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Corporate/Koch Brother-Linked Group Asks FCC to Repeal Charter/Spectrum’s Data Cap Prohibition

A conservative group funded by corporate interests and the Koch Brothers has asked FCC chairman Ajit Pai to answer its petition and move expeditiously to cancel the prohibition of data caps/usage-based pricing as a condition for FCC approval of Charter Communications’ acquisition of Time Warner Cable and Bright House Networks.

A number of pro-consumer deal conditions were included as part of the merger transaction’s approval, and won the support of a majority of FCC commissioners under the leadership of former FCC chairman Thomas Wheeler, appointed by President Barack Obama.

The Competitive Enterprise Institute (CEI) is hopeful that with Wheeler out of office and a new Republican majority at the FCC under the Trump Administration means the FCC will end requirements that Charter offer unlimited data plans, discounted internet access for low-income consumers, and start allowing Charter to charge fees to Netflix and other content providers to connect to its broadband customers. CEI has every reason to be hopeful, pointing out Chairman Pai is a fan of data caps on residential broadband service, opposes Net Neutrality, and recently effectively killed a Lifeline program that would have extended inexpensive internet access to the poor.

CEI:

As then-Commissioner Pai wrote in 2016, this condition is neither “fair” nor “progressive.” Instead, he called this “the paradigmatic case of the 99% subsidizing the 1%,” as it encourages Charter to raise prices on all consumers in response to costs stemming from the activities of a “bandwidth-hungry few.” Other problematic conditions include the ban on Charter charging “edge providers” a price for interconnection and the requirement that the company operate a “low-income broadband program” for customers who meet certain criteria.

The group is optimistic Pai will oversee the unwinding of Charter’s deal conditions largely pushed by former FCC chairman Thomas Wheeler, after Pai recently led the charge to revoke another condition required of Charter in return for merger approval – a commitment to expand its cable network to pass at least one million new homes that already receive broadband service from another provider.

Pai also opposed the low-income internet program, calling it “rate regulation.” The CEI claimed the requirement will “undermine Charter’s ability to price its services in an economically rational manner.”

“Hopefully, the FCC’s new leadership will seize this opportunity to take a stand against harmful merger conditions that have nothing to do with the transaction at hand—by granting CEI’s petition,” the group wrote on its blog.

YouTube TV An Epic Fail Before It Even Launches: Bad Value, Ad-Littered DVR

Google’s forthcoming online TV streaming service will cost too much for too little and includes a cloud-based DVR that will replace many of your recordings with unskippable-ad-laced alternatives.

YouTube TV was previewed for reporters Tuesday, despite the fact it won’t debut until late spring or early summer, with a lineup of 40 channels for $35 a month. The “skinny bundle” from Google has managed to put together a very incomplete lineup of major cable networks and for most of the country, on-demand-only access of network shows about a day after they air.

YouTube TV Tentative Lineup

  • Disney: ABC, ESPN, ESPN2, ESPN31, ESPNU, ESPNews, SEC Network, Disney Channel, Disney Junior, Disney XD, Freeform
  • NBCUniversal: NBC, Telemundo, Bravo, Chiller, CNBC, E!, Golf Channel, MSNBC, NBC Universo2, NBCSN, Oxygen, Sprout, SyFy, Universal HD, USA. In some regions: Comcast Regional Sports Networks, NECN (New England Cable News)
  • CBS: CBS, The CW, CBS Sports Network
  • Fox: FOX, FS1 (Fox Sports 1), FS2 (Fox Sports 2), BTN (Big Ten Network), FX, FXX, FXM, Nat Geo, Nat Geo Wild, Fox News, Fox Business. In some regions: Fox Regional Sports Networks
  • The Weather Channel: Local Now (rolling weather forecasts)
  • YouTube TV members can also add Showtime for $11 a month and Fox Soccer Plus for $15 a month.
  • Availability of local TV/live network streaming limited to residents of New York, Los Angeles, Chicago and Philadelphia.

Prospective customers will have to tough it out with no access to AMC, HBO, MTV, Comedy Central, Nickelodeon, MTV/VH1, CNN, Cartoon Network, Discovery, TBS, TNT, PBS, Food Network, and HGTV among many other missing networks.

