It's a massive benefit. There's a couple parts to it, but a huge thing is you need to remember is there's effectively zero marginal cost to the ISP/cell carrier for the next customer - it's nearly all fixed costs.

If a pre-paid customer doesn't have the money, they'll either go without or downgrade their service. Less revenue for the company.

If a post-paid customer doesn't have the money...they might later. Their bill can be rolled forward, half paid, eventually sold to collections, whatever. More revenue in the long-term no question. Also, if you can charge your post-paid customers for all the things they opted into but didn't think too hard about the pricing on - SMS messages used to be $0.10 in my market, lots of parents opened up bills with 2000 text messages on them. Long distance and overseas calls were hugely expensive (and still are, in some cases) - big money makers for the carriers.

And contracts, of course. Customer acquisition is one of the biggest problems in the industry, getting people on a monthly billing cycle keeps them from easily switching.

Late fees, payment plans with service fees, and locking people into contracts are all incredible profitable.

You are overestimating customers' willingness to prepay. Using the service all month and getting a bill at the end is a hardwired habit and how all utilities have operated forever. Increasing the up-front cost for a new customer by $50-100 is going to be a huge hit for the business.

I'd assume the late payment fees and cancellation fees make up a good chunk of their income.

Or instead of credit just require a one-time deposit like utilities do when you don't provide a SS# for the credit check. It can still be post-paid, just pocket the deposit and kill the service if they miss paying a month.

Using centurylink now. It's prepaid.

Agreed, if the customer owed something/missed a payment, then this letter makes sense.

This customer didn't owe anything, so clearly this letter wasn't intended for them, but got it by an error.

I'm all for pitchforking Comcast and other giants who have terrible business practices, but this article seems like it's trying to drum up angst when this can clearly be explained by a mistake.

If I had bad debt and an option to repay my debt or have it cancelled if I do X and X is reasonable, these are both good options.

But only if you have access to a free lawyer, because the most likely outcome is that they'll make the same claim they already made -- that the letter was meant to be sent to customers that had outstanding billing issues. And I don't think it's illegal for the company to promise debt forgiveness to customers that re-join.

He said letters like the one Schklair received are sent to numerous former customers who may have billing issues. The letters are intended to help indebted people find their way back into the financial light, he said.

That's what the mobsters say as well, and somehow even they get a bad reputation. Can't people see we are trying to do them a service?

As the article clearly states, he had no debt with Spectrum. Which Spectrum admitted when questioned.

There is no debt to speak of though

I'm not sure you're familiar with how the "you can't cancel" trick works.

The situation in TFA is what happens if you try to escalate an ignored cancellation request by stopping payment. The company graciously extends debt to cover the service that you surely didn't intend to cancel, and when your balance -- augmented by late fees, of course -- has grown to be worth their while, they try to collect.

Variations on this theme exist. Sometimes you take a less than completely active role in the sign-up process and only learn about it on collection. Sometimes you "successfully" cancel and they just fail to process it. The common theme here is ongoing transactions for ongoing service (that isn't actually delivered) in the absence of ongoing consent. It's dysfunctional that we allow this in any form, regardless of whether the form in TFA is slightly less dysfunctional or slightly more dysfunctional than the most common form, which is what I structured my comment around.

If subscription services had to register with your credit card, credit reporting agencies, or some authority that gave you a (complete!) list and a cancel button, all of these problems would go away, along with the awful business models that they enable.

Companies are intended to extort money from former customers based on real and implied threats? What is the claim here? Are you saying for profit companies are inherently parasitic and politicians need to pass specific regulations to prevent every instance of bad corporate behavior? Or is it that politicians have created systems that makes companies acting antisocially inevitable? Or is it that companies have made adequate enough campaign contributions to have politicians look the other way?

You say that like politicians and companies never talk to each other. Who do you think is exerting the corrupting pressure on the politicians?