SubscribeCBC-TV personality George Stroumboulopoulos has dedicated two segments of his show, ‘George Stroumboulopoulos Tonight’, to the subject of Internet Overcharging. He’s convinced the arguments from service providers are nothing less than rubbish. Our daily lives now depend more than ever on an online universe some want to make unaffordable. (5 minutes)
Bell is pulling out all the stops trying to defend its justification for Internet Overcharging through so-called usage-based billing. In a published debate between the telecom giant and TekSavvy — a small independent ISP trying to preserve flat rate broadband service in Canada, Bell claims Canadian broadband is the third best in the world, ahead of the United States, all of Europe, and just barely trailing Japan and Korea:
At the same time, Canada has increasingly become a world leader when it comes to broadband. When it comes to actual download speeds, Canada ranks third in the G20, behind only densely populated Korea and Japan. And prices are low — in fact, for higher-speed services, lower than in both the U.S. and Japan.
Michael Geist, a popular columnist fighting against Canadian Internet Overcharging, scoffs at the notion:
I’m not sure where these claims come from – Canada does not appear in the top 10 on Akamai’s latest State of the Internet report for Internet speed and no Canadian city makes Akamai’s top 100 for peak speed. The OECD report ranks Canada well back in terms of speed and price as does the Berkman report. The NetIndex report ranks Canada 36th in the world for residential speed. Moreover, the shift away from the OECD to the G20 has the effect of excluding many developed countries with faster and cheaper broadband than Canada (while bringing in large, developing world economies that unsurprisingly rank below Canada on these issues). While there is probably a report somewhere that validates the claim, the consensus is that Canada is not a leader.
Bell’s Magic Pony-stories are at best exaggerated and at worst, phoney-baloney from the telco’s government relations department.
Stop the Cap! compared prices across several providers and found no value for money in broadband plans from all of the country’s major phone and cable companies. Without fail, all were heavily usage limited, most throttled broadband speeds for peer-to-peer applications, engaged in overlimit fees the credit card industry would be proud to charge, and simply were almost always behind their counterparts to the south — in the United States. In fact, some consumers are importing their broadband from the USA when they can manage it.
“Bell can’t win the argument on the merits, so it is making things up,” writes London, Ontario resident Hugh MacDonald. “I have had Bell DSL for years now, and there isn’t anything fast or cheap about it.”
MacDonald’s broadband service from Bell tops out at around 4Mbps.
Mirko Bibic, senior vice-president for regulatory and government affairs at Bell claims consumers have to pay more to fund infrastructure expansion, and even challenges our long-standing assertion that telephone network comparisons don’t apply:
Bell provides all our customers with the best possible Internet experience available — the result of heavy and ongoing investment to expand our network capacity both to meet fast-growing demand and to manage the congestion that threatens everyone’s Internet experience.
Internet congestion is a fact and it cannot be wished away. Network providers like Bell must, like hydro utilities, build our networks to handle the heaviest usage times, not just an average of usage over time. At 8:30 in the evening, demand is at its absolute peak. And we have to deliver based on the volume at that time.
Keeping up with growing volume obviously means these network investments are not one-time costs. Between 2006 and 2009, Internet usage more than doubled, and Bell has invested more than $8-billion in the last five years in network growth and enhancement to keep pace. Yet at the same time, the CRTC has found that the average price per gigabyte downloaded has actually declined by 20%.
That’s why the long distance analogy, so often used by those with an interest in confusing the issue, is fundamentally misleading. In the case of long distance, it’s the simple transmission of voice over long-established legacy networks.
But Bibic ignores several important facts and doesn’t disclose others:
What broadband network does not have to make regular investments to expand to meet demand? Cable and telephone company DSL business models, in place for at least a decade, priced network expansion, infrastructure return on investment, and data transmission into pricing formulas. While data demands are increasing, the costs to meet those demands are, as Bell openly admits, declining.
What amount of revenue and profit has been earned from selling broadband service to Canadian consumers and the wholesale market and how does that compare to the dollar amount invested? Bell Canada’s financial report for the third quarter of 2010 shows the company will earn an estimated $3.5 billion in revenue from its broadband Internet division alone. Bell’s capital spending numbers also include network investments for its fiber to the neighborhood service, Fibe. Bell’s revenue from selling the video side of that service were on track to deliver an additional $1.5 billion in revenue in 2010. Not including the enormous wholesale broadband market, Bell will earn at least $5 billion a year from its broadband division.
In fact, Bell’s financial report also openly admits much of its capital spending increases have been spent on deploying its IPTV network Fibe in Ontario and Quebec, not on Internet backbone traffic management.
