Six years after Telecom Act was signed, consumers still are waiti...
Six years after Telecom Act was signed, consumers still are waiting for better phone and cable services, Consumers Union and Consumer Federation of America said in yearly update. They said most Americans continued to have only one choice of…
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cable company and phone company, their bills were more expensive and harder to understand, advertisements for “cheap” long distance plans hid monthly fees that erased savings for many consumers, and complaints about service continued to stack up. Groups said lawmakers deregulated industry before competition existed and based their decision on Act on “naive assumption” that companies wanted to enter each other’s markets and compete. “Relaxing the government oversight of cable and phone monopolies has allowed them to merge, consolidate their control of core markets and begin to expand their monopoly power into adjacent markets,” update said. Groups urged President Bush and Congress to fix law to protect consumers from price gouging and shoddy service. They said 8 major companies were providing local phone service in 1996, each to different area of country, while today there were 4, and nation’s largest long distance providers -- AT&T, MCI WorldCom, and Sprint -- had either raised or planned to raise their basic long distance rates in coming weeks. Between 1996 and Dec. 2001, cable rates increased 36% -- almost 3 times rate of inflation, consumer groups said, and 95% of American households had only one choice for cable company. Among 5% that have cable competition, rates are 14% to 20% cheaper, update said. Meanwhile, 2001 survey by Consumer Reports showed cable companies received low marks for service. So far, satellite TV has failed to compete with cable, groups contended. Update said both cable and long distance phone companies had upgraded their infrastructure to offer high-speed Internet, but said leading cable companies had increased monthly charges 12-33% per month in last year, while telephone providers of DSL had raised rates as much as 25%.