One potentially interesting feature – an unlimited cloud-based DVR service, is rendered almost unusable with the imposition of prioritized video-on-demand. In short, this means that once a video-on-demand version of the show you recorded on your DVR becomes available, you can no longer access your recording. Your only option is to watch the ad-heavy, on-demand version with advertising you cannot skip. In most cases, that will give customers about 12-24 hours to watch their DVR recordings before they become inaccessible, at least until the on-demand version is removed.

Wojcicki

That’s a challenging proposition when consumers have other choices including AT&T’s DirecTV Now, Sling TV, and PlayStation Vue. The premise of YouTube TV, like many others, is to appeal to cord cutters and cable-nevers — especially millennials.

“There’s no question millennials love great TV content,” said YouTube chief executive Susan Wojcicki. “But what we’ve seen is they don’t want to watch it in the traditional setting.”

What Wojcicki ignores is the fact millennials prefer to watch their shows on-demand. Relying on live television as the primary source of scripted television shows is already inconvenient and unnecessary. The viewing experience is increasingly an individual one, catering to the whims of a single viewer watching on a tablet, smartphone, or connected TV. Of all the websites on the internet, YouTube should already understand the trend towards individualized viewing better than most.

Just as important, YouTube TV is a lousy deal. Hulu subscribers can binge watch all the series they want with no ads for $11.99 a month. YouTube TV will charge nearly three times the price and force customers to sit through up to 18 minutes of ads an hour. Hulu doesn’t require customers to use Google’s Chromecast as the only stream-to-TV option either. A premium YouTube Red subscription also won’t get you a better deal or fewer ads. You may already pay to watch YouTube commercial free but now you will pay more to watch YouTube TV filled with ads.

Analyst Michael Nathanson said Google’s real goal here is to get into the television advertising market. Because customers will be held captive by a disabled fast-forward button, they will see Google-targeted ads playing in ad slots normally reserved for use by local cable operators. Getting a lot of people to watch those ads means YouTube TV will at least be generous about something. A subscription will include access for six accounts with separate login information, but only three users can watch simultaneously, if they bother.

AT&T Follows Verizon Back to Optional Unlimited Data Plans for All Starting Tomorrow: $100/Mo

Unlimited data is back.

AT&T has followed Verizon Wireless back the era of unlimited data plans, starting tomorrow.

The AT&T Unlimited plan will be available to all customers, not just those signed up with DirecTV, and will be expensive. A single line unlimited voice, text, and data plan will reportedly cost $100 a month. Customers switching four lines to unlimited data will pay $180 after a $40 bill credit kicks in 60 days after signing up. This means for the first two months, customers will pay $220 for the privilege of unlimited data.

The new plan is open to residential and business/corporate accounts and business customers will also get the benefit of any corporate discounts.

AT&T’s definition of “unlimited” actually means 22GB. If you exceed that amount, AT&T reserves the right to slow your data connection “during periods of network congestion.”

The plan includes:

  • unlimited calls from the U.S. to Canada and Mexico
  • unlimited texts to over 120 countries
  • talk, text and use data in Canada and Mexico with no roaming charges when adding the free Roam North America feature
  • the ability to switch off AT&T’s “Stream Saver” which limits online video playback to 480p

“We’re always listening to our customers and will continue to evolve to provide more choice, more convenience, and more value,” claims AT&T in a press release. But observers believe AT&T listens to the competitive realities of the marketplace more than its customers who never wanted to lose the option of unlimited data in the first place.

 

AT&T Slowly Strangling U-verse TV to Reposition Bandwidth for Broadband

Phillip Dampier February 16, 2017 AT&T, Broadband Speed, Competition, Consumer News, Online Video No Comments

AT&T’s U-verse TV has been losing customers for over a year. (Image: Market Realist)

AT&T wants its U-verse TV video service dead, but is willing to watch it bleed customers for a while before likely downsizing or axing the service to make room for better broadband speeds.

The phone company has allowed U-verse TV to wither on the vine for more than a year, losing hundreds of thousands of customers every quarter since late 2015, and surprisingly has done almost nothing to stop the subscriber losses. In all, more than a million AT&T U-verse TV customers canceled service in 2016.

