Three Baltimore City councilmen and the Baltimore Digital Equity Coalition are requesting a price gouging investigation into Comcast’s new data cap on Xfinity internet customers in Maryland and elsewhere across the country.
In a letter to Maryland Attorney General Brian Frosh, Councilmen Ryan Dorsey, Zeke Cohen and Kristerfer Burnett said the plan to charge customers without unlimited plans up to $100 a month for data over 1.2 terabytes will exacerbate a lack of internet access in low-income households.
“Children in Baltimore, and other jurisdictions, already face a steep ‘digital divide,’ which has harmed their education over the past year,” they wrote. “We ask that you investigate the data caps as a predatory form of ‘price gouging’ for Maryland consumers.”
Frosh, a Democrat like the councilmen, has received the letter, spokeswoman Raquel Coombs said.
“Certainly it’s something we will look into,” she said.
Price gouging, which violates the Consumer Protection Act, is subject to injunctive relief, mandatory disgorgement and consumer restitution, and civil penalties of $10,000 per violation. A violation is also subject to criminal prosecution as a misdemeanor.
But completing an investigation could prove challenging, because Maryland does not have a permanent price gouging statute. An executive order by Republican Gov. Larry Hogan authorizes Frosh’s office to investigate price gouging during the COVID-19 pandemic, but that power lasts only until Maryland’s state of emergency expires.
Comcast spokeswoman Kristie Fox called 1.2 terabytes “a massive amount of data” and said “a very small percentage” of customers are expected to exceed the cap, which she said the company has instituted for years in other regions of the country.
Comcast announced Wednesday that it would extend its initial three-month grace period to allow customers to adjust to the data cap, which debuted Jan. 1. Customers will not see any extra charges for exceeding the cap until their August bill, Fox said.
“Most of our customers will not be impacted by this, and there’s ample time for customers to understand their usage and look at the unlimited data options if they do find themselves going over 1.2 terabytes,” Fox said.
But the Baltimore councilmen and Digital Equity Coalition noted a recent statement by Tony Werner, Comcast’s president of technology, that rising internet usage from remote working, learning and entertainment “has all been within the capability of the network.”
“If the pandemic related surges in data usage, which were up 32% in March, are within the capability of the network, then there is no reason for the looming data cap policy,” they wrote.
Fox declined to elaborate on the specific reasons for the timing of the policy change, but she said Comcast “definitely took pandemic usage into account.”
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Under the data cap, customers without an unlimited plan will be charged $10 plus tax for every 50 gigabytes beyond the new threshold, up to a monthly max of $100, the company has said.
While pricing on plans varies, customers with their own modem and router can join an unlimited data plan for $30 a month, according to the company. Customers who lease an Xfinity modem can get unlimited data, plus some other features, for $11 more a month.
About 96,000 households in Baltimore lack wired broadband service, and an additional 52,000 do not have broadband of any type, the councilmen and coalition said. Half of non-broadband subscribers cited high prices as the reason they lack service, they wrote, citing a 2019 Pew Research Survey.
“Our most vulnerable residents should not be faced with further threats to their economic livelihood,” they wrote. “We must protect the households that currently subscribe to this vital utility and also to ensure that those most impacted by the pandemic, Black and Latinx households, do not bear the brunt of capricious fees.”
Tia Price, director of the Baltimore Digital Equity Coalition, accused Comcast of “monetizing off of the pandemic” and noted that 5% of customers — the number Comcast said initially would be affected — equals about one in every 20 Baltimore households.
The Comcast spokeswoman, who backed off the 5% figure Wednesday, declined to provide an updated estimate of how many households would likely hit the cap.
“I see this as one step closer to charging people more money,” Price said in an interview. “If we don’t start to watch when these incremental changes happen, where are we going to be a year or two years from now?”