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Surprise: Some Alabama Customers Unhappy About AT&T’s Experiment Ending Landline Service

att-logo-221x300AT&T customers in Carbon Hill, Ala. received an unwelcome surprise in their mailbox recently when AT&T informed them they will be part of an experiment ending traditional landline service in favor of a Voice over IP or wireless alternative.

Affected customers are involuntary participants in what AT&T calls an “exciting opportunity for our customers and for our company,” but many residents want no part of it.

The Wall Street Journal reports Carbon Hill city clerk Janice Pendley says some people in the former mining town are not pleased.

“Some of them like their landline, and they like it just the way it is,” she says.

AT&T’s experiment will force new and existing customers to switch to its more-expensive U-verse broadband platform, use a mobile phone, or a home landline replacement that works over AT&T’s cellular network. The FCC has granted AT&T permission to impose its experimental plan to end traditional landline service in two communities where regulatory protections for landline customers are weak to non-existent — Alabama’s Carbon Hill and Delray Beach, Fla.

Carbon Hill is a small town of around 880 households in extreme western Walker County. It is the kind of rural town AT&T would likely never consider for a U-verse upgrade. AT&T embarked on a second major push to extend U-verse into more communities last year, but also indicated it would strongly advocate for a wireless replacement for its landline network in the rest of its service areas. Because Carbon Hill is an experiment, AT&T will offer U-verse to at least part of the community regardless of the usual financial Return on Investment requirements AT&T usually imposes on its U-verse expansion efforts.

carbon hillAT&T is pushing forward despite the fact it  has no idea how it will offer service to at least 4% of isolated Carbon Hill residents not scheduled to be provided U-verse and not within an AT&T wireless coverage area. There are also no guarantees customers will be able to correctly reach 911, although AT&T says the technology “supports 911 functionality.” Serious questions among consumer advocates remain about whether the replacement technology will support burglar alarms, pacemakers and even systems used by air-traffic controllers.

The difficulties service Carbon Hill relate to its rural makeup and income profile. In Delray Beach, it is all about customer demographics. Half of the city is home to residents over 65 years old — the group most likely to prefer their existing landline service. Many are likely to be unhappy about a transition to new technology that will not work in the event of power interruptions, will require the installation of new equipment, or will be tied to a wireless platform that some say reduces the intelligibility of telephone conversations and often introduces audio artifacts like echo, background noise, and dropouts.

In both cities, customers only offered wireless-based service will no longer have access to DSL or wired broadband service of any kind. The wireless alternative from AT&T comes at a high cost and a low usage allowance.

The benefits to AT&T are unquestionable, however. The company will win almost universal deregulation as a Voice over IP or wireless telephone provider. Legacy regulations on customer service requirements, pricing, and obligations to provide affordable phone service to any customer that requests it are swept away by the new technologies. Competitors are also worried AT&T will be able to walk away from regulations governing open and fair access to AT&T’s network.

ip4carbon hillThe Wall Street Journal reports:

The all-Internet protocol “transition holds many promises for consumers, but losing access to affordable voice and broadband services cannot be part of that bargain,” wrote Angie Kronenberg, general counsel of Comptel, in a letter to the FCC last month on behalf of the small-carrier trade group, several companies and public-interest groups.

AARP said it believes AT&T’s plan has “numerous problems.” The technology might not be reliable enough or fail when calling 911 in an emergency, the advocacy group for seniors told regulators in its comment letter. The FCC is reviewing hundreds of comments received in response to AT&T’s request.

EarthLink piggybacks on the “incumbents as little as economically possible” and has laid nearly 30,000 miles of fiber-optic cables throughout the U.S. to help it reach more than a million customers, says Rolla Huff, a former EarthLink chief executive. Still, the company needs access to the connections built by AT&T and Verizon into buildings.

Telecom carriers such as Windstream in Little Rock, Ark., and sellers of broadband data services like EarthLink and XO Communications LLC, of Herndon, Va., have had the right to buy last-mile access at regulated prices since the last major overhaul of federal telecom laws in 1996.

tw telecomIf AT&T ends its traditional network, those competing service providers will have to negotiate with AT&T for access at whatever price AT&T elects to charge.

A preview of what is likely to happen has already been experienced by TW Telecom, an independent firm selling phone and Internet services to businesses over more than 30,000 miles of fiber lines. But that fiber network means nothing if a customer’s last mile connection is handled by a local phone company no longer subject to regulated pricing and access rules.

In Tampa, where Verizon has deployed FiOS as an unregulated replacement for its older, regulated copper-based network, TW Telecom learned first hand what this could ultimately mean:

Rochester Telephone Corporation was born in 1921 after a merger between the Rochester Telephonic Exchange, a branch of the Bell Company of Buffalo and locally-owned independent Rochester Telephone Company, which was not allowed to use Bell's long distance network.

Rochester Telephone Corporation was born in 1921 after a merger between the Rochester Telephonic Exchange, a branch of the Bell Company of Buffalo and locally owned independent Rochester Telephone Company, which was not allowed to use Bell’s long distance network.

TW Telecom approached Verizon in 2012 to seek last-mile access to a Tampa, Fla., building being converted into a bank from a restaurant. Verizon had installed only FiOS at the building.

Verizon said no, telling TW Telecom to build its own connection or pay Verizon thousands of dollars to do the job. TW Telecom declined to pay and lost the customer’s business.

“When it happens, it’s devastating,” says Kristie Ince, who oversees regulatory policy at TW Telecom. Similar snarls have cost the company at least six customers since then. Other carriers say they have had similar clashes.

In Illinois, Sprint’s business phone network has run into a barricade manned by AT&T. Sprint needs AT&T to interconnect calls placed on Sprint’s network intended for AT&T’s customers. The two companies cannot agree on an asking price under the deregulation scheme so Sprint converts its Voice over IP calls to older technology still subject to regulation just so calls will successfully reach AT&T’s customers. AT&T promptly converts those calls back to Voice over IP technology as it completes them.

AT&T said it has “no duty” to connect its Internet protocol traffic with Sprint’s.

If the FCC keeps IP-based traffic deregulated, if and when the old landline network is decommissioned, AT&T will have the last word on access, potentially putting competitors out of business.

Our great-great grandparents experienced similar problems in the early days of telephone service, when high rates from the local Bell telephone subsidiary provoked local competition. But Bell companies routinely refused to handle calls placed on competitors’ networks, forcing customers to maintain a telephone line with both companies to reach every subscriber. Additionally, only Bell-owned providers had access to the long distance network – a competitive disadvantage to competing startups.

Regulatory changes, a handful of mergers and the eventual establishment of the well-regulated Bell System eventually solved problems which threaten to return if AT&T has its way.

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Time Warner Cable’s New Ad Campaign Advertises “No Data Caps”

nocapsTime Warner Cable has introduced a new marketing message to potential customers, promoting the fact its broadband service has “no data caps.”

The new ads, appearing for the first time earlier this month, break from the usual tradition of avoiding telling customers they can use broadband service as much as they like. The cable industry advertised “unlimited access” in its broadband offer for years to compete against dial-up Internet. More recently some have redefined the term to mean “you can use the service anytime day or night,” but not consume unlimited amounts of data.

Of course, with Comcast attempting to claim they have “no data caps” either, only “data thresholds,” Time Warner Cable still has some wiggle room should it impose usage-based billing. Technically, under that scheme users don’t have a “data cap,” just a usage allowance above which they will face overlimit penalties.

Still, it is a nice change for at least one major cable company to be willing to market service without data caps. Time Warner’s most likely intended target for the campaign is AT&T U-verse, which has increasingly cracked down on customers exceeding its own usage caps — 150GB a month for DSL, 250GB a month for U-verse. Customers pay a overlimit penalty of $10 for each 50GB allotment above those allowances.

 

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Wireless Company Lobbyists Add Cell Tower Deregulation to Connect Every Iowan Act

Is a cell tower coming to your backyard?

Is a cell tower coming to your neighbor’s backyard?

Amended language in a bill that would expand broadband service to rural Iowa strips local communities from regulating where wireless companies can place their cell towers, potentially threatening its passage.

The “killer” amended language originated from wireless phone company lobbyists, most likely working for AT&T, and suddenly appeared in the Iowa House version of the bill.

AT&T has routinely proposed such language in several states, claiming the new regulations are designed to “streamline” the expansion of cellular networks often held up by ‘spurious objections’ from local citizens opposed to the unsightly towers in their immediate neighborhoods.

Local governments have also regularly weighed in on approving cell towers in areas where they pose an aesthetic threat or a potential safety risk and some, according to AT&T, have interminably delayed consideration of cell site proposals.

The language in the House bill introduces time limits on cell tower approvals, prohibits communities from rejecting tower placement except under limited circumstances, and denies communities access to cell site documentation deemed private, competitive information by wireless companies.

(Unless you want to put a cell tower here)

(Unless you want to put a cell tower here)

The cell tower language is included in the House version of the Connect Every Iowan Act, legislation considered a priority by Gov. Terry Branstad this year. Branstad wants to remove financial and regulatory impediments and offer tax credits to stimulate expansion of broadband into areas most providers have previously deemed uneconomical to serve.

AT&T sees wireless broadband as a sensible alternative and the company has publicly advocated using wireless 4G technology in rural areas. If the House measure is approved, AT&T and other wireless companies can affix microcells or other cellular antennas to utility poles, street signs, or water towers without seeking permission from local authorities.

Colleagues in the Iowa state Senate were concerned about the language in the House version of the bill.

“The language in the House bill, in my view, is pretty egregious,” Sen. Steve Sodders, (D-State Center), who is leading the effort on the Senate bill. He told the Associated Press, “It really took away all local control of cell tower siting.”

“The real angst there is that without local control on these towers, these things can be built right in your neighborhood,” said Sen. Matt McCoy, (D-Des Moines). “Nobody wants to come home and see that. Finding that balance is going to be key.”

att-logo-221x300Des Moines city attorney Jeff Lester noted the language in the bill cleverly favors cellular companies with a built-in guarantee of approval of their cell tower requests:

The bill does not require cellular companies to provide company and business plan information to local governments when applying for a new cell tower site. Should municipal authorities deny a request, and a cellular company then brings the case to federal court, local authorities wouldn’t have the evidence necessary to justify their denial.

Lester said under federal law, company information serves as evidence in these appeals. Without it, there is no basis for denial, he said, and the ruling would be in favor of the cellular company.

Rep. Peter Cownie, (R-West Des Moines), who spearheaded the effort in the House, said determining where towers can or cannot go is a difficult task, but that it’s not his intent to weaken anyone’s say in their placement.

“I do not want to take away the authority of local officials in terms of cell tower siting,” he told AP. “I don’t think anyone’s goal is to take that away.”

Subcommittees in both chambers plan to meet to discuss the legislation next week.

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Telecom Italia Seeks Advice from AT&T on How to Grab More €uros from Customers

Telecom Italia wants to learn from the master of higher priced phone service: AT&T

Telecom Italia (TI) has a big problem. While AT&T charges the average American $66 a month for mobile service, competition in Italy has forced wireless prices down to $18 a month for comparable service.

TI chief executive officer Marco Patuano wants the price cutting to end and traveled to the United States to learn from AT&T how it was able to raise prices and increase customer spending with usage-capped Internet, phone and television service. His self-described “innovation trip” brought him straight to the office of AT&T CEO Randall Stephenson.

TI is trying to end years of losses and sales declines precipitated by falling prices and a growing disinterest in traditional landline service. AT&T accomplished that by boosting investment in mobile services. AT&T charged high prices for unlimited data plans until demand for data grew to the point the company could earn much more metering Internet usage. As a result, AT&T has earned a staggering $100 billion over the past decade from boosted phone bills.

Patuano

Patuano

Patuano wants to find a way to follow in AT&T’s footsteps as TI’s share price has fallen more than 70 percent over the last six years. Fierce competition from Vodafone and VimpelCom have forced prices down across Italy. With prices so low, investors have shown little interest in providing funding for wholesale upgrades to 4G wireless service. In turn, that has kept Telecom Italia from offering faster data speeds which would allow them to raise prices for service.

In North America, high wireless prices and the relative lack of competition have brought considerably better financial returns for investors. That high rate of return has attracted investment allowing providers like AT&T and Verizon Wireless to spend billions on network upgrades that have, in turn, further increased revenue at both companies. Customers benefit from the faster speeds, but also pay for the privilege with some of the highest wireless prices in the world.

It’s a formula Patuano wants to bring to the Italian market, but he needs more investment to stabilize TI’s finances. TI was the government-owned phone company until it was privatized in 1997. Despite having a massive customer base, nimble wireless competitors have outflanked the phone company and the results have been falling sales, disconnected customers, and its $37 billion in debt reduced to junk status by investor rating services. The company sold its headquarters in Milan and got rid of its Argentine subsidiary, along with suspending shareholder dividends.

att_logo“The first target now for a phone carrier is upgrading networks and transform it to a platform for high-value services,” Patuano said. “This is exactly what AT&T did and what we are calling for.”

Patuano has seen AT&T defend its turf in the wireline business by scrapping its traditional landline/DSL-only service in larger markets in favor of a hybrid fiber-copper network dubbed U-verse. Patuano is now pondering whether TI could deliver a package of phone, broadband and television service over a broadband platform. The average AT&T U-verse customer spends $170 a month on U-verse, an amount much better than $18 a month. TI could do even better than AT&T because Italy lacks many cable television providers — Italians depend on satellite television for multichannel pay television.

AT&T and TI are no strangers to one another. In 2007, AT&T attempted to buy a stake in the Italian phone company but met with a storm of objections from Italian politicians. AT&T dropped the idea soon after.

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Math Problem: The Telecom Industry’s Bias Against Fiber-to-the-Home Service

Phillip "Spending $6k per cable customer is obviously a much better deal than paying half that to build a fiber to the home network" Dampier

Phillip “Spending $6k per cable customer is obviously a much better deal than paying half that to build a fiber to the home network” Dampier

Math was never my strong subject, but even I can calculate the groupthink of American cable and telephone companies and their friends on Wall Street just doesn’t add up.

This week, we learned that cable companies like Bright House Networks, Suddenlink, and Charter Communications are already lining up for a chance to acquire three million cable customers Comcast intends to sell if it wins approval of its merger with Time Warner Cable. Wall Street has already predicted Comcast will fetch as much as $18 billion for those customers and pegged the value of each at approximately $6,000.

But for less than half that price any company could build a brand new fiber to the home system capable of delivering 1,000Mbps broadband and state-of-the-art phone and television service and start banking profits long before paying off the debt from buying an inferior coaxial cable system. Yet we are told time and time again that the economics of fiber to the home service simply don’t make any sense and deploying the technology is a waste of money.

Let’s review:

Google Fiber was called a boondoggle by many of its competitors. The folks at Bernstein Research, routinely friendly to the cable business model, seemed appalled at the economics of Google’s fiber project in Kansas City. Bernstein’s Carlos Kirjner and Ram Parameswaran said Google would throw $84 million into the first phase of its fiber network, connecting 149,000 homes at a cost between $500-674 per home. The Wall Street analyst firm warned investors of the costs Google would incur reaching 20 million customers nationwide — $11 billion.

