DirectTV’s DVR Lease Shell Game
Posted by Kirk Biglione in I Hate The Cable Company on Aug 11, 2008
My life in television purgatory came to an end recently when Kassia and I moved back into our home, after an extensive remodel, and re-activated our DirectTV service.
Given the amount of time I’ve spent ranting about Charter Cable over the past four months I should be happier about my return DirectTV.
While I am still happy with DirectTV’s service, I have to say that the company’s equipment leasing scheme has me feeling like I’ve been fleeced.
When I think about watching TV, what I’m really thinking about is watching TV on my trusty TiVo. Without the TiVo pay TV isn’t worth watching. TiVo is an essential filter that brings value to my television viewing experience.
I was more than a little annoyed to discover that in order to upgrade our service to an HD package, I would have to buy a new DirectTV brand receiver/DVR.
I was fine with the part where I had to buy a new DVR, my TiVo is nearly seven years old. It was the part about not being able to buy a new TiVo that really bothered me. My recent Charter experience demonstrated how truly horrible a DVR can be. Don’t let anyone tell you that all DVRs are the same. Those people are fools who watch commercials by choice and buy what they’re told to buy.
After doing a bit of research (research = talking with Tim Gaskill) I decided that the DirectTV DVR couldn’t possibly be worse than the Charter DVR, and might actually be a slight upgrade from my ancient TiVo Series One with the hole drilled in the case and a frayed ethernet cable hanging out of the side. My TiVo has been modded so much it looks like something Homeland Security should know about.
I decided to call my friends at DirectTV to upgrade my service.
The helpful DirectTV sales lady explained that the new DVR would cost $199, and that an additional $4.99 per month lease fee would be added to my bill.
Wait a minute? Did she say lease fee? If I was leasing the DVR what was I paying $199 for?
The operator explained that the lease fee isn’t really a lease fee at all. She doesn’t know why they call it that. It’s actually more of a DVR service fee.
She assured me that the $199 that was about to be charged to my Visa was indeed a purchase.
To be honest, I felt sort of strange even asking. Why else would I pay $199 for a DVR if I wasn’t actually buying it? If I walked into a Circuit City or a Best Buy and paid $199 for the very same box I certainly wouldn’t ask the sales person to verify that I was, in fact, really buying the DVR.
So, I take the operator at her word and finalize my purchase.
Three weeks later my next bill arrives. I’m looking at the details and I see the $4.99 lease fee. Actually seeing it on my bill makes me more curious.
I do a bit of research on The Google and quickly realize that I’ve been had. The lease fee that is not really a lease fee is, in reality, a lease fee.
And the $199 I paid for the DVR? That’s also a lease fee. Except it’s really more of a down payment.
I’ve come to find that I didn’t really buy anything, and the new DVR that’s sitting in my living room is actually property of DirectTV. If I cancel my subscription tomorrow I have to return the box or pay a penalty.
Oh, then there’s the small matter of the two year commitment. Of course I agreed to that without complaint. After all, I’ve been with DirectTV for nearly eight years and I have every reason to expect that I might be with them for another 8, or maybe even 80.
At least that’s what I thought before they snookered me into this crazy equipment lease deal.
Could this possibly get worse? Well, yes, in fact, it can. It turns out that the DVR I’m leasing comes with a 90 day warranty. If the damn thing breaks after 90 days I have to pay to repair or replace it. Even though it technically isn’t my DVR.
DirectTV has a solution to that problem. For an additional monthly fee I can insure the DVR that isn’t really my DVR against any possible damage.
Honestly, I don’t know how this can possibly be legal. Apparently I’m not alone. There’s a class action lawsuit in the works and I’ve discovered a legion of disgruntled DirectTV subscribers (and former subscribers) on various AV forums online.
If you read the fine print you find that DirectTV does actually mention the lease agreement, but it is so buried on their website that I can’t actually link to it. The lease is not mentioned on the the DVR product page or the page that lists the details of each service package. And based on my experience, some of DirectTV’s own employees don’t really understand the lease agreement.
Here’s what DirectTV needs to do to make things right:
1. Provide better disclosure. DirectTV needs to be more obvious about the fact that all equipment is being leased, and more transparent about the terms of the lease. They also need to disclose the total cost of the lease prior to signing consumers to a long-term commitment.
2. Educate all DirectTV sales staff and affiliates (including sales people at Best Buy, Circuit City, and any other retail outlet that sells DirectTV equipment leases) about the terms of the lease, and instruct them to provide customers with accurate information.
3. Give customers the option of purchasing their own equipment, and support third party products like TiVo.
In the past I’ve been something of a DirectTV advocate, providing a strong recommendation for the service and encouraging friends and family to sign-up.
