The Consumerist covers a minor bungle by Comcast, which sent e-mail to a whole mess of their customers heralding a 50 percent speed increase in huge, bold print that was not to be:

Customers who waded into the text accompanying the festivities discovered the speed increase was only meant for so-called “Economy Service” customers who were getting upgrades from 1Mbps to 1.5Mbps.  A few days later, the requisite “apology for our error” e-mail was headed out — to the wrong customers:

Broadband for America is the product of the nation's largest phone and cable companies.

Broadband for America has begun assaulting the airwaves with a high-priced advertising campaign claiming that “broadband is leading the [economic] recovery” but is threatened by “1930s telephone regulations,” urging Congress to get involved to stop broadband reform.

The 30 second ads blanketed cable and several Sunday morning news shows yesterday.

What the ads don’t mention is Broadband for America is actually one giant front group backed by large phone and cable companies.  In a study released last fall, Stop the Cap! found virtually every single “coalition” member, including so-called “independent consumer advocacy groups,” do substantial business with, or have received significant financial contributions or board assistance from companies including AT&T, Verizon, and Comcast.

Well-financed by the telecommunications industry it directly represents, Broadband for America seeks further deregulation and wants Congress to stop the FCC from enacting broadband reforms ranging from “truth in marketing” and billing to Net Neutrality.

The “honorary co-chairs” of the group are Michael Powell, the same Bush Administration FCC chairman that badly bungled the FCC’s approach to broadband policy thrown out in the courts earlier this year, and former Congressman Harold Ford, Jr., who left public service for a very lucrative career in “dollar-a-holler” advocacy and working as a lobbyist for the economic-vampire investment bank Goldman Sachs (something Broadband for America left out of his online biography.)

Broadband for America, a telecom-backed astroturf group, is running these advertisements promoting the agenda of AT&T, Verizon, and Comcast to try and stop broadband reform policies.  (1 minute)

WMC-TV in Memphis compared rates among providers to check and see if mandatory Comcast service represented a good deal for Mid-America renters.

Mid-America Apartment Communities, a nationwide apartment management company, continues to unveil new mandatory cable service fees on renters — this time for eight Mid-America apartment complexes in Memphis, Tennessee.

Memphis renters began receiving word of the new required $40 a month Comcast cable package late last month and the controversy has sparked additional media attention.

Mid-America earns a significant kickback bonus from Comcast for mandating cable service on all of its renters.  That upsets many renters who choose not to have cable service, or subscribe to a satellite provider like DirecTV or DISH.  The $40 fee doesn’t go away if you don’t want the service.  Earlier in July, Stop the Cap! covered Mid-America’s mandatory cable service introduction in other parts of Tennessee and Texas.

Legal experts say the arrangement is perfectly legal, so long as it is not imposed unilaterally on renters.  Instead, Mid-America includes the mandatory cable clause in its new renter and lease renewal agreements.  If you don’t want to pay the fee, your only option is to move somewhere else.

The $40 Comcast package delivers 100 digital channels, 45 music channels, and one on-demand channel.  That appears to coincide with Comcast’s Digital Starter package, which normally runs $51.50 a month in Memphis.

Some current Comcast subscribers who rent from Mid-America do appreciate the discount and the convenience of paying cable charges as part of their monthly rent.  But others do not want to be compelled to pay for Comcast service they don’t want or cannot afford.  For them, the extra $40 a month charge is effectively a rent increase.

WMC-TV’s ‘Investigators’ Team took a look at Mid-America Apartments’ new mandatory cable charges imposed on its Memphis renters.  (4 minutes)

Netflix has a big problem.

As it gradually shifts its operations towards more instant, on-demand video streaming of movies and TV shows subscribers want, some well-connected studios and distributors have a vested interest in stopping Netflix in its tracks.

Among the most threatened is Time Warner’s HBO, which has watched premium movie channel subscriptions erode for years as consumers dump pay-TV for lower cable bills and Netflix subscriptions.  For up to five dollars less than what cable systems charge for HBO, Netflix customers get access to unlimited video streaming and can still check out one movie at a time on traditional DVDs.

Netflix is slowly evolving their business towards streaming and away from costly and labor-intensive DVD rentals-by-mail.  Customers enjoy the instant access to programming — no waiting for the mail or getting on a waiting list for popular titles.  Netflix does not have to pay ever-increasing postage rates either, or replace lost or damaged DVDs.

