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In the two months between my July and September billing statements, RCN raised the cost of my home television and Internet service by over 41%. Moreover, they claim that they did nothing to reconfigure my service. As a result of this extraordinary increase in my monthly bill, I cancelled my cable television and Internet service with RCN on August 28, 2008. Although the price increase was partially masked by RCN's juggling of the various cost items, the single largest identifiable source of the increase was the appearance of a phantom charge on my September 2008 invoice for over $46 for something called "Signature Cable TV". This charge had never existed before, I had never requested this service and RCN could offer no explanation regarding what the additional fee was providing to me. They could not explain how my service had changed between August 25 and August 26-- the latter being the first day this fee was imposed-- such that this fee would somehow or other be warranted. I do have a theory, set forth in the last paragraph of this letter, that RCN is trying to artificially juice its stock value in order to lure an unsuspecting buyer into overpaying for the company. But you can read the letter and reach your own conclusion. And if you are an RCN customer yourself, it's time to do what no cable company would dream of wanting you to do: It's time to actually read the fine print on your cable bill. There is one further irony I can't resist mentioning: In attempting to resolve this matter, I asked RCN to simply give me an incremental credit of only $26, moderately less than the $47 I am requesting in this letter. I was willing to take the haircut to avoid having to spend the time to file this complaint and pursue the inevitable follow up. Their customer service rep said no way. You can decide for yourself whether or not you think she made the right choice. Watertown, Massachusetts 02472 28 August 2008 The Honorable Martha Coakley Attorney General Commonwealth of Massachusetts One Ashburton Place Boston, MA 02108 Dear Attorney General Coakley: Summary I am writing to request your assistance in resolving a billing dispute with the RCN Cable company. Until today when I cancelled my Internet and television services, I had been a customer of RCN here in Watertown for several years. Given that there are many thousands of RCN customers in the greater Boston area, you are likely to be hearing from other similarly situated consumers. To focus briefly on the big picture behind the complaint which follows, you need to understand that RCN has, despite their claims to the contrary, unilaterally changed their service package for customers such as myself by adding a completely new and unexplained (and unrequested) service called “Signature Cable TV” at an additional $46.44 per month starting with their latest September invoices. An Overview of My Billing Dispute Earlier today I attempted to request a credit of $243.69 for the reasons detailed below. This morning I went to the RCN storefront on Massachusetts Avenue in Arlington (1) to cancel my account, (2) to return my rented cable box (and related equipment), and (3) to make a claim for the aforementioned credit. While I was successful at achieving the first two objectives, I was told that the only way RCN would entertain a billing dispute was if it was made to their toll free number. When I explained to the RCN employee in the storefront that using their toll free number usually involves both a long wait and frequently doesn’t produce satisfactory results, I was told once again that I could only dispute my bill by calling RCN’s toll free number. And so, reluctantly, this is exactly what I did. Despite my lengthy explanation and impassioned pleas, the RCN employee I reached was unable to offer me any credit other than for a $5 late fee that had appeared on my most recent bill for September. (Incredibly, this was a fee which RCN had assessed despite the fact that my account, at all times, has had a valid credit card number registered for RCN’s monthly autopay service.) Broadly speaking there are two reasons I am requesting a refund. First, despite the fact that I have been unable to use four of the five television receivers in my home which were connected to an RCN television cable since mid-July, RCN continued to charge me full television connection fees during this approximately six week period. Second, despite their repeated claims that they have made no changes to my service, during this two month period they changed the description of what I was buying (they added something called Signature TV for at $46.44 per month that hadn’t existed previously), I lost the use of four of my five televisions, and my monthly bill went from $153.57 in July to $217.14 two months later in September. That works out to an increase of over 41%. (Note also that the September number assumes they will be true to their word and issue a credit for the above noted $5 late fee.) When I asked the customer service agent how she could possibly justify or explain a 41% increase, she simply said that there had been some rate adjustments! RCN’s Switch To Digital and What Resulted From It In early July RCN notified me that I would need a converter box for each of the four television receivers that was then connected directly to their cable service. As I understand it, this resulted from a decision they made to stop broadcasting the conventional analog signal over their cable network. Somewhat reluctantly in mid-July, I called the number they provided to order four converter boxes. I had some rather grave misgivings about the electric cost of running these converter boxes. Before placing my order I called RCN to ask how many watts the converter boxes use. The customer service employee who took the call– who didn’t know what a watt was– informed me that the electric usage was the same as what it