Proposed Rule Means Airlines Would Have To Be More Forthcoming With Fee Disclosures


Purchasing plane tickets can be a painstaking task. First, you comb through options to see what fits your schedule, then you search high and low for a price that meets your travel budget. But upon arriving at the airport you’re faced with fee after fee and pretty soon, that travel budget goes out the window. Those days might be over, however, now that the U.S. Transportation Department has proposed a new rule that would require airlines to directly disclose basic service fees.


The newly proposed rule aims to make it easier for travelers to determine the true cost of a ticket, Reuters reports.


Under the proposed rule, U.S. airlines would be required to spell out the costs for extra charges, such as fees for checked bags, carry-on bags and advanced seat assignments, at all points of sale. Additionally, online sites that allow flight searches, such as Kayak, would also be required to provide more detailed information on ticket costs.


“Knowledge is power, and our latest proposal helps ensure consumers have clear and accurate information when choosing among air transportation options,” Anthony Foxx, U.S. Transportation Secretary, says in a Transportation Department news release. “The proposal we’re offering today will strengthen the consumer protections we have previously enacted and raise the bar for airlines and ticket agents when it comes to treating travelers fairly.”


The proposed rule would also expand the number of carriers required to report information to the Department about on-time performance, oversales, and mishandled baggage rates. Currently, only carriers who account for at least 1% of domestic passenger revenue must provide reports. The new requirement would move the threshold to carriers that account for at least 0.5% of passenger revenue, which would include Spirit Airlines.


Data collected through the reports will be publicly available in the Air Travel Consumer Report.


The new rule also includes the following proposals:



  • Require large travel agents to adopt minimum customer service standards such as responding promptly to customer complaints and providing an option to hold a reservation at the quoted fare without payment, or to cancel without penalty, for 24 hours if the reservation is made one week or more prior to a flight’s departure date;

  • Require carriers and ticket agents to disclose any code-share arrangements on initial itinerary displays on their websites;

  • Prohibit unfair and deceptive practices such as preferentially ranking flights of certain carriers above others without disclosing the bias in any presentation of carrier schedules, fares, rules, or availability.


Wednesday’s proposal builds upon rules created by the Department in 2009 and 2011. Those rules raised the penalties for long tarmac delays and required airlines to announce full fares, including taxes, in advertised ticket prices.


According to the Transportation Department, the previous rules have created a better, more fair treatment of airline passengers.


However, the airline industry and Congress recently began pushing the ironically named Transparent Airfares Act that would essentially allow airlines to advertise only a fraction of the price consumers actually pay.


The department will collect public comments on the proposed rule for the next 90 days.


U.S. government seeks greater disclosure of airline fees [Reuters]


U.S. Department of Transportation Proposes Additional Consumer Protections for Air Travelers [United States Department of Transportation]




by Ashlee Kieler via Consumerist

Spotify Has 10 Million Paying Customers, Still Loses Money


There have been three broad eras so far of online music. There was the era of Napster, when rampant piracy was great for music-loving young people, and a seeming catastrophe for artists and record labels. There was the era of iTunes, which allowed fans to buy only the single song that they wanted to hear. Now the era of Spotify lets us simply stream music on a variety of devices. It’s convenient, but is it sustainable for everyone…especially Spotify, which still doesn’t turn a profit?

It’s clear that consumers enjoy the streaming business model, but what about the companies that provide those streams? Spotify is based in Stockholm, Sweden, and has about 40 million members. They operate in a few dozen countries, but the United States and United Kingdom are its biggest markets. Most of the people who use the service get some ads mixed in with their music, but about a quarter of its members have a paid, ad-free subscription, which costs around $10 per month.


The important question is this: can a music-streaming service turn a profit? Normally, notes Bloomberg Businessweek in a profile of the company, cloud-based services eventually turn a profit by scaling up: building a service and licensing content, then bringing on more paying customers. For Spotify, it won’t quite work that way: they pay artists a fixed amount each time one of their songs play. While some musicians aren’t thrilled with this arrangement, others think it’s pretty peachy.


