A targeted crackdown on “junk fees” makes a lot of sense
slowboring.com
slowboring.com
Apparently, there was an $11 "content delivery fee" for the TV. As if buying the cable channels and having them "delivered" to my home are different freaking things. As if you can buy the rights to watch cable at the comcast store, but if you want it at home, you gotta pay an extra $11.
These companies are going to whine and scream about these changes, but they really brought this on themselves.
Yeah, as the article said, one guy states that they'll just push the cost to other consumers - but this isn't cost, it's ridiculous profit margins.
The problem isn't so much the price that they charge people, it's that they cannot substantiate these costs - they're extra profit, pure and simple.
But this is a thing ingrained in US culture, charging additional fees on top of the base fee for anything - I'm thinking of tipping culture as well, which evolved from a "I really appreciate what you did" thank-you, to a "We don't pay our staff enough so we expect you to pay us extra to compensate". Shameful. I'm glad the US seems to have a resurgence of unions and people are standing up to it.
Profit margins are a different discussion. If you charge me $20 for a cookie or you charge me $15 + a $5 baking fee, your profit margins are the same. We can argue either way that they are ridiculous. But you shouldn't be able to advertise that you sell $15 cookies if there's no way to buy them for $15.
Since money is fungible, isn't it true by definition that any mandatory fees are "pure profit"?
I have some sympathy with businesses that want to break out government surcharges into a separate line item; but as the article indicates most stuff isn't in that category.
I don't mind if the bottom lines stay the same. Right now, I can't compare bottom lines, because the real bottom line is hidden. Is the $50/night hotel cheaper than the $100/night one? No one knows, unless they spend the time to get all the way to the final booking step on both (or more realistically, dozens of) options.
Sure; but the 911 fee is, as is the local utility user fee and the public and educational broadcasting fee; and (to be clear) I am saying that I don't mind them being broken out for billing purposes - the only reason they're not when advertising is because of the race-to-the-bottom on pricing transparency.
My bill includes a "Administrative Fee", "Federal Universal Service Charge", "Regulatory Cost Recovery Charge", "State Telecommunications Excise Surcharge", "County Public Safety Communications Surcharge", and "State Public Safety Communications Surcharge", plus several taxes.
Hmm, I actually agree with you, but that would be raising the bar above where it is for normal pricing practice elsewhere in the U.S. e.g. shelf and menu prices exclude sales tax. In fact, for digitally-delivered services or goods that ship across state lines, it's impossible to know the final price unless you know the state (and, indeed, county and sometimes city) to which it's going to be delivered.
Wouldn't that solve most of the problem?
The problem isn't really the cost, it's the deception. It tricks consumers and prevents an efficient market for goods and services, and as the article states, creates a particularly bad experience for at least some consumers that the business can justify in the name of profit.
If everyone knew this was happening, they would spend more time trying to avoid falling prey to it. Nobody is paying an extra fifty bucks because they don't want to spend the extra twenty minutes. But if every consumer knew this, it wouldn't be deception, it would be friction. And companies would eventually stop doing it to make their service more appealing.
Yes, but the US Regulators have been "captured" by some of these monopolistic industries, to the point that the monopolies can do these things w/o worrying about laws against them:
As a consumer it’s hard to differentiate junk fees from mandatory fees imposed by federal, state, county, municipalities fees. As an example I pay different sales taxes for the same internet plan in 2 different states. Another example is my cellphone plan was slightly higher in another city/county than my current residence due to different E911 fees. The difference is usually cents to a dollar.
The only exception are optional upgrades, and even those have to be clearly disclosed in advance.
In EU these kind of sheenings never happen.
Airplane sites tried with payment fees, adding 40/50€ for ALL providers. EU changed the law that the price has to include the fee for at least 1 payment… So if the cheapest is paypal at 30€, they have to add 30€ to the price.
Maybe because it's more fragmented in terms of language/culture, so you don't have ad campaigns that span both ends of the continent? The wider prevalence of unitary governments (as opposed to federal systems) also help.
This is a very common feature of such ads. In small print, of course.
If they're adding a surcharge for something you would reasonably expect to be included in the offering which they advertised at a lower price, it would be false advertising.
You'd at least run afoul of the act against unfair competition:
German version / English version
§5 Misleading commercial practices: https://www.gesetze-im-internet.de/uwg_2004/__5.html / https://www.gesetze-im-internet.de/englisch_uwg/englisch_uwg...
