×
You will be redirected back to your article in seconds

Cable’s Secret Downgrade Fees: Big Operators Charge Subscribers to Switch to Cheaper TV Packages

Comcast and Time Warner Cable confirm they charge customers for changing to less-expensive programming tiers

Cable TV customers looking to reduce their monthly bills by switching to a less-expensive programming package may be in for a rude surprise: Some operators will charge a one-time fee of up to $6 for the privilege.

Among the biggest providers, Comcast and Time Warner Cable confirmed that they have such policies in place. These fees, which the companies don’t disclose on their websites, appear mainly designed to discourage customers from trying to pay a lower monthly rate for TV.

Comcast, the biggest pay-TV provider in the U.S., charges a fee of $1.99 to $5.99 depending on region for customers who switch to a less-expensive programming package, according to a company rep.

TW Cable, meanwhile, charges $4 for programming downgrades in certain areas, mostly in the western part of the U.S. (including Los Angeles). The operator calls this an “addressable change of service fee,” a Time Warner Cable spokeswoman said.

SEE ALSO: Pay-TV Prices Are at the Breaking Point — And They’re Only Going to Get Worse

To be sure, six bucks won’t break the bank. And the tier-downgrade fee policies of Comcast and TW Cable, which in some cases have been in place for at least three years, are not always enforced by customer-service representatives, according to the operators. (The MSOs also don’t charge a downgrade fee for the cancellation of premium channels, like HBO.) In addition, Comcast waives the fees if the price of a customer’s programming tier has recently increased.

But the fees are illustrative of why many cable TV customers are frustrated with the industry, and why the biz is at risk of seeing more of them cancel as new and cheaper options come to market.

An over-the-top provider like, say, Sony or Verizon — which is close to clinching a deal for up Intel’s Internet TV unit as soon as next week, according to industry sources — might have a receptive base of disgruntled consumers just itching to switch to a more customer-friendly TV provider.

It’s worth noting that not every pay-TV distributor has such policies. DirecTV, Cox Communications and Verizon FiOS, for example, say they do not charge any kinds of programming-package downgrade fees.

And there are nuanced variations to the practice. Dish Network charges a $5 programming downgrade fee but only if that occurs within 30 days of a customer’s last change, according to the satcaster. In addition, new Dish customers are exempt from the charge if they are requesting a downgrade within 60 days of activation.

The bigger picture is that growth in the pay-TV segment is flatlining, at best. That means the fight to retain subscribers is about to get much more intense. In such a climate, it seems curious that any provider would retain a policy of charging fees that essentially stick a thumb in the eye of customers looking for a better value on TV.

More Biz

  • US Capitol

    The Sneaky Long Game of ALI’s Restatement of Copyright (Guest Column)

    Last week, Senator Thom Tillis and four other members of Congress sent a letter to an organization you may never have heard of, the American Law Institute (ALI).  The letter questions the ALI’s ongoing project to publish a competing version of the Copyright Act – or, as the ALI calls it, a “Restatement” of copyright [...]

  • Tom Petty’s Daughters, Widow Settle Legal

    Tom Petty’s Daughters, Widow Settle Legal Battle Over Estate

    Tom Petty’s widow and daughters from a previous marriage have settled their bitter legal battle, according to a report in Rolling Stone. Earlier this year, Adria Petty and Annakim Violette, the late singer’s daughters with his former wife Jane, sued his second wife, Dana York, for $5 million, alleging that she had deprived them of [...]

  • Tropical rainforest on the banks of

    Warner Music Aims to Plant 100,000 Trees in the Amazon as Holiday Gift to Staff

    In a move that inspired and environmentally conscious companies will hopefully emulate, as a holiday gift to its employees, Warner Music Group is partnering with the One Tree Planted organization to plant trees in the fire-ravaged Amazon forest. The company is planting 10 trees in the Amazon for each employee — a total of 48,210 [...]

  • Republic Records Names Chris Blackwell Senior

    Republic Records Names Chris Blackwell Senior VP of Creative Content

    Republic Records has named Chris Blackwell senior vice president of creative content & development, it was announced today by co-founders Monte and Avery Lipman and general manager Jim Roppo. According to the announcement, Blackwell will lead creative development for film, television and premium platform projects set to feature and showcase Republic Records artists. His responsibilities include establishing partnerships to create, develop, [...]

  • China Spying Technology Tik Tok Placeholder

    TikTok Gains Global Momentum -- but Also Raises Sticky Privacy Questions

    Bay Area rapper Saweetie didn’t intend for “My Type” to come out as a single. But when a clip of the bouncy anthem about desirable (and slightly vulgar) attributes in a partner started to take off on TikTok as part of a social media challenge, it became clear the song would be her defining hit. The [...]

  • Carlyle Group, Investors in Taylor Swift

    Carlyle Group, Investors in Taylor Swift Catalog, Address Scooter Braun Drama (Sort Of)

    Kewsong Lee, co-CEO of The Carlyle Group, a private equity fund whose assets include a minority investment in Big Machine Label Group, the record company that’s home to Taylor Swift’s catalog, spoke to CNBC’s “Squawk Alley” on Wednesday. During the interview, held at the Goldman Sachs Financial Conference, host Wilfred Frost asked the business executive [...]

  • Mergers and Deals Placeholder

    Top 19 Media Trends of 2019: Mega Mergers

    Media consolidation has been rife in the past two years, as traditional media companies have scaled up in order to protect themselves against the new entrants challenging their business.  Traditional media has spent $229 billion since March 2018 on just six key mergers as rivals opted to combine their assets to compete in the new [...]

More From Our Brands

Access exclusive content