Apple’s rumored talks to purchase Beats Audio isn’t just about getting the company’s colorful, high-priced headphones for itself: Beats has a music-streaming service that competes with Spotify and Pandora. It could be that the only way a music streaming service can support itself is as a loss leader for a hardware company or a software platform.


Spotify Hits 10 Million Paid Users. Now Can It Make Money? [Bloomberg Businessweek]




by Laura Northrup via Consumerist

Airbnb Agrees To Hand Over Some User Info To NY Attorney General

airbnbnyc There’s been yet another development in the ongoing battle between Airbnb and the state of New York, with the online home rental service agreeing to turn over some data about its customers to the state’s Attorney General, but not to the extent that a subpoena from the AG’s office had originally sought.


The subpoena saga goes back to last October, when NY AG Eric Schneiderman issued a subpoena seeking a wide swath of data on 15,000 users in the New York City area.


The data requested in that subpoena included the physical and e-mail addresses of users, dates of guest stays and how much money hosts earned for those rentals. Airbnb argued that the subpoena was overly broad and that some of the data being requested was immaterial to questions of whether or not Airbnb users were violating NYC tax and hotel laws.


Last week, a court in Albany sided with Airbnb, while also saying it appeared there were a “substantial” number of Airbnb hosts that may be in violation of the law.


The AG’s office immediately issued a new subpoena that hoped to answer the court’s concerns about the overly broad version issued in last fall, but today both Schneiderman and Airbnb announced an agreement that would turn over information that is materially relevant to the investigation without revealing information about individual users.


According to the agreement [PDF], information turned over to Schneiderman’s office will be anonymized by redacting names, e-mail addresses, phone numbers, social media account info, user names, host IDs, listing IDs, apartment numbers, Social Security numbers, tax ID numbers, amounts paid, account numbers, codes, security questions, password info.


However, if the AG or the NYC Office of Special Enforcement choose to investigate specific parties, Airbnb will provide these authorities with the above information for the particular users being looked into.


So on the one hand, Airbnb isn’t being forced to hand over all relevant and sensitive info for thousands of customers; on the other, the state and city’s attempted crackdown on the rental service will continue.


“Airbnb and the Office of the Attorney General have worked tirelessly over the past six months to come to an agreement that appropriately balances Attorney General Schneiderman’s commitment to protecting New York’s residents and tourists from illegal hotels with Airbnb’s concerns about the privacy of thousands of other hosts,” reads a joint statement about the deal. “The arrangement we have reached today for compliance with the OAG subpoena strikes this balance.”




by Chris Morran via Consumerist

And Teens Everywhere Cried: American Eagle Outfitters Set To Close 150 Stores

If AE closes stores, where will teens get their awesome colored hoodies? (Scott Lynch)

If AE closes stores, where will teens get their awesome colored hoodies? (Scott Lynch)





Soon a graphic T-shirt-sized hole will appear in the hearts of teenagers across America. That’s because American Eagle Outfitters is gearing up to shut down more than 100 stores.

Citing weak sales and increased markdowns, the teen retailer announced Wednesday that it plans to shutter 150 stores over the next three years, Bloomberg Businessweek reports.


The retailer currently operates more than 1,000 American Eagle Outfitters and aerie stores in the United States. Of the 150 stores set to close, the company plans to close about 50 AE stores and 20 aerie stores by the end of 2014.


Officials with the company expect the closings to generate an approximate annual savings of $10 to $15 million.


American Eagle to close stores after weak 1Q [Bloomberg Businessweek]




by Ashlee Kieler via Consumerist

Groups To Protest Time Warner Cable Merger Outside Comcast Meeting Tomorrow

Click image to see the full-page ad Consumers Union took out in the Philadelphia Inquirer and other papers.

Click image to see the full-page ad Consumers Union took out in the Philadelphia Inquirer and other papers.