“We remain skeptical that Google will find a scalable and economically feasible model to extend its build out to a large portion of the U.S., as costs would be substantial, regulatory and competitive barriers material, and in the end the effort would have limited impact on the global trajectory of the business,” Bernstein wrote to its investor clients.

dealSo Google spending $11 billion to reach 20 million new homes is business malpractice while spending $18 billion for three million Time Warner Cable customers is confirmation of the cable industry’s robust health and valuation?

Bernstein’s firm never thought highly of Verizon FiOS either.

“If I were an auto dealer and I wanted to give people a Maserati for the price of a Volkswagen, I’d have some seriously happy customers,” Craig Moffett from Bernstein said back in 2008. “My problem would be whether I could earn a decent return doing it.”

Back then, Moffett estimated the average cost to Verizon per FiOS home passed was $3,897, a figure based on wiring up every neighborhood, but not getting every homeowner to buy the service. Costs for fiber have dropped dramatically since 2008. Dave Burstein from DSL Prime reported by the summer of 2012 Verizon told shareholders costs fell below $700/home passed and headed to $600. The total cost of running fiber, installing it in a customer’s home and providing equipment meant Verizon had to spend about $1,500 per customer when all was said and done.

Moffett concluded Verizon was throwing money away spending that much on improving service. He wasn’t impressed by AT&T U-verse either, which only ran fiber into the neighborhood, not to each home. Moffett predicted AT&T was spending $2,200 per home on U-verse back in 2008, although those costs have dropped dramatically as well.

Moffett

Moffett

Moffett’s solution for both Verizon and AT&T? Do nothing to upgrade, because the price wasn’t worth the amount of revenue returns either company could expect in the short-term.

It was a much different story if Comcast wanted to spend $45 billion to acquire Time Warner Cable however, a deal Moffett called “transformational.”

“What we’re talking about is an industry that is becoming more capital intensive,” Todd Mitchell, an analyst at Brean Capital LLC in New York told Bloomberg News. “What happens to mature, capital-intensive companies — they consolidate. So, yes, I think the cable industry is ripe for consolidation.”

Other investors agreed.

“This is definitely a bet on a positive future for high-speed access, cable and other services in an economic recovery,” said Bill Smead, chief investment officer at Smead Capital Management, whose fund owns Comcast shares.

ftth councilBut Forbes’ Peter Cohan called Google’s much less investment into fiber broadband a colossal waste of money.

“Larry Page should nip this bad idea in the bud,” Cohan wrote.

Cohan warned investors should throw water on the enthusiasm for fiber before serious money got spent.

“FTTH authority, Neal Lachman, wrote in SeekingAlpha, that it would cost as much as $500 billion and could take a decade to connect all the houses and commercial buildings in the U.S. to fiber,” Cohan added.

Cohan was concerned Google’s initial investment would take much too long to be recovered, which apparently is not an issue for buyers willing to spend $18 billion for three million disaffected Time Warner Cable customers desperately seeking alternatives.

An investment for the future, not for short term profits.

An investment for the future, not short term profits.

Municipal broadband providers have often chosen to deploy fiber to the home service because the technology offers plenty of capacity, ongoing maintenance costs are low and the networks can be upgraded at little cost indefinitely. But such broadband efforts, especially when they are owned by local government, represent a threat for cable and phone companies relying on a business model that sells less for more.

The American Legislative Exchange Council (ALEC), funded by Comcast, Time Warner, AT&T, Verizon, and other large telecom companies is at the forefront of helping friendly state legislators ban community fiber networks. Their excuse is that the fiber networks cost too much and, inexplicably, can reduce competition.

“A growing number of municipalities are [...] building their own networks and offering broadband services to their citizens,” ALEC writes on its website. “ALEC disagrees with their answer due to the negative impacts it has on free markets and limited government.  In addition, such projects could erode consumer choice by making markets less attractive to competition because of the government’s expanded role as a service provider.”

The Fiber-to-the-Home Council obviously disagrees.

“Believe it or not, there are already more than a thousand telecom network operators and service providers across North America that have upgraded to fiber to the home,” says the Council. “The vast majority of these are local incumbent telephone companies that are looking to transform themselves from voice and DSL providers into 21st century broadband companies that can deliver ultra high-speed Internet and robust video services, as well as be able to deliver other high-bandwidth digital applications and services to homes and businesses in the years ahead.”

Stephenson

Stephenson

In fact, a good many of those efforts are undertaken by member-owned co-ops and municipally owned providers that answer to local residents, not to shareholders looking for quick returns.

The only time large companies like AT&T move towards fiber to the home service is when a competitor threatens to do it themselves. That is precisely what happened in Austin. The day Google announced it was launching fiber service in Austin, AT&T suddenly announced its intention to do the same.

“In Austin we’re deploying fiber very aggressively,” said AT&T CEO Randall Stephenson. “The cost dynamics of deploying fiber have dramatically changed. The interfaces at the homes, the wiring requirements, how you get a wiring drop to a pole, and the way you splice it has totally changed the cost dynamics of deploying fiber.”

Prior to that announcement, AT&T justified its decision not to deploy fiber all the way to the home by saying it was unnecessary and too costly. With Google headed to town, that talking point is no longer operative.

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As Usual, Big Telecom in the Running for Worst Company in America 2014

2014wciabracketdayfive

Our friends at The Consumerist invite you to participate in the 2014 Worst Company in America contest. Readers are invited to cast a series of votes — one each day — to help narrow the field to the truly abysmal, the god-awful, and the despised. The ultimate winner receives the Golden Poo award.

Not surprisingly, the nation’s biggest telecom companies are among the regular finalists. The big ones are all there — Comcast, Time Warner Cable, Verizon, and AT&T.

Hated cable companies frequently beat down big banks like the vipers at Chase, where settlements in the hundreds of millions with the government for wrongdoing are almost a monthly occurrence. Voters would rather fly the Unfriendly Skies with Divided Airlines, Last Frontier Air — even US Scare — than deal with Comcast’s offshore customer service. The bad boys at Electronic Arts and Koch Industries bring knives to AT&T’s gunfight on good customer relations.

Over the last eight years, Comcast turned up as the big winner of the Golden Poo award in 2010 and either runner-up or third place in 2008, 2009, 2011, and 2013. AT&T achieved third place in 2012. Time Warner Cable and Verizon are usually eliminated in the finals, but their regular appearance on the nominations list is not something they can be proud of. Time Warner Cable has already managed to beat back EA, big winner in 2012 and 2013. So this year they might go all the way to the top… or is it bottom?

Year Winner Runner-up Third place
2006 Halliburton Choicepoint Wal-Mart and US Government
2007 RIAA Halliburton Wal-Mart and Exxon
2008 Countrywide Financial Comcast Diebold and Wal-Mart
2009 AIG Comcast Bank of America and Ticketmaster
2010 Comcast Cash4Gold Bank of America and Ticketmaster
2011 BP Bank of America Comcast and Ticketmaster
2012 Electronic Arts Bank of America AT&T and Wal-Mart
2013 Electronic Arts Bank of America Comcast
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Time Warner Cable, Comcast Crash, Burn in Consumer Reports’ 2014 Ratings

consumer reportsDespite claims of improved customer service and better broadband, Comcast and Time Warner Cable’s customer satisfaction scores are in near-free fall in the latest Consumer Reports National Research Center’s survey of consumers about their experiences with television and Internet services.

Although never popular with customers, both cable operators plummeted in the 2014 Consumer Reports ratings — Time Warner Cable is now only marginally above the perennial consumer disaster that is Mediacom. Comcast performs only slightly better.

In the view of Consumers Union, this provides ample evidence that two wrongs never make a right.

“Both Comcast and Time Warner Cable rank very poorly with consumers when it comes to value for the money and have earned low ratings for customer support,” said Delara Derakhshani.  “A merger combining these two huge companies would give Comcast even greater control over the cable and broadband Internet markets, leading to higher prices, fewer choices, and worse customer service for consumers.”

These ratings reflect Internet service only.