§5a Misleading by omission: https://www.gesetze-im-internet.de/uwg_2004/__5a.html / https://www.gesetze-im-internet.de/englisch_uwg/englisch_uwg...
Some quotes:
> A commercial practice is regarded as misleading if it contains false statements or other information suited to deception regarding the following circumstances: [..] 2. the reason for the purchase, such as the existence of a specific price advantage, the price or the manner in which the price is calculated [..]
> The following are also regarded as an omission of information: 1. the hiding of material information, 2. the provision of material information in an unclear, unintelligible or ambiguous manner, 3. the provision of material information in an untimely manner.
That's not what it says though. It merely empowers the BMWK - with agreement of the federal assembly - to decide in which manner prices of consumer goods are be provided and calculated. They then may decide that prices of airline tickets have to be listed a certain way.
It also empowers the BMWK to pretty much turn businesses upside down to make sure they're following these rules.
That's pretty much all it says. It's a really short law of just two paragraphs (used to be three, but one got removed).
By requiring any listed price to be inclusive of fees. Australia does the same.
No "$100/night" in the search results if the checkout adds a $20/night resort fee.
Including the tax in the price is so much nicer.
I would love either of these in the US — both would be massive improvements over “you thought it was $100/night until you clicked a couple times and found the $40”.
But the most important thing: Price on the first page you see is the same that gonna be charged.
Same thing for flight bookings, what you see on the search is what you pay!
What inovative concept by the EU!
Airbnb adds fees that goes to airbnb ( vs the host). How does that look in germany, its added to the price host sets. Host sees a different price/night on the listing than what she set ?
also, Airbnb lets you see cleaning price in the listing, so its not a hidden fee.
The price that's advertised in the overview includes all fees, so you can't appear more attractive by shifting costs to the cleaning fee.
this is usa https://imgur.com/a/FJaKHvS
Australia makes them put that in the price. It's why using the Australian AirBnB site to find an AirBnB is so much nicer.
> also, Airbnb lets you see cleaning price in the listing, so its not a hidden fee.
They make it hard to compare listings based on total price, though. Which is especially bullshit when a bunch of listings are clearly using the cleaning fee to boost profit, not to cover cleaning.
Hotels do the same thing on HotelTonight. When the amount of the resort fee/cleaning fee ends up doubling the price, that's just dishonesty - even if the truth does eventually come out.
It is though. both in sorting and filtering.
https://www.cbsnews.com/newyork/news/new-york-city-cash-law-...
Tangentially, I'm also pleasantly surprised how easy it still is to buy a physical MetroCard. My understanding a few years back was that contactless payment would be the default by now and if I wanted to buy a physical MetroCard, I'd no longer be able to do that at stations but I would instead need to go to "select retail partners" to do so.
As a guy who used to have to take a zipper bag full of cash to the office safe every night, the convenience of the customer part may be laughable but the safety of the staff part isn't. Offhand I can't think of a more effective way to bring back 1990s mugging culture.
The website was designed by contractors paid for by tax dollars unassociated with InvoiceCloud.
These are similar problems - billing and payment can be difficult problems due to the way the industry operates. But the trend towards making it more inconvenient (or in some cases, impossible) to pay by any other means that does not include a price gouging service fee is not adding value for consumers.
> We’ll make cable internet and cellphone companies stop charging you up to $200 or more when you decide to switch to another provider.
If your cell provider gives you a subsidized phone and puts you on a contract that has an early termination fee, that seems fair.
If cable companies are doing this sort of thing, then it would be more of an issue since they don’t provide expensive equipment that the customer keeps. But I mostly hear about cell providers doing this.
Resort fees and concert ticketing fees have the problem that you can never figure out what the prices of things are until you get through checkout (or sometimes even later!). Requiring early disclosure of those so consumers can make informed decisions is an easy sell.
Random market distortions, like "no more ETFs on telecommunications plans" and "you can't charge for seats on the airplane if a child is involved", need a little more analysis.
But by bundling these two things together, the whole initiative feels deceptive. "Here's a clear good along with some murky stuff, but the whole thing is good because we at least proposed the clearly good stuff!"
However, especially with the energy prices having gone up, the energy companies have just offered to pay this fine outright if someone wants to switch to them.
Now if they can just do something about all the hosts that want me to take out the garbage, sweep/vacuum the floor, clean the dishes, wash the linens, tear down the beds - then then charge a cleaning fee on top of all that. I just spent half a day of my vacation cleaning your house, AND you want me to pay you a cleaning fee?
