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RCN Raises Rates, Adds 'Downgrade Fee'
Recession? Too bad. Here's a price hike and new fees
by Karl Bode Tuesday 21-Apr-2009 tags: prices · competition · business · bandwidth · cable · consumers · RCN CABLE
As users in our RCN forums discuss, cable overbuilder RCN is raising their rates for a number of services, increasing bundle costs for consumers anywhere from $8 to $20 per month, while raising the prices for a number of their broadband tiers across several markets. A mailer (see pic) informs customers that the price increases are necessary to provide "the most up-to-date products and services at a competitive rate." Of course the term "up to date product" and "competitive rate" are subjective, as one of our users notes:

I had the 7mps service up until a few months ago. I had called, as I do every year, to complain about the prices and request a discount. Last year, they gave me $15.00 per month off, this year, it's $25.00 per month (when they get it correct on the bill). Because I did this, and the fact that they no longer offer the 7mps speeds, they "reset" my account to the 5mps service. And with discounts, my internet is $29.99 for the 5mps service. Now, looking at the rates listed, the 5mps is now a whopping $50.00 per month.

Of interesting note (and something picked up by the Consumerist) is that starting May 1, RCN says they will be joining the industry trend of imposing a $5 downgrade fee for any customer who wants to make changes to their account. Usually, such fees are used by carriers to push ordinary business costs into below the line fees so they don't have to advertise higher prices (rate hikes in disguise). In this instance, RCN successfully institutes a double whammy, both raising prices and then applying a new fee to any customer who tries to save money.

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Anonymous_
Anonymous
Premium
join:2004-06-21
127.0.0.1
kudos:2

4 edits

TWC Has a downgrade fee too they charge $2.99 fee

see subject
i get 15/2 for about 45$/mo

short list of who has a downgrade fee
Dish network
TWC/roadrunner
Microsoft (they all ready got sued)
comcast
AT&T

battleop

join:2005-09-28
00000

Re: TWC Has a downgrade fee too they charge $2.99 fee

The ISP I use at home has this type of fee. They give you one change per 6 months and then I think it's a $5 fee. I asked why they had the fee and they said they had a good number of customers who would call and change their plan monthly.
tvdrew

join:2008-08-20
Washington, DC
Reviews:
·RCN CABLE

Re: TWC Has a downgrade fee too they charge $2.99 fee

That seems reasonable (or at least not wacky). If you're combatting that problem, a fee is a decent way to do it (as is a 3-mo. commitment). But $5 for any change, as opposed to more than one downgrade in a 3 (or 6) month period is just nasty.

Boo RCN.
aparis99

join:2006-10-24
Owensboro, KY
whats wrong with a downgrade or change of service fee? People would change packages ALL of the time to get certain channels in for events or particular shows. Get bored with HBO, just call in a switch to TMC for a week, then switch to STARZ for a week... it keeps people from doing that
jjeffeory

join:2002-12-04
USA

Re: TWC Has a downgrade fee too they charge $2.99 fee

Extra fees are asinine and really show how little some companies care about the people who give them money for a service. When you have good customer service, you do not charge these fees. People are tired of being nickled and dimed to death from every industry. If the industries are going to do that, their initial price should be much lower. Who cares if the customers change their plan? You've got an agent there twiddling their thumbs. They might as well do something...

jester121
Premium
join:2003-08-09
Lake Zurich, IL

Re: TWC Has a downgrade fee too they charge $2.99 fee

Completely disagree. The customers who cost the company money with silly phone calls are the ones playing the nickel-and-dime game, and should have to pay if they want to flip-flop back and forth between plans. It costs money to have people answering the phone and making adjustments to bills, so charging for frequent account changes makes sense to me.
jjeffeory

join:2002-12-04
USA

1 edit

Re: TWC Has a downgrade fee too they charge $2.99 fee

Yes, those pesky, inconvenient customers... They're really a problem. If it wasn't for them, these companies wouldn't have to have customer service. Think of all the money they could save then!