These ratings reflect Internet service only.

Comcast ranked 15th among 17 television service providers included in the ratings and earned particularly low marks from consumers for value for the money and customer support.  Time Warner ranked 16th overall for television service with particularly low ratings for value, reliability, and phone/online customer support.

Another ratings collapse for Comcast and Time Warner Cable

Another ratings collapse for Comcast and Time Warner Cable

Comcast and Time Warner Cable were mediocre on overall satisfaction with Internet service.  Both companies received especially poor marks for value and low ratings for phone/online customer support.

“In an industry with a terrible track record with consumers, these two companies are among the worst when it comes to providing good value for the money,” said Derakhshani.  “The FCC and Department of Justice should stand with consumers and oppose this merger.”

For as long as Stop the Cap! has published, Mediacom has always achieved bottom of the barrel ratings, with satellite fraudband provider HughesNet — the choice of the truly desperate — scoring dead last for Internet service. We’re accustomed to seeing the usual bottom-raters like Frontier (DSL), Windstream (DSL), and FairPoint (DSL) on the south end of the list. But now both Comcast and Time Warner Cable have moved into the same seedy neighborhood of expensive and lousy service. Comcast couldn’t even beat the ratings for Verizon’s DSL service, which is now barely marketed at all. Time Warner Cable scored lower than CenturyLink’s DSL.

Breathing an ever-so-slight sigh of relief this year is Charter Communications, which used to compete with Mediacom for customer raspberries. It ‘rocketed up’ to 18th place.

If you want top-notch broadband service, you need to remember only one word: fiber. It’s the magical optical cable phone and cable companies keep claiming they have but largely don’t (except for Verizon and Cincinnati Bell, among a select few). If you have fiber to the home broadband, you are very happy again this year. If you are served by an independent cable company that threw away the book on customer abuse, you are relieved. Topping the ratings again this year among all cable operators is WOW!, which has a legendary reputation for customer service. Wave/Astound is in second place. Verizon and Frontier FiOS customers stay pleased, and even those signed up with Bright House Networks and Suddenlink report improved service.

Ratings are based on responses from 81,848 Consumer Reports readers. Once again they plainly expose Americans are not happy with their telecom options. The average cost of home communications measured by the Mintel Group is now $154 a month — $1,848 a year. That’s more expensive than the average homeowner’s clothing, furniture or electricity budget. The same issues driving the bad ratings last year are still there in 2014: shoveling TV channels at customers they don’t want or need, imposing sneaky new fees along with broad-based rate increases every year, low value for money, and customer service departments staffed by the Don’t Care Bears.

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Usage Billing Money Maker: Wireless Carriers Will Earn More Than $100 Billion On Data Plans This Year

U.S. wireless carriers are on track to earn more than $100 billion this year from usage-based billing plans for mobile data, the first country in the world to break the symbolic $100 billion mark in data revenue.

Analyst Chetan Sharma reports Verizon Wireless and AT&T are statistically the largest recipients of revenue earned from metering data usage. For the first time in 2013, mobile data revenue surpassed voice revenue in the U.S., making data usage the most lucrative product available from wireless carriers.

A graph from the Economist published last year explains the runaway revenue growth at U.S. wireless carriers. The lack of significant competition has allowed U.S. companies to charge an average of $85 a month for data plans, which are nearly always bundled into compulsory packages of unlimited voice calling and texting. In contrast, customers in China pay just $24 for data plans. In the United Kingdom, the average charge is $9 a month.

mobile-data-prices-chart-2Sharma said the only disruption to this revenue growth in the United States comes from T-Mobile USA, which has recently cut prices on its service plans, forcing AT&T and Verizon Wireless to react with moderate price cutting. But with the significant disparity in market share between AT&T and Verizon vs. T-Mobile, neither larger carrier is expected to take a significant hit to their bottom lines without a mass exodus to the country’s fourth largest provider.

