Larry writes:

I just attempted to buy, at Circuit City, using my charge card, and one of the $40.00 government-provided coupons, a TV converter box. After swiping both cards, the sales clerk presented me with two printouts to sign. One was for $21.19 and the other was for $40.00. Of course the $21.19 was the one for the difference between the purchase price minus the government coupon (plus the sales tax). Both printouts ended with this statement:

"The cardholder agrees to the credit card amount shown hereon and agrees to perform the obligations set forth in the cardholder agreement with the issuer."

I refused to sign the one for $40.00. I spoke with the manager, Kim, (whose last name is "the only Kim in the store") to cancel the transaction. She said she couldn't and insisted that I sign both printouts. I could see this was going to turn into an issue so I quickly pocketed both unsigned receipts, the government coupon card, and my credit card and left while Kim was threatening to call the police. NOTE: I removed no merchandise from the store.

As I was driving away, Kim was standing outside writing down my license number and talking on her cell.

The government is distributing $40 coupons to subsidize converter boxes that will allow people to watch television over-the-air after February 17, 2009, when all broadcast signals switch from analog to digital.

Retailers are required to accept the coupons, and customers are required to sign a slip so the coupon can be redeemed. For some mindless reason, Circuit City is using a credit card agreement as their signature slip, and making it appear as if the customer is about to pay an extra $40.

Circuit City already called Larry to tell him that his $21 charge would be reversed. As for his $40 coupon, apparently, it will be "refunded to the government."

Cablevision writes:

"There is no direct connection between the digital transition of broadcast television stations that will occur across the nation in early 2009 and Cablevision's decision to transition away from the duplicate analog feeds of a certain number of channels that we already carry in digital format.

Unfortunately, Cablevision goes on to say:

Neither our customer service training, nor our customer communications, link the two in any way."

As for Cablevision's training, we spoke with four customer service representatives and each one said the same thing. These weren't rogue agents conjuring up their own unsupportable explanations. Two CSRS put us on hold to consult their materials, came back, and repeated their assertions.

When we asked the agents to tell us who instructed them to mention the FCC, they expressly stated that they were following Cablevision's training. We strongly suspect that if we (or you) called back, we would again receive the exact same answer. Could all the agents have made the same mistake, and lied about their training? Absolutely, but Occam's Razor seems to shred any suggestion of a coincidence.

Cablevision admits that their agents repeatedly provided incorrect information. Two questions remain: Are they now lying about their training; and, how will the FCC admonish Cablevision for their deceptive and predatory behavior?

PREVIOUSLY: Cablevision Blatantly Lies To Subscribers As The FCC Twiddles Its Thumbs
Cablevision Uses Digital TV Transition To Upsell Basic Cable

Cablevision is lying to customers by claiming that the FCC will require all subscribers to upgrade to digital cable boxes in 2009. Digital cable boxes cost $6.50 per month, plus an extra $10.95 for digital service. Cablevision recently sent a letter to all boxless subscribers threatening to cut several channels unless they forked out a bundle of extra cash for digital service. When one of our family member called for an explanation, Cablevision shirked responsibility and placed the blame squarely on some crazy new FCC mandate. We called shenanigans and decided to call back and record our chats with several customer service representatives. Inside, the recordings of Cablevision lies and the FCC's flaccid response.

Before we get to the recordings, let's look at Cablevision's fairly innocuous letter:

40 million American families don't use a digital cable box. Assuming all cable companies use Cablevision's rates, operators stand to pick up an extra $698,000,000 per month by convincing all 40 million families to shell out an extra $17.45 for digital service. That small piece of change is worth more than the yearly GDP of several small nations.

Cablevision is well within its bounds to charge whatever it wants for service. They can tell us we need a cable box, and that service will now cost $300 per month. That's a freedom afforded by the market. What they can't do is cowardly hide behind the FCC and blame their money-grubbing on the government. Let's listen as they try to do just that:

We spoke with four representatives, each of whom blamed the FCC for forcing us to upgrade to digital cable. We asked one representative how this information was conveyed to the CSRs, and she explained that Cablevision had specifically trained them to point to the FCC.

Let's be perfectly clear: the FCC decision has absolutely nothing to do with the channels Cablevision is taking away, nor does it require anyone to upgrade to a digital cable box.

Don't believe us? Let's see if we can find someone to refute Cablevision.... Maybe Cablevision is up to the task?

We spoke with two representative at the FCC who claim that several cable companies have engaged in similar deceitful and fraudulent actions. According to the representatives, the Commission is powerless to take action. One even defended the cable companies, saying:

"Most of [the cable companies] are blaming it on the FCC. It's easier for us to take it. We have broad shoulders, you know? We're the ones who have to explain it to all the consumers anyway when they find the 800 number and then they start calling and asking us: "why is my cable company doing this to me? I want to file a complaint."

Unfortunately, there are no mandates for good customer service. I wish there was! I would really like there for to be a mandate that says: "I'm sorry, but people on the phone at my cable company have to be nice to me and they have to tell me the truth." I wish there was, but there's not.

A mandate for good customer service couldn't be enforced by the 82nd-airborne, but lying? Regulated companies should not be allowed to lie to their customers.

Thankfully, the bespectacled bossman helming the FCC takes a different view. Chairman Kevin Martin recently slammed retailers for lying about the digital transition, dishing out several million dollars worth of fines to Sears, Best Buy and Walmart. Why can cable companies lie, but not retailers?

We know that Chairman Martin is a good guy who likes consumers. Let's go back and listen to the sweet consumer-protecting swan song he sung so graciously in our defense last year:

If the cable companies had their way, you, your mother and father, or your next door neighbor could go to sleep one night after watching their favorite channel and wake up the next morning to a dark fuzzy screen. This is because the cable operators believe that it is appropriate for them to choose which stations analog cable customers should be able watch. It is not acceptable as a policy matter or as a legal matter.

Kevvy was announcing that cable companies would be required to carry broadcast channels (CBS, NBC, ABC, etc...) until 2012, and not Travel Planet or RAI, which Cablevision is preparing to yank. The Chairman did, however, explicitly endorse our right to enjoy cable service without a box, and Cablevision's right to require us to rent one:

...the Commission is not forcing consumers to purchase or lease a set top box to continue watching their favorite channels. This decision lies in the hands of the cable company. They can avoid the need for new boxes bychoosing to downconvert the digital signal into analog at their headend. This downconversion would permit analog cable subscribers to continue watching broadcast television just as they do today without disruption.

This isn't the first time Cablevision has used the DTV transition to beat customers like cash-spewing pinatas. The cable giant was previously caught sending letters to prospective customers telling them that TV would disappear in 2009 unless they started paying $240 per year, despite the availability of $20 converter boxes that will keep the Price Is Right up and running.

Cablevision is clearly engaged in a pattern of deception and fraud. The FCC has a responsibility to investigate and admonish Cablevision for their abusive conduct. Predatory upseling simply cannot be tolerated in a responsibly regulated marketplace.

PREVIOUSLY: Cablevision Uses Digital TV Transition To Upsell Basic Cable
Sears, Best Buy, Wal-Mart And Others Fined For Not Warning Consumers About Analog Obsolescence
FCC Takes Action To Prevent Cable Companies From Dropping Digital Broadcast Networks From Analog Cable

Consumers can request the $40 coupons now, but they expire after 90 days even though converter boxes are still not widely available. Mouse Print broke down all the known caveats:

1. You cannot combine the coupons toward the purchase of a single box (each will cost between $50 and $70 approximately).

2. The coupons expire 90 days from their mailing to you, and expired coupons will not be replaced.

3. There are only 22.5 million coupons unless Congress authorizes 11.25 million more.

4. While some boxes have already been approved, more are expected.

5. Many if not most retailers do not have the boxes in stock yet.

Mouseprint rightly argues that the coupons should not expire. The federal government shouldn't worry that throngs of coupon-wielding seniors will bankrupt the treasury by simultaneously redeeming their DTV coupons. This is the sort of problem the government might be able to tackle if a single official was overseeing the DTV transition.

DTV Coupons: The Consumer Catch-22 [Mouse Print]
(Photo: anomalous4)

On February 19, 2009, stations will stop broadcasting analog signals. Consumers will be unable to receive signals over the air unless they shell out $60 for a digital converter box. Few people know about the transition, or the $40 coupons the government has made available to subsidize the cost of the converter boxes. Where we see a problem, The Singing Regulators see a song.

Bloomberg reprinted the lyrics to Away in a Farm House, sung to the tune of Away in a Manger:

Away in a farm house, no show can I see. I lost all my coupons to get DTV. My friends in the city, they all said, "Relax!'' That's easy to say when you're wired with co-ax. Looking for help, I went down to the store, I asked for more coupons, they just said "what for?'' They sold me a monster, takes up my whole wall. I yearn for the days of my old analog. In Two-Thousand Nine after Super Bowl Week, My analog set will become an antique. I hope that the public will know what to do, For most of my neighbors do not have a clue...

Oh BlackBerry! FCC Carolers Poke Fun at Issues: Cindy Skrzycki [Bloomberg]
PREVIOUSLY: $40 Coupons For Digital TV Converter Boxes
The Conversion to Digital Television Is Going To Be Unpleasant

(Photo: clofresh)