Home » Cablevision (see Altice USA) » Recent Articles:

Despite Net Neutrality, Providers Launch Fiber Spending Spree

Despite claims from some industry-backed researchers and former members of Congress that Net Neutrality has reduced investment in telecommunications, a new research note from Deutsche Bank shows America’s top telephone and cable companies are spending billions on fiber upgrades to power wireless, business, and consumer broadband.

“Telecoms have become much more public signaling their intent to increase fiber investment, with AT&T and Verizon leading the spending ramp,” reports Deutsche Bank Markets Research.

Verizon has been on a fiber spending spree in the northeastern United States, signing contracts with Corning and Prysmian worth $1.3 billion to guarantee a steady supply of 2.5 million miles of fiber optic cable Verizon plans to buy over the next three years. Much of that spending allows Verizon to lay a foundation for its future 5G wireless services, which will require fiber to the neighborhood networks. But in cities like Boston, Verizon is also once again expanding its FiOS fiber to the home service to consumers.

AT&T is committed to connecting 12.5 million homes to gigabit-ready fiber broadband by 2019 — part of a deal it made with the FCC to win approval of its acquisition of DirecTV. AT&T claims it has already connected 5.5 million homes to its gigabit AT&T Fiber network, expected to reach 7 million by the end of this year.

Deutsche Bank thinks providers’ future drive towards 5G service will also simultaneously benefit fiber to the home expansion, because the same fiber network can power both services.

“To support the upcoming innovations such as autonomous driving, IoT, smart cities, the US needs to densify its fiber network,” Deutsche Bank said. “The U.S. fiber penetration rate is 20% vs. 75% for leading OECD countries, which suggests a large gap needs to be closed.”

Altice founder Patrick Drahi (second from left) and Altice USA CEO Dexter Goei (center) visit a Cablevision fiber deployment on Long Island, N.Y.

The bank predicts companies will spend around $175 billion over the next 10 years building out their fiber networks, with most of the spending coming from the phone companies, who may see fiber buildouts as their best attempt to level the playing field with cable operators’ hybrid fiber-coaxial cable networks. As cable operators expand their networks to reach more business parks, they have been gradually stealing market share for phone and data services from phone companies. Consumer broadband is also increasingly dominated by cable operators in areas where phone companies still rely on selling DSL services.

FierceCable notes Comcast and Altice have stepped up aggressive spending on fiber networks for their consumer and business customers. Altice is planning to decommission Cablevision’s existing coaxial cable network and move customers to fiber-to-the-home service. Comcast is deploying fiber services while still selling traditional cable broadband upgraded to DOCSIS 3.1, which supports substantially faster broadband speeds. The two networks co-exist side-by-side. Customer need dictates which network Comcast will use to supply service.

Customers benefit differently in each state, depending on what type of service is available. Comcast’s large footprint in Pennsylvania, outside of Philadelphia, is usually served by traditional coaxial cable. Verizon still sells DSL in much of the state. In Massachusetts, Verizon is building out its FiOS network to serve metro Boston while Comcast will depend on DOCSIS 3.1 upgrades to speed up its internet service. In New Jersey, long a battleground for Verizon’s FiOS service the company stopped aggressively expanding several years ago, Comcast has announced DOCSIS 3.1 upgrades for the entire state.

Independent phone companies are also seeing a bleak future without fiber upgrades. Both CenturyLink and Windstream are planning moderately aggressive fiber expansion, particularly in urban service areas and where they face fierce cable competition. Frontier continues its more modest approach to fiber expansion, usually placing fiber in new housing developments and in places where its copper facilities have been severely damaged or have to be relocated because of infrastructure projects.

None of the companies have cited Net Neutrality as a factor in their future broadband expansion plans. In fact, fiber networks have opened the door to new business opportunities to the companies installing them, and the high-capacity networks are likely to further reduce traffic/transit costs, while boosting speeds. That undercuts the business model of selling digital slow and fast lanes.

Cablevision Class Action Lawsuit Filed Over Cancellation Policy

A class action lawsuit has been filed in New York alleging Cablevision’s new owner — Altice USA, illegally changed the terms and conditions of its cancellation policy without adequate notice and was unjustly enriched charging millions for service departing customers did not receive.

New York resident Christopher Krafczek discovered he was still being billed for Altice’s Optimum cable service after canceling his service. He was caught in Altice’s change of its terms and conditions that took effect Oct. 10, 2016, which declared in all-capital letters Altice doesn’t give refunds for customers electing to cancel service before the end of a billing cycle:

Monthly Charges: Your monthly subscription begins on the first day following your installation date and renews thereafter on a monthly basis beginning on the first day of the next billing period assigned to you until cancelled by you. The monthly service charge(s) will be billed at the beginning of your assigned billing period and each month thereafter unless and until you cancel your Service(s). PAYMENTS ARE NONREFUNDABLE AND THERE ARE NO REFUNDS OR CREDITS FOR PARTIALLY USED SUBSCRIPTION PERIOD(S).