What are some of Bell’s biggest risks to a happy-clappy shareholder report for investors next quarter? To quote:
Bibic
As for Bell’s claims about the “long distance analogy,” it’s only slightly ironic that a telecommunications company considers today’s voice networks radically different from data networks. Analog transmission of voice calls went the way of the telegraph around a decade ago, with the last analog, step-by-step telephone switch in North America in Nantes, Quebec switched off in late 2001. Today, telephone traffic is digital data, no different than any other kind of data transported across the country.
Bell cannot afford to have comparisons made between the telephone company’s move towards flat rate billing for phone calls and their broadband service moving away from it, because it torpedoes their entire argument.
Bibic then argues UBB is the right way to go because… major providers already charge it:
UBB has been the established framework for Internet services in Canada for years. Bell, for example, offers standard Internet service packages ranging from 25 gigabytes up to 75 gigabytes per month. As well, customers can sign up for 40 GB more for $5 per month, 80 GB for $10 or a whopping 120 GB more for $15. Keep in mind that 120 GB will get you 600 hours of standard definition video streaming or 100 hours of HD video streaming.
Not a bad deal when you consider average usage on our network is 16 GB per month and half of our customer base uses just five GB a month.
Most Canadians don’t see the “good deal” Bell says they will get from dramatically increased broadband prices. In fact, polls reveal the only groups in Canada that support such pricing are Big Telecom executives and the CRTC.
A new Angus Reid/Toronto Star poll illustrates what we’ve found to be true wherever ripoff “usage-based” pricing appears: people despise it, no matter how much Internet they use:
In the online survey of a representative national sample of 1,024 Canadian adults, three-in-four respondents (76%) disagree with the recent decision from the Canada Radio-television Telecommunications Commission (CRTC), which set the stage to eliminate unlimited use plans.
Bibic can relax as long as the current panel of commissioners at the CRTC, largely drawn from telecommunications companies, remain in place. They continue to agree with Bell’s point of view and ignore the citizens they are supposed to represent.
Chris Raines from Raines Broadcasting offered his take on Usage-based billing and Canada’s telecom regulator in this commentary. Raines calls Bell, Rogers, and Shaw bad actors in Canada’s broadband marketplace, caught throttling and overcharging their customers. (3 minutes)
Finckenstein at Thursday's hearing. Turn me over when I'm done on one side.
Canadian Radio-television and Telecommunications Commission chairman Konrad von Finckenstein appeared before a Commons committee last Thursday to answer questions regarding the growing scandal of so-called “usage-based billing (UBB).” The Commission’s decision to enforce this pricing scheme, ending unlimited broadband service in Canada, has created major headaches for the Conservative government of Prime Minister Stephen Harper.
Seasoned political observers were shocked when Industry Minister Tony Clement earlier tweeted his support for overturning the CRTC decision. Thursday’s hearing at the Standing Committee on Industry, Science and Technology also suggested the decision was made without any prior consultation with von Finckenstein, who appeared to be learning most of the details of the Clement’s decision at the hearing itself or in the morning newspapers.
Facing a grilling from members from just about every major political party in Canada, from the Liberals to the Bloc Quebecois, von Finckenstein only managed to add fuel to the fire, blaming “heavy users” for forcing the end of unlimited usage plans, all to protect what he called “innocent users.” He also blamed online video services like Netflix for forcing new pricing policies on Canadian consumers, who were increasingly using their broadband connections for more than just “e-mail and Facebook.”
At times exasperated, the chairman seemed to rely on industry talking points to address concerns with MP’s in attendance, occasionally without fully understanding their meaning.
At one point, he insisted Internet Protocol TV (IPTV), was never delivered over the Internet. At another, he claimed that providers would certainly use all of the funds collected from new, higher-priced broadband plans to rebuild their networks, asking rhetorically, “how else would they use that money?”
The head of the agency that is tasked with protecting the interests of Canadian consumers regularly compared the Internet to a power, gas, or water utility, which he said justified usage pricing. But von Finckenstein ignored landline telephone service, which is most related to broadband — a service moving towards flat rate pricing. Instead, he relied on cell phone pricing, which caused several reporters to cringe, as they reflected on newly-introduced flat-rate calling plans among new wireless competitors.
At this point a reporter for the Globe & Mail bemused with all of the utility comparisons tweeted: “Main difference is I can’t watch movies on my furnace.”
The CRTC’s decision to ignore hundreds of thousands of petition signers across Canada while quickly acceding to Bell’s request for a 60-day temporary delay in implementing the pricing scheme brought an angry response from Openmedia.ca, a pro-consumer group highly critical of UBB.
