Leading cable multi service operator (MSO) Comcast Corporation (CMCSA - Free Report) has agreed to pay $2.3 million to the Federal Communications Commission (FCC) as a settlement for its unlawful billing practices. Interestingly, this is the largest amount the FCC has ever levied as a penalty.
Forced Upgrades
Many customers at Comcast were billed for services and equipment without their knowledge. Moreover, even after discovering the charges, the customers usually opted for the painfully slow process of getting a refund. Even customers who refused opting for any extra service or upgrade were charged for the unrequested services. This illegal practice is termed as ‘negative option billing’ in the industry where companies provide services and charge customers without the latter’s consent.
Comcast’s Defense
Comcast stated that the FCC did not find any intentional wrongdoing and thus the company had to cough up a penalty for some isolated cases. Moreover, Comcast has agreed to step up customer service in order to put a check on such incidents.
The Bottom Line
Apart from the hefty fine, such practices will dent Comcast’s reputation to a large extent. At the time when pay-TV providers like Comcast, Charter Communications Inc. (CHTR - Free Report) and AT&T Inc. (T - Free Report) are grappling with high customer churn, thanks to the growing popularity of over the top (OTT) streaming services from companies like Netflix Inc. (NFLX - Free Report) , such incidents are sure to act as a dampener. Moreover, Comcast is set to launch its wireless service next year and hence should work on enhancing customer service in order to handle similar issues better.
Comcast currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
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Leading cable multi service operator (MSO) Comcast Corporation (CMCSA - Free Report) has agreed to pay $2.3 million to the Federal Communications Commission (FCC) as a settlement for its unlawful billing practices. Interestingly, this is the largest amount the FCC has ever levied as a penalty.
Forced Upgrades
Many customers at Comcast were billed for services and equipment without their knowledge. Moreover, even after discovering the charges, the customers usually opted for the painfully slow process of getting a refund. Even customers who refused opting for any extra service or upgrade were charged for the unrequested services. This illegal practice is termed as ‘negative option billing’ in the industry where companies provide services and charge customers without the latter’s consent.
Comcast’s Defense
Comcast stated that the FCC did not find any intentional wrongdoing and thus the company had to cough up a penalty for some isolated cases. Moreover, Comcast has agreed to step up customer service in order to put a check on such incidents.
The Bottom Line
Apart from the hefty fine, such practices will dent Comcast’s reputation to a large extent. At the time when pay-TV providers like Comcast, Charter Communications Inc. (CHTR - Free Report) and AT&T Inc. (T - Free Report) are grappling with high customer churn, thanks to the growing popularity of over the top (OTT) streaming services from companies like Netflix Inc. (NFLX - Free Report) , such incidents are sure to act as a dampener. Moreover, Comcast is set to launch its wireless service next year and hence should work on enhancing customer service in order to handle similar issues better.
Comcast currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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