Cable companies are not just the big names that have their own corporate logos, they also have to pay taxes on profits made by their customers.
So why are they so bad?
The bad news: The vast majority of them are small, family-owned companies that are not paying their fair share.
In a recent survey, a whopping 67% of respondents said they have paid no income tax for the past year.
They were also found to be the only service providers who reported the lowest rates of customer satisfaction and a large majority of respondents also said they do not see any savings in taxes over the next five years.
According to a report by the Tax Justice Network, in 2018, there were 2,200 cable companies with revenues of over $10 billion in the United States, according to the Bureau of Labor Statistics.
And they’re not alone.
According the National Taxpayers Union, there are approximately 3,000 large cable and satellite companies, with revenues exceeding $20 billion.
All of them have had their share of problems.
“There’s been a great deal of litigation,” says Robert Ecker, president of the National Consumers Union.
“Many of these companies have gone through a lot of litigation.”
This year alone, the companies that took the top spot in our survey of cable companies were all involved in a number of lawsuits.
Among the cases brought against them were one by the FCC that resulted in a $10.6 billion fine for Comcast and one by New Jersey’s attorney general that resulted with a $6.6 million fine for Time Warner Cable.
Both of those lawsuits involved violations of the Sherman Antitrust Act, which was enacted in 1914 and prohibits anticompetitive conduct.
“I can’t think of any company in history that’s been held accountable for anything that happened,” says Ecker.
“The fact that these are companies that have been in this business for decades, and have been paying their taxes, is pretty amazing.”
But it’s not just small businesses that are struggling.
“It’s an old story,” says Joe Boggs, president and CEO of the American Cable Association.
“People have always had to be careful what they pay for cable.”
In recent years, the FCC has moved to restrict the amount of money cable companies can spend on programming, which is the number one reason people turn to cable in the first place.
And there are a lot more consumers than ever watching video on their smartphones and tablets, which has resulted in more cable subscribers than ever.
“What the average American consumer wants to watch is entertainment, not just entertainment,” says Boggd, “and the only way to do that is to pay for something with the right incentives and the right channels.”
The bottom line is that you shouldn’t have to choose between the quality of the content that you want to watch and the amount you’re paying for.
And the only time you should have to do so is if it’s the right thing to do.
And even then, if you have to, it’s often because you don’t have a choice.
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