On Thursday, Comcast’s investors will be meeting here in Philadelphia, but they’ll be doing so over the din of protestors from numerous local and national organizations who are coming out to oppose the cable company’s planned merger with Time Warner Cable.

Among the groups involved in the event outside the Kimmel Center on Broad St. tomorrow morning will be our own Consumers Union, which has taken out a full-page ad in the Philadelphia Inquirer to voice opposition to the mega-merger.


“This merger would give Comcast unprecedented power over what we see, how fast we see it, and how much we pay,” said Delara Derakhshani, policy counsel for Consumers Union. “Comcast and Time Warner Cable already rank near the bottom of the latest Consumer Reports’ customer satisfaction survey. Consumers stand to lose big if this merger is approved.”


Even in Comcast’s hometown, it gets little love from consumer advocates.


“Comcast’s service in Philadelphia is a great reason why they should not be allowed to expand,” said Bryan Mercer, co-Executive Director of the Media Mobilizing Project, which launched the CAP Comcast! Campaign earlier this year to hold Comcast accountable in Philadelphia as it renegotiates its franchise to sell services in its hometown. “If they merged with Time Warner Cable, their high prices, bad record of service to low income communities, and outsized political power would expand even more.”


Comcast has repeatedly touted its Internet Essentials program as an indicator of just how much the company wants to help bridge the data gap, making Internet access available to low-income families, but many have questioned the actual long-term value of the program, and only a small fraction of eligible families have been enrolled in the program.


“When Comcast promised working families in Philadelphia that we could get discounted internet services, that should have been a promise we could trust,” said Dawn Hawkins of Action United, which has been organizing for a redo of Internet Essentials. “But when I applied, Comcast held a ten-plus year old bill against me and kept my family offline. Comcast should not be able to merge with Time Warner Cable, and push broken promises for families instead of affordable internet for everybody.”


The coalition opposing the Comcast/TWC deal have already gathered 400,000 signatures on a petition to halt the merger.


“While Comcast executives are spinning this deal as a positive before investors in Philadelphia and bureaucrats in Washington, the rest of the country isn’t so easily fooled,” said Mary Alice Crim of Free Press. “For us this merger means sky-high prices, lousy customer service and too few companies controlling the future of communications in the United States. It’s time regulators in Washington ignored the lobbyists, listened to the public and rejected the Comcast-Time Warner Cable merger outright.”


If you’re in the Philadelphia area and want to take check out tomorrow’s event, it will start at 10 a.m. outside the Kimmel Center at 300 S. Broad St. (that’s the corner of Broad & Spruce).




by Chris Morran via Consumerist

Latest Data Says TWC-Comcast Merger Bringing Broadband Caps To Nearly 80% Of Users


The future just keeps looking brighter for those who make money from data caps, and more limited for everyone else. The latest data out on home broadband caps now shows that if the Comcast and TWC merger goes through, 79% of internet subscribers — four in every five Americans with a broadband connection — will face a monthly data cap on their plans.


The most recent math comes from GigaOm, who have been tracking broadband data caps for ages. They last took a stab at calculating the number back in April, and came up with a similar 78%.


However, the projections are able to be more specific, and less conjecture, now that we have a few key pieces of information. First, the Comcast-TWC plan to spin off 4 million subscribers to Charter: Charter has a data cap, and so once the deal is completed, those four million consumers will too.


Second, there is more certainty about Comcast’s plans for the future. Their “data threshold” program has so far only been tested in some markets, but Comcast recently made clear that it fully intends to have its data caps and usage-based billing set in place within five years.


That timeline would put it post-merger, meaning the cap would apply to the combined subscriber base of Comcast and TWC — right now, thirty million customers, and only likely to climb.


Latest stats show Comcast/TWC merger will cap 79% of broadband subscribers [GigaOm]




by Kate Cox via Consumerist

Top Laundry Detergents At Medium Prices Available At Warehouse Clubs

256213-laundrydetergents-membersmark-ultimatecleansamsclubLooking for a reasonably-priced but effective laundry detergent? Consider signing up for a warehouse club if you aren’t already a member of one. Our high-efficiency colleagues down the hall at Consumer Reports put out their list of great performers at reasonable prices, and two of the top three are house brands from Sam’s Club (Member’s Mark) or Costco (Kirkland). Non-members can check out Wisk Deep Clean instead.


