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Outbid, Charter Expected to Eye Consolation Prizes: Cox, Bright House, and/or Suddenlink

brighthouse_logoBright House Networks’ long standing relationship with Time Warner Cable — which negotiated programming deals on behalf of the smaller cable operator with operations in the south — may come to an end with an approval of a merger between Comcast and Time Warner. That could make Bright House a prime candidate for a takeover.

Charter Communications is likely to seek consolation prizes now that Comcast has outbid the smaller cable company for Time Warner Cable. Liberty Media’s John Malone and Charter’s CEO Tom Rutledge are meeting with advisers and board members to discuss where Charter will go next to grow its operations.

Malone and Rutledge believe the cable industry must consolidate to better position it against competition from online video, phone companies, and satellite television. Malone would like to see the United States served by just a few cable operators, and feels acquisitions are the best way to accomplish his vision.

suddenlink logoCharter is almost certain to buy at least some of the three million Time Warner Cable customers Comcast intends to cast-off if it wins regulator approval of its buyout deal. But Team Charter has assembled enough financing to go much farther than that.

Among the most likely targets, according to CRT Capital Group and Raymond James Financial are family held Cox Communications, the third largest cable operator in the country with more than four million customers, Bright House Networks, the tenth largest operator with just over two million customers, and Suddenlink Communications and its 1.4 million subscribers.

COX_RES_RGBCox, like Cablevision, has been closely controlled by its founding family for years, so rumors of sales of one or both have never come to fruition. But with the merger announcement of Comcast and Time Warner Cable, Wall Street pressure to consolidate is growing by the day. There is talk that if Comcast succeeds in its buyout effort, even satellite providers like DirecTV and DISH are likely to seek a merger. Even Cablevision, which serves suburban New York City may finally feel enough pressure to sell.

A Cox spokesperson this week continued to insist the company is not for sale, but money often has a way of changing minds, if there is enough of it on the table.

Other small regional operators also likely to be approached about selling include: MidContinent, Mediacom, and Cable ONE.

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Kansas’ Senate Commerce Committee Members Well-Compensated by Big Telecom

lobbyist-cashThe Kansas State Legislature website makes it very difficult to find exactly who wrote and introduced Senate Bill 304, the laughingly titled, “Municipal Communication’s Network and Private Telecommunications Investment Safeguards Act.

In fact, the bill should be titled, “The Big Telecom Duopoly Protection Act,” because it makes it almost impossible for any publicly owned network to get off the ground and compete in the state of Kansas, even in places where the nearest cable or DSL connection is dozens of miles away.

Instead of naming names, the legislature’s website prefers to show the bill introduced by the Committee on Commerce, sponsored by the Committee on Commerce, and referred to the Committee on Commerce for further consideration. Since they apparently wrote and co-sponsored the bill, we don’t expect it will take them too long to rubber stamp their approval.

The Republican-dominated members of the committee are already well-acquainted with the state’s largest cable and phone companies, as their campaign donations from 2012 illustrate:

  • Sen. Julia Lynn (R), Chairperson: AT&T ($1,750), Comcast ($1,500), CenturyLink ($1,000);
  • Sen. Susan Wagle (R), Vice-Chair: Cox Communications ($1,750), AT&T ($1,500), Kansas Cable Telecommunication Association ($1,250), Comcast ($1,000), CenturyLink ($1,000);
  • Sen. Tom Holland (D), Ranking Member: AT&T ($1,000);
  • Sen. Pat Apple (R): AT&T ($1,000), Comcast ($1,000), Kansas Cable Telecommunication Association ($250), Time Warner Cable ($250), Verizon ($250), CenturyLink ($250);
  • Sen. Jim Denning (R): CenturyLink ($250);
  • Sen. Oletha Faust-Goudeau (D): AT&T ($1,000), Cox Communications ($1000), Kansas Cable Telecommunication Association ($250);
  • Sen. Jeff Longbine (R): AT&T ($2,000), CenturyLink ($1,750), Cox Communications ($500);
  • Sen. Jeff Melcher (R): CenturyLink ($1,000);
  • Sen. Robert Olson (R): AT&T ($1,750), Comcast ($1,500), CenturyLink ($1,250), Cox Communications ($750);
  • Sen. Mary Pilcher-Cook (R): Comcast ($1,000).

Data: Project Vote Smart, 1/30/2014

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Anti-Community Broadband Bill Introduced in Kansas; Legislating Incumbent Protection

What company is behind the effort to ban municipal broadband in kansas.

AT&T is a frequent backer of anti-community broadband initiatives, as are some of the nation’s biggest cable companies.

The Kansas Senate’s Commerce Committee has introduced a bill that would make it next to impossible to build publicly owned community broadband networks that could potentially compete against the state’s largest cable and phone companies.

Senate Bill 304 is the latest in a series of measures introduced in state legislatures across the country to limit or prohibit local communities from building better broadband networks that large commercial providers refuse to offer.

SB 304 is among the most protectionist around, going well beyond the model bill produced by the corporate-backed American Legislative Exchange Council (ALEC). At its heart, the bill bans just about any would-be competitor that works with, is run by, or backed by a local municipality:

Sec. 4. Except with regard to unserved areas, a municipality may not, directly or indirectly offer or provide to one or more subscribers, video, telecommunications or broadband service; or purchase, lease, construct, maintain or operate any facility for the purpose of enabling a private business or entity to offer, provide, carry, or deliver video, telecommunications or broadband service to one or more subscribers.

For purposes of this act, a municipality offers or provides video, telecommunications or broadband service if the municipality offers or provides the service:

  • Directly or indirectly, including through an authority or instrumentality:
  • Acting on behalf of the municipality; or for the benefit of the municipality;
  • by itself;
  • through a partnership, joint venture or other entity in which the municipality participates; or
  • by contract, resale or otherwise.
Tribune, Kansas is the county seat of Greeley County.

Tribune, Kansas is the county seat of Greeley County.

This language effectively prohibits just about everything from municipally owned broadband networks, public-private partnerships, buying an existing cable or phone company to improve service, allowing municipal utilities to establish broadband through an independent authority, or even contracting with a private company to offer service where none exists.

The proposed legislation falls far short of its intended goals to:

  • Ensure that video, telecommunications and broadband services are provided through fair competition;
  • Provide the widest possible diversity of sources of information, news and entertainment to the general public;
  • Encourage the development and widespread use of technological advances in providing video, telecommunications and broadband services at competitive rates and,
  • Ensure that video, telecommunications and broadband services are each provided within a consistent, comprehensive and nondiscriminatory federal, state and local government framework.

Proponents claim the bill is open to allowing municipalities to build broadband services in “unserved areas.” But upon closer inspection, the bill’s definition of “unserved” is practically impossible to meet anywhere in Kansas:

“Unserved area” means one or more contiguous census blocks within the legal boundaries of a municipality seeking to provide the unserved area with video, telecommunications or broadband service, where at least nine out of 10 households lack access to facilities-based, terrestrial broadband service, either fixed or mobile, or satellite broadband service, at the minimum broadband transmission speed as defined by the FCC.

Even the FCC does not consider satellite broadband service when it draws maps where broadband is unavailable. But this Big Telecom-backed bill does. Even worse, it requires would-be providers to prove that 90 percent of customers within a “census block” don’t have access to either mobile or satellite broadband. Since satellite Internet access is available to anyone with a view of the southern sky, and the most likely unserved customers would be in rural areas, it would be next to impossible for any part of the notoriously flat and wide open state to qualify as “unserved.”

Each rectangle represents one census block within one census tract that partially covers Greeley County. Under the proposed legislation, a community provider would have to visit every census block to verify whether a private company is capable of providing service, including satellite Internet access.

Each rectangle represents one “census block” within a larger “census tract” that partially covers Greeley County. Under the proposed legislation, a community provider would have to visit each census block to verify whether a private company is capable of providing broadband service, including satellite Internet access.

To illustrate, Stop the Cap! looked at Greeley County in western Kansas. The county’s total population? 1,247 — the smallest in the state. Assume Greeley County Broadband, a fictional municipal provider, wanted to launch fiber broadband service in the area. Under the proposed bill, the largest potential customer base is 1,247 — too small for most private providers. Still, if a private company decided to wire up the county, it could with few impediments, assuming investors were willing to wait for a return on their investment in the rural county. If SB 304 became law, a publicly owned broadband network would have to do much more before a single cable could be installed on a utility pole.

Census Block 958100-1-075, in downtown Tribune, has a population of 10.

Census Block 958100-1-075, in downtown Tribune, has a population of 10.

To open for business, Greeley County Broadband would have to spend tens of thousands of dollars to independently verify its intended service area — the county — is unserved by any existing broadband technology, including satellite and mobile broadband. The authors of the bill intentionally make that difficult. Just one census tract in Greeley County (#9561), encompassing the county seat town of Tribune (pop. 741) has dozens of census blocks. Some are populated, others are not.

Greeley County Broadband now has several big problems. Under the language in the bill, a municipal provider must first define its service area entirely within its borders — in this case Greeley County — and base it on contiguous census blocks. That means if pockets of qualifying potential customers exist in a census block surrounded by non-qualifying census blocks, Greeley County Broadband cannot include them in its service area.

Census Block 958100-1-075 — essentially at the intersection of Broadway Ave. and West Harper St., right next to City Hall — has a population of 10. AT&T Mobility’s coverage maps show Tribune is covered by its 3G wireless data network (but not 4G). That census block, along with every other in the area, would be disqualified from getting municipal broadband the moment AT&T upgrades to 4G service, whether reception is great or not. It doesn’t matter that customers will have to pay around $60 for a handful of gigabytes a month.

But wait, Verizon Wireless declares it already provides 4G LTE service across Greeley County (and almost all Kansas). So Greeley County Broadband, among other would-be providers, are out of business before even launching. Assuming there was no 4G service, if just two of those ten residents had a clear view to any satellite broadband provider, Greeley County Broadband would not be permitted to provide anyone in the census block with service under the proposed law. Under these restrictions, no municipal provider could write a tenable business plan, starved of potential customers.

Kansans need to consider whether that is “fair competition” or corporate protectionism. Is it a level playing field to restrict one provider without restricting others? If competition promotes investment in technologically challenged rural Kansas, would not more competition from municipal providers force private companies to finally upgrade their networks to compete?

In fact, the bill introduced this week protects incumbent cable and phone companies from competition and upgrades by keeping out the only likely competition most Kansans will ever see beyond AT&T, Comcast, or CenturyLink’s comfortable duopoly – a municipal or community-owned broadband alternative. Providing the widest possible diversity is impossible in a bill that features the widest possible definition of conditions that will keep new entrants out of the market. Community-owned networks usually offer superior technology (often fiber optics) in communities that are usually trapped with the most basic, outdated services. While the Kansas legislature coddles AT&T, that same company wants to mothball its rural landline network pushing broadband-starved customers to prohibitively expensive, usage capped wireless broadband service indefinitely.

verizon 4g

Seeing Big Red? The areas colored dark red represent the claimed coverage of Verizon Wireless’ 4G LTE network in Kansas. Under SB 304, these areas would be prohibited from having a community-owned broadband alternative.

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Staking the Heart of the Power-Sucking Vampire Cable Box

vampire-power-1-10964134Two years after energy conservation groups revealed many television set-top boxes use almost as much electricity as a typical refrigerator, a voluntary agreement has been reached to cut the energy use of the devices 10-45 percent by 2017.

The Department of Energy, the Natural Resources Defense Council, the American Council for an Energy-Efficient Economy, the Appliance Standards Awareness Project, the Consumer Electronics Association, and the National Cable & Telecommunications Association agreed to new energy efficiency standards for cable boxes expected to save more than $1 billion in electricity annually, once the new equipment is widely deployed in American homes. That represents enough energy to power 700,000 homes and cut five million tons of CO2 emissions each year.

“These energy efficiency standards reflect a collaborative approach among the Energy Department, the pay-TV industry and energy efficiency groups – building on more than three decades of common-sense efficiency standards that are saving American families and businesses hundreds of billions of dollars,” said Energy Secretary Ernest Moniz. “The set-top box efficiency standards will save families money by saving energy, while delivering high quality appliances for consumers that keep pace with technological innovation.”

DVR boxes are the biggest culprits. American DVRs typically use up to 50W regardless of whether someone is watching the TV or not. Most contain hard drives that are either powered on continuously or are shifted into an idle state that does more to protect the life of the drive than cut a consumer’s energy bill. A combination of a DVR and an extra HD set-top box together consume more electricity than an ENERGY STAR-qualified refrigerator-freezer, even when using the remote control to switch the boxes off.

NRDC Set-Top Boxes  Other Appliances-thumb-500x548-3135

Manufacturers were never pressed to produce more energy-efficient equipment by the cable and satellite television industry. Current generation boxes often require lengthy start-up cycles to configure channel lineups, load channel listings, receive authorization data and update software. As a result, any overnight power-down would inconvenience customers the following morning — waiting up to five or more minutes to begin watching television as equipment was switched back on. As a compromise, many cable operators instruct their DVR boxes to power down internal hard drives when not recording or playing back programming, minimizing subscriber inconvenience, but also the possible power savings.

In Europe, many set-top boxes are configured with three levels of power consumption — 22.5W while in use, 13.2W while in standby, and 0.65W when in “Deep Sleep” mode. More data is stored in non-volatile memory within the box, meaning channel data, program listings, and authorization information need not be re-downloaded each time the box is powered on, resulting in much faster recovery from power-saving modes.

The new agreement, which runs through 2017, covers all types of set-top boxes from pay-TV providers, including cable, satellite and telephone companies. The agreement also requires the pay-TV industry to publicly report model-specific set-top box energy use and requires an annual audit of service providers by an independent auditor to make sure boxes are performing at the efficiency levels specified in the agreement. The Energy Department also retains its authority to test set-top boxes under the ENERGY STAR verification program, which provides another verification tool to measure the efficiency of set-top boxes.

Comcast, DirecTV, DISH Network, Time Warner Cable, AT&T, Verizon, Cox Communications, Charter Communications, Cablevision, Bright House Networks and CenturyLink will begin deploying new energy-efficient equipment during service calls. Some customers may be able to eventually swap equipment earlier, depending on the company.

http://www.phillipdampier.com/video/WCCO Minneapolis Check Your Cable Box 6-27-11.mp4

WCCO in Minneapolis reported in 2011 cable operators like Comcast may make subscribers wait 30 minutes or more for set-top box features to become fully available for use after plugging the box in. (1:50)

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Cox Communications Exploring Bid for Time Warner Cable

coxCox Communications is contemplating jumping into the bidding for Time Warner Cable either on its own or with others, according to a story published in today’s Wall Street Journal.

Privately held Cox is the country’s third largest cable operator, right behind Time Warner Cable, with nearly 4.5 million subscribers. It’s slightly larger than Charter Communications, which itself wants to acquire TWC.

timewarner twcCox and Cablevision, the nation’s two largest privately held or controlled cable companies, have both been mentioned as targets for takeover in a rush to consolidate the cable industry. Cablevision has been rumored to be on the verge of selling for years, but the Dolan family that founded the cable operator has the final say. Cox previously indicated it had no intention of selling, preferring to explore buying opportunities.

Speculation is mounting that Comcast, Charter, and now perhaps Cox could offer a joint bid for Time Warner Cable, splitting up the company and absorbing TWC subscribers in their own operations without attracting unwanted attention from antitrust regulators and the FCC, either which could effectively torpedo a deal.