But for Netflix streaming to succeed, the company needs agreements with content producers — Hollywood studios and distributors — for so-called “streaming rights.”

One contract wins the right to obtain and rent out the physical DVD’s, which Netflix has had no problem in obtaining… eventually.  But another, separate agreement is needed win the rights to stream movies or TV show over the Internet.

So far, most of Netflix’s streaming agreements cover older movies and TV shows that have already found their way to Hulu or have been run to death on premium movie channels.  Anyone for Big, Fast Times at Ridgemont High, or Class Action?  These are all listed by Netflix as “new releases.”

Now Netflix wants to expand their library to include additional titles and they’ve run into a roadblock – HBO.

The premium movie channel controls streaming rights not just for its own programming, but also for Warner Bros., 20th Century Fox, and Universal.  Those three movie studios produce an enormous amount of movies and television shows, and without being able to contract streaming licenses, Netflix may be in big trouble.

HBO's Go service streams HBO movies, specials, and series to "authenticated" HBO subscribers

HBO intends to keep those shows, as well as its own, exclusively for itself and its cable and telco-TV partners.  As part of the TV Everywhere concept, HBO will dramatically expand its own streaming movie service — HBO Go, currently only available to authenticated Comcast and Verizon FiOS HBO subscribers.  Everyone else can forget about it.

The pay television industry — cable, satellite, and telco-TV, is more than happy to accommodate HBO sticking it to Netflix.  HBO Go could help sustain the premium movie channel and sell more subscriptions.

The video war means that Netflix will be in the DVD rental-by-mail service for years to come, if only to serve up movies and TV shows from those three studios.  More likely, however, is that Netflix will find a partner to help return fire — denying HBO access to movies controlled by Netflix.

Ultimately, consumers are likely to follow the content.  If Netflix controls it, consumers will sign up for that service.  If the cable industry controls it, they’ll be forced to keep their cable subscriptions.  It’s a high stakes game either way.

Reardon is fine with this vision of your online future.

Marguerite Reardon confesses she’s confused.  She doesn’t understand what all the fuss is about regarding Google and Verizon teaming up to deliver a blueprint for a corporate compromise on Net Neutrality.  In a column published today, Reardon is convinced she’s on a debunking mission — to deliver the message that rumors of the Internet apocalypse are premature.

As I read the criticism of Google and Verizon’s supposed evil plan to demolish the Internet, and as I hear about “protests” of several dozen people at Google’s headquarters, I scratch my head and wonder: am I missing something?

The Google-Verizon Net neutrality proposal I read last week doesn’t sound nearly as apocalyptic as Free Press, a media advocacy group, and some of the most vocal critics out there have made it sound.

In fact, most of proposal sounded a lot like a plan FCC Chairman Julius Genachowski offered nearly a year ago, which many Net neutrality proponents seemed to support.

In short, Google and Verizon say they agree to a set of rules for the Internet that would prohibit broadband providers from blocking or degrading lawful content on the Internet. Broadband providers would also not be allowed to take action to impede competition.

This is pretty much what Genachowski has proposed.

OK, terrific. There is agreement.

But wait, Net neutrality zealots are still unhappy.

Hmmm… “zealots?”  Reardon probably just angered the majority of CNET’s readers, who now find themselves labeled as crazed Internet online freedom fighters — net fundamentalists who want absolute protection against big Internet Service Providers tampering with their Internet Experience.

Where can I get my membership card?

Reardon’s “debunk” consists of her narrow, inaccurate definition of Net Neutrality pounded into a pre-conceived notion of what is and is not possible in a competitive broadband marketplace.  In short, she’s satisfied we can all move along… there is nothing to see here:

What Free Press and Public Knowledge don’t seem to realize is that AT&T and Verizon already offer differentiated services today with enhanced quality of service to business customers. Verizon’s Fios TV and AT&T’s U-verse TV services are also examples of managed Internet services that are delivered to consumers. And the last time I checked, no one, other than their cable competitors, has complained about AT&T and Verizon offering competition in the TV market.

The truth is that if Verizon and AT&T wanted to cannibalize their broadband business with premium broadband services, they’d already be doing it. But they aren’t, because there hasn’t been a market for it.