jester121, I respect your disagreement. Some people are unreasonable. Most people aren't unreasonable. Frankly, the customers wouldn't play the nickel-and-dime game if they felt they were getting appropriate value for their services. Most people wouldn't play the nickel-and-dime game if THEY weren't being nickeled-and-dimed for things that have historically been gratis and accepted as part of the service. It seems like our society has gotten away from being customer-centric and gone towards being corporate-centric. The signs are everywhere. It's kind of sad... Your sentiment kinds of summed up what the corporations seem to feel about the customer. Screw the customer. They need us more than we need them.... Thanks.

jester121
Premium
join:2003-08-09
Lake Zurich, IL

Re: TWC Has a downgrade fee too they charge $2.99 fee

I don't disagree with much of what you're saying, but it's kind of pointless to wistfully remember those good old days. Companies that refused to accept the fact that customers are not only sometimes wrong, but in fact that a large number of customers go out of their way to screw over companies, are no longer in business. Just like any number of other competitive advantages, those that chose not to adapt chose to fail, and aren't around. Companies that are smart enough to cut loose their unprofitable/bothersome customers and quit taking their crap will survive just fine, because bosses finally realized that for certain markets it's a zero sum game and they're content to shuffle market share back and forth.

We can argue all day about chicken vs. egg -- did some customers ruin it for everyone by scamming and trying to take advantage, or did companies "deserve" to get screwed over since they're inherently evil. However, it's not something I care deeply about, and I don't think I'm going to change anyone's mind one way or another.

davey

@rcn.com
This is supposed to be a tech company, not a corner store. If RCN were not run so badly it could easily let customers change their plan online. As it is, you have to spend half an hour minimum just to get some guy in India to switch your phone features (after RCN arbitrarily changed them without notice).

joetaxpayer
I'M Here Till Thursday

join:2001-09-07
Sudbury, MA
Reviews:
·Comcast
said by aparis99:

whats wrong with a downgrade or change of service fee? People would change packages ALL of the time to get certain channels in for events or particular shows. Get bored with HBO, just call in a switch to TMC for a week, then switch to STARZ for a week... it keeps people from doing that
When one of the premium channels was offering all 6 Star Wars movies in HD over Christmas break, I called Comcast and said I'd like to get that channel for two weeks and not pay the extra service change fees. Agent said she'd mark the account so when I canceled in 2 weeks no fee. Sometimes you gotta ask.

davey

@rcn.com
Punker, do you work for the cablecos? Why shouldn't customers be able to change their minds when they want to without being treated as some kind of sinners? AFAIK, you can't switch for a week anyway -- what exactly is wrong with switching from HBO to Starz for a month, or dropping it altogether? You seem to think it's self-evident that whatever "keeps people from doing that" is obviously a fine thing.

RCN is pulling a scam here, raising rates and skimming extra bucks off of those who decide the new menu is no longer worth the money. It's a shame -- RCN is pretty good at the tech end, but habitually try to nickel and dime their customers at every turn.

ATT Universe and FIOS both say they're coming to my area soon. I'll be eagerly waiting to make the switch.

N10Cities
Premium
join:2002-05-07
Lavaca, AR
Dish has done that for as long as I can remember. Don't charge you for upgrading, but ding you for downgrading..

pepe329419360

@comcast.net
I recently downgraded services (eliminated premium channels & downgraded VoIP service) and there was no fee. YMMV, clearly.

-Pedro

Jigsaw
Stardust We Are
Premium
join:2000-10-21
Cleveland, OH

1 edit
What would be the fee if i told them to take there stuff and shove it up there ass?