AT&T has admitted it has abandoned aggressively marketing its U-verse TV platform and has put its marketing muscle into selling DirecTV, the satellite provider AT&T acquired two years ago. DirecTV has added customers at a remarkably similar rate that AT&T has been losing U-verse TV customers. AT&T is even willing to watch customers walk into the arms of their competitors, a clear sign AT&T hopes their U-verse TV customers churn away.

Customers report U-verse TV-related promotions and retention plans have gotten worse in the last 14 months and some tell Stop the Cap! they were steered to DirecTV when they contacted AT&T to discuss their options.

Even the U-verse brand is being gradually discontinued. AT&T recently rebranded its fiber to the home service AT&T Fiber, dropping the AT&T U-verse with GigaPower brand the company had used since first announcing gigabit speed access.

AT&T U-verse as a brand is slowly disappearing in favor of AT&T Fiber.

Market Realist reports AT&T doesn’t necessarily want to spend a lot of money upgrading its legacy U-verse fiber to the neighborhood network across its entire landline service area, but needs to boost broadband speeds to stay competitive with cable broadband. When U-verse was originally launched, the service reserved much of its available bandwidth for television service, limiting broadband speeds to a maximum of around 24Mbps. That is no longer seen as competitively adequate and that leaves AT&T with only two options: upgrade its legacy infrastructure to support fiber-fed gigabit speed or reduce the amount of bandwidth devoted to television services and use it to expand broadband speeds.

AT&T is doing a little of both, expanding its gigabit broadband service in very limited areas in 46 cities with 23 more to come sometime this year. An indication of just how few customers can actually buy AT&T’s gigabit speeds was revealed indirectly by AT&T. Only four million homes and businesses, including 650,000 apartment and condo units can buy 1,000Mbps broadband from AT&T nationwide. Los Angeles and Chicago — both AT&T Fiber service areas, combined have more than five million potential customers alone.

In many cases, fewer than 10% of AT&T’s customers in AT&T Fiber cities can actually buy the service. In Knoxville, Tenn., AT&T admitted its gigabit service was only available in about 30 apartment and condominium complexes.

AT&T is promising to expand its fiber service to reach at least 12.5 million customers in 67 metro areas by the summer of 2019. But that will still likely leave more than half of AT&T’s customers out of reach of the service.

AT&T has told investors it plans no blockbuster budget increases to aggressively roll out fiber service across its footprint, which includes much of the south and midwest and large sections of California. Instead, it will likely offer fiber service to new housing developments, multi-dwelling units, and higher income areas. That decision still requires AT&T to do something for customers not on a near-term upgrade list, and that will likely be a gradual transformation of legacy U-verse into broadband-only service with speeds closer to 50-75Mbps, where video streaming from services like DirecTV Now can travel over the top to customers.

Disney CEO Suddenly Discovers There Are Too Many Ads on TV; Cutting Ad Load on ABC, ESPN

Phillip Dampier February 15, 2017 Consumer News, Online Video 2 Comments

“I think that in general, there is probably too much commercial interruption in television,” Disney CEO Bob Iger told investors on the company’s first-quarter earnings call.

As some commercial networks cut “hour-long” TV shows to as little as 39 minutes, viewers have taken notice and are tuning out.

TV advertising loads — how many ad breaks and for how long — have been increasing since the 1950s, leaving viewers with less and less of their favorite shows. Networks have gotten creative over the years finding new spaces for advertising content by compressing opening titles and closing credits, telling producers to plan for shorter shows, using product placement to showcase brands and products inside shows, and editing or compressing older programs that can no longer fit in their allotted time slots.

The idea of reducing advertising is a recent phenomena, but one being taken seriously by networks that have watched ad revenue and ratings slip, as viewers learn to bypass or avoid advertising, or watch something else.

Iger promised an unspecified reduction in advertising on Disney-owned ABC and ESPN. It is uncertain if that will result in a slight decline of a minute per hour or something more dramatic. Time Warner, Inc., began opting for the latter in 2015, cutting ad time on certain shows on its TruTV network by half. Viacom and 21st Century Fox followed with experimental ad reductions of their own that same year.

Reducing advertising does not necessarily mean revenue reduction. Earlier experiments raised ad rates to compensate for the reduced number of commercials. Advertisers were reportedly pleased by the experiments because shorter ad breaks encouraged viewers to avoid channel surfing, giving higher exposure to advertising messages.

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