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Cox Speed Boosts Come With Free Cloud Storage That Eats Your Data Allowance

Phillip Dampier October 22, 2013 Broadband Speed, Consumer News, Cox, Internet Overcharging 1 Comment

coxCox Communications today officially unveiled broadband speed increases along with free cloud storage without adjusting data plan usage allowances for customers who take advantage of the service enhancements.

“Our customers tell us that their overall online experience is becoming increasingly important to them,” said Betty Jo Roberts, vice president of marketing for Cox Virginia. “Speed, access, safety and storage are key components of their communications and entertainment needs. Free cloud storage presents an especially significant value, as most similar services are fee-based.”

Internet Tier/Allowance
Current Speeds Download/Upload New SpeedsDownload/Upload Free Cloud Storage
Essential – 100GB 3 Mbps / 768 Kbps

5 Mbps / 1 Mbps 1 GB
Preferred* – 250GB 25 Mbps / 2 Mbps 25 Mbps / 5 Mbps 5 GB
Premier D2* – 250GBWith DOCSIS 2.0 device 25 Mbps/3 Mbps No change 50 GB
Premier D3* – 250GB 30 Mbps/6 Mbps 50 Mbps / 10 Mbps 50 GB
Premier Plus – 250GB 60 Mbps/12 Mbps 75 Mbps/15 Mbps 50 GB
Ultimate – 400GB 100 Mbps / 20 Mbps No change Unlimited

*A DOCSIS 3 modem is required to consistently receive optimal speeds for Preferred and higher tiers.

cox speed

Using cloud storage regularly and taking the new speeds for a hard run could drive customers perilously close to their monthly usage allowance. Cox Ultimate customers get unlimited cloud storage but not unlimited broadband usage. While Cox does not currently charge any overlimit fees, the company does reserve the right to request heavy users upgrade to a plan with a higher allowance, reduce usage, or face account termination.

Although Cox touted the speed upgrades as coming at no charge, the cable company is busy hiking rates for certain broadband tiers. Customers report the popular Premier tier has increased from $55.99 to $62.99 in some markets and as high as $73.99 in Phoenix.

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Cox Closes Down Summer Trial of flareWatch, An Online Video Alternative to Cable TV

Phillip Dampier September 19, 2013 Competition, Cox, Internet Overcharging, Online Video No Comments

flare-logoCox has pulled the plug on its summer trial of flareWatch, an over-the-top virtual cable TV service that works over an existing broadband connection. The sudden end of the trial, now scheduled for Sept. 27, comes several days after new participants found orders for the accompanying Fanhattan-made set-top box canceled without warning. Customers who paid $99.99 for the box, later reduced to $49.99, are supposed to be getting refunds according to Cox Customer Care.

“This limited trial was conducted as part of Cox’s ongoing customer research to determine how to best evolve our offerings to meet customers’ changing needs,” according to a Cox official. “We remain focused on helping customers discover and connect to the things they care about in ways that are easy-to-use and reliable and we will continue to test and explore new products. We will continue to evaluate the flareWatch trial results to determine how this might impact future product plans.”

Flarewatch over

Peter Litman got confirmation flareWatch has been put out.

Customers visiting Cox’s website dedicated to the IP-based video service found only a “Service Unavailable” message greeting them.

Cox’s flareWatch service offered about 100 channels (many over-the-air) for $34.99 a month, with a cloud-based DVR feature, and was available only to Cox customers in Orange County, Calif., with Preferred Internet service. Use of the service counted against your monthly Cox broadband usage allowance.

Later in the trial, Cox raised the price by $5 a month and bundled Rhapsody’s streaming music service and a small video-on-demand feature. It also cut the purchase price of the hardware in half.

Trial participants report the notification Cox was terminating the service seemed sudden and perhaps unplanned.

Cox says otherwise.

“As planned, the Orange County trial has successfully completed. We collected excellent customer feedback and usage data to inform our broader deployment of Fan TV,” said a Cox spokesperson. “As announced in May, Fanhattan plans to work directly with pay TV service providers to distribute Fan TV. Making sure it’s ready for primetime requires rigorous testing, trial customer feedback and constant iteration. This limited trial was a small, early step in that direction.”

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Verizon FiOS Wins PC Magazine’s ISP Award: “FiOS Is the Absolute Fastest Nationwide Broadband”

fastest isp 2013Verizon FiOS is the fastest nationwide broadband service available.

That was PC Magazine’s assessment in its ranking of the fastest Internet Service Providers of 2013. It’s not the first time Verizon FiOS has taken top honors. In fact, the fiber to the home broadband service has consistently won excellent rankings not only for its speed, but also for its value for money and quality of service. The worst thing about FiOS is that many Verizon customers cannot buy the service because its expansion was curtailed in early 2010.

Verizon FiOS has seen its national speed rankings increase this year. In 2012, the provider’s nationwide download speeds averaged 29.4Mbps; this year FiOS average downstream speeds jumped to 34.5Mbps. Upstream speeds are also up from 26.8Mbps to 31.6Mbps. In part, this is because a growing number of customers have moved away from Verizon’s entry-level 15/5Mbps package with a $10 upgrade to Quantum FiOS 50/25Mbps service. FiOS TV customers can upgrade themselves with their remote control.

Frontier Communications made the top five in the Pacific Northwest, thanks to FiOS infrastructure the company inherited from Verizon.

Other high-ranking ISPs included Midcontinent Communications, a small cable provider serving the north-central states. Midco’s DOCSIS 3 upgrade allows the company to offer most customers up to 100Mbps service. The average download speed for Midco customers is 33.1Mbps; average upload speed is 6.4Mpbs.

Where cable operators face head-on competition from Verizon FiOS, the usual competitive response is speed increases. Cablevision is a good example. It came in fourth place nationally with average speeds of 25.9/5.9Mbps. Comcast has also been boosting speeds, especially in the northeast where it faces the most competition from fiber. It came in third place with average speeds of 27.2/6.8Mbps and offers Internet speeds up to 505Mbps in some areas.

There were companies that performed so poorly, they barely made the regional rankings. The most glaring example largely absent from PC Magazine’s awards: Time Warner Cable, which has lagged behind most cable operators in the speed department. It scored poorly for the second largest cable company in the country, beaten by Charter, Mediacom, and CableONE — which all usually perform abysmally in customer ratings. The only regional contest where Time Warner made a showing at all was in the southeast, where it lost to Verizon FiOS, Comcast, and Charter. Only TDS, an independent phone company, scored worse among the top five down south.

Even more embarrassing results turned up for AT&T U-verse, which performed so bad it did not even make the national rankings. AT&T has promised speed upgrades for customers this year, and has implemented them in several cities. Unfortunately for AT&T, its decision to deploy a fiber to the neighborhood system that still depends on copper to the home is turning out to be penny wise-pound foolish, as it continues to fall further behind its cable and fiber competitors. At the rate its competitors are boosting speeds, U-verse broadband could become as relevant as today’s telephone company ADSL service within the next five years.

Other players scoring low include WOW!, a surprising result since Consumer Reports awarded them top honors for service this year. Also stuck in the mud: Atlantic Broadband (acquired by Canada’s Cogeco Cable, which itself is no award winner), Suddenlink, Wave Broadband and Metrocast, which serves smaller communities in New Hampshire, Maine, Pennsylvania, Maryland, Virginia, Connecticut, South Carolina, Mississippi and Alabama.

The magazine also ranked the fastest U.S. cities, with top honors going to the politically important Washington, D.C., and its nearby suburb Silver Spring, Md, which took first and second place. Alexandria, Va., another D.C. suburb, turned up in eighth place. No cable or phone company wants to be caught delivering poor service to the politicians that can make life difficult for them.

Brooklyn, N.Y., took third place because of head-on competition between Cablevision and Verizon FiOS. Time Warner’s dominance in Manhattan and other boroughs dragged New York City’s speed rankings down below the top ten. Among most of the remaining top ten cities, the most common reason those cities made the list was Verizon FiOS. Florida’s Gulf Coast communities of Bradenton (4th place) and Tampa (6th place) have fiber service. So does Plano, Tex. (5th place) and Long Beach, Calif. (7th place). The other contenders: Hollywood, Fla. takes ninth place and Chandler, Ariz. rounds out the top 10.

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America’s Worst Rated Companies: Charter, Time Warner, Cox, Cablevision, Verizon, Comcast…

charter downNine of the ten lowest ranked firms in America are cable and telephone companies, according to a new report from research firm Temkin Group.

A poll ranking customer service at 235 U.S. companies across 19 industries found cable companies dead last, quickly followed by Internet Service Providers (often those same cable operators).

Participants were asked to rate their satisfaction with different companies on a scale of “1″ (very dissatisfied) to “7″ (completely satisfied). Not very many participants gave high marks to their telecommunications service provider. Temkin’s resulting net satisfaction score found familiar names in the cable and telephone business scraping the bottom.

America’s worst provider? Charter Communications, which managed an embarrassing dead last 22 percent satisfaction score for television service. Time Warner Cable managed second worst for television at 25%, followed by Cox and Cablevision’s Optimum service (both 28%). Bottom rated Internet service came from Qwest (now CenturyLink), Verizon (presumably DSL), and Charter — all scoring just 31%.

Oddly, Temkin’s survey participants gave top marks to the long-irrelevant AOL for Internet service, which may mean those dial-up customers don’t know any better. Highest marks in television service went to Bright House Communications, which ironically depends on Time Warner Cable for most of its programming negotiations.

temkin bottom rated

Most suspect the ratings show long-term customer dissatisfaction with endless rate increases, poor customer service and reliability, and lack of choice in an increasingly expensive television lineup.

The Temkin Group gathered its data from an online survey of 10,000 consumers in the U.S. during January 2013, all asked to rate their experiences with companies over the past 60 days.

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ABC Network Putting Video Behind Paywall: Only Paying Cable/U-verse Subscribers Can Watch

WATCH_ABCFree TV? Not quite.

Despite offering free over-the-air television, ABC is putting its programming and stations behind a new paywall that can only be breached by “authenticated” cable and AT&T U-verse subscribers able to prove they already pay to watch.

Watch ABC is the television network’s contribution to the cable industry’s “TV Everywhere” project that offers online viewing options for current cable television subscribers.

Watch ABC now offers on-demand and live viewing of programming aired by the network and six network-owned television stations both at the desktop and through apps for iOS, Android, and the Kindle: New York City’s WABC-TV, Philadelphia’s WPVI, Los Angeles’ KABC, Chicago’s WLS, San Francisco’s KGO, and Raleigh-Durham’s WTVD. (Coming soon: Houston’s KTRK and Fresno’s KFSN.)

During the “online preview,” ABC permitted online viewers within confirmed coverage areas to watch the station nearest them for free. Now, viewers will also have to confirm they are paying cable or AT&T U-verse customers to watch online.

But even then, not everyone will qualify. ABC only has streaming authentication agreements with AT&T U-verse, Cablevision, Charter, Comcast, Cox Communications, and Midcontinent Communications. Watch ABC is currently off-limits to everyone else, including customers of Verizon FiOS, Time Warner Cable, and both satellite services.

ABC has also banned IP addresses known to be associated with anonymous proxy servers. This measure is designed to enforce geographic restrictions to be sure only local viewers can get access to the station in their area.

By this fall, ABC affiliates owned by Hearst are expected to also join Watch ABC’s paywall system.

ABCNews.com announced an experiment with a paywall in the summer of 2010. It never came to fruition.

http://www.phillipdampier.com/video/WPVI Philadelphia Watch ABC in Philadelphia 5-14-13.mp4

WPVI in Philadelphia turned over airtime during its evening newscast to self-promote the new ‘Watch ABC’ app and explain how it works. Effective now, it only works with preferred partner cable companies and AT&T U-verse. (Aired: May 14, 2013) (2 minutes)

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