was for the one converter box I already had. It happens that that works out to 43 kw or $8 a month per box or $32 more a month in electric costs alone for the boxes I reluctantly decided to order. In any event none of this mattered because the converter boxes never arrived. When I called RCN a few weeks after I had placed my order in an effort to try to determine when they would arrive, the person I spoke with assured me that she could find no record of the order. By this time I had already received my August bill and I had been disturbed to learn that my monthly service had gone up from $153.57 to $170.90. When I learned that the order for my converter boxes had been lost, I determined that I would cancel my service with RCN. After I made this decision it took me about three weeks to replace my RCN Internet and television services. (This was partly because of some of the particulars of the Internet service that I need for my home office.) The first part of that process was completed yesterday when my new Internet provider began service. As a result, this morning I was able to cancel all of my RCN services. (My new television service provider is scheduled to start up tomorrow.) Why I Believe RCN Owes Me A Refund I believe I am entitled to a refund for two separate reasons: (1) Four of my five television receivers have not been available to me for the last six weeks; and (2) Despite RCN’s claim that they didn’t change my service, they increased my bill by 41% and added something called “Signature Cable TV” which I never asked for and was never told about prior to receiving my September bill. Regarding the loss of television service, I am willing to split the difference with RCN and hold them accountable for only three of the roughly six weeks that I was unable to receive their cable signal on my four non-digital television receivers. In short, I believe I should be compensated for their incompetence in losing the order to provide me with the converter boxes that I had ordered about six weeks ago. Using my August invoice as a guide, my television service fees in August (not counting the HDTV converter box or the related premium channel service fee) came to $79.45. If I multiply that by 21/31, I get $53.82 for a three week period. If I then take 4/5 of that, I get a net credit of $43.06. Regarding their change in my service, I believe that RCN should refund me the difference that they charged me between August 26 and August 28 (today) which I continue to believe arose from their unilateral reconfiguration of my service. As noted before, my RCN bill went from $170.90 in August to $217.41 in September, primarily as result of their adding the Signature Cable TV service. That increase comes to $46.51 per month. It is worth underscoring that this $46.51 increase in my monthly cable bill between August and September is almost exactly equal to the $46.44 charge for “Signature Cable TV” which appeared on my bill for the first time in September. I believe RCN should, at a minimum, refund me 3/31 of that amount or $4.50. My total refund request relating to their failure to provide me with the service I was paying for and for their changing my service without my consent comes to $47.56. It is important to underscore that since RCN is going to charge my American Express card for the full amount of my September usage charges (i.e., $217.14) and since I will have then paid for service from August 26 through September 25, RCN also needs to refund me 28/31 of $217.14 or $196.13. It is my understanding that they fully intend to issue me a credit for this portion of my bill that relates to the 28 days of service remaining in the current service month after today. However, it is worth going through the arithmetic just so that there is no confusion regarding what I believe needs to happen. What I Believe Needs To Happen Because RCN’s defective billing system failed to bill my American Express card (which they had on file with my account) for the $170.90 due from my August bill, that amount rolled forward to September and the $5.00 late fee was added. Finally, add in the $217.41 from my September bill and you get to the grand total of $393.04 which showed up on my September invoice. With regard to this total amount, I am requesting a combined credit of $243.69, i.e., $47.56 plus $196.13. When this credit is applied to the full September bill amount of $393.04, the net amount due is only $149.35. Unless instructed otherwise by a representative provided by your office, I will only pay $149.35 more to RCN. I will inform American Express that $243.69 of the $393.04 in charges that RCN will soon bill to my American Express account are in dispute. What RCN Is Probably Doing You don’t really need to read any further, but as a retired investment banker, I can’t resist sharing with you my hunch as to what is going on here. It is no secret that RCN has been trying to sell itself for sometime now. The only possible explanation I can find for these two back to back fee increases (and especially the mysterious new “Signature Cable TV” charge) is that they are making a desperate gamble that some sloppy venture capitalist will be so impressed by the momentary surge in income that is like to occur once their September operating results are released that he will substantially overpay for the company. This isn’t just bad news for some rich investor group; it’s also bad news for those citizens of the Commonwealth who depend on RCN for their cable, Internet and telephone services. These foks, initially, will be victimized by the addition of these fees for phantom services, and, second, will ultimately have to take the time and energy to switch to alternative providers. If you share my passion for fairness, I urge you to use every available power to you to stop this miscarriage of justice swiftly and decisively. cc: Compliance Officer RCN Corporation 196 Van Buren Street Herndon, VA 20170 |