After this experience I’m much less likely to recommend DirectTV, and I’ll probably spend quite a bit of time warning people about DirectTV’s deceptive equipment leasing practices.
ATT U-verse.
4 receivers, 1 hd dvr no purchase, no lease
wifi router
monthly agreement, no long term contracts
6 mbps inet connection
so far I’m happy
So basically, given the two-year commitment, DirecTV is charging you $320 dollars just to give you the ability to pay them another $80-100 month to watch their programming.
What happens if, next year, they come up with the most godlike HD-DVR in human history? Despite the fact that you don’t actually own your DVR, you can’t upgrade, right?
Or even worse, what happens if they ever decide to support TiVo again? Too bad! Such bullshit.
The fact that all DVRs aren’t the same is, ironically enough, the reason that I’m sticking with Charter. As long as they’ll support my TiVo Series 3, I’ll probably remain their customer.
Larry: So far no AT&T UVerse isn’t available in my area. Maybe in 2 years after my DirectTV commitment expires.
Jim: My sense is that I could upgrade to whatever super new DVR DirectTV comes up with. I would just have to pay whatever the new lease fee is AND extend my commitment by another 2 years. It’s funny that DirectTV is acting like a mobile phone provider right around the time the courts are ruling that mobile phone providers can’t charge an early termination fee.
Two words: Tivo HD
Kicks A S S!
Even places nice with Time-Warner cable.
OK ..maybe someone can shed some light for me …Direct TV’s notorious leasing deal. I have two receivers …one came free of charge, with the service, one is being billed a 4.99 “lease” charge. Now …according to DT, I own both boxes; this 4.99 is a “programming fee”. I wanted to upgrade one reciever, and add to the system, using my own purchased boxes. According to them, I’d have to pay the 4.99 “lease fee” for all addtional boxes I didn’t even BUY from them. Why?
Vinny, It’s been my experience that DirectTV isn’t very good at explaining the details of the monthly bills that they send to their customers. If you purchase a receiver from DTV, it’s actually a lease. After MANY calls to DTV I finally got them to eliminate the monthly lease fee on my single HD DVR receiver.
The 4.99 monthly fee is per *additional* receiver, and it applies to any additional receiver, regardless of where you purchased it. It’s actually a programming fee, although your bill probably identifies it as a lease fee. DTV operators are helpless to do anything about the wording, despite the fact that it’s misleading.
Here’s the secret- yes it is a lease fee- a fee of 200 dollars- that’s just for the privilege of having the device. The lease fees you pay every month are actually unavoidable Mirroring Fees. Mirroring is what DTV calls their way to copy the service of the “Primary” receiver over to other receivers. That means you will ALWAYS pay this- even if you own it which… truth told- owning that receiver is $500 or $499 but lets not split hairs. Owning the HD-DVR which is only guaranteed to work on Direct TV’s service (and rarely works then) doesn’t save you any money- you still pay the $5 mirroring fee every month forever.
Also- Leasing is just that; not lease to own as many seem to be confused by… you will never own leased equipment. Ever….
The only advantage to owning is that you won’t have to return the receiver when you wise up and cancel your services.
Also- for those that don’t know- DTV REVERES 3 year customers to the point they will offer a free upgrade if you have never had that type of advanced equipment… however they will still place the 2 year commitment that is $480 early cancellation fee (Either involuntary or voluntary) it does tier down 20 bucks every month you complete but…. that’s hardly compensation.
End of the line- yes ATT is more expensive than some cable companies- but it doesn’t lure you in with introductory pricing plans (that I have ever witnessed) and both ATT Uverse and Cable companies that offer all 3 services will offer all 3 services at a premium of just under about 200 bucks. (which is actually somewhat pleasing in my eyes)
In fact our current supplier of internet, Cable, and Phone gives us high speed internet topping out at 23 MBPS down- 2MBps- over 200 channels and two phone lines for only 150 bucks or so and that’s the price after introductory offer.
So needless to say- DTV is the devil- stay away from it- I am warning you now…
Signed;
Whistleblower
directv well I have currently an HR10 which was HD but they changed and it is no longer HD so I upgraded for $100 and new 24 month contract guess what they sent me a refurbished unit that is scratched and plastic front has a gash they refused to replace it due to cosmedic I will be changing to Dish Network
Does anyone know the address I can mail ALL the equipment to, I am canceling it and want NOTHING to do with Direct TV again!
Thanks!!
before direcTV I had a programmed VCR which functioned very well. Since DirecTV I cannot record at all
in spite of wiring diagrams and help from experienced people. Does DirecTV have a way of blocking existing equipment to sell DVR
Yes most is true, the biggest issue is they do not disclose the extension. I have 4 receivers and one went dead, I called and they would replace with a refurb or new, i said ok, well after i got the email confirmation I read the terms which was a link in the email, in this in the middle and in bold was the extension clause 1 yr for standard def and 2 yrs for HD. I called next morning to cancel the reciever, they said ok , but it shipped out and i got it and had to send it back and then send the broken one back, they said a recovery box so it’s free back.
The lack of disclosure on the phone and the fact that I made a 2 yr commitment with them – I pay – they provide and the lease box didn’t make it 2 years (1.5 yrs) and they wanted to extend my agreement 2 years when the equipment originally given to me didn’t make it the 1st commitment.. oh well.
The deal breaker is extension of contract for a broken unit, i can see a commitment like a cell phone for a new unit and thus a commitment as they units are expensive or so they say ..
A PLUS for direct is their customer service is in the USA and they speak english. I was with Dish for 10 years and they went to overseas and good luck with communication. I actually called dish and said hey i watn new equipment, been with you 10 years and have the old metal units still the person in broken english said could get one unit but not 3 or 4… Well when i signed for directv and got $300 off new tv i was buying anyhow and called to cancel dish, i was connected to a perfect english speaking person that would have given me the moon, i mean they were willing to pay the termination fees for the direct of i canceled and stayed with them, I said since you have chose to go over seas and I gave your company the chance to work with me and didn’t I have to say goodbye and maybe in two years i might be back. I took me 2 months to get my 1/2 month payment back, it’s not automatic they send you a refund when you cancel unless you hound them weekly.
Nothing’s perfect i guess, I’ve had direct 1.5 years and it’s the same picture as dish, i’ve actually had no issues except a dead unit which is in a guest room and i can survive, it would get sticky i guess if you had one unit and it died beofre your commentment..
hmmm
IF EVERYBODY WOULD REFUSE TO SIGN A COMMITMENT THEY WOULD HAVE TO DO IT OUR WAY OR GO BROKE.
WE WOULD BE WILLING TO PAY $ 50.00 OR SO TO THE INSTALLER BUT NO COMMITMENT. DONT BUDGE AND IT WONT TAKE LONG FOR THEM TO DO IT OUR WAY.
This “lease” game is the same that was played by the telephone companies years ago. The good old telephone hanging on the wall or sitting in the living room was ALWAYS the property of your local telephone company and you paid $2/month to lease it. The phones lasted forever and the lease was never paid off. Finally the govt got involved and required the phone company to remove the fee.
Called and asked for advertised rebate offer for Direct TV. Advertised, $100 dollar rebate to myself, and person advising them for the monthly fee of $39.95 Rcvd equipment, and called to confirm the rebate information the installer would not take. They told me no problem, however I could not apply for the rebate for 30 days. Thinking this was not right, I again called one week later, and was advised the same information. With that, I did not suspect any foul play, and expected my first months billing for the agreed $39.95.
When I got the bill it was for $69.41, and I called them as to why it was not what I had agreed to? They said that it was because the rebate information was not applied and that I could NOW apply for it online. I asked if I was to pay the bill, would they apply the credit due to my account, and she told me no, and that it would take another 8 to 10 weeks to apply it. I then told her that was NOT what I had agreed to, and they were now expecting me to pay the rebate amounts to them ahead of time, and that later on they would give me my own overpayment back. I then told her, that if that was the way they did buisness, that I did not want their service, to bill me for the amount of service that I had used, and to take their equipment back. They said fine. Later on, a salesman,(I have his name in my records), called and asked what it would take to keep my service with them, I replied, very easy, just honor our agreement of the rebate and the agreed price of $39.95. He said fine, he would apply a rebate of $50 to make up for the overpayment, and that he would also, include three months of free HBO. I said fine, however, I INSISTED THAT THEY SEND ME SOMETHING IN WRITING with this agreement. He said he would email it to me. After a week of no email, I again called them, and asked why I had not rcvd the agreement. The lady told me that it had been automatically sent. I asked her to simply resend the email, and I would then be happy to pay the bill (now this is two months at the overcharge price). She refused, and said she would not send it, and when I asked for a supervisor, she would not get one, and said that I would not get the aggrement sent to me. With this I then said, if you are not going to honor your aggrement, then I no longer want your service. She said fine, now they are harrasing my mother and I from a collection agent for the amount of $431.00 FOR EARLY TERMINATION,,,, I would sincerely like to see this go to court, and would like anyone to please give me some advice..
sincerely,,
Victor La Fountaine
I just went back to Comcast because they offered me a no contract triple play deal that only a salesman can offer you. He knocked on my door, not over the phone. I have had Direct TV for 6 years now, and with the economy being what it is we are having money issues, so we are trying to save wherever we can. I have been in this new house for two years and have had nothing but problems with DTV. I was never told about a early termination fee ever, till the women on the phone just told me. I got the first DVR in 2006 and the secound on when we moved here in September of 07. This woman was insisting that I got the DVR in o8, and that I would be charged for the early termination of the 2nd DVR. That it was a two year deal. I said I was not paying for It because I was never told about it. Then she said she would be sending me a prepaid package so I could send both DVR’s back to them. I don’t know if I should even send them back to them if they are going to try to charge me that term. fee. Will someone let me know what they think I should do with the box’s If you were me.
