Nickels and Dimes: AT&T to Charge Wireless Customers $0.61 Administrative Fee
The sly bean counters at AT&T figured out that by charging its wireless customers a nominal monthly administrative fee, it could generate hundreds of millions of dollars in additional revenue per year. Such is the power of numbers and how quickly they add up, assuming customers stick around for the ride. The ones that do will be charged 61 cents per month beginning May 1, The Wall Street Journal reports.
AT&T could stand to gain more than half a billion dollars by imposing this new "below-the-line" fee, so called because these types of charges usually appear at the bottom of the bill where they may not be noticed by customers.
Image Source: Flickr (zombiette)
According to AT&T, which gave customers 30 days notice of the new charge, the fee will cover "certain expenses, such as interconnection and cell-site rents and maintenance." That's on top of a "regulatory cost recovery charge" that's in the neighborhood of 50 cents per line.
AT&T isn't alone here. Verizon charges an administration fee of 90 cents per line along with a regulatory charge of 16 cents. Sprint Nextel charges $1.50 and 40 cents, respectively, and T-Mobile charges a regulatory fee of $1.61 per line (it doesn't tack on an administrative fee).
While small, these fees add up to big bucks. Spread across 70.7 million on-contract wireless subscribers, AT&T would collect an additional $518 million in 2014 from the new fee, and that's without adding a single new customer.
AT&T could stand to gain more than half a billion dollars by imposing this new "below-the-line" fee, so called because these types of charges usually appear at the bottom of the bill where they may not be noticed by customers.
Image Source: Flickr (zombiette)
According to AT&T, which gave customers 30 days notice of the new charge, the fee will cover "certain expenses, such as interconnection and cell-site rents and maintenance." That's on top of a "regulatory cost recovery charge" that's in the neighborhood of 50 cents per line.
AT&T isn't alone here. Verizon charges an administration fee of 90 cents per line along with a regulatory charge of 16 cents. Sprint Nextel charges $1.50 and 40 cents, respectively, and T-Mobile charges a regulatory fee of $1.61 per line (it doesn't tack on an administrative fee).
While small, these fees add up to big bucks. Spread across 70.7 million on-contract wireless subscribers, AT&T would collect an additional $518 million in 2014 from the new fee, and that's without adding a single new customer.
