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Cable Companies Expand Broadband Lead in U.S.; Subscriber Adds Up 35%

Phillip Dampier November 15, 2018 Broadband Speed, Competition, Consumer News 1 Comment

Cable companies continue to dominate the U.S. broadband marketplace, and the gap between cable broadband and telephone company DSL continues to widen.

Leichtman Research Group reports the top seven cable companies together added 728,423 internet customers in the last three months, an increase of 35% over 2017. One of the biggest gainers was Comcast, which grew 363,000 subscribers during the third quarter. At the same time last year Comcast added 213,000 customers. Charter Spectrum grew by 308,000 customers in the third quarter, bolstered by speed upgrades in select areas and more aggressive promotions. At the same time in 2017, Spectrum added 285,000 customers.

Cable’s gains are phone company losses. AT&T, Frontier, CenturyLink, and Consolidated (formerly FairPoint) saw 159,974 customers disconnect service in the last three months. Phone company losses were buffered in part by government-funded rural broadband expansion campaigns, which typically introduce broadband service in rural areas for the first time. Where customers have a choice, they are increasingly choosing cable companies to supply internet service because speed and reliability are often better, especially compared to DSL service still prevalent in a lot of areas.

Broadband Providers Subscribers at end of 3Q 2018 Net Adds in 3Q 2018
Cable Companies
Comcast 26,872,000 363,000
Charter 24,930,000 308,000
Cox* 5,040,000 20,000
Altice 4,096,300 14,200
Mediacom 1,260,000 9,000
WOW (WideOpenWest) 755,100 7,300
Cable ONE 660,799 6,923
Total Top Cable 63,614,199 728,423
Phone Companies
AT&T 15,746,000 (26,000)
Verizon 6,958,000 2,000
CenturyLink^ 5,435,000 (71,000)
Frontier 3,802,000 (61,000)
Windstream 1,015,000 8,300
Consolidated^^ 781,912 (1,974)
Cincinnati Bell^^^ 310,700 200
Total Top Telco 34,048,612 (149,474)
Total Top Broadband 97,662,811 578,949

Sources: The Companies and Leichtman Research Group, Inc.

*LRG estimate
^CenturyLink only reported residential subscribers in 3Q 2018.  LRG estimate including non-residential subscribers
^^Consolidated includes a minor sale of a local exchange carrier
^^^Cincinnati Bell does not include the acquisition of Hawaiian Telecom
Company subscriber counts may not solely represent residential households. Top cable and telephone companies represent approximately 95% of all subscribers.

Unsurprisingly, California Fires Cause Significant Charter Spectrum Outages

Phillip Dampier November 14, 2018 Charter Spectrum, Consumer News No Comments

Charter Spectrum customers across Ventura County, Calif., are reporting significant outages of TV, internet, and phone service as a result of the region’s ongoing wildfires, which have caused significant damage to Spectrum’s fiber optic lines.

“Our fiber lines have been damaged or destroyed by the fire in multiple areas,” said Spectrum spokeswoman Pamela Yu in an e-mailed statement. “Our technicians will be working to restore service as soon as it is safe to do so, and we get approval from the fire department to go into those areas. We are repairing fiber where we have been given access and crews are restoring services.”

Stop the Cap! reader Juan Hidalgo, who lives outside of Camarillo, told us he lost service late last week, saw it briefly restored on Monday, and is out of service once again.

“I waited on hold 49 minutes before a representative confirmed there was additional damage to their fiber optic service lines, which are spread across the county and have affected Spectrum and other providers,” Hidalgo said. “I know it is not their fault, but I wish they had redundancy in their network so they could transfer service to another cable not affected by the fires.”

Hidalgo and his family are safe, although they could see smoke from the Woolsey fire last weekend. Things have calmed down since then, and Hidalgo says he realizes that his inconvenience pales in comparison to the losses some Californians are experiencing.

“My heart goes out to them and their families, and I am aware that in comparison having your cable out doesn’t really seem that important, but considering how serious fires are becoming in California, finding ways to maintain service to get important messages out seems more urgent than ever,” Hidalgo said.

The fires have also caused disruptions to other service providers, especially fiber-fed cell towers in fire areas. As customers drop landline service, most depend on their cellphones to get urgent alert messages and stay in touch with friends and family, as well as emergency services like 911. Those who escaped from the devastating Camp Fire in northern California reported significant problems making and receiving calls during the peak of the fire and the resulting evacuation. Most reported text messaging was the most reliable service when calls did not go through and internet service was spotty.

Some attempts by volunteer groups and competing ISPs to bring up publicly accessible internet hot spots had mixed results, according to the Ventura County Star.

VIDEO: How Big Telecom Isolates Rural America

From the producers of Dividing Lines:

Across the country, state legislatures have created barriers to community involvement in expanding internet access.

In Tennessee, lobbyists from AT&T, Charter, and Comcast spread huge campaign contributions around the state legislature. AT&T’s influence is felt in the governor’s own broadband expansion legislation, which was tailor-written to allow the phone company to collect huge taxpayer subsidies to expand inferior DSL into rural parts of Tennessee.

Meanwhile, some local communities seeking to build state-of-the-art fiber to the home networks capable of delivering 10 gigabit service found that doing so would be illegal under state law.

Think about that for a moment.

A multi-billion dollar telecom company is allowed to expand its slow speed DSL network with taxpayer-funded grants while your local community is forbidden to bring fiber optic service to your home even if your community votes to support such a project. Exactly who is the governor and state legislature working for when it comes to resolving Tennessee’s rural broadband nightmare?

In part two of this series, watch State Senator Janice Bowling describe how much influence AT&T has over the Tennessee state legislature. (5:31)

Say Hello to America’s Least-Taxed Corporation: Charter/Spectrum’s 2017 U.S. Tax Rate Was -883.95%

Phillip Dampier November 8, 2018 Charter Spectrum, Public Policy & Gov't No Comments

(Source: Wallethub)

When Charter Communications CEO Thomas Rutledge met with President Donald Trump in early 2017, he probably did not realize just how much the Trump Administration was prepared to reward America’s second largest cable company.

After collecting a $98 million dollar compensation package for himself by successfully pulling off acquisitions of Time Warner Cable and Bright House Networks, Rutledge today presides over America’s least taxed corporation. In fact, the American people owe Charter a significant ‘refund’ after the company achieved a negative overall U.S. tax rate of -883.95%.

WalletHub analyzed annual reports for the S&P 100 — the largest and most established companies on the stock market — in order to determine the federal, state and international tax rates they paid in 2017.

Charter’s tax accountants took full advantage of the Trump Administration’s permanent corporate tax cuts, which lowered corporate tax rates from 35% to 21%. But Republicans who supported the corporate tax cuts left intact most of the generous corporate deductions, offsets, and other credits that ensured few of America’s top corporations ever paid anything close to 35%. As a result, the lowered tax rate combined with what critics call “corporate welfare and giveaways” allow a growing number of companies to not pay a penny in taxes. In fact, many will be in the enviable position of avoiding taxes and still getting an effective ‘refund’ worth billions.

Companies that are required to regularly invest in their businesses and buy equipment, hardware, and other tangibles as part of the cost of doing business are often the most generously rewarded. Tax deductions originally intended to inspire corporate spending during tougher economic times are great news for companies that have significant capital investments. Most of these companies planned on making those investments with or without a tax break, but all are welcome to the idea of using those investments to reduce their effective tax rate to zero. Charter’s acquisitions of Time Warner Cable and Bright House came with the understanding both systems needed substantial upgrades — spending Charter is using to offset taxes not just this year, but several years in the future.

The next least-taxed company was Kraft Heinz, which was taxed at -98.7%. Other big winners are AT&T (-98.36%), Comcast (-55.59%), and Verizon (-51.36%). AT&T and Verizon are frequent winners of an effective tax rate of 0.00% because of the substantial deductions available to both as a result of continually upgrading their highly profitable cellular networks.

Source: WalletHub

“Here We Go Again”: Third Spectrum Outage in Weeks Wipes Out Service in Montana

Phillip Dampier November 6, 2018 Charter Spectrum, Consumer News No Comments

Parts of Montana were left without phone, internet, or cable television service for the third time in the last few weeks after the latest outage from Spectrum caused widespread interruptions.

“Here we go again,” complained Spectrum customer Greg Dugdale. “Charter/Spectrum phones and internet down in Havre and then they are back up, then they are down again.”

The worst affected area is Great Falls, which is coping with its third major service outage.

KRTV-TV reported Spectrum officials are blaming repairs being performed on a third-party carrier’s network for the latest service interruption. Although Spectrum was aware of the problem, they were completely reliant on the other provider to correct it.

Customers are increasingly frustrated about Spectrum’s repeated service problems. An outage in early October wiped out service for almost 48 hours. Last Friday, another outage took out service for several hours. In both cases, the company blamed damage to a fiber optic line, for which it apparently has no backup.

Spectrum officials apologized for the interruption, but will not issue automatic service credits for affected customers. Those looking for a credit will need to reach out to Spectrum customer service to request one.

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