The reality is that consumers are in control of what type of services are offered. If the public Internet can adequately deliver a service for free, then there’s no need to pay for it. But if someone can provide a better service over a dedicated network and there are consumers willing to pay for it, then why shouldn’t it be offered? Isn’t that why some people subscribe to a 768Kbps broadband service for $15 a month, and others pay $100 for a 50Mbps service?

So let’s debunk the debunk.

First, Net Neutrality is not about stopping broadband providers from offering speed-based tiers of service.  In fact, that’s the Internet pricing model we’ve all come to know and love (although those prices are just a tad high, aren’t they?)  Free Press and Public Knowledge do not object to ISPs selling different levels of broadband speed tiers to consumers and businesses to access online content.

Net Neutrality isn’t about stopping ISPs from selling some customers “lite” service and others “mega-super-zippy Turbo” service — it’s about stopping plans from some ISPs to establish their own toll booths on the Internet to charge content producers twice — once to upload and distribute their content and then a second time to ensure that content reaches a particular ISPs customers on a timely, non-speed-throttled basis.  Consider this: you already pay good money for your own broadband account.  How would you feel if you sent an e-mail to a friend who uses another ISP and that provider wanted to charge you 20 cents to deliver that e-mail?  Don’t want to pay?  That’s fine, but your e-mail might be delayed, as paying customers enjoy priority over your freebie e-mail.

A lot of broadband customers may never understand the implications of giant telecom companies building their own toll lanes for “preferred content partners” on the Internet because they’ll just assume that stuck online video or constantly rebuffering stream is the fault of the website delivering it, not their provider intentionally pushing it aside to make room for content from companies who paid protection money to make sure their videos played splendidly.

Second, Reardon need only look to our neighbors in the north to see a non Net Neutral Internet experience in Canada.  There, ISPs intentionally throttle broadband applications they don’t want users running on their networks.  They also spank customers who dare to try what Reardon insists Verizon would never stop — using their broadband service to watch someone else’s content.  With the application of Internet Overcharging like usage limits and consumption billing schemes, cable companies like Rogers don’t need to directly block competitors like Netflix.  They need only spike customers’ broadband bills to teach them a lesson they’ll not soon forget.

Within days of Netflix announcing their imminent arrival in Canada, Rogers actually reduced the usage allowances of some of their broadband customers.  If you still want to watch Netflix instead of visiting Rogers pay-per-view cable menu or video rental stores, it will cost you plenty — up to $5 per gigabyte of viewing.

Reardon seems to think giant providers like AT&T, Verizon, and Comcast care about what their customers want and wouldn’t jeopardize the customer relationship.  Really?  She herself admits she hates paying for hundreds of channels she never watches, yet providers are deaf to complaints from customers demanding an end to this practice.  What about the relentless price hikes?  Wouldn’t that drive off customers?  Perhaps… if customers had real alternatives.  Instead, with an effective duopoly market in place, subscribers pay “the man,” pay an almost identical price from the “other guy,” or go without.

Providers understand their power and leverage in the marketplace.  Until serious competition arrives, it would be a disservice to stockholders not to monetize every possible aspect of broadband service in the United States.

The check against this naked aggression on consumers’ wallets is from consumer groups who are fighting against these big telecom interests.

Before dismissing Net Neutrality “zealotry,” Reardon should experience the Internet in Canada and then get back to us, and more importantly those consumer groups she flicks away with disdain, and join the fight.

FCC Chairman Julius Genachowski needs another calcium supplement to stand up against powerful broadband interests. Let's send him one.

When citizens get active and get involved, they can make a difference.  That’s true even with giant corporations like Verizon Communications.

FCC Chairman Julius Genachowski has been straying as of late.  In 2009, his nomination to chair the Commission came with a lot of promises he’s now threatening to break with the American people:

• to make the FCC more open and accountable to the public interest;
• to promote and expand broadband to underserved Americans;
• to protest the open Internet with strong Net Neutrality protections.

Genachowski watched Comcast use the federal courts to invalidate much of his agency’s authority over broadband because of flawed policies and bad compromises made by the previous administration.  Providers lived with that arrangement until it inconvenienced them.  Then they sued… and won.

History teaches us that making the same mistakes all over again will bring similar results.

Chairman Genachowski is wrong to think brokering secret, back room deals with major corporate broadband providers will solve America’s broadband issues.  Verizon, AT&T, Google, Comcast, and the other players do not answer to the FCC — they answer to their stockholders and Wall Street.  While corporate deals are struck behind closed doors, it is you and I that face living with the results and we don’t even have a seat at the table.