“The CRTC’s stubbornness in the face of a mass public outcry demonstrates the strength of the Big Telecom lobby’s influence,” said founder and national coordinator Steve Anderson . “While government officials have recognized the need to protect citizens’ communications interests, the CRTC has made it clear that their priorities lie elsewhere. Now is the time for citizens to demonstrate that they, rather than incumbent ISPs, are the real stakeholders.”
Some media observers and consumer groups are also scoffing at the government’s suggestion the CRTC should be allowed to review its own, earlier decision, claiming it is a virtual certainty the regulator will find their original decision was the correct one.
In fact, von Finckenstein’s relentless defense of usage-based pricing, even in light of recent political realities, suggest the Commission’s authority could be swept aside to keep the matter from becoming an issue in future elections.
“I would like to reiterate the Commission’s view that usage-based billing is a legitimate principle for pricing Internet services,” the chairman told members attending the hearing. “We are convinced that Internet services are no different than other public utilities, and the vast majority of Internet users should not be asked to subsidize a small minority of heavy users. For us, it is a question of fundamental fairness. Let me restate: ordinary users should not be forced to subsidize heavy users.”
The CRTC also claims the UBB policy will only impact residential customers — business accounts are exempt. But several MPs questioned that statement, suggesting home-based businesses, farmers and other entrepreneurs would face Internet Overcharging schemes.
Canada’s Liberal Party is using the occasion to embarrass the Tories’ handling of what they’ve called an Internet fiasco. Liberal’s industry critic, Marc Garneau, used some of his seven minutes of question time to ask whether the CRTC first heard of the Harper government’s stance on UBB through social media network Twitter.
Quotes from the CRTC Chairman; Image by Vojtěch Sedlák & Openmedia.ca
This message appears in place of the original websites that were formerly hosted under the domains seized by the U.S. government.
Just days before the Super Bowl, the U.S. Department of Homeland Security temporarily disrupted several popular online video websites that showed live streams of major sporting events. Late last week, the agency launched “Operation In Our Sites,” which redirected site visitors to a notification claiming the “domain name has been seized.”
But critics charge the effort ultimately was a waste of U.S. taxpayer dollars and questions are being raised about the legality of interfering with one of the websites based in Spain, deemed legal by that country’s courts.
Rojadirecta, a Spanish website, does not actually host any live web streams itself, instead publishing links to other websites that do. In operation since 2005, the enormously popular site today attracts more than one million visitors a day, most looking for live streams of game coverage. After two Spanish courts found the website operating within Spanish law, the site’s profile and popularity only increased.
Since the domain names affected were registered through a U.S. registrar, it opened the door for the Department of Homeland Security to obtain a seizure warrant through the United States Attorney’s Office for the Southern District of New York.
An affidavit filed with the court stated that piracy threatens “the leagues’ ability to sell game tickets and secure local television and radio carriage, and the value of advertising revenue generated by broadcast, radio and new media partners.” The agency also blamed online video piracy for high prices charged for stadium admission and for cable networks showing sporting events. “Sports fans are also victims, as the costs expended by sports leagues in an effort to address online piracy are passed on to fans when they purchase tickets or subscribe to sports networks.”
Rojadirecta wasn’t alone. Other web addresses seized included:
The agency’s actions commenced without any prior notification to the website owners.
“We have not been notified,” Rojadirecta’s Igor Seoane told TorrentFreak, a BitTorrent news site. “In our opinion the U.S. authorities are completely despising the Spanish justice system and sovereignty.”
Critics have attacked the agency for wasting taxpayer money chasing the video websites instead of finding Osama bin Laden.
Thanks to lobbying from Hollywood studios, language was inserted in the Patriot Act directing the agency to enforce U.S. copyright law at home and abroad.
U.S. Senator Ron Wyden (D-Oregon) called the web domain seizures “alarmingly unprecedented,” and could “stifle constitutionally protected speech.” Wyden’s office has been in touch with the agency seeking clarification and justification for the domain seizures.
Questions about how worthwhile the effort ultimately was are also being raised, considering virtually all of the affected websites were restored and re-indexed by major search engines under new domain names within hours, sometimes minutes, after being seized.
Several of our readers who shared this story with us suggest the move by the federal agency backfired, because it gave new prominence to these websites many never heard of before last week. We sure didn’t. There are no sports enthusiasts here at Stop the Cap! HQ, but we were intrigued to find several of these sites linking live-streaming news channels, including CNN, CNBC, MSNBC, BBC World, and Fox News. In fact, a few are even streaming ABC, CBS, and NBC stations for free. Quality varies considerably. The MSNBC feed has audio sync problems and CNN stutters.