Krafczek and his attorneys are taking Altice to court claiming the cable company broke New York’s General Business Law § 349 for deceptive practices and for unjust enrichment. The class action lawsuit claims the cable operator failed to provide proper written notice of the change in its billing practices.

Customers canceling service before the end of a billing cycle can incur $100 or more in charges for cable service no longer received after turning in cable equipment as part of a move or to switch providers.

Altice is likely to claim Krafczek has no standing to bring the case because Cablevision/Altice subscribers are bound by a mandatory arbitration provision in their subscriber agreement. If a customer did not send Altice a written opt-out request within a limited window of time when mandatory arbitration was first introduced, Altice will likely claim that customer cannot sue or participate in a class action lawsuit.

Company officials told the Asbury Park Press last fall subscribers were given advance notice of the change of terms. A spokeswoman told the newspaper Cablevision included the change of terms notice in several monthly billing statements. The spokeswoman also claimed customer service representatives are trained to tell departing customers that billing would continue until the end of the billing cycle, allowing customers to schedule a disconnect at that time.

The case seeks a minimum of $50 or greater in damages for each class member, based on the amount billed after disconnecting service, attorney fees, and punitive damages.

The lawsuit claims customers in New York, Connecticut, and New Jersey who voluntarily disconnected cable service between October 2016 and May 3, 2017 paid more than $5 million for service they did not want to continue receiving.

The law firm of Mayer Brown LLP is handling the case.

Rebranded: Goodbye Suddenlink and Cablevision/Optimum, Hello Altice

Patrick Drahi’s acquired cable properties in the United States will join a global rebranding under his company’s own brand: Altice.

Suddenlink, Cablevision/Optimum, SFR-Numericable (France), HOT (Israel), Portugal Telecom-MEO-Sapo (Portugal), and Orange-Tricom (Dominican Republic) will all be called simply “Altice” by the second quarter of 2018.

Cablevision’s Lightpath commercial service will be rebranded “Altice Business” as well.

The global rebranding has begun before Altice USA launches its IPO, expected to attract $1 billion or more that will likely be used to help finance the acquisition of other American cable companies.

Along with a new logo, Altice also introduced its new tagline: “Together Has No Limits” — ironic for a company that continues data capping its Suddenlink broadband customers. Drahi delivered lofty remarks about his aspirations for the new logo and tagline during a closed circuit presentation seen by employees in all the countries where he owns cable companies.

“Our innovations must not make our individual realities smaller, but our collective ambitions greater,” Drahi said. “Not to make individuals more dependent on technology, but more reliant on each other. ‘Together Has No Limits’ is an invitation from the Altice family to come together and build a dream engine that unlocks all of human potential. Together has no limits means ‘let’s learn together, let’s be safe together, let’s be knowledgeable together, and please let’s enjoy!'”

It’s all a part of Drahi’s master plan to dominate the cable and telecom marketplace in the United States. He has freely admitted Altice has started small, but is in no way done making acquisitions and forcing future mergers. In Drahi’s own words, he’s not interested unless he runs the #1 or #2 largest telecom company in a country.

Drahi’s recipe for acquisition success is paying handsomely for acquisitions and then gutting expenses and much of the workforce Drahi considers unnecessary or redundant. After paying $17.7 billion for Cablevision — an amount his critics called excessive, Drahi slashed salaries, closed call centers, and began obsessively scrutinizing expenses. Employees complain morale is low and even the most mundane tasks like keeping the employee break room up and running now requires justifying almost every purchase in management committee meetings that employees fear. Drahi jettisoned much of Cablevision’s senior management, if only because he deemed them overpaid.

Drahi

Extravagance was never a word used to describe Suddenlink. The smaller operator Drahi also acquired in 2015 is known for serving smaller, more rural and economically distressed markets. But Drahi remains obsessed about cost-cutting there as well.

Wall Street analysts scoffed at Drahi’s claim he would cut nearly $900 million in costs at the two American cable companies. But thanks to his “cut to the bone” strategy, Drahi has touted about $400 million in savings to investors so far, with more to come. While Drahi claims he likes to pay employees “as little as possible,” he has no problem splurging on new acquisitions and upgrading the ones he already owns. To allow his Cablevision property to stay competitive against Verizon FiOS, Drahi has authorized ripping out existing coaxial cable and moving to an all-fiber network instead. Speed upgrades are also underway at Suddenlink that now deliver faster speeds than the much-larger Charter Communications now offers its customers.