Pricier brand-name detergents took the top scores for performance, but the warehouse club brands cost about half as much as big name Tide. The finest liquid detergent/underground currency that Procter & Gamble makes will run you about 28 cents per load, but lower-priced options cost only about half as much.


Low-cost detergents that get top marks for cleaning [Consumer Reports]




by Laura Northrup via Consumerist

GM Adds Another 200,000 Vehicles To Its Continually Growing Recall List

aveo There is yet another recall to add to General Motor’s already swelling list. This time more than 200,000 subcompact cars were recalled for a potential fire hazard created by daytime running lights.


On Wednesday, General Motors recalled 218,000 model year 2004 to 2008 Chevrolet Aveos, bringing the company’s running tally of recalled vehicles so far in 2014 to more than 13 million.


According to a notice [PDF] GM submitted to the National Highway Traffic Safety Administration, heat generated in the vicinity of the daytime running lamp [DRL] module – located in the center console of the instrument panel – can melt and cause a fire.


The Associated Press reports that GM officials are aware of an unspecified number of fires due to the issue, but that the company does not know of any injuries or deaths.


A notification schedule and remedy for the recall has not been determined. Owners of affected vehicles may contact General Motors customer service at 1-800-222-1020.


Wednesday’s announcement comes just a day after GM recalled 2.42 million vehicles in four separate recalls for an array of issues. Affected vehicles included the Buick Enclave, Chevrolet Traverse, GM Acadia, Saturn Outlooks, Chevrolet Malibu, Pontiac G6, Cadillac Escalade and Escalade ESV, Chevrolet Silverado HD and GMC Sierra HD.


Last week, GM recalled 2.7 million vehicles in five separate recalls for issues involving brakes, taillights and windshield-wipers.


So far in 2014 General Motors has been mired with recalls; one of which included 1.6 million vehicles for an ignition switch problem that has been connected to at least 13 deaths and set-off a firestorm of inquiries into the company’s recall behavior.


The company faces multiple probes related to the faulty ignition switch recall, including inquests into how long the company knew about the deadly issue before warning drivers. Last week, GM was slapped on the wrist for $35 million for waiting 13 years to acknowledge an ignition defect it knew about before the first recalled vehicles hit the road.


Consumers have already filed lawsuits against the company for its actions related to releasing the vehicles although issue were known.


GM adds 218,000 subcompacts to growing recall list [The Associated Press]




by Ashlee Kieler via Consumerist

eBay Asking Users To Change Passwords Following Hack


Another day, another hack attempt on a major online business. This time it’s eBay, which announced this morning that it will be asking users of the online marketplace and auction site to change their passwords following an attack on its system by cyber criminals.

There was some confusion on Wednesday morning as eBay initially posted an alert asking users to change their passwords and then subsequently removed it from the site without any apparent explanation.


Then it posted this announcement on its corporate website confirming that it will indeed be making requests for users to update passwords “because of a cyberattack that compromised a database containing encrypted passwords and other non-financial data.”


The information that may have been taken from the company included eBay customers’ names, encrypted passwords, email addresses, physical addresses, phone numbers and dates of birth.


“There is no evidence that any financial information was accessed or compromised; however we are taking every precaution to protect our customers,” a rep for the company says in a statement.


The company says that all financial and credit card information is stored separately from the database that was compromised.


“Cyberattackers compromised a small number of employee log-in credentials, allowing unauthorized access to eBay’s corporate network,” says the company. “Working with law enforcement and leading security experts, the company is aggressively investigating the matter and applying the best forensics tools and practices to protect customers.”


The hack actually occurred back in late February and early March. According to eBay, it knows of no increased fraudulent account activity on eBay as a result of the hack.




by Chris Morran via Consumerist

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