At least one angry fan of the websites compiled a guide recommending websites be removed from Hollywood’s copyright enforcement ‘overreach’ by registering domain names through overseas providers. They do not answer to the Department of Homeland Security.
"Too rich for my blood."
How do you cushion the blow of a 46-percent rate increase for your fiber-optic television service that will cause consumers to flee? Don’t tell them about it.
Regulators in the Pacific Northwest are beside themselves over news that their new local phone company, Frontier Communications, is going to raise rates $30 or more for its FiOS cable television service. The company earlier promised no rate increases as a result of its purchase of landlines from Verizon.
But the only way customers in Oregon know about the impending rate hike is from The Oregonian newspaper; Frontier has yet to formally notify subscribers of the dramatic price hike.
The newspaper reports the higher rates were supposed to take effect at the beginning of the year for new customers, and Feb. 18 for current customers with expiring contracts.
But Frontier has not yet notified its customers of the rate increases. Spokeswoman Stephanie Beasly told the paper the company was working on “specific messaging.” Namely, how does Frontier tell customers their bills are going up $30 and still have them as customers after that.
Until the deck chairs can be re-arranged, the rate increase will not take effect. But Beasly emphasized it eventually will.
Washington County regulators (in Oregon state) are questioning Frontier’s justification for the rate hikes, namely “increased programming costs,” noting their competitors are charging far less for the same type of service:
Bend Broadband, an Oregon system providing a similar level of programming and services as Frontier, is able to manage its costs and keep subscriber rates at or below the range of large cable operators and significantly below those that Frontier has announced.
Some regulators are wondering if they were deceived by the company’s earlier promises to deliver “competitive prices” in the region. Metropolitan Area Communications Commission administrator Bruce Crest wrote the company suggesting they are not living up to their end of the deal:
However, Frontier’s recent decision to place a significant and unjustified rate increase on its customers, along with the incongruity of Frontier’s justification for that increase against the statements made in 2009 and 2010, makes us question whether Frontier has, or ever had, a good faith commitment to fulfill the terms of the franchise.
Frontier responded to the Commission’s inquiry by essentially telling them to bug off — they have no authority to question Frontier’s prices. Company vice-president Steven Crosby waved-off MACC’s concerns:
While Frontier recognizes that the MACC is interested in any Frontier FiOS video price increases and alternative offerings Frontier provides to its customers, Frontier respectfully notes that the MACC does not have authority to regulate the rates Frontier may charge for FiOS video service, nor does the MACC have authority to regulate Frontier’s commercial relationships with content providers. Accordingly, Frontier reserves the right to decline to respond to inquiries directed to topics that are beyond the MACC’s jurisdiction and may be competitively sensitive. Furthermore, Frontier objects to the MACC’s letter of January 20th to the extent that it contains characterizations and questions that misstate facts and conclusions or are otherwise misleading.
Have we got a deal for you!
You’ve heard all the excuses:
Despite the fact provider financial reports show a trend towards reduced spending on infrastructure, data transport costs continue to drop, and debunking of exaflood horror tales, providers persist in demands for this so-called “fairer pricing” for broadband service.
But what is fair?
As Canada contends with an Internet Overcharging scheme that limits consumption to an average of 40-60GB per month, with $1-5 per gigabyte in overlimit fees, does this represent fair pricing?
The Toronto Globe & Mail decided to investigate, and the results will come as no surprise to readers here.
Fact: Usage is growing exponentially, especially among users streaming online video. Canadians, just like Americans, are swarming towards multimedia-rich content from YouTube to Netflix. Usage growth of 50 percent per year is not out of line. But as the newspaper discovered, extraordinary growth alone does not deliver the whole story. The capacity to handle that Internet traffic has not only kept up with growth, it has exceeded it, at levels of unprecedented efficiency.
The Globe & Mail notes:
[...] Processing power, hard disk densities and transmission rates grew at rates closer to 60 per cent per year over the same period. In addition, the servers and routers and other electrical equipment that are the backbone of the Internet are much more energy efficient than they were ten years ago, which has dramatically reduced the cost of operations.
In simple terms, the bandwidth explosion is real, but it’s been more than offset by more powerful and more energy-efficient machines. So, we can reject the notion that increased usage is the a significant rationale for huge Internet price increases and usage-based billing.
Costs down, but prices going up?
Among virtually every provider, the percentage of average revenue spent on broadband network expansion per customer has dropped. Even Verizon, which suspended expansion of its fiber to the home network, has not faced an avalanche of new costs to deliver large amounts of data to FiOS customers.