In March, Drahi acquired Teads, the number one video advertising marketplace in the world. He intends to precision-target audiences with relevant advertising, which could enhance revenue at his cable TV and online properties. Altice has also been beefing up its content operations, particularly in Europe where Drahi has decided to launch his own cable networks instead of overpaying for other companies’ networks. Domestically, Drahi sees value in expanding Cablevision’s News 12 Networks operation and will import i24, his Tel Aviv, Israel based international 24-hour news and current affairs network to the United States.

Just as he has done in Europe, Drahi has telegraphed how he intends to do business in the U.S.

“I have always been very clear, that first is fixed [cable], then mobile, then content,” Drahi said. “We started in the U.S. with cable. We are too small in cable to go mobile at the moment. But everything is open. We will see.”

French Press: U.S. Consumers Ripe for Fleecing By Cable Magnates Like Altice’s Patrick Drahi

The French press continues to report, with some bewilderment, that U.S. consumers are being fleeced by the country’s biggest telecom companies while politicians do nothing to regulate a duopoly market or force more competition to stop the pick-pocketing. The Francophone press is responding to reports that cable baron Patrick Drahi is vacuuming up profits from his American subsidiary Altice USA — which owns Cablevision and Suddenlink — and is likely to get much bigger in 2017, all thanks to the U.S. regulatory landscape.

“Americans live under a corrupt politician-sanctioned broadband monopoly in many places, and this assures telecoms operators in the United States can earn astounding profit margins impossible in European markets,” notes Giga France.

Le Figaro reported this month Altice’s directors had an easy job figuring out where much of the global conglomerate’s future profits would come from: the United States.

“Given the structure of the telecom market, [Altice’s] margin for growth in France is low, whereas in the United States it is considerable,” the newspaper reported. The reason is a persistent lack of competition, made possible by politicians that accepted the recommendations of lobbyists and corporate special interest think tanks on how to structure the broadband market.

Drahi

In the United States, providers have won near-absolute control of their networks and need not share access with competitors. Large telecom companies argued that requiring shared access to their infrastructure would threaten investment and stall broadband network deployment. Ironically, some even argued it would lead to reduced competition. But the reverse turned out to be true and the United States has fallen far behind in competition and network quality, while more traditionally regulated markets in Europe now enjoy low prices, faster internet speeds, and a larger number of competitors vying for consumers’ business.

Wall Street indirectly conspires to keep the status quo by discouraging the entry of new fixed line providers, claiming it will destroy shareholder value and consume billions of investor dollars constructing competing networks that will be unlikely to attract enough subscribers fast enough to give shareholders a timely return on their investment.

With a provider-friendly Trump Administration in power, and more importantly the installation of Ajit Pai, a notorious telecoms-friendly regulator as chairman of the FCC, Altice’s directors consider 2017 to be one of the most inviting years for expansion in the United States.

Le Figaro reports there is plenty of opportunity for Altice’s empire to become more dominant in North America. In France, its SFR unit now holds a 25% share in the fixed line market, but that number is unlikely to grow much considering ongoing price wars that come from fierce competition in France. In the U.S., Altice only holds barely 3% of the market, and Drahi has made no secret he would like to become at least the second-largest provider in the United States.

Les Echos suggested Altice is quietly preparing a full-scale ambush on the U.S. market starting with a much-anticipated IPO expected this year. Wall Street doesn’t welcome Altice entering the U.S. cable business as a market disruptor. Instead, investment banks are willing to loan huge sums to Altice for the purpose of acquiring telecom companies, maintaining the existing duopoly of one cable and one phone company for the majority of Americans.

“In the past, every time he introduced a publicly traded asset, Drahi proceeded with acquisitions: Numericable, in 2013, SFR the following year; and by 2015 Cablevision and Suddenlink in the U.S.A.,” reports Les Echos.

In France, up to four providers compete head to head for fixed line telecom customers. In other parts of Europe, telecom networks are often forced open to competitors. Neither is the case in the States, and consumers are paying very high telecom bills as a result.

Les Echos notes the U.S. cable business is so lucrative, “never before has a French company made such an important investment in the country of Uncle Sam.”

Suddenlink and Cablevision: Consistent source for fat revenue growth for Altice.

Drahi told investors more than a year ago he wanted to eventually generate 50% of Altice’s business overseas, primarily in the profitable U.S.

Altice has so far only bought up smaller cable operators, but observers expect Drahi will aim for much larger targets, including the possibility of buying out a wireless provider or even targeting Comcast, AT&T, or Charter. Les Echos quotes Vincent Maulay, an analyst at Oddo who notes that Drahi may be able to collect future assets inexpensively if Verizon decides to move on an acquisition of Charter. Regulators will likely force the combined company to shed cable assets in New York State where Verizon and Charter currently compete. That would allow Drahi’s Cablevision to pick up divested service areas, perhaps even in Manhattan.