Sincerely,
Louann Hepworth
I was a DTV customer for 12 years, about 3 years ago decided to upgrade to HD
well the DVR’s were backorder for 6-10months so I went to Direct Buy and bought the DVR. DTV tried to charge me lease fees for over a year until I finally told them enough times that this was not legal – so I had a line on my statement called lease rebate that credited back the automatic charge. Recently I got a very good deal from Comcast so I cancelled my DTV and they insisted that the receiver was their equipment. I sent them copies of the receipt and they refused to accept this evidence, sent me a prepaid return box and a bill for the equipment. I threw the return box in the trash and told them to pursue their recourse for whatever they thought it was worth. Two lessons stand out from all the posts on this site: 1. Refuse to sign a contract for length of service, this will require some cooperation amongst consumers and would quickly solve many problems, but in reality it will probably not happen unless the government steps in. 2. If something seems intuitively unfair or manipulative it probably is and if we don’t walk away from offers that appeal to our greed, then we are most likely going to get screwed.
Encouraging the little people to resist being taken advantage
of by the corporations. Just look at how good TiVo was and how they
were destroyed by companies out to make a buck.
Jeff M
This is such a joke, I’ve been with DirecTV since 1994 in all that time I’ve been paying for both the DVR service and the two extra satellite boxes not discussed in this article. I’ve seen a change in the level of service since it was part of Hughes and spun off as well as a gross change in the cost of service in that time. Existing customers aren’t offered anything including a free pay per view movie for staying with direct TV. When I made my last move and upgraded to HD I had to do a so called buy and pay for the equipment and installation myself another $200 plus bucks. I kept the service because of the geographical moves I’ve made and the access to the NFL Sunday ticket but I’m through being a sucker for a company that places shareholder value ahead of customer satisfaction. I can watch the games on the NFL network but I totally plan to dump DirecTV and use ATT U-Verse. I’d like to know when the class action suit will be filed I’d sure would like to see some of the money I squander for TV service returned to me. I say stay away from them if you can because there plan is to get money out of you anyway they can.
look heres the deal it’s not a lease fee it’s a mirroring fee to give you programming on a second tv. Any satellite company has one dish just waives it if you plug it into a phone line or internet connection. Cable companies have them too unless you are poor and you get basic channels on the other tvs. And you people who proclaim 20mbps you would never use that in everyday life but since cable isn’t digital by any stretch of the imagination they have to give you high dl speed to compensate for lag go dsl. A dsl satellite and phone package averages 98 dollars and you get much more reliable service. Cable user= bad credit score because if this guy had to pay 199 that means he failed the credit check that’s easier than getting a target card or a secured card from your bank. Bash satellite if you want but customer service scores tell the story and directv discloses everything over the phone they call them rcc’s or required call components and if they don’t tell you those quality assurance listens and they record every call if they don’t you have the right to request the recording and if you are right you may cancel without penalty and I do mean every call. Instead of whining make sure you disclose all the facts and I say this on behalf of directv despite the fact that they closed the directv call center that I worked at in arizona due to company cutbacks based on the loss they took on the sunday ticket now I work for dish network pay is better but I kept my directv.
That’s great Dishman, but I only have one DVR and one TV. So, it’s clearly not a mirroring fee. And I paid $199 for equipment that I don’t actually own. You may call it whining, but usually when I pay that kind of money for technology I like to have some say in what I’m purchasing. That’s not the case with DirectTV. There’s still only one option — the truly mediocre DirectTV DVR.
Still waiting for the return of TiVo.
I was with Comcast but their customer service is absolutely horrible and their tech support is useless. Decided to go with Direct TV almost two years ago. The lease fee and the charges for equipment that i do not own has me waiting to get out and like everyone else the sales people can’t give you a straight answer as to why I have to pay so much for equipment that I do not own. I don’t even want to get into the fact that when I switched from basic to HD I was told that it was not a problem (ie no charge) and when I did it they wanted $300 and I refuse to pay the $100 to upgrade the receiver for my other tv.
My HD DVR just crapped out on me so they are sending me a new one but my contract (in my mind) expires in a few months and by that time I am hoping for U-Verse (not that I think that they are a saviour but I do feel as though I being nickel and dimed with DirectTV