How many $10 things in your life actually cost almost $20? I’m guessing not a lot.
Apple claims that monthly wireless service for an Apple Watch here in the U.S. is $10/month. But for most of us this is not where the billing ends, but where it actually begins. Tack on the usual taxes and fees, and that $10.00 becomes $19.81. In the grand scheme of things, this is fairly small potatoes, but the extra baggage these plans carry is rather mind-blowing. Besides, the reason I have money for purchases like this is because I don’t spend money foolishly.
What am I getting on about? Take a look at the billing breakdown of my wife’s Apple Watch Series 3 w/ LTE:
| Base Service | Cost | Explanation |
| AT&T Access for Apple Watch | $10.00 | Self-explanatory |
| Surcharges & Fees | ||
| Administrative Fee | $1.99 | This is AT&T charging you for their overhead. You know how a grocery store might charge you a Luminated Direction Fee to pay for the electricity used by their exterior signage, or how McDonalds charges you a Potato Peeling Fee for your french fries? Yeah, it’s just like that. |
| Federal Universal Service Charge | $0.54 | This goes to the Universal Service Fund, a long-obsolete government program to help offset the costs to provide service for people who live in bumble-fuck nowhere. |
| Illinois Telecom Relay Service | $0.02 | The FCC describes it as follows: “The TRS fund compensates TRS providers for reasonable costs of providing interstate telephone transmission services that enable a person with a hearing or speech disability to communicate with a person without hearing or speech disabilities.” Last I checked, there are tons of services out there that charge these folks a handsome fee for their services, usually because they’re offset by insurance. But we’re literally talking about two pennies here, so I’m not going to sweat it. |
| Regulatory Cost Recovery Charge | $1.50 | This is another example of AT&T charging you for their normal operating costs. This one is because the big bad government makes them do stuff, like figure out how much to charge you for the USF and TRS fee. |
| Government Taxes & Fees | ||
| Illinois 911 Surcharge | $5.00 | According to Ting Mobile, most states and localities charge between $0.50 and $3.00. Like most taxes in Chicago, it just happens to be a rip-off at $5.00. |
| Municipal Telecommunications Tax | $0.38 | Purely a money grab by your local politicians for the ‘privilege’ of having phone service. |
| State/Municipal Telecommunications Tax | $0.38 | See above. Because if there’s one thing we don’t have a shortage of, it’s bodies of government with their hands out. |
| > GRAND TOTAL < | $19.81 |
So there you have it: the real cost of owning a cellular-capable smartwatch. $3.49 of pork snuck in by the carrier, $0.56 going to Washington, a five-spot for EMS reach-ability, and an extra $0.76 to the local government just because they can.
Illinois Policy talks a bit about the per-state taxes charged on mobile devices. Worth a read, even if you don’t live in the Democratic People’s Republic of Illinois.