DaveDude
No Fear

join:1999-09-01
New Jersey
kudos:1

Downgrade fees need to be illegal

I dont know why people put up with this, i would just cancel and re-sign. What ever causes the most pain for RCN. BTW i am x-customer, RCN, was the only company i know that was forced to upgrade, or close. Downgrade all the way then.
MOTO6809

join:2007-11-05
Springfield, MA

Re: Downgrade fees need to be illegal

said by DaveDude:

I dont know why people put up with this, i would just cancel and re-sign. What ever causes the most pain for RCN. BTW i am x-customer, RCN, was the only company i know that was forced to upgrade, or close. Downgrade all the way then.
Are they serious a "Downgrade Fee"?!?!?

Some people downgrade because they can't afford what they have and decide to drop services to save some money.

"RCN says they will be joining the industry trend of imposing a $5 downgrade fee", do other telco's and cable co's do this?
TheWickerMan

join:2002-04-09
Enola, PA

Re: Downgrade fees need to be illegal

said by MOTO6809:

Some people downgrade because they can't afford what they have and decide to drop services to save some money.
Yes, so they're going to charge people more of what they know they don't have. I guess the only thing to do at that point is cancel everything.
hottboiinnc
ME

join:2003-10-15
Cleveland, OH

Re: Downgrade fees need to be illegal

TWC Mid Ohio charges $150 to downgrade if you have one of their price "lock" specials.

ropeguru
Premium
join:2001-01-25
Mechanicsville, VA
said by TheWickerMan:

Yes, so they're going to charge people more of what they know they don't have. I guess the only thing to do at that point is cancel everything.
Sir, that will be a $10 cancellation fee to you.

Millenniumle

join:2007-11-11
Fredonia, NY

Antenna

I really like my antenna.

Hpower
Roflmao

join:2000-06-08
Glendale, CA

1 edit

Sucks

Damn, pretty big change. I guess RCN is not doing too well financially? They probably are going to loose some customers with this increase in ratse. That downgrade fee is kinda stupid but other major ISP's have it already.
--
The Internet is about to go down....it is actually.
johnp292

join:2009-03-11
Easton, PA

Avoided the "Downgrade" Fee AND the rate hike!

I was already unhappy with RCN's content, and the last straw was the notice of the upcoming $5 service fee that they announced on our March bill. That made my decision easy...I "downgraded" all the way to DirecTV (kept RCN for the Internet though, which I'm happy with). We've been thrilled since the change, and I was even more thrilled when I got that little postcard from RCN announcing the rate hike. There are lots of satellite dishes in my neighborhood. RCN needs to wake up.

Boredness
The Lurker
Premium
join:2005-07-07
In Limbo
Reviews:
·Comcast

Makes no sense but...

It seems that deep recessions cause the communication and entertainment industries to panic and become more greedy. Is inflation here yet? It sure feels like it.
--
Politics is a business. It's all about the money!
tmc8080

join:2004-04-24
Brooklyn, NY
Reviews:
·ooma
·Optimum Online
·Verizon FiOS

upside of cherry picking?

that's what you get when the company cherry picked their network to go in places where the big guys really didn't feel like expanding to... then along came Verizon's FTTP network.. and RCN finally became a nice provider on par with speakeasy, sprint's offspring: earthlink, etc..

there always are options.. unsubscribing? they have a disconnect fee as well? the cost of getting that customer back are going to be MORE than the bogus charges they're willing to p/o customers with.. so give it time.. let's see how customers react. probably not good.
chronoss2009
Premium
join:2008-09-23
kudos:2

told yahs

greedy is as greedy does and to combat the soon losses they will do what try and rip you of for taking a lesser account.

SO take a summer off and screw them over badly.
IF even 33% did it , it would FREAK out the shareholders as they can't afford to keep raising rates during a recession.

PUT the pressure on them harder and im sure if you really must have net , goto a cyber cafe for the month spend 5$ instead a 55+

cdr1000

join:2004-02-18
10100

Re: told yahs

»homepages.nyu.edu/~sab275/rcn_sucks.html

Maggs
Life is awesome
Premium
join:2002-11-29
Woodside, NY

Re: told yahs

Good story. That was when RCN was almost in Bankruptcy. They have gotten way better. I had a tech here at 8:30AM on a Saturday, he even called before he came. He took only an hour to test everything, and we were set.

cdr1000

join:2004-02-18
10100

Re: told yahs

said by Maggs:

Good story. That was when RCN was almost in Bankruptcy. They have gotten way better.
Have they?