I disagree. Shifting the costs to the primary price is good economics because it enables consumers to comparison-shop based on price and leads to a more competitive market. That's what companies are trying to hack with hidden fees.
Is there a difference between resort tax on a hotel room and a resort fee as this article states?
Can the Federal government ban certain states / counties / cities taxes?
Hotels say these are for things like wifi or bottled water in your room etc. that might have been separate charges in the past but are now being bundled into a single fee "for your convenience", which is fine, but if it's not optional then it's just part of your room rate now, right?
The Feds wouldn't really be banning the fee, they'd be banning hiding it in the last checkout step.
Prices on e.g. hotel websites should be listed with all fees and taxes included.
Should _everything_ being sold have all fees and taxes included? Grocery store, restaurants, department stores, etc?
Edit to add: they made me this offer at the airport kiosk, immediately before my flight boarded. They knew it wasn't anywhere near full.
An optional fee for priority boarding is very different. (I don't understand the folks who want to rush onto the plane to sit in a less comfortable seat, but that's a different issue entirely.)
The post you're responding to is essentially a complaint that they purchased insurance (at a known negative expected value) and didn't see a payout. Which on its face is ridiculous.
It doesn’t happen often but checked bags can get lost. Also, waiting 10~15 minutes to pick up your bag can be annoying after a long flight.
If you fly American a lot, the branded credit card is the way to go. Not sure if the same is true for the other carriers, but I'd suspect it is. Even with the most basic economy ticket you get most of these optional add-ons (one checked bag, better boarding position, select your seats) as a cardholder. Credit card spend also counts towards status qualification for AA now, so CC spend can get you across the line to gold status if you might not have made it otherwise, and at that point you'll start to get upgrades to business/first on flights where everybody on the plane doesn't also have status. That will put you in boarding group 1, which, hey, mission accomplished and you didn't even need to spend $29 at the kiosk :).
Stats don't lend themselves to perfect predictions.
Most of the time, there's somebody who's happy to have the free travel. I've done it and the compensation was approximately one free transatlantic round trip in exchange for spending the night in an airport hotel. The cost to the airline is, of course not the face value of the voucher.
To put a finer point on it, I wanted to get some value out of my $29. I got none. If I said "Hey, give me $29. I'm not gonna give you anything, I just want $29," would you give it to me? Transactions in capitalism are supposed to be voluntary, mutually beneficial exchanges. What benefit did I get? AA exploited an information asymmetry to scam me out of $29.
It's not for sellers to make value calculations for buyers. Caveat emptor.
But, here, they clearly exploited an information asymmetry to make me a zero value offer, knowing there was some probability I'd accept. Caveat emptor only applies when you have some way to evaluate or vet the offer in advance. With the hidden information that was kept from me, I was robbed of such opportunity.
Would you be complaining if the entire flight was full of people in group Z (for some value of Z < X)? Or if you'd bought a day-of-travel upgrade when you would've gotten a complimentary upgrade with your frequent-flyer status? Or if you'd paid extra to select a seat at booking when the seat you wanted turned out to be open at check-in time? Or if you paid to change your flight rather than wait on free same-day stand-by?
For all you, or the checkin agent, know there could've been irregular ops that moved the entire passenger complement from another flight to yours after you checked in. Unlikely, but it happens.
If you're really that worried about, write the airline and complain. They may give you a refund or some free miles or something. However, you got exactly what you paid for and entered willing into the transaction.
And, to be clear, literally the entire business of airlines (which is yield management) is based on asymmetry of knowledge between between travelers and carriers.
You knew the service, the possibilities and everything else.
Stop complaining.
It's a sweet deal, if you can get it.
Forcing you to buy the modem on an over-priced installment plan is obviously not OK.
Internet went out randomly a few weeks ago. Their online assistant tried to ping my modem and failed, they sent a tech out and fixed the line and were on their way.
It sucked being without internet for a couple of days, but it was also kind of nice.
Yes, but a common phenomenon lately is you arrive and not only is there a significant cleaning fee, but there's a list of chores on the "house rules" you're required to do before leaving that should be part of that cleaning fee.
People have occasionally been asked to mow the lawn.
I am not a messy person. I can tidy, no problem. I'm not paying you a $250 "cleaning" fee after 2 nights and doing your chores too.