What a steal! Verizon is offering DSL Internet service for just $19.99 per month. I was so excited until I tripped over this asterisk: The “price” doesn’t include taxes and fees; a one-time promotional charge of $55; an obligation to purchase Verizon phone service; a 60 percent increase in fees after the first six months; and a $79 termination fee. By steal, I mean from my pocket.

Here’s another bargain: AT&T is offering a netbook and wireless service for just $199. I almost forked over the cash until I used my magnifying glass to read the fine print. The “price” doesn’t include the up-front cost of $300, with a $100 rebate, and it doesn’t include a mandatory two-year contract for service that costs $40 to $60 per month; a hefty termination fee; and high charges for going over the data plan.

By bargain, I mean for AT&T.

What the heck is going on here? Increasingly, phone, cable and wireless providers are fudging the numbers on their products and services, misleading consumers until they get hit with outrageous bills and hidden fees. And at that point, consumers are already locked in, only able to escape the corporate chokehold if they pay even more money.

The practices are so harmful and egregious that six public interest groups, including Free Press, filed commentswith the Federal Communications Commission this week asking the agency to protect consumers. It’s time the telecom industry told us the truth about their billing practices.

The other organizations signing the comments are Consumer Federation of America, Consumers Union, Public Knowledge, Media Access Project and New America Foundation.

How do these practices affect the consumer? Chris Riley, policy counsel for Free Press, said:

When consumers have the facts, they can make informed choices. Unfortunately, consumers are bombarded with inconsistent and incomplete information when shopping for service providers or plans, and they are often baffled by misleading and confusing bills once they sign up. Customers invest a lot of money in these services and spend a great deal of time using them. That’s why the FCC must ensure truth in billing and must establish clear disclosure rules so that consumers do not fall victim to the dubious and misleading practices of their phone or Internet access providers.

The misleading practices commonly employed by the phone and cable industry include:

• Internet access services are being labeled with theoretical “maximum speeds,” rather than actual speeds. These actual speeds can lag behind advertised rates by 50 percent;
• New “PowerBoost” services advertise even faster speeds, but do not guarantee consumers will get faster service despite higher bills;
• Service providers often deliberately obscure the real cost of services with misleading advertising that hides fees, surcharges, promotional periods, early termination fees and bundling requirements; and
• Many services and service bundles are falsely advertised with “base rates” that conceal the true cost of service. Consumers are later surprised to find themselves in long-term contracts and paying higher non-promotional prices.

The FCC needs to step in to stop these pickpocketing billing schemes. The comments urge the Commission to adopt protective and enforceable advertising and billing rules for all communications services, including wireless services, Internet access services and service bundles.

Consumers don’t want surprises; we just want the truth.