I, for one, am not interested in living in a broadband gated community with AT&T working the front gate.

Genachowski has apparently forgotten he is supposed to be working for the American people, not for America’s broadband duopoly. Not too long ago, Genachowski’s office hinted it might be prepared to cave on meaningful broadband reform.  Outraged citizens flooded the FCC and told him to grow a spine and stand up for our interests and he followed through announcing broadband reform was finally on the way.

It’s time to send the chairman another calcium supplement:

• Retweet this act.ly petition to demand that Genachowski accounts for his inaction.
• Answer these two questions to get the FCC to work for you and not AT&T.
• Learn more about getting involved in the fight to win Net Neutrality protections.

This fight is far from over.

Cricket, the regional wireless carrier that claims to offer “unlimited” data plans that really are not, has jacked up prices on its wireless broadband plans and reduced wireless data usage allowances.

Cricket used to charge $40 a month for 5GB of monthly usage, $60 for 10GB.  No more.

Now the company wants you to pay more for less:

2.5GB for $40, 5GB for $50, and 7.5GB for $60 is hardly "respeKting" your wallet

Thankfully, existing Cricket customers are grandfathered into their existing $40 for 5GB plan, so they do not face the price hike and allowance cut.

Cricket’s claimed speeds up to 1.4Mbps are fiction — in our own tests we found service never exceeding 650kbps, and often averages 500kbps or less in the Rochester, N.Y. area.  When Cricket cell sites become congested, as they have in the southeastern part of the city, speeds can drop to 56kbps or less, making the service completely unusable.  While web page browsing and audio streaming are acceptable using Cricket, video streaming is not.  YouTube and other video multimedia was too painful to watch.

Cricket’s best advantage in the wireless broadband market was its pricing.  Customers accepted dramatically reduced coverage areas (don’t expect Cricket to work outside of the city, nearby suburbs, and adjacent major highways), slower speeds, and a “Fair Access Policy” that throttles your connection to dial-up speeds (or less) once you exceed your monthly allowance, all in return for service priced $20 less than most of the competition.  The modem is usually free or deeply discounted, and there is no contract requirement.

But at Cricket’s new pricing, consumers should take a look at Clearwire’s new 4G service, Comcast High Speed 2Go, or Road Runner Mobile instead.  Clear’s 4G-only plan offers unlimited access for $40.00 a month without a “Fair Access Policy” throttling your service to dial-up speeds, and much faster service than Cricket can provide.  The only downsides are the up front cost of the modem and being sure 4G is available in your area.

Clear, Comcast High Speed 2Go and Road Runner Mobile offer 4G service plans with a fallback option to 3G coverage for about $55 a month.  Clear and Comcast do not limit 4G usage, but do limit 3G access to 5GB per month before overlimit fees apply.  Road Runner Mobile offers unlimited access to both 3G and 4G service.

Cricket likes to claim it “respeKts your wallet.”  Raising prices and reducing usage allowances isn’t exactly a sign of respect.

What a great way to introduce U-verse to Chattanooga — headline news that an AT&T technician pepper-sprayed three dogs owned by a Chattanooga woman with a repellent known to be stronger than police pepper spray.

The nightmare for Janelle Lawrence began last week when an AT&T technician came on her property unannounced and began working in her fenced-in yard.

Janelle greeted the technician and asked him if her dogs, who were sharing her yard with the AT&T employee bothered him.

“He said not anymore.  I pepper sprayed them,” Janelle told WRCB, a Chattanooga television station.

She also noticed her dogs reeling in pain.

“My pug had pepper spray all over her body and was having trouble breathing and it got all over my arms and I started burning,” Lawrence says.

Lawrence says the technician was rude to her and refused to show her I.D. or a work order.

She recorded his truck number off the back of his work truck and called the main office demanding to know why he was there when she doesn’t subscribe to any of the company’s services.

AT&T told WRCB they didn’t need Janelle’s permission to enter her property or spray her pets.

AT&T issued a statement to the station:

“An AT&T technician has been working on this street all week for this week’s U-verse launch in Chattanooga. This AT&T technician needed access to the easement area on this fenced-in property, which is in a public right of way.”

Janelle remains deeply upset at AT&T and the employee, who appears not to be suffering any ill-effects to his job from the incident.

