A U.S. Senate investigation into pay-TV industry billing practices found that Time Warner Cable and Charter Communications — which completed their $67 billion merger in May — have regularly overbilled customers for equipment and made no effort to proactively provide refunds for the errors.
The report, released Thursday by U.S. Senators Claire McCaskill (D-Mo.) and Rob Portman (R-Ohio), who lead the Senate’s Permanent Subcommittee on Investigations, said that both cable operators “made no effort to trace equipment overcharges to their origin unless customers specifically asked them to and did not provide notice or refunds to customers.” The Senate probe, initiated last year, looked into billing and customer-service operations at five top providers: Comcast, AT&T’s DirecTV, Dish Network, Time Warner Cable and Charter.
Between January and April 2016, Time Warner Cable overbilled customers nationwide an estimated $639,948, and is projected to overcharge customers a total of $1.9 million this year, according to the report. Charter said it overbilled customers by at least $442,691 per month, per the report.
In a statement, Charter said: “An audit of our set-top boxes charges over the last nine months found them to be over 99% accurate. To move us closer to 100% accuracy and permanently resolve this issue, we have installed new controls to ensure discrepancies are caught and eliminated on a daily basis. Customers who were incorrectly charged for set-top boxes are being notified and given a 12-month credit for these fees.”
The cable company also said that since 2012, it has invested $7 billion in network improvements and added more than 7,000 jobs.
The Senate investigation found that, in contrast to Time Warner Cable and Charter, Comcast and DirecTV provide automatic refunds or credits to customers who have been overcharged by their billing systems and that Dish’s billing system is designed to prevent such overcharges from occurring in the first place.
Charter’s acquisition of TW Cable and Bright House Networks, backed by John Malone’s Liberty Broadband, made it the third-largest pay-TV provider in the U.S., with 17 million subscribers.
The Senate subcommittee’s report also said that consumers are frustrated by the ongoing rise of the cost for cable and satellite TV, with some packages increasing up to 33% since 2011, and are confused about promotional pricing. In addition, the industry is beset by chronic customer-service problems, the report concluded.