Softbank, the Japanese company that now controls Sprint, has launched a lobbying effort to secure permission to acquire T-Mobile and merge it into the Sprint network. But with reports showing T-Mobile’s willingness to disrupt the wireless market, regulators are likely to be reluctant to remove that competition from the playing field.

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Your Online Privacy — Invaded; AT&T and Verizon Among List of Offenders

http://www.phillipdampier.com/video/CBS The Data Brokers -- Selling your personal information 3-9-14.flv

This weekend, 60 Minutes profiled how marketing companies invade your privacy, track your personal life and locations, and sell the lucrative information with little notice to you to third parties. Among the offenders are AT&T and Verizon, which both have special divisions devoted to pitching your personal details to advertisers of all kinds. Although they claim the information they sell does not include your real identity, third-party marketers make a living putting this kind of “aggregate” information together with other data to discover your name and address. At least with AT&T and Verizon, there are easy ways to opt out. (13:56)

http://www.phillipdampier.com/video/CBS How to defend your privacy online 3-9-14.flv

Looking to protect your privacy? 60 Minutes Overtime provides some advice and some examples of the lengths you’d have to go to be completely “off the grid.” (5:52)

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Fiber to the Home is Now Cheap Enough for AT&T to Expand It to Dallas, Other Cities

Phillip Dampier March 10, 2014 AT&T, Broadband Speed, Competition, Consumer News No Comments

att gigapowerAT&T says it plans to adopt fiber to the home service in cities around the United States as part of an expansion of its U-verse GigaPower service.

CEO Randall Stephenson told investors at the Morgan Stanley Technology, Telecom, and Media Conference the “cost dynamics” of fiber optics have become “really encouraging” in its targeted fiber deployment in Austin, Tex.

“In fact I would tell you we are so encouraged that we want to begin taking this to other communities [where] we can get the terms and conditions like we have in Austin,” Stephenson said, referring to Austin’s red-tape cutting and clearing the way for fiber upgrades with eased permit requirements and pole attachment policies. “We are redirecting investment to fiber to the home deployment, and in fact we are going to launch the service in Dallas this summer.”

Stephenson added that where U-verse faces significant competition from a “new competitor,” AT&T will be “a little more aggressive and assertive in deploying that technology around the country.”

That most likely means AT&T will choose fiber to the home service in areas facing imminent competition from Google Fiber or another similar provider.

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  • Milan in Austin: I forgot to mention that everyone should take a minute to sign the Consumers Union anti-Comcast/TWC Merger petition today. https://secure.consumers...
  • Milan in Austin: This is encouraging! According to a local free paper, the Austin area TWC speed increase will be implemented in June. All we need now is for the Comca...
  • Loons in June: "We use an OTA antenna for FREE HDTV (21 channels total, 120 if you like religious/infomercial/homeshoppingclub/foreign channels)" You get 120 OTA ...
  • Michael Elling (@Infostack): Phil, we need to 1) push for equal/open access in layer 1 for any and all providers granted a public ROW or frequency, with a quid pro quo that end-us...
  • SmilingBob: We cut the cord on the cable companies and used DSL Extreme for our broadband, which uses Verizon or AT&T lines, depending on your area. We got t...
  • Dave Hancock: Not likely, as Verizon is not expanding. Further, cord-cutting may not work out too well on Verizon, as they do not deliver those high speeds for man...
  • John: It has been since December 17, 2014. Know one has an answer. I will never trust a word from Comcast again....
  • innovate: I will go with Verizon FiOS for TV, Internet and homephone if it was available in my area. I do not like cable slow speeds....
  • Dave Hancock: great reporting Phillip!!...
  • Duffin: Yep, Cincinnati Bell has been sending out Tweets and emails about this. 100% increase. Greedy bastards....
  • Frank: People are stealing cable, so the FCC are getting comcast and other cable companies to put a stop to it.... Plain and simple.. Get a life.. 6 cents a ...
  • Paul Houle: I don't know the last time I've seen a TV ad that wasn't for reverse mortgages or mobility aids....

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