If anyone wants to know why TEM (technology/telecom expense management) exists or why it’s a good idea, the article “The Great Telecom Rip-Off” by David Rosen, published online at COUNTERPUNCH 3/23/23 explains it. We are providing the link directly to that article here https://www.counterpunch.org/2023/03/23/the-great-telecom-rip-off-2/ if you want the in-depth report. Or, read on for a few excerpts, which are frankly frightening. While most of this applies to consumers, the article also covers universities and municipalities.
“Over the last few decades, the leading telecom companies have engaged in a host of schemes to swindle their customers and the American taxpayer. One involves overcharging customers for which they have been repeatedly sued. Others involve deceptive pricing practices, questionable accounting schemes, substitution of inferior wireless (e.g., 5G) for fiber-optic system upgrades, capture of federal and state regulatory agencies and the “deregulation” of the telecom industry. These schemes fueled the telecom swindle.”
“In September 2020, the State of California won a $116 million suit against Verizon ($68 million) and AT&T ($48 million). The suit was brought by a “whistleblower,” OnTheGo Wireless, LLC, and thirty government entities claiming under the California False Claims Act that the telecoms overcharged the state and government customers for wireless services. Some 300 state and local entities will recover money for the excessive payments, including the State of California, state universities as well as city and county governments.”
“New Networks Institute’s (NNI) Bruce Kushnik identifies a series of schemes telecoms use to execute overcharges, including:
- Services Fees – Charges for services customers did not order that NNI estimates totals $17 billion annually. They include:
- “Ramming” — The phone company adds a service, that is provided by one of the companies’ subsidiaries or different line of business, that was not ordered.
- “Cramming” — A service is added by another company that was not ordered.
- “Slamming” — A company switches you to their service without permission.
- Made Up Fees – They are commonplace and can include “Cost Recovery Fees” and “Administrative Fees” on wireless or even Digital Voice service on a FiOS bundle of voice and broadband as well as “Broadcast TV & Sports Fee” on cable services. NNI estimates these at $22.7 billion.
- Made Up Taxes on Made up Fees — America’s communications services are taxed made up fees, which are then also taxed, fees and surcharged. NNI estimates they generate $25 billion per year. For example, “Verizon Surcharges and Fees” are not mandated but are a pass-through. They include taxes applied to Verizon, but which it is allowed to pass onto the subscriber’s bill as an administrative fee. The Verizon web site states that “these are Verizon charges, not taxes.” It reads:
- Administrative Charge, which helps defray certain expenses we incur, including charges we, or our agents, pay local telephone companies for delivering calls from our customers to their customers; fees and assessments on our network facilities and services; property taxes; and the costs we incur responding to regulatory obligations. Please note that these are Verizon charges, not taxes.”
This article tells us here at Inverse that a company with multiple locations with multiple telecom providers can be “easy marks”. The individual responsible for monitoring and paying the telecom bills every month would have a challenging, if not impossible, job of trying to sort through monthly invoices to ensure accuracy. Not to mention ensuring rates are the best and watching for price hikes. Unless that individual is dedicated to only monitoring these expenses, it’s unreasonable to expect them to stay 100% on top of it all. And honestly, the telecom providers know that. An extra fee here, an “accidental” overcharge there when combined with charging business customers for unused phone lines, and more … who could hope to keep track? That’s why TEM services like ours exist. We have experts at Inverse, with the experience to recognize what’s real and reasonable vs. what’s not. We offer a complimentary audit as a starting point with clients to help them understand quickly how much they could save. Call us if you’re interested. We would love to help you reduce your tech and telecom cost. 800-854-2444 or visit www.inversetech.com
Source: COUNTERPUNCH online, 3/23/23 by David Rosen