Service contract question

[ksnh]

I'm contemplating signing up for the Turbo Gold package, and went through the on-line process up to the point where I opened up and read the sample contract. I said "yeah, yeah, yeah" until I read the underlined "we can raise rates whenever we want" paragraph. I interpreted the sum of all the legalese to specify that if Dish raises (without any "percentage of increase" limits, etc.) rates during the two year term it would not be a breach of contract, and thus my only recourse would be pay the increase or cancel and incur significant pro-rated penalty charges.

You who are on the provider side may think that I'm naive to get hung up on that clause, but I've signed many other contracts where the whole point of the contract was to hook me for an extended term but grandfather me at contract inception current price as an incentive to commit to that extended term. Am I missing something here, or is it just as simple as my interpretation would suggest?

 

[KAB]

Unless a promotion clearly states a "lock-in" rate for a specific period of time, then yes Dish, DirectTV, Comcast, TWC and nearly every TV provider can and will raise rates that you are liable to pay over the course of your commitment...or terminate with penalty. Rates are raised regularly in the late winter, early spring.

 

[garys]

Many, many, many people think that since they are locked into a commitment (with most of Dish Network's are now 24 months) that the price is locked for that same period. The statement is to clarify that it is not. The only positive I can give is that Dish usually only raises the rates once a year in Feb, Direct is usually a month after, but many of the cable co's can and do raise their rates several times in a 12 month period.

 

[Andrewwski]

Where I am, TWC gives you a price lock for a contract. It'd be nice if Dish/Direct did the same but they won't. They won't raise the rates ridiculously, you just have to anticipate the raise every year anyway.

Not that I would sign a contract with TWC, so I don't get a price lock either.

 

[ksnh]

Unless a promotion clearly states a "lock-in" rate for a specific period of time, then yes Dish, DirectTV, Comcast, TWC and nearly every TV provider can and will raise rates that you are liable to pay over the course of your commitment...or terminate with penalty. Rates are raised regularly in the late winter, early spring.

Not really "apples to apples" when you include cable (at least my cable co.) which doesn't require a contract for most services. I can bail any time without incurring a punitive cancellation charge. With Dish (or DTV) I have to trust to faith that a provider's idea of a fair increase mirrors mine, and that doesn't sit well.

I have a really hard time imagining that either of those two main providers couldn't accurately forecast the cost of a fixed-price two year plan that would yield the same profit as what they would reap from me if I signed a current contract. I'm guessing that it just wouldn't be at the flashy price point that they're dangling to attract new business. If they can't look two years ahead (and it's not the same two years for their entire subscription base, because sign-ups are continuously staggered on a daily basis), then I don't have a warm fuzzy feeling about what I can expect to pay. What people seem to be telling me is that my $120 advertised savings for the first six months may be nearly offset by an inevitable rate increase that would take effect right around when I see my last $20 credit. That's quite a coincidence!

And yes - to save someone unnecessary keystrokes - I do recognize that I have a choice. That doesn't mean that the topic is not fair game.

 

[KAB]

IIRC, the "average" price increase for Dish this year was $6.00-$8.00. It varied by programing and equipment packages. One of the greatest contributors to to Dish's cost increases are the program providers. The sleaziest of them being some of the owners of local stations wanting to charge exorbitant re-transmission fees. Dish is often in a damned if you do, damned if you don't buy holding out against these demands. Good for most of us to keep the outlays down, bad for those in the markets that lose their locals for a period of time. Generally, Dish wins out in the end. In short, with provider contracts renewable yearly, it is hard to tell what two years out will bring.

 

[Awohar]

Not all stations like viacom, fox, etc., have their contracts coming up for renewal at the same time. So while DISH tends to review their rates once a year, their profitability changes with every one of those contract renewals with each station. So its hard to price lock someone when you don't know how much it will cost you to provide every channel they want for any extended length of time.

Subscriber acquisition costs tend to be $600 or higher per new customer. They have to manufacture the equipment you need, they have to pay for all the materials and labor to get you the services you want, and then they have to give you an additional incentive to come on board. Would you want to spend all that money on someone without some guarantee that they'll be with you a certain length of time? DISH is just being realistic when they say "programming and pricing is subject to change" since they can't really guarantee you they can bring you a channel like ESPN beyond the current contract they have with them since that contract doesn't necessarily expire at the same time as yours.

 

[StanUbankit]

Not really "apples to apples" when you include cable (at least my cable co.) which doesn't require a contract for most services. I can bail any time without incurring a punitive cancellation charge. With Dish (or DTV) I have to trust to faith that a provider's idea of a fair increase mirrors mine, and that doesn't sit well.


Does your cable provider charge for installation or other incidentals? If so you have to factor that into "how much does it cost for no commitment", if you decide to cancel after a short period of time. You could look at the history of Dish/Direct price increases over the last 10 years and I would expect to find a fairly consistent percentage increase each year. I used to pay yearly (in advance) with Dish, this accomplished two things: saved approx a month worth of charges (about 8.5%) and of course guaranteed the price for a year. I quit doing it because you are locked in to that particular programming package and I believe I tried to get it with one of the early hd packs and they didn't offer it on an annual basis. I'm not gonna lose any sleep over what Dish/Direct's increase is, whether or not I'm on a contract. I'm more worried about what our politicians (local, state & federal) are up to, that's always been a much bigger hit on my budget
You're doing the right thing, get as much info up front and make the decision that works best for your situation.