“You can do something to me and I’ll take it all day, but if you touch my little angels,” Lawrence says that’s where she draws the line.

The pepper spray incident took a considerable amount of shine off AT&T’s U-verse launch event, particularly for potential customers who are also pet owners like Stop the Cap! reader Sam who pointed this incident out to us.

“The same quick-drawing AT&T technician that attacked this poor woman’s pets could be aiming for yours or mine next,” he writes. “As long as this guy is still employed by AT&T, I wouldn’t have U-verse in my house even if they gave it to me for free.”

As far as Sam as concerned, AT&T pepper sprays their customers with high bills and bad service on a daily basis anyway.

“These guys have no shame buying their way into Tennessee with another one of those statewide deregulation bills that brought lots of campaign cash for supporters and very little for consumers,” Sam writes. “I signed up for EPB Fiber service, which is owned by the city, costs me less than either the cable or phone company, and delivers real fiber optic service right to my house.”

Sam also notes the guy who installed it loved his two dogs and cat.

WRCB-TV was the only station in Chattanooga to spend more than a few seconds on U-verse’s introduction in the city this week, but it wasn’t the kind of PR AT&T was exactly hoping for.  [Warning-Content may upset sensitive viewers.]  (2 minutes)

All this during an underwhelming launch week for AT&T’s U-verse in the River City, which garnered almost no attention in the local broadcast media, except for the pepper spraying incident.  The local newspaper put the story in its Business section.

Chattanooga residents now enjoy a fifth choice for several traditional services offered by cable or satellite:

• Comcast — incumbent cable operator
• EPB — municipally owned power utility and fiber-to-the-home provider
• AT&T — U-verse brings better speeds and service than traditional DSL from the phone company
• DirecTV — Satellite TV
• DISH — Satellite TV

The biggest savings residents will find from Comcast and AT&T comes when bouncing back and forth between new customer promotions.  Or you can just stick with EPB, which seems to offer the same prices for new and old customers.  For broadband customers, EPB delivers (by far) the fastest Internet speeds — up to 100Mbps upstream and downstream.  Comcast comes in at second place, and AT&T U-verse tops out at around 24Mbps if you are lucky.

Once promotional pricing from Comcast and AT&T expire, savings are highly elusive.  Price comparisons are extremely difficult because of channel line-ups, bundled equipment, and different Internet speed tiers and phone calling plans.  Making the best choice means sitting down and exploring channel lineups, HD channel tiers, how much broadband speed you require, and what kind of phone service you want, if any.

Most of the triple-play bundled promotions including standard cable, Internet and phone service will run between $119-139 a month before taxes, fees, and equipment costs.  If you sign a contract, Comcast will throw in a free iPod Touch.  Providers will keep your package price-increase-free for the length of any contract you sign.  That could be important, because AT&T and Comcast have been increasing their rates at least annually.

Raw video from the Chattanooga Times Free Press captured the launch party for AT&T U-verse in the city.  (34 seconds)

McCormick - An AT&T Friend for Life

While AT&T was patting itself on the back for its wonderfulness, AT&T took special care to extend personal credit to Rep. Gerald McCormick (R-Hamilton County) for shepherding the Competitive Cable and Video Services Act of 2008 through the Tennessee General Assembly.  It helped deregulate the telecommunications industry in Tennessee and de-fang oversight agencies tasked with protecting consumer interests.  The result has been a myriad of customer service nightmares for Tennessee residents, particularly for those who are with AT&T and have faced repeatedly inaccurate bills and terrible customer service.

McCormick was right there in the press release to help celebrate the achievement:

“As Tennessee policymakers, our goal was to increase investment throughout the state and give consumers more choices and innovative new services, and I’m honored to help AT&T celebrate this launch,” Rep. McCormick said.

AT&T invested $180,000 in Tennessee lawmakers like McCormick to do the right thing by AT&T and pass the bill.  The Chattanooga Times Free Press delivered a breakdown in April 2009 summing up the spending as AT&T pushed forward its bill:

State Election Registry records show AT&T’s PAC gave almost $180,000 to candidates, usually incumbents, as well as PACs operated by legislative leaders and caucuses and parties in the two-year 2008 campaign cycle.

The PAC, funded by top executives, gave $2,000 to Lt. Gov. Ron Ramsey, R-Blountville, the Senate speaker, records show. The PAC gave another $8,000 to Mr. Ramsey’s leadership PAC, known as RAAMPAC, according to records.

The AT&T PAC contributed $5,000 to then-House Speaker Jimmy Naifeh, D-Covington, and another $4,000 went to Mr. Naifeh’s leadership PAC, the Speaker’s Fund, records show.

Rep. Gerald McCormick, R-Chattanooga, who is sponsoring the AT&T-backed deregulation bill, reported receiving $1,250 from AT&T’s PAC in 2007, records show.

“I don’t know how much money I’ve gotten from them,” Rep. McCormick said Tuesday. It is “up to each individual legislator whether they let that kind of thing influence them. I would hope that nobody would. I certainly don’t. I don’t need the campaign money that bad, to be honest with you.”

Janelle Lawrence and her beloved pets enjoyed none of this AT&T largesse — just the literal sting of the results.

Comcast subscribers in cities across the country are getting as hot as the summer as they learn the cable company is jacking up prices again — for many the second time in a year.  This time, the rate hikes are blamed on the cost to deliver an expanded lineup of HD channels, increased programming costs, and new cable modems.  Yet on the eve of the European Union approving a proposed Comcast-NBC Universal merger, many Comcast cable customers are beginning to wonder if all of these rate hikes are going to pay for that deal.

Here is a sampling of press reports from across the country on the latest round of increases:

San Francisco Chronicle: Comcast Corp. said it is raising rates for California cable and Internet customers by an average of 3.8 percent starting Aug. 1. The average video customer will see their monthly bill increase by $2.49 from $60.76 to $63.25 a month. Internet service will also increase for the first time in five years from $44.72 to $46.67 a month, a $1.95 increase. Andrew Johnson, regional vice president for Comcast California, said the increase is necessary to pay for more programming choices, new features, faster Internet speeds and improvements to customer service.  The last rate increase came October 15, 2009 when rates went up just over 1 percent.

The Record (Stockton, Calif.): For the second time in less than 10 months, Comcast Corp. customers in San Joaquin County face price increases for cable television service and, for the first time in five years a boost in charges for a cable Internet connection, the company announced recently. Customers in Stockton, Manteca, Lathrop and San Joaquin County served by Comcast will see an increase of nearly 4 percent in their cable bills beginning Sept. 1. Notices began going out to subscribers late last week. Other Northern California areas served by the cable giant will see prices change Aug. 1.

“They’ve got you tied in,” said Art Hickey of Stockton, who has five television sets in his home and subscribes to the highest tier of digital service. “They tease you with those six-month deals and 12-month deals and they don’t say what it’s going to be after that. People buy into it and then they’re just stuck with it,” he said.

So why not try another source of television?

“I haven’t compared, and I don’t want to because it’s a nuisance,” Hickey said.

The Spokesman-Review (Spokane, Wash.): Most of Spokane’s Comcast subscribers will see price increases in their Internet and video services effective in August, the cable company announced. Comcast’s last price increase went into effect October 2009. According to Comcast spokesman Walter Neary, most Spokane cable television subscribers will see an average monthly increase of about $3.21, or 4.9 percent. Customers who subscribe to Limited Basic, the least expensive package of Comcast TV channels, will have no increase in their monthly bill. Limited Basic includes all over-the-air local stations and the public, education and government channels.

Customers who pay for Comcast cable Internet will see two increases – a modem rental fee that will rise to $7 from $5 per month, and a $3 hike for monthly Web service. Subscribers who bundle Internet with either Comcast voice or TV service won’t pay the $3 hike, but will still see the modem fee increase, Neary said. Subscribers can eliminate the modem fee by buying their own modem. The Internet price hike reflects increased investment by Comcast in additional security services for subscribers and technology upgrades, Neary said. Another price increase, not reflected in Comcast’s stated 4.9 percent average monthly hike, is a $2 hike in the “HD technology fee.” TV subscribers who see HD Comcast channels will pay $8 per month for that technology fee, said Neary.

York Daily Record (York, Penn.): Comcast Cable is about three weeks away from putting into effect its second price increase in less than one year. On Aug. 1, the company will boost the average York County customer’s bill by roughly 3.5 percent, said Bob Grove , a spokesman for Comcast Cable’s Keystone Region. That increase is on top of a 1.9 percent price hike for the average Comcast customer that took effect Nov.1. The current rate increase is rooted in Comcast’s company-wide digital upgrade that calls for a jump in the number of high-definition channels to climb from 50 to 100, Grove said. Also, Comcast’s on-demand video menu will increase from 18,000 choices, 4,000 of which are HD, to 20,000 selections with 5,000 of those coming in as high-definition, he said.