Maggs
Life is awesome
Premium
join:2002-11-29
Woodside, NY

Re: told yahs

Maybe if one asks nicely. Honey goes a long way you know.

crazy

time warner charges $1.99 in new york for their "transaction fee".....not only does rcn charge outrageus downgrade fee, they tell you what day you can downgrade or disconnect. if you call to cancel, they tell you to call back next month.

Logan 5
Enjoying the Cataclysm
Premium,MVM
join:2001-05-25
Austin, TX
kudos:7

How is this crap even remotely legal??

I read stories like this on BBR with distressing frequency and think to myself "Gdamn that's a rip off, how do these companies get away with it??".

I want to know how anyone in a position to stop abuses like this from occurring either can't see or doesn't care whats happening to the little people (i.e. you and me).

It's no better out here on the West Coast in California with Comcrap which makes me dread the day when and if AT&T ever decides to end the DSL service in my area.

It just boggles my mind the unhidden greed that's plain to see if one connects the dots and they are so openly brazen about doing it..
jjeffeory

join:2002-12-04
USA

Re: How is this crap even remotely legal??

Companies have started to do this in all industries. Remember the banks? Many of them have started charging a teller fee. Gas and electric Utilities... They do it in many places too. It's something that has been overlooked and is spreading as the managers from one industry slowly infect other industries they enter. Greed. Get as much money out of people as you can. It doesn't matter what is right, or honorable, or good. Just what can be argued to be legal or illegal.
johnp292

join:2009-03-11
Easton, PA

1 edit

Re: How is this crap even remotely legal??

said by jjeffeory:

Companies have started to do this in all industries. Remember the banks? Many of them have started charging a teller fee. Gas and electric Utilities... They do it in many places too. It's something that has been overlooked and is spreading as the managers from one industry slowly infect other industries they enter. Greed. Get as much money out of people as you can. It doesn't matter what is right, or honorable, or good. Just what can be argued to be legal or illegal.
I think Banks are where all this fee nonsense started. They are the biggest crooks going when it comes to fees. Not only are they outrageous but they deliberately handle their customers accounts in ways designed to maximize the banks' fees. What ever happenned to fiduciary responsibility? We have to vote with our business whenever we can, which is why I use a credit union instead of a bank.

joako
Premium
join:2000-09-07
/dev/null
kudos:5

Re: How is this crap even remotely legal??

But what if you make a large payment, like a car or mortgage payment. Would you want a $1.00 soda to make that check bounce? Banks process transactions in order largest to smallest for your protection!
--
PRescott7-2097
johnp292

join:2009-03-11
Easton, PA

Re: How is this crap even remotely legal??

That line of baloney is what the banks will tell you, but isn't it convenient that they can earn multiple fees by doing that instead of only one? And frankly, yes, I would prefer the mortgage or the car payment to bounce and have one mess to clean up rather than having to deal with multiple annoyed creditors and multiple fees from both the bank and the creditor.

Bit00
Premium
join:2009-02-19
00000

Oh, never mind reality

Like the deflationary recession we're in or anything.

RCN user NYC

@rcn.com

how can they do this?

I signed a year contract when I joined up, and part of this means if a better deal came along, I was locked-in with RCN. But I also thought this meant RCN couldn't raise my prices while I was locked-in with them.

Overall I'm much happier with RCN than I was with time warner. I have better service- internet, phone, tv- and at a much much better price. but i'm not sure how they can do this if you signed a one year agreement at a certain price!?

time to call the NY AG's office

OhBoy

@sbcglobal.net

Re: how can they do this?

