AT&T has raised the price of call waiting, call forwarding, and caller ID by $1.01 per month for all California customers that do not subscribe to a service bundle. This marks AT&T’s second rate hike since the California Public Utilities Commission stopped regulating phone rates last summer in the name of “promoting competition.” AT&T is not hesitant to admit that the rate increases are designed to prod consumers into signing up for bundled phone and internet packages:

“Prices for wireless and high speed internet are declining, and the fact that you have bundled offers provide tremendous value,” said AT&T spokesperson Gordon Diamond.

According to AT&T, which serves 80% of the California market, only 30% of customers are affected; so why all the fuss over a $1 increase? According to the Bill Nusbaum, the head of The Utility Reform Network, this is just another selfish ploy to improve AT&T’s bottom line without providing any additional value to customers:

“Its a line of code in their switches. There are no trucks to roll to the customer. There is little they have to do to provide the service. So it’s all profit,” Nusbaum said.

Consumer Groups: Customers Being Nudged to Bundle [KABC]
(Photo: mrbill)

Want more consumer news? Visit our parent organization, Consumer Reports, for the latest on scams, recalls, and other consumer issues.