But what about the “fairness” proposition. Should light users pay less than heavy users? Historically, even in countries where usage-based pricing is the norm, usage-limited customers still pay comparatively high prices for broadband service, particularly when measured on cost per megabit per second against the usual lower caps cheaper plans provide. So-called “light usage” plans also have natural usage caps built-in — they come with far slower speeds that, at their worst, discourage use of high bandwidth services.
The Globe & Mail concluded: “Rather than ensuring consumers receive fair Internet pricing, the Canadian Radio-television and Telecommunications Commission seems content to line the pockets of cable and telecommunications companies by forcing Canadian consumers to pay Internet data rates that have no basis in reality.”
Here’s why:
Wholesale Data Costs
The “fairness” argument falls apart when the truth is revealed about the wholesale costs large providers pay for their Internet connections. Assuming the providers’ arguments that pay-per-use pricing is fair, the prices they ask Canadians to pay for that use certainly are not.
The Globe & Mail again:
Approximately four years ago, the cost for a certain large Telco to transmit one gigabyte of data was around 12 cents. That’s after all of its operational and fixed costs were accounted for. Thanks to improved technology and more powerful machines, that number dropped to around 6 cents two years ago and is about 3 cents per gigabyte today.
Are these valid numbers? After the recent CRTC decision regarding UBB, it was announced that effective March 1st, Bell will be charging Third Party Internet Access (TPIA) providers $4.25 for a 40 GB block of additional data transfer.
The fact that Bell is able to sell 40 GB of data to wholesalers for $4.25 and still make a profit demonstrates that the true cost of data transfer is well below the 10.5 cents per gigabyte they are charging wholesalers. One TPIA provider agreed the 3 cents per gigabyte figure is probably close to the true cost.
So why are Internet service providers charging consumers $1 or more per gigabyte of data used beyond their respective data caps? That’s a good question.
The “good answer” is: profits.
With providers charging overlimit fees from $1 per gigabyte on Bell’s most generous plans to $5 per gigabyte for Rogers’ Ultra-Lite plan, this represents overcharging of at least 10-50 times what it actually costs the providers to deliver that data.
Broadband costs in the United States are dramatically lower than in Canada, in part because of a larger marketplace and because of greater capacity and more competition, yet proposals from some American providers sought similar limits and overage pricing.
But considering the true cost of the service, charging closer to 10 cents per gigabyte — not $1 or more — would represent a fair price. So long as regulators like the CRTC cater to providers, consumers will pay considerably more.
http://www.phillipdampier.com/video/CTV Usage Based Billing 2-1-11.flvCTV News explores Usage-Based Billing, and why it will makes an expensive broadband experience even more costly in the days ahead. (6 minutes)
High gain Wi-Fi antennas like this one allowed one Ontario couple to leave Canada's cable companies behind and sign up for Time Warner service in the United States.
Last week, Stop the Cap! compared prices from two Internet Service Providers — Rogers Communications on the western side of the Niagara River — in Ontario, and Time Warner Cable on the eastern side in Niagara Falls, N.Y.
The price disparity is no secret to one Canadian family who read our piece and let us know they import their broadband service, thanks to long distance Wi-Fi, from the United States.
The couple, Neil and Michelle (we’ve been asked not their reveal their real names) and their three boys have lived along the Niagara River, which divides the United States and Canada, for over a decade. Jim has been fascinated with low power, long distance communications since his days in amateur radio.
“I’ve always been trying to see what stations I can pick up, especially low power ones,” Neil tells us.
That curiosity came with Neil to his interest in broadband wireless communications. Living along the river, Neil was fascinated to see Wi-Fi signals make their way across the river from the United States’ side.
“Thanks to a clear shot across the river, and a lot of businesses located adjacent to the Robert Moses Parkway, it’s easy to pickup Wi-Fi signals from businesses on the American side,” says Neil.
Neil discovered many networks wide open for public use and began to consider the implications of “importing” his broadband service from the United States to escape Rogers’ high prices.
“For Canadians, the idea of escaping the country’s communications providers is not that unusual,” Neil says. “Some already have ‘gray market’ satellite dish accounts with America’s DISH or DirecTV, and some even use American prepaid cell phones, which are much cheaper than our own services and get good local reception across Niagara Falls down to Fort Erie.”
“So I began wondering what would happen if we could install a decent Wi-Fi system high enough on the house to get a good signal from a partner on the other side of the river,” Neil pondered. “We started by putting a test signal up and driving through some Niagara Falls neighborhoods on the American side and found some good prospects.”
A long-shot advertisement on a well-known “for-sale/trade” website paid off, when an American family responded, intrigued by the experiment.
“The fact we were willing to pay their cable bill as compensation didn’t hurt either,” Neil suggests. “The chances appeared very good for success, because we can see some of their trees from our roof.”