Its because there is no competition for broadband services, these guys have a negotiated monopoly in the areas they operate. They can control rates because they have either weak competition or no competition in their areas or they make deals to keep rates high. Look at any other developed country and see if their ISP services have such a monopoly. I'll bet its rare. Want lower rates? One of two methods Government regulation or more competition. (The only two options I know of)

tim_k
Buttons, Bows, Beamer, Shadow, Kasey
Premium,VIP
join:2002-02-02
Stewartstown, PA
kudos:25

fees

I can see charging the fee since it does cost money to change service. But if they raise rates, then they should wave any downgrade fees.

davey

@rcn.com

RCN is the textbook case against a "free market" for comcos

With semi-larcenous behavior like this, RCN takes its place as the poster child for radical re-regulation of the communications industry. People like to whine about the specter of oppressive bureaucracy, but there's no government bureaucracy as incompetent and indifferent to customers as RCN and all the rest of the phone/cable/net providers I've ever dealt with.

All deregulation/nonregulation has done is make the US a third world country when it comes to communications services. It's way past time to force providers to finally provide those communications and that service.
tvdrew

join:2008-08-20
Washington, DC

Re: RCN is the textbook case against a "free market" for comcos

Regulated monopolies never had good service either.

The real problem is insufficient competition much of anywhere.

Ally

@omcastbusiness.net

RCN price change

I had a bill of 136.33 a month (not including taxes etc). It’s a phone, TV, internet bundle. The price was hiked last October when RCN forced me into digital which was not necessary and not asked for! Now there is a notice (see top of page) that is changing my account again! The new fee will be $142.35. $6.02 change! And that’s a promotional discount!!!! I asked a lady at RCN what the final increase will be. She put me on hold and eventually came back with no guarantee but she thinks 202.35 will be my bill next year! $60 a month more!!! And I get nothing more than I have now. If I signed up today I would get the same package with a "promotional discount" for $85.94!
That’s a $56 dollar difference now and a $116 difference next year! WOW. Think I'm going to have to go shopping for a new cable company. That’s ridiculous!

ZoetMB

@oneringnetworks.net

Plus they take away channels...

It's not just that they've raised prices every year. It's that they've also taken away channels from the basic services. When I first signed-up with RCN, IFC and Sundance (as just two examples) were basic channels. Now they're not.

I understand that the cable channel providers are also greedy and are raising prices to RCN every year. And they're going to get greedier because advertising revenue is way down. But one of the problems is that there are far too many cable channels -- there's simply not enough advertising revenue, even in a good economy, to support them all.

IMO, RCN (and other MSOs) should assign "points" to each channel. The packages should be based on the number of points associated with the channels you elect to "subscribe" to. So you choose the channels you want. The Sports channels generally cost the MSOs like RCN the most, yet in my particular case, I don't watch a lot of sports on TV, so I'd be willing to give up some sports channels to get some other channels back. With a point-based system, everyone could get what best suited them and people could lower their costs by just taking the channels that appealed to them.

One thing I will give RCN credit for is that they no longer charge extra for most of the HD channels and they have a lot of them, although you do have to pay extra for their HD box.

Before they went digital, I didn't have a cable box. When they first announced that they were going digital and you needed a cable box, they had a promotion (which I actually think was an error) in which you got a free box. So I'm not paying for my box (although I had to argue with them over this), but when I switch to HD, I will have to start paying for it again...HOWEVER....

the pricing is now so costly that I'm seriously thinking about dropping cable TV. All of the shows I watch regularly are available for free online and while the HD quality is far from perfect (pixelation in dark areas), it's fine for most purposes.

Lately it seems like their domain servers aren't working properly. It takes forever to get to a site. Once in the site, it's fine.

Unfortunately, I live in an apartment building, so it's either RCN, Time-Warner or nothing. We do have a roof antenna that worked pretty well receiving analog channels. I'm not able to test the digital reception, but I'm not aware of anyone complaining that they can't get digital TV.

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