FTC’s Lina Khan Takes Aim At Sneaky Fees On Her Way Out The Door

I’ve covered the cable TV and broadband industries for a long while, and for the vast majority of that time, U.S. regulators have looked the other way while companies rip consumers off with hidden fees. At some point the U.S. just decided that this type of false advertising was a form of acceptable creativity.

And while the efforts weren’t always consistent, the Biden administration really did try to make a difference on this front. The Biden FCC tried to mandate more clarity in broadband and cable TV pricing, so your broadband company couldn’t rip you off with “internet cost recovery fees,” “regulatory recovery fees,” and other bullshit that lets them falsely advertise a lower rate.

And over at the Lina Khan FTC, they’ve finalized rules requiring that hotels and ticket sellers itemize bullshit fees (and the full cost of service) right up front at the point of sale. Though even here, with an FTC routinely blasted as “too aggressive,” there are a whole bunch of caveats and carve outs:

“The FTC’s rules still allow companies to impose fees, so long as they are clearly displayed. The agency also focused its prohibition on just the lodging and live-event industries, not the fuller array of firms — from airlines to internet giants — that have similarly stoked public anger.”

Note the agency voted 4-1 in favor of these new rules, with the one dissenting voice being Andrew Ferguson, Trump’s incoming FTC boss. It’s extremely unlikely Ferguson will actually enforce the rules, given that, like most Trump 2.0 officials, his focus will be on gutting most consumer protections (you, know, populism!) and harassing trans people or companies that don’t kiss Trump ass.

Should we someday return to any era resembling competent regulatory governance, it might be nice to remember that FCC and FTC efforts to crack down on fees are nice, but transparency isn’t enough. Making companies be clear about the fact they’re ripping you off doesn’t stop them from ripping you off.

Most of these fees are outright false advertising and should be banned outright. Many of them are the result of a lack of competition, which wouldn’t be as much of a problem if the U.S. government actually took antitrust reform and merger review seriously and applied it consistently across industries.

For the scattered antitrust reform cases the FTC filed, the agency lacks the funds or resources (quite intentionally) to truly tackle the country’s consolidated monopoly problems. And while the FCC nibbled around the edges of the problem (with things like broadband “nutrition labels“) the agency lacked the backbone to even publicly criticize telecom monopoly power itself.

But those efforts will look positively courageous compared to what’s coming during Trump 2.0. Emboldened by a corrupt Supreme Court, the second administration will gut consumer protections and weaponize government to harass administration critics, while endlessly allowing the kind of mindless consolidation that causes these kinds of predatory behaviors to begin with.

Trump 2.0, unconstrained about concerns of re-election, will be a greatest hits of terrible ideas making most existing problems much worse, and absolutely none of it is going to be subtle.