They have created a new machine, the Keurig 2.0, that will only accept their own officially licensed cups that typically cost between 75 and 80 cents each (for about a dime’s worth of coffee). It is also designed to accept different size K-cups to brew either a single cup of coffee or four cups.

    Hmmm. Where have we seen this before? Oh yes, inkjet printers. A few years ago, printer manufacturers who got tired of seeing consumers refill their own ink cartridges or buy cheap no-name ones, got the brilliant idea to affix a computer chip to each cartridge refill. That way, the printer could check if an official cartridge was installed or not. If not, the printer would stop working.

    Similarly, Keurig presumably didn’t like all the cheaper knockoff little K-Cups on the market, or the reusable and washable cups that one can just add a scoop of grounds to whenever coffee was desired. So, they came up with a machine that would only turn on when a legitimate K-Cup was popped in.

    How does Keurig disclose this limitation of their new coffeemakers?

    *MOUSE PRINT*: From a footnote in the product description:

    Keurig compatibility

    What do they mean they can’t guarantee that non-Keurig-2.0 cups will work? They deliberately designed the machine not to work with them.

    *MOUSE PRINT*: From their FAQs:

    The Keurig® 2.0 brewer will only function with Keurig® brand pods. That means the Keurig® 2.0 brewer will brew both K-Cup® and Vue® pods and the new K-Carafe™ pods. Keurig® brand pods have been specially designed to work with the Keurig 2.0 Brewing Technology® in the Keurig® 2.0 system, which guarantees a perfect brew every time. Look for the Keurig Brewed® seal on your favorite K-Cup® pod and K-Carafe™ pod varieties to ensure a delicious cup every time. Keurig cannot guarantee that pods without the Keurig Brewed logo will work in the Keurig 2.0 brewer.

    How exactly does the Keurig 2.0 work? No, they didn’t put a computer chip in every cup. The stories vary, however, of what the actual technology is, depending on whom you ask. Customer service folks at the company say the new coffeemakers have a laser that reads a serial number on the top of the new K-Cups. A company executive says that an infrared light is shined on the foil cover of each K-Cup, and the wavelength of the reflected light is measured to see if it matches a set standard.

    What happens if you try to put an unlicensed little cup of grounds in the new machines? You get an error message on a little computer screen, the machine fails to start, and the coffee cops are notified.

    *MOUSE PRINT:

    oops

    Not long after the new system came on the market, hackers went to work to defeat it, and came up with three primary ways to continue using whatever coffee containers you want. The first is removing one wire :

    The other ways involved putting a legitimately licensed cap or portion of one over a rogue cup.

    It may be obvious, but MrConsumer sees Keurig’s move as anti-competitive and anti-consumer. If the spy inside the machine is really only needed to distinguish between the old one-cup canisters and the new four-cup ones, I’ll forgo the wizardry and happily press a size button.

    • • •

    March 16, 2015

    FTC Sues DirecTV Over Misleading Ads

    Filed under: Electronics,Internet,Retail — Edgar (aka MrConsumer) @ 6:44 am

     Last week, the FTC sued DirecTV for deceptive advertising practices for their digital satellite television services.

    In particular, the FTC said that their advertising didn’t make clear a number of key facts:

    1. That the low advertised rate, such as $19.99, only applied to the first year of service, and that rates in the second year were typically $25 to $45 higher per month.;

    2. That the consumer had to agree to a two year contract, and if they cancelled, they would be charged a $20 cancellation fee for each month remaining on the contract;

    3. That the consumer’s silence after three free months of premium TV channels such as HBO or Showtime would be construed as their acceptance of continuing to receive those channels at an average of $48 extra per month — in essence, a negative option plan.

    Here is a sample ad from their website as of the day after the lawsuit was filed:

    DirecTV adClick ad to see actual size

    Even at full size, you might not be able to read the fine print.

    *MOUSE PRINT:

    Near the $19.99 price: with 24-mo agreement Select package plus add’l fees.

    Under “view all packages”: All DirecTV offers require 24-month agreement. Requires enrollment in auto bill pay. Select package or above. Additional equipment required & advanced receiver fees apply. Minimum 2-room set up required for free Genie upgrade offer. Select through ultimate packages.

    The offer details link discloses that up to a $480 early termination fee applies.

    As we have explained many times, it is not enough for advertisers to disclose key facts somehow, somewhere. It has to be “clear and conspicuous” disclosure. In the words of the FTC complaint, the agency contends that “disclosures are inadequate in terms of their content, presentation, proximity, prominence or placement such that consumers are unlikely to see or understand such disclosures.”

    The FTC’s lawsuit did not emphasize a key point that consumers complain about online — the total cost of the service. Even in the first year of the contract, it is nowhere near $19.99 a month because of a multitude of added required fees and charges not clearly specified in their ads.

    • • •
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