“We’ve continually invested in next-generation technology to support new product features, more programming choices and improvements to customer service,” according to a statement released by Comcast concerning the increase. However, for those currently enrolled in a Comcast promotion, your bill will remain unchanged until that particular deal ends, Grove said. “Nearly half of all Comcast customers are on some kind of promotion,” he said.

Public Opinion (Chambersburg, Penn.): Many Comcast customers will see an increase in their monthly bills starting next month. The average customer bill in the Chambersburg area will increase by about 3.5 percent, according to a company spokesperson. The new rates take effect Aug. 1. A customer with standard cable or digital starter service will now pay $63.50 a month, or $3.50 more. Expanded basic, digital preferred, digital premier and total premium services are also increasing by $3.50 a month. Limited basic service, digital economy and family tier services are not affected. Economy, Performance and Blast! tiers of high-speed Internet will be increasing $2 a month. Monthly prices for the Ultra and Extreme 50 tiers will not change. Digital voice services will also cost $1.95 more a month.

Centre Daily Times (State College, Penn.): Comcast this week started sending out another round of mailings notifying customers of another change. But this time around the mailing isn’t warning of an impending digital conversion, or announcing the addition of more high definition television channels. This time around, it’s a notification of a rate increase. Effective Aug. 1, the average price for Comcast in the State College area will go up about 3.5 percent.

The company cited technology and infrastructure investments when contacted for comment. “These investments make it possible to deliver continued innovations, such as more HD and On Demand choices, converged services, faster Internet speeds, multi-platform content and new services consumers want and value,” said Bob Grove, director of public relations for the Keystone region of Comcast. Grove said the recent digital conversion by the company was one of the cost factors, as well as other programs that have included increasing Internet speeds for customers in the area. He noted that bills for customers whose service operates under one of the company’s promotions will not be affected until the promotion period expires.

A major owner of apartment complexes in 13 states in the southeast and south-central United States has a deal for you, whether you like it or not.

Mid America Apartment Communities, which maintains a portfolio of 42,252 apartments, is requiring its residents to purchase cable television from providers like Comcast or they’ll find the $40 month cable fee tacked on their rent, water, or refuse collection bill.  They call it a wonderful savings opportunity for their residents.  But a Stop the Cap! investigation followed the money and discovered the real benefits are in kickbacks paid to Mid America by participating cable companies.

Mid America is extending the policy to all of its apartment complexes over the coming months, notifying residents about its new CableSaver program through flyers.  Enrollment in the program is automatic for new residents, and will take effect for existing residents upon the renewal of their annual lease agreement.

Known as “bulk buying,” apartment complexes can receive preferential discounts for their residents if they commit to mandatory cable service for each apartment.  In Chattanooga, residents of Mid America’s Hamilton Pointe, Hidden Creek, Steeplechase, and Windridge Apartments were notified this month they’ll be compelled to spend $40 a month for Comcast’s Digital Starter Package.

Mid America owns apartment complexes in 13 states. All of them will find the CableSaver program coming their way sooner or later.

The mandating of cable service is not going down well with every resident, particularly those who purchased satellite TV equipment or who have service with other providers like AT&T’s U-verse or Verizon FiOS.  While Mid America isn’t banning competing cable services from serving its complexes, residents will still be forced to pay for cable service in addition to whatever their current provider charges.

Lydia Ramirez of Chattanooga lives in a Mid America Apartment Communities property.  She told WDEF-TV News, ”We told them that we are not interested in this but they say it’s mandatory. And so here we are.”

Ramirez just had Dish Network installed but says she’s been told she will have to pay for Comcast cable, too, if she renews her lease.  She said, ”We don’t want Comcast and we feel that should be our choice instead of them making it mandatory.”

Instead of being allowed to choose satellite or other cable providers, Ramirez says being forced to go with Comcast is kind of like being told you can only grocery shop at Food Lion.  Ramirez adds, “I don’t see how they can do that. I think we as tenants have an option to choose what cable company we want to go with.”

Some renters in Houston, Texas have been there and done that.  Late last year, KPRC-TV reported residents at The Reserve at Woodwind Lakes got a deal they couldn’t refuse.  A letter from the front office promoted an exciting new offer: It reads the complex “has teamed up with a cable company to bring you an exclusive offer that will allow you to enjoy expanded basic service at a greatly reduced rate.”  Sounds great until you get to the second line of the letter, which uses language only a credit card company could love:

“If you have not yet chosen to opt in, the reduced rate of $40 will be added to your water and trash bill once your renewal takes effect.”

Text of a flyer delivered to Houston-area renters at a Mid America complex

In other words, your “choice” to “opt in” is neither.

Mid America is selling this mandatory cable program as a real money-saver.  But we discovered it’s actually a real moneymaker for Mid America, who earns compensation from kickbacks paid by cable companies in return for cramming cable service down renters’ throats.

Kickbacks for cable is nothing new in the rental business.  Complex owners used to routinely make exclusive deals with providers to deliver service to residents, often through contracts that kept competitors out.  But a 2007 FCC ruling made such exclusive arrangements illegal.  A Federal Court of Appeals agreed: cable companies cannot have exclusive rights to provide service in apartment buildings that they wire.  But complex owners and cable operators discovered an enormous loophole — complex owners can force residents to pay mandatory cable fees as part of their rent so long as they did not bar would-be competitors from also providing service.  But given that renters would already be paying for service, it is unlikely they’d choose another and pay double or more for duplicated cable service.

Cable companies like Comcast enter into these agreements because they provide guaranteed revenue for minimal cost, thanks to “install it once” cable wiring and bulk billing.  Since many renters are also young — renting their first apartment after leaving home — establishing a relationship with those customers may make them customers for life.  Cable companies can also use the program as an opportunity to sell add-on services to renters, such as broadband, digital phone, and premium channel packages.

But why would a company like Mid America want to alienate at least some of their renters who do not want to be forced to pay for cable service?  The answer is easily found in Mid America’s publicly disclosed financial reports — Mid America makes a healthy profit from the CableSaver program.

Mid America owns apartment complexes in these states

Mid America’s quarterly 10-K filing with the Securities and Exchange Commission shows the company is earning so much money from cable companies like Comcast, it has broken the revenue out into a new section of its financial report.

In the first quarter of 2010, as Mid America introduced its CableSaver program, the company reported earning $1.3 million dollars in revenue from cable kickbacks.  The company tells investors its new mandatory cable program will become an important source of new revenue for the complex owner:

“We continue to develop improved products, operating systems and procedures that enable us to capture more revenues. The continued roll-out of ancillary services (such as re-selling cable television), improved collections, and utility reimbursements enable us to capture increased revenue dollars.”

It’s all a part of a profit-making strategy to increase shareholder value and stick residents with increasing costs to deliver fatter profits.  Renters might be interested to know the company has more in store for them in the coming months:

Our goal is to maximize our return on investment collectively and in each apartment community by increasing revenues, tightly controlling operating expenses, maintaining high occupancy levels and reinvesting as appropriate. The steps taken to meet these objectives include:

• [...] developing new ancillary income programs aimed at offering new services to residents, including telephone, cable, and internet access, on which we generate revenue;
• implementing programs to control expenses through investment in cost-saving initiatives, including measuring and passing on to residents the cost of various expenses, including water and other utility costs.

Unfortunately for residents, short of moving, there is no escaping these fees. Some residents have contacted their member of Congress or the FCC to complain about the loophole that allows a complex owner to charge for cable service residents don’t always want. Another way to send a message is to tell Mid America you will not do business with them until they make the CableSaver program truly optional. If the company stands to lose more money than it receives from cable company kickbacks, it may choose to amend its policies.

We have four reports on this story, courtesy of WDEF-TV Chattanooga, Tenn., and KPRC-TV in Houston, Texas  (10 minutes):

1. The FCC bans exclusive cable contracts forcing renters to buy service from one provider.  (KPRC-TV 10/31/2007)
2. Can Complex Choose Your Cable Company? In Houston, Mid America Forcing Renters to Buy Comcast Cable.  (KPRC-TV 1/7/2010)
3. Four Chattanooga Area Apartment Complexes Make Comcast Cable Mandatory for Renters. (WDEF-TV 7/12/2010)
4. AT&T U-verse Arrives in Chattanooga (But Won’t Be Too Attractive to Mid America Residents). (WDEF-TV 4/30/2010)