Niagara Falls, Ontario (left) and Niagara Falls, N.Y. (right), divided by the Niagara River.
Neil guessed right because today, with the help of two raised directional, roof-mounted high-gain Wi-Fi antennas that can literally “see” one another, the Ontario family enjoys its cable-TV and broadband service from Time Warner Cable.
“The signal is rock solid and the only time we get some speed problems is if someone in one of the bed and breakfast places nearby ends up on our channel,” Neil says. “We can even watch television with the help of a Slingbox we installed on the American side which works perfectly fine on a Wireless N connection.”
Since the rise of Canada’s exchange rate against America’s declining dollar, the savings are dramatic. A comparable cable-TV plan with Rogers runs $80 a month for standard service, equipment fees, and HD service charges. Add another $50 for broadband service with the modem rental fee and Neil would pay Rogers $130 a month before taxes for the two services.
“And we would be limited to just 60GB of usage per month before the $2/GB overlimit fee started making the bill even higher,” Neil says.
Time Warner Cable currently charges Neil’s adopted family $87 a month for television and broadband on a promotion.
Today, Neil’s conscience (and savings) led him to decide “borrowing” another family’s account wasn’t fair, so now he pays for -two- accounts with Time Warner, one for the New York family, the other belonging to him.
“Time Warner thinks of us as apartment renters and bills a post office box,” Neil says. “The other family doesn’t care about cable-TV anymore so we’re just paying for their broadband account.”
The neighbors are certainly amused.
“When they come over, they call us ‘the American Embassy in Niagara Falls’ because of all the ads for Time Warner they see across the cable channels we get and because American cable systems ignore virtually all Canadian TV networks.”
Why go through all this?
“Now that we’re paying for two accounts, it’s a matter of principle,” Neil says. “I will not do business with a company that slaps usage limits on broadband, and now I don’t have to.”
In fact, now that the family’s sons are getting close to teen years, their Internet use is growing.
“We almost don’t care about the cable-TV anymore ourselves — we’re watching shows online, on-demand in this household,” Neil says. “For my kids, they are growing up with the concept of television being always on-demand and it works around their schedule, not the other way around.”
Besides, Americans have access to Hulu, and Canada does not.
“Hulu is very important, and Netflix was even before it was sold in Canada,” Neil says. “Now we can watch what we want, as much as we want, and pay a fair price for unlimited broadband.”
Neil can’t complain about Time Warner Cable, except for the fact it provides him with a U.S. IP address, which locks him out of a lot of Canadian online video-on-demand services from the CBC and other networks’ websites.
“They do a much better job than Rogers ever did with consistent broadband speeds and fewer outages, and we can live without replays of 18 to Life and Little Mosque on the Prairie,” Neil says. “I’m just glad you folks at Stop the Cap! convinced Time Warner to abandon the kind of pricing that is ruining the hell out of Canada’s broadband.”
Verizon Wireless isn’t entirely rolling out the welcome mat for new iPhone customers. PreventCAPS, one of our regular readers, dropped us a note indicating Verizon quietly added something new to the terms and conditions for new customers as of Feb. 3rd, which just so happens to coincide with the date the company started taking orders for the Apple iPhone — it reserves the right to throttle your speeds and “optimize” your browsing experience with caching and network management techniques that could reduce the quality of online videos and other bandwidth-intensive graphics.
As part of our continuing efforts to provide the best experience to our more than 94 million customers, Verizon Wireless is introducing two new network management practices.
We are implementing optimization and transcoding technologies in our network to transmit data files in a more efficient manner to allow available network capacity to benefit the greatest number of users. These techniques include caching less data, using less capacity, and sizing the video more appropriately for the device. The optimization process is agnostic to the content itself and to the website that provides it. While we invest much effort to avoid changing text, image, and video files in the compression process and while any change to the file is likely to be indiscernible, the optimization process may minimally impact the appearance of the file as displayed on your device. For a further, more detailed explanation of these techniques, please visit www.verizonwireless.com/vzwoptimization
If you subscribe to a Data Plan or Feature on February 3, 2011 or after, the following applies:
Verizon Wireless strives to provide customers the best experience when using our network, a shared resource among tens of millions of customers. To help achieve this, if you use an extraordinary amount of data and fall within the top 5% of Verizon Wireless data users we may reduce your data throughput speeds periodically for the remainder of your then current and immediately following billing cycle to ensure high quality network performance for other users at locations and times of peak demand. Our proactive management of the Verizon Wireless network is designed to ensure that the remaining 95% of data customers aren’t negatively affected by the inordinate data consumption of just a few users.
