Consumer advocates are criticizing the nation’s second largest wireless carrier over a new charge for its subscribers.
AT&T (T) said it will begin adding a 61-cent administrative fee to all wireless contract monthly bills this month. The company said the fee is in line with similar fees charged by rival carriers. The new fee is estimated to boost AT&T’s annual revenue by more than $500 million, the Wall Street Journal notes.
The company claims that the fee covers a variety of service-related expenses including “cell-site rents and maintenance,” and interconnection costs. But consumer groups say that such fees are meant solely to increase revenue. They also note that such fees appear near the bottom of monthly phone bills and are often overlooked by subscribers.
Verizon Wireless, majority-owned by Verizon Communications (VZ), charges consumers a 90-cent administrative fee each month. That’s down from 99 cents earlier this year. Sprint (S) charges a monthly administrative fee of $1.50. By contrast, T-Mobile (TMUS) doesn’t charge an administrative fee, but does charge regulatory fees of $1.61 a month. Other carriers charge regulatory fees as well.
Shares of AT&T fell fractionally in Friday morning trading.