Saturday, May 25, 2013

AT&T adds $0.61 monthly administrative fee that could net the company half a billion annually

AT&T has added a tiny $0.61 "Mobility Administrative Fee" to its postpaid contracts, it was reported on Thursday. While that may seem small for the consumer, it's huge for the carrier. The charge will net the nation's no. two wireless carrier hundreds of millions of dollars.

The addition to the bottom line, in fact, will be somewhere around half a billion dollars. That's a lot of extra revenue for the $0.61 monthly fee ($7.32 per year), which AT&T categorizes as "below the line," alongside tax and fees as an administrative surcharge.

A spokesperson for AT&T said the new fee is "consistent with similar fees charged by other carriers," and that it will "help cover certain expenses, such as interconnection and cell site rents and maintenance."

It is true that the other Big Four carriers have similar administrative fees. In fact, both Verizon and Sprint actually have higher administrative line charges. Meanwhile, T-Mobile bundles its administrative fees in with regulatory charges, so it is difficult to tell how much it charges.

In any case, those facts are not likely to be much consolation for AT&T customers.

AT&T customers can expect their May bill to reflect the change. Apparently, it went into effect -- quietly -- on May 1. It's details on AT&T's site, here.



No comments: