GATEWAY, Juno settle consumer deception claims

Tuesday, May 15th 2001, 12:00 am
By: News On 6

WASHINGTON (AP) _ Two computer companies have agreed to change their policies after consumers were forced to pay hidden charges for Internet access, federal regulators said Tuesday.

``These so-called 'free' Internet access offers were anything but,'' said Jodie Bernstein, director of the FTC's consumer protection bureau. ``Information about fees was hidden in the fine print.''

The Federal Trade Commission alleged that Juno Online Services made it unreasonably difficult for consumers to cancel their premium service before a free trial period ended.

Computer maker Gateway Inc., charged $3.95 per hour for rural customers to dial into the Gateway.Net service with a supposedly toll-free phone number, the FTC charged.

Juno spokesman Gary Baker said that his company has changed its practices, but they are not out of the ordinary.

``The policies and practices here at Juno have always been highly comparable to those of our major competitors,'' Baker said. ``Everybody in the industry made these types of disclosures the same way.''

The FTC said Juno failed to disclose that phone numbers used to access its service were long-distance for certain customers and similarly failed to tell customers that they only had one month to use their 150 free hours.

Baker said Juno's customer service has improved, and customers can cancel their pay accounts through e-mail as well as a phone call.

Gateway ran advertisements that said its computers included a free year of Internet access through Gateway.Net, according to the FTC, but had ``minuscule'' two-point type that disclosed a per-hour cost for rural customers and a 150-hour per month limit. Other ads had no disclosure, regulators said.

Gateway spokeswoman Donna Kather said the ads in question ran in 1999, and newer ads properly disclose the costs.

``We've already reached out and refunded a good portion of these customers,'' Kather said.

Both companies agreed to stop their practices, and will reimburse customers as part of the settlements.