Save on Monthly Internet Fees
Plus: Internet bills are confusing and filled with surprise charges—but it doesn't have to be that way
Neil Krauch, a retired cybersecurity expert living in a town about 15 miles from Branson, Mo., recently wrote to Consumer Reports with a fairly simple question: Why are internet bills so hard to understand?
Confusing bills are a familiar problem. When Consumer Reports studied cable TV bills in 2019, we found lots of extra fees that consumers hadn’t expected—$450 a year beyond the advertised price for the average person in our study. After our findings were published, Congress tightened the rules to make cable billing more transparent.
But many of the same companies seem no better when it comes to internet bills. In a 2020 study called the Cost of Connectivity, the nonprofit Open Technology Institute of New America concluded that internet customers face overly complicated pricing structures, poorly itemized fees, and lack of transparency.
How to Cut Your Bill
Though you can’t avoid some charges, such as taxes and franchise fees, there are ways to save money on your internet bill.
To start, ISPs charge an average of $70.38 for installation when you first sign up for service, but AT&T, Charter (Spectrum), Comcast (Xfinity), and others offer self-installation kits for an average of just $9.30, according to the Open Technology Institute. Just note that if you run into trouble and need assistance, companies may hit you with a self-installation service fee. AT&T, for example, charges a $99 "self-installation assistance" fee if you opt to do it yourself but then need help.
Secondly, companies typically impose an equipment rental fee, often about $10 to $12 a month, for your modem and router. You can save long-term by buying the equipment yourself. You first have to make sure the modem is compatible with your ISP; that’s information you can often get from the ISP’s website. (Note that your modem may stop working if you switch to another service.)
If you go that route, or cancel service entirely, make sure you find out what equipment you need to return to the company to avoid being charged a penalty. AT&T, for example, charges $150 for failure to return its WiFi gateway if you terminate service, and $65 for each WiFi extender.
Sometimes you can get a monthly discount for enrolling in both auto-pay and paperless programs. AT&T, for example, will cut $5 a month off your bill for doing so, and Comcast offers a $10 discount on eligible plans. Verizon’s discount is either $5 or $10, depending on the plan. Autopay can also help you avoid late-payment fees.
Try to avoid paying by phone, because some companies charge you every time you do this. For instance, AT&T has a $5 "payment convenience fee" when you make a payment with the assistance of a retail agent, customer service, or a collections representative. Charter/Spectrum likewise charges $5 when you pay by phone with the assistance of customer service.
And remember, it often pays to negotiate if you’re unhappy with your service. In our latest telecom survey results, published last fall, about two-thirds of those who haggled over the cost of their bundled plan ended up getting one or more perks, such as a cheaper price or a new promotional rate.
Internet Nutrition Labels
Advocacy groups, including Consumer Reports, have been lobbying for years to make internet pricing information easier to read and understand so that consumers can compare plans and providers, and know what to expect when their monthly bills arrive.
"There is a complete lack of price transparency or information on internet service bills," says Jonathan Schwantes, senior policy counsel at Consumer Reports. "A bundled service plan may not include a separate price for internet service, and often internet-only bills don’t let consumers know what download and upload speeds they’re paying for. Imagine if the auto industry did not put the expected gas mileage or a price on the window sticker of a new car. That’s the reality in the murky internet service market."
An option endorsed by Consumer Reports is a standardized broadband label, similar to the Food and Drug Administration’s nutrition label, that clearly spells out each internet plan’s monthly rate, extra fees, and promised data speeds, and says when a promotional rate will expire. The examples above, for both fixed broadband and cellular plans, were created by the Federal Communications Commission back in 2016 and seemed poised for adoption, but the push for better labeling was stopped the next year under the Trump administration. Now, the concept is being revived.
As part of a large broadband project, CR is preparing to take a much harder look at internet billing, by crunching the numbers on tens of thousands of internet bills. Stay tuned for more details about the project, and how you can join the effort later this summer.