These kinds of “network management” techniques, which include speed throttles, reduced quality graphics, and caching (which can result in stale web pages being served to your mobile device), are all made possible by the Federal Communications Commission’s failure to implement Net Neutrality protections for wireless providers. While Verizon stresses it will treat all content to the same network management techniques equally, the “improved” broadband experience Verizon claims to offer is more likely to improve the company’s bottom line from reduced spending on network upgrades.
Like most providers, Verizon isn’t willing to be specific about what amount of usage is likely to trigger the throttle, why it needs to be maintained for the remainder of the billing cycle even when network congestion is not a problem, and what speed customers will be stuck with for the rest of the month.
Broadband Reports reached out to Verizon for specifics and discovered the provider has not actually implemented these measures… yet:
“The notice yesterday simply reserves the right for new customers or renewing their contracts,” Verizon spokesman Jeffrey Nelson tells Broadband Reports. “We’re reserving the right to actively manage the network in specific ways should that need exist – and only for customers who are under contract that includes that provision,” he says. “Because this is down the road – if at all – it’s too early to tell what those triggers might be, or what throughput limitations would look like.”
Verizon may be concerned about the potential impact millions of data-craving iPhone customers will bring to its network in the coming weeks. Existing customers with Android devices or Blackberry handsets are safe for now — the provision only impacts customers who sign new contracts as of last Thursday.
Verizon says it will retain its unlimited data option (with the right to throttle service) for a “limited time only.”
Shhh... Bright House's fiber network is a secret.
Volusia County’s consideration of a community-owned fiber optic network has been scoffed at by incumbent cable provider Bright House Networks, which claims the network is “redundant” and unnecessary.
The proposed fiber project is being promoted by Jim Cameron, vice president of government relations for the Daytona Regional Chamber of Commerce. The organization believes a public-private fiber-optic network could do wonders for economic development across the Fun Coast.
But the idea of stringing miles of fiber to connect area businesses to a gigabit-speed network brought rolled eyes from the folks at the cable company.
“We have miles and miles of fiber-optic lines in Volusia County,” Donald Forbes, senior director of corporate communications for Bright House told the Daytona Beach News-Journal. “Where anyone is willing to do business with us, we can make it happen . . . You want it, we’ve got it.”
But area businesses supportive of Cameron’s initiative are mystified by Bright House’s secretive-fiber-network, because few ever heard of it before.
Jason Frederick, business development director for WorkSmart MD, a Daytona Beach medical billing company, was just one example. The News-Journal reports Frederick was surprised when he was told that Bright House claims to have fiber lines in the county that can deliver Internet at one gigabit per second, about 200 times faster than average broadband service in the U.S., or faster.
“I haven’t heard anything about Bright House offering one gig, and my tech guy is laughing (incredulously) right now,” said Frederick.
"This series presents information based in part on theory and conjecture. The producer's purpose is to suggest some possible explanations, but not necessarily the only ones, to the mysteries we will examine."
In Search Of… Bright House’s Mystery Fiber
Bright House declined to quote pricing for access to their fiber network to the folks at the News-Journal, so Stop the Cap! called Bright House Networks’ Business Solutions department this morning posing as a new business customer looking for fiber optic access.
STC: We were calling to gather information about getting broadband service for our new Internet business. Can you tell me what kind of broadband services you have available?
At this point, Bright House asked us a ton of questions about where the business was located, what we intended to do with the connection, how many employees we had, etc. After feeding them answers, we got them to narrow down some basics, even as they tried to have a sales representative come out and meet with us (we explained they would have to fly to New York to manage that, and they should bring a shovel if they come.)
Bright House pointed us to their website for basic details, but stressed individual plans could be customized to meet our needs. That was the invitation we were looking for.
None of these plans seemed at all fast enough for our needs, we explained. The maximum plan on their website, 50/5Mbps, didn’t even come close. Where was the 50/50 or 100/100Mbps plans? What if we needed a gigabit? Didn’t we read they ran a fiber network?
Bright House: We do run a fiber network, but it’s a special kind known as a hybrid fiber/coax network. That is the most proven technology out there, installed to millions of homes and businesses across the country for more than a decade.
STC: Then all-fiber networks are unproven?
Bright House: In a way, yes. But more important, they are enormously expensive.
STC: How expensive?
It would cost you this much.
Bright House: We spent millions on ours.
STC: So you are saying if we wanted Bright House to deliver fiber to our business, it would cost millions?
Bright House: Probably not that much, but it would probably be a waste of money because it was so expensive. We service business customers all over central Florida, and I’ll be honest none of them really need fiber — it would be a waste of money. We couldn’t even give you a price for fiber because nobody ever asked us before.
STC: Wow, I am surprised nobody has even asked. Our business would want symmetrical broadband so our upload and download speeds would be the same. We also don’t want to pay an outrageous amount of money for it. What would Bright House charge for a symmetrical connection?
Bright House: One of our account specialists would have to talk with you about that. Our network was designed to deliver faster download speeds because that is what our customers want.
STC: Well, not every customer.
Bright House: I understand that, and it sounds like you are a special case. I think you’ll find we deliver the best service in town for business customers, and we sure do a lot better than AT&T. Have you spoken with them about their service?
STC: We don’t want DSL.
Bright House (laughing): I can certainly agree with you there. AT&T is a good company for what they do, but I am proud to say we do better. And we can give you cable television and business phone service in one package.
STC: Yes, but we’re probably getting ahead of ourselves. How much would it cost for just the broadband service?
Bright House: Before we quote you a price, we’d really like to sit down with you or a representative of your company so we can explain our whole product line and the benefits we offer. Is there someone down here we could meet with?
STC: Not yet, but I appreciate the information and we can always call you back.
(We did learn from another source 50/5Mbps business class service costs around $190 a month from Bright House.)
So Bright House fiber remains elusive, even after our call. Connected Nation, which has direct ties to Big Telecom, couldn’t find any fiber across the area either. That was surprising, considering the large telecom companies help manage their operations:
The Florida Department of Management Services is running Connected Nation’s efforts in the Sunshine State.
If the goal is widespread fiber-optic coverage, then Connected Nation’s map shows Florida sorely needs a fiber dietary supplement (Metamucil-optic?). Only a small portion of the state — around Orlando and to the south, and around Tampa and along the surrounding Gulf Coast — has fiber coverage, according to Connected Nation’s survey results.
Jessica Ditto, Connected Nation communications director, said the map only reflects spots where fiber-optic lines run to homes, and that Bright House might not have responded accurately to the survey. Bright House’s Forbes said he hadn’t heard of Connected Nation.
You didn't want this anyway, did you?
Another indictment for the useless work Connected Nation does for large sums. If a major provider doesn’t answer the questionnaire, broadband from that provider apparently does not exist as far as Connected Nation is concerned.
Finding fiber is Daytona is turning into that commercial for Honey Nut Clusters cereal. It’s got to be around somewhere.
The county director of economic development, Phil Ehlinger, suggests it is all around us even if we can’t see it at first glance.
“I am not aware of anyone (in the business community) who is unable to get the service that they want,” Ehlinger told the newspaper. “Bright House and some of the other folks, AT&T, they have been putting in fiber optic all over the county.”
But the important question left unanswered is whether or not you can access it. For individuals, the answer is clearly no. Bright House believes its network is plenty fast enough, and AT&T didn’t want to talk to us in time for today’s story. But phone companies, already vulnerable in the broadband speed race, prefers to deflect the question, arguing you don’t need that speed anyway.
Fiber optics delivers the fastest broadband experience, period. But when providers don’t sell or promote the service, it’s easy to suggest nobody wants it.
But not too far away, in communities like Chattanooga, and several areas in North Carolina, they -do- want it. Even Verizon FiOS, a growing presence in the northeastern United States, has won over business and residential customers to fiber-fast broadband. In many cases, the network sells itself.
But in central Florida, Bright House won’t sell the service to you even if you ask. It’s apparently the best kept secret in Daytona Beach.
[Updated 2/4/2011 -- Don Forbes attached a reply to a piece on Broadband Reports that quotes from our piece:
Bright House Networks does in fact provide Fiber to the Premise (FTTP) – or what is known in the business services market as “dedicated access” – to its business customers who want this type of bandwidth. We work directly with our business customers to provide solutions tailored to meet their specific needs. We currently serve more than 3,000 Florida business locations directly with fiber. We currently offer speeds up to 1 Gbps, although it should be understood most business customers do not require 1Gbps speeds. Residential customers, at this time, do not need the bandwidth offered with dedicated fiber – however, Bright House has led the industry in comprehensively deploying next-generation bandwidth services (DOCSIS 3.0) to its’ entire footprint in Florida – current speeds offered are 50 Mbps with the ability to offer much higher. We provision our network according to our customers’ needs.
As a private company, we do reserve the right to share specific proprietary details of our network and our business for competitive reasons. However, it is no secret that we offer the above services.
It apparently is a secret to the people taking calls at Bright House's business services hotline at 1-877-424-9246. That's the number we called yesterday to inquire. The results are noted above. I'd make two observations:
We stand by our piece, which documents our direct experiences with Bright House Networks business class customer service.]
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