Moratorium on Spectrum Rate Hikes? We Tried!

In mid-March broadband provider Spectrum raised the price of my cable package by 7%. It was well into the pandemic and the economic damage from the shutdown was already biting. City council had enacted the moratorium on eviction for non-payment and was considering a moratorium on rent increases too. Could we take a stand against Spectrum for heartlessly jacking-up the cost of our only lifeline?

Think back to March, early in the statewide and local emergencies declared to combat COVID, when Sacramento outlawed price-gouging and our own city cautioned residents against hoarding. That’s when a Spectrum bill with a 7.1% price hike landed in my mailbox. During an economic shutdown demanding another $10 was unseemly. Could City of Beverly Hills do something about it?

I wrote city council last March:

Can’t miss this 7.1% increase in March from Spectrum for their phone-TV-internet package. Just as we’re all self-isolating, and increasingly dependent on Spectrum for nearly any and all content coming to our TVs, landlines and devices, we are paying a percentage increase that is some unknown multiple of inflation.”

Spectrum rate hike March 2020

“Perhaps council can discuss a resolution at the next council meeting that would at least condemn this kind of profiteering from our only cable provider,” I said. For good measure I called into the March 31st virtual city council meeting to hail the need to temporarily cap Spectrum prices.

I was optimistic because the ‘optics’ of a broadband rate increase during a pandemic wasn’t great. For city council the optics of pushing back against a near-monopoly provider was much better. And besides there is some backstory….

Beverly Hills has been working to build out our own ‘fiber to the premises’ broadband service to get around the cartel that keeps internet access too costly. Under the plan, city hall would be the broadband service provider once homes & businesses are connected through city fiber to the backbone. But the fiber project hit some snags and this Spectrum price hike reminded us why tomorrow is not too soon to liberate ourselves from Spectrum’s grip.

City council acted swiftly and agreed to add a new section to the COVID urgency ordinance:

During the period of local emergency declared by the City Council on March 16, 2020, in response to the COVID–19 pandemic, there shall be no increase in Internet access fees or reduction in service.” (urgency ordinance 20-O–2806 section 4).

Comparing that 7.1% Spectrum rate hike to Bureau of Labor Statistics figures for consumer prices, I now see the increase was almost FOUR times greater than the change in annual consumer prices. As the COVID shutdown started to bite, Spectrum was twisting the knife.

I didn’t need data on consumer prices to know that $150 was too much to pay for cable TV, so I stripped it from my Spectrum service and my bill dropped to $60. It felt great to be a cable-cutter.

Fast forward to holiday time. We’re still in the pandemic and Spectrum sharpened the knife again: December’s bill showed an 8.3% rate increase for broadband service. I was not alone in noticing it. The LA Times ran a piece about the Spectrum rate hike. (Spoiler alert: the rate rises not to cover an increasing cost of providing the service but to subsidize the company’s foray into content.)

Spectrum rate hike December 2021

The consumer price data for December now show that rate hike was five times greater than the annual change in consumer prices! So again I got on the horn with city hall. I showed my cable bill to assistant city manager. I also pointed out that Spectrum’s late fee of $8.95 was an egregious 14% on a $65 bill. (The company had suspended the late fee as a goodwill gesture in March and subsequently extended the suspension through June, but relief from that exorbitant late fee was short-lived; it was never again mentioned by Spectrum.)

“I would like to make a formal complaint pursuant to this provision or otherwise see the city encourage Spectrum to roll back that rate increase.”

“Let me check and get back to you,” Assistant City Manager Nancy Hunt Coffey said.

A short time later the city’s IT chief got back to me. “After considerable effort, we were able make contact with a meaningful Government Affairs executive who is working with the City regarding the issue you raised,” he said. “We expect to establish a meeting in the near future to discuss this issue further. We are also working with the City Attorney’s office to address next steps.” He added, “We have reached out to our local contact to discuss the issue, and they should be reaching out to you either today or early in the new year to see if there is an interim remedy that would work for you.” That’s service!

Depends on the Meaning of ‘Fee’

Indeed I received a call from Spectrum that very morning. A rep from the corporate office asked how he could address my concerns about the broadband rate increase. I wasn’t looking for an individual fix, I said, but wanted some clarity about the effectiveness of my city’s COVID urgency ordinance which had prohibited this kind of broadband rate increase. I sent the ordinance over.

At issue was this language in the ordinance: “During the period of local emergency…there shall be no increase in Internet access fees or reduction in service.”

Spectrum views ‘internet access fees’ as different than broadband rates or charges, he said, even as acknowledged Spectrum did increase the broadband rate by five bucks nationally. He said Spectrum does not assess ‘access fees’ at the state or local level, however, and so the ordinance does not affect Spectrum.

So I turned to Spectrum’s terms of service for clarification and indeed there is the distinction between service-related ‘charges’ and ‘fees’ in the text:

Subscriber agrees to pay all charges associated with the Service(s), including, but not limited to, charges for installation, service calls, live-agent customer assistance, monthly subscription service, equipment, measured and per-call charges, applicable federal, state, and local taxes and fees, fees to recoup any applicable municipal, state and federal government fees, permitted fees and cost recovery charges… — Spectrum Terms of service: charges & billing

No, I didn’t see an instance where Spectrum refers to the broadband cost as a ‘fee,’ so the ball was back in the city’s court and I continued to wait for news from city hall.

On January 12th I wrote to councilmembers and suggested city council revisit the language in the broadband rate moratorium. I didn’t hear back (and no change has been made to the urgency ordinance since).

One note on my exchange with Spectrum: When I call Spectrum it takes an hour on the phone to work out a small bug in my bill. It’s a real hassle. But when Spectrum corporate office calls the conversation can be informative and productive.

Epilogue

Recently I reached out to city hall again. “This is with the attorneys,” said the IT chief. I noted that Massachusetts is about to enact a cap on broadband price hikes and the bill’s language might be a model for our own ordinance amendment. But I can read the room! The current Spectrum rates will likely outlast our local emergency and urgency ordinance.

They say that you can’t fight city hall. But city hall isn’t the problem here. You really can’t fight Spectrum!