Altice’s Cost Cutting Truth: 2.5+ Million Customers Fled for the Hills

In 2016, just one company was responsible for more than half of all consumer complaints aimed at telecommunications companies in France. That provider was Altice-owned SFR/Numericable.

Last year alone, the number of complaints against Patrick Drahi’s telecom conglomerate jumped 120%, with consumers upset about the company’s landline, wireless, cable TV and broadband services, according to data from the French Association of Telecom Users (AFUTT) and noted by Capital.

The biggest spike in complaints targeted the company’s wired broadband services, where complaints rose 166% (in contrast, mobile complaints were up a milder 72% over the year before).

AFUTT records out of more than 5,000 complaints received last year, 73% of all contract complaints, 68% of customer service complaints and 66% of complaints about bait and switch promotions regarded Mr. Drahi’s operations in France.

Patrick Drahi’s business philosophy, backed by billions in Wall Street bank loans used to acquire companies and then slash budgets to the bone, proved to be terrible for his customers in 2016. Cablevision and Suddenlink subscribers can only hope those mistakes won’t be repeated here.

In just over two years after taking over one of France’s largest cell phone and cable operators — SFR/Numericable, more than 2.5 million customers have fled, fed up with Drahi’s initial lack of interest spending money on network upgrades and service improvements. It didn’t help that the prior owner — the conglomerate Vivendi — didn’t invest enough either, leaving the French cell phone company with headline-grabbing service outages, indifferent customer service, and a fear of employee suicides from threatened cutbacks and layoffs.

Even investors and the banks financing Drahi’s worldwide conquest of cable and telecom companies were concerned enough to apply pressure to stem customer losses that continued at a record pace for more than six months. The damage to SFR’s reputation has been so great, the wireless company has experienced two very bad years even with $2.3 billion in emergency spending to keep customers happy with service improvements while trying to win others back.

Paulin

Michel Paulin, in charge of SFR, told employees in an internal memo obtained by Les Echos things are still bad at the company.

“We have to face it: our customers are still not satisfied and far too many are still leaving for other operators,” Paulin wrote. “This year we will have to regain the confidence of our customers, but we will also have to return to growth in fixed and mobile broadband.”

That growth is still expected to come at the expense of jobs. By the summer of 2019, Drahi will have presided over the slashing of more than one-third of the SFR/Numericable workforce, amounting to at least 5,000 French workers. Many of Altice’s most recent investments are in content agreements to bolster programming for subscribers. SFR launched five sports channels, two news and information channels, and has spent heartily to acquire sports rights and programming agreements with American networks including NBCUniversal and Discovery.

Altice is also dramatically increasing spending on its news channel i24 News, which will soon be on the lineups of Cablevision and Suddenlink cable television customers. The news channel broadcasts multiple feeds in French, English, and Arabic and will supply viewers with international and Middle Eastern news, particularly focused on Arab countries where Al Jazeera delivers fierce competition.

Search This Site:

Contributions:

Recent Comments:

  • Todd: If the fine print is that bad, it's just as bad as Spectrum's $14.99 Internet Assist. They offer it, but no one can actually qualify to get it. It s...
  • Mike W.: They are not doing the right thing by any means. This is simply a PR stunt to make them look good to everyone who doesn't realize this is a BS progra...
  • Dylan: I better be getting 200mbps instead of 100 soon then if I do get a increase from $55 to $60 for bundle internet services. I understand the investments...
  • Charles Dennett: Just looked at my bill dated October 14. I'm in the Rochester, NY market. I have Spectrum TV select ($64.99/month), DVR Service ($12.99/month) and 10...
  • Gale Blue: It’s sounds good until u paid ur money and then u get an email saying they need additional info smh I am a mother who lives wit my daughter and the ca...
  • Victor Bosnich: Have been trying to return this junk and get my refund of $100+ for months, finally had chat with technician, told him situation, he sent me to next p...
  • Jr: Can I still use the same wifi router they gave me? I'm going to get the Netgear but it says I need a router to get WiFi so what do I do?...
  • RJ: I get great service from Charter with Internet. Their upload speed sucks so they need to upgrade, innovate and get Full duplex going. I'd love to have...
  • Inga Nobles: Forgot password and username I'm enquiring about the promotion samsung chromebook...
  • fhall1: The PSC should also make a point of extending other "conditions" that were agreed to as part of the TWC buyout. For example - data caps. Spectrum ag...
  • Frontier Employee: I am a current Frontier Employee and I can promise you that the company's lack of concern for those less fortunate does not solely reside with its cus...
  • JayS: The MVNO US Mobile has just changed their 'Unlimited talk & Text + data plans' similar to what you have indicated. The Unlimited Talk & Text ...

Your Account: