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FCC Chairman Gives Green Light for More Cable Mergers; Calls and Reassures Cable Execs Some Deals Are Okay

Wheeler

Wheeler

Federal Communications Commission chairman Tom Wheeler personally called the chief executives of some of America’s largest cable operators, including Charter Communications and Time Warner Cable, to reassure them that the agency does not object to future cable industry consolidation.

Wheeler said any new merger deal would be assessed on its own merits, and cable executives should not assume the agency is against future cable mergers just because it objected to the Comcast/Time Warner Cable deal.

The Wall Street Journal reports Wheeler sought to “clear the air” in response to industry hand-wringing over whether future buyouts and acquisitions could get passed the FCC. Wheeler reassured executives they were over-reading the commission’s intent.

Wheeler did suggest he would like to see more competition among cable companies, an idea that has been dead on arrival since the cable industry began colluding to agree to stay out of each other’s territories two decades ago. Although Wheeler would like to see competition increased by cable operators competing head to head for customers, it is much more likely the industry will seek further consolidation to reduce the prospect of competition, not increase it.

The larger the cable operator, the greater the economy of scale — especially for cable programming costs. A potential new entrant would likely be discouraged from entering the business, discovering it had no prospect of getting cable programming at prices comparable to what the largest cable operators pay.

Cable Stock Fluffer Craig Moffett Encourages Cable Operators to Add Usage Caps Before Title II Takes Effect

"More Caps" Moffett

“More Caps” Moffett

If you are a cable executive looking to further gouge customers captive to your “only game in town” broadband speeds, now is the time to slap around customers with usage caps and overlimit fees, because your company may no longer be able to do that after June 12, when the FCC’s new Title II regulations officially take effect.

“If you’re a cable operator, you might want to strike while the iron is hot,” said MoffettNathanson principal and senior analyst Craig Moffett, who has shared his love for all-things-cable with investors for years.

Moffett regularly asks cable industry executives about when they plan to introduce usage limits or usage-based billing for customers who often have no other choice for 25Mbps service, the lowest speed that now qualifies as broadband.

But tricking customers into accepting industry arguments about “fair pricing” must be handled carefully, because making a mistake with customers could cost your executives their summer bonuses if the pocket-picking policies cause a revolt.

Multichannel News reminds its cable industry readers Time Warner Cable failed to start their usage cap experiment in 2009 due to a “furor” by customers (often led by us). Instead of filling their coffers with the proceeds of overlimit fees, “the cable giant [was forced] to rethink its pricing strategy, keeping prices the same for heavy users of bandwidth but offering discounts to customers whose usage was lighter.”

Image: schvdenfreude

Image: schvdenfreude

Unable to get its definition of “fairness” across to customers, Time Warner Cable never had to look back, raking in greater and greater unlimited broadband profits quarter after quarter, even as their costs to deliver service continued to drop.

Faced with the prospect of a newly empowered FCC to keep cable industry abuses in check, Multichannel News tells cable executives the money party may be over before it begins if they wait too long:

Title II regulations, which reclassify broadband as a common- carrier service, are about to take effect June 12, and the Federal Communications Commission has said it would look closely at any usage-based pricing plans to determine if they discriminate against online video providers. That could force some Internet service providers to move to implement their version of usage-based pricing before the deadline.

To “soften the blow,” the trade journal reported Cox significantly increased usage caps and are setting the overlimit fee at $10 for each 50GB of excessive usage, much lower than wireless plan overlimit fees. Multichannel News suggests this will help customers “get accustomed to overage charges.”

But Cox customers in the Cleveland area may be able to turn the table on Cox.

“Let them get accustomed to the fact I am dumping them for WOW! the moment I receive official notification about the caps,” said Stop the Cap! reader Dave, who has a choice between Cox, AT&T, and WOW! — a competing cable operator without usage caps. “AT&T isn’t enforcing its cap around here either, so I am definitely canceling my service and have two other choices. People have to be willing to send a clear message usage caps are an absolute deal-breaker.”

Although usage caps are not affected by Net Neutrality regulations, the fact the cable industry faces added regulator scrutiny under Title II allows the FCC to put an end to practices it considers to be anti-competitive. Introducing usage caps for customers trying to find an alternative to Cox’s cable television package by watching online video instead may qualify.

Source: FCC Will Get Serious About Data Caps if Comcast Moves to Impose Them Nationwide

fccA well-placed source in Washington, D.C. with knowledge of the matter tells Stop the Cap! the Federal Communications Commission is prepared to take a hard look at the issue of Internet data caps and usage-based billing if a major cable operator like Comcast imposes usage allowances on its broadband customers nationwide.

Comcast introduced its usage cap market trial in Nashville, Tenn. in 2012 but gradually expanded it to include Huntsville and Mobile, Alabama; Atlanta, Augusta and Savannah, Georgia; Central Kentucky; Maine; Jackson, Mississippi; Knoxville and Memphis, Tennessee; Charleston, South Carolina; and Tucson, Arizona.

“Two and a half-years is exceptionally long for a ‘market trial,’ and we expected Comcast would avoid creating an issue for regulators by drawing attention to the data cap issue during its attempted merger with Time Warner Cable,” said our source. “Now that the merger is off, there is growing expectation Comcast will make a decision about its ‘data usage plans’ soon.”

In most test markets, Comcast is limiting residential customers to 300GB of usage per month, after which an overlimit fee of $10 per 50GB applies. Despite that, Comcast’s forthcoming premium gigabit speed plans are exempt from usage caps, the company announced.

Comcast sustomers in market test cities have not been happy with the usage caps, some confronted with inaccurate usage measurement tools or “bill shock” after claiming to find surprise charges on their cable bill. One federal employee offered his own story of bill shock — $200 in overlimit fees on his April Comcast bill. The customer spent $70 a month on broadcast basic cable television and Comcast Internet service. As an almost cord-cutter, he could instead rely on one of several alternative online video providers like Netflix or Hulu, but watching video that did not come from Comcast’s cable TV package contributed to eating his monthly usage allowance and subjected him to hundreds of dollars in extra fees.

cohen“I’ve reviewed [the] account to see and can confirm the charges are valid,” responded a Comcast representative who defended the company’s usage cap trials. “Please understand that we are not here to take advantage of customers. We are here to provide a great customer service experience.  After researching [the] account, at this time no matter what level of service you obtain, the Internet usage [allowance] will remain the same.”

To date, the Federal Communications Commission has left the issue of data caps and usage-based billing on the back burner, despite a Government Accounting Office report that found little justification for usage limits or compulsory usage allowances on broadband.

In 2012, former FCC chairman Julius Genachowski defended the practice, claiming it would bring lower prices to light users, spur “innovation” and enable consumer choice. But Comcast customers have found little, if any savings from Comcast’s so-called “data usage plans.” The only savings comes from enrollment in Comcast’s Flexible Data Option, which offers a $5 discount if a customer keeps usage under 5GB a month on just one plan — Comcast’s 3Mbps $39.95/mo Economy Plus tier.

“We don’t see much innovation coming from Comcast’s usage limit trials because Internet pricing continues to rise and the plans have the side effect of discouraging customers from using competing video providers, which can consume a lot of a customer’s usage allowance,” our source adds.

You're over our arbitrary usage limit!

You are over our arbitrary usage limit!

As far as enabling consumer choice, Comcast’s own representative put the kibosh on that, unless a customer wants to pay higher Internet bills.

Net Neutrality and issues surrounding Title II have consumed much of the FCC’s attention in the residential broadband business during the first half of the Obama Administration’s second term. Usage billing and data caps are likely to become bigger issues during the second half if there is a decisive move towards compulsory usage limits and consumption billing by large operators.

“An operator the size of Comcast absolutely will draw scrutiny,” said our source. “If Comcast decides to impose its currently tested market trial plans on Comcast customers nationwide, the FCC will take a closer look. Under Title II, the agency is empowered to watch for attempts to circumvent Net Neutrality policies. Usage caps and charging additional fees to customers looking for an alternative to the cable television package will qualify, especially if Comcast continues to try to exempt itself.”

Cable industry officials have also become aware of the buzz surrounding usage caps and growing regulator concern. Some reportedly discussed the possibility of FCC intervention behind closed doors at the recent cable industry conference in Chicago. Multichannel News reported (sub. req.) cable industry executives increasingly fear federal officials will ban usage pricing for wired broadband service on competitive grounds. Online video competitors rely on large cable and phone companies to reach prospective customers, many that may think twice if usage allowances are imposed on consumer broadband accounts.

LTE-Unlicensed: How the Wireless Industry Plans to Conquer Your (and the Cable Industry’s) Home Wi-Fi Hotspot

special reportWith billions of dollars in new revenue and royalties to be made, Qualcomm and some members of the wireless industry are pushing regulators to quickly approve a new version of LTE wireless technology that will share many of the same frequencies used by home and business Wi-Fi networks, creating the potential for speed-killing interference.

Wireless operators believe LTE-Unlicensed (LTE-U) could be used to offload much of the growing wireless data traffic off traditional 4G LTE wireless data networks. With the cost of securing more wireless spectrum from regulators growing, LTE-U technology would allow operators like AT&T, Verizon, Sprint and T-Mobile to use the U-NII-1 (5150-5250MHz) and U-NII-3 (5725-5850MHz) unlicensed bands currently used for Wi-Fi to deliver high-speed wireless broadband traffic to their customers.

Qualcomm and Ericsson, behind the newest iteration of LTE, have a vested interest promoting it as the ideal choice for metrocell, indoor enterprise, and residential small cell applications. Every manufacturer incorporating LTE-U technology into everything from carrier-owned microcells to smartphones will owe royalty payments to both companies. With billions at stake, Qualcomm is doing everything possible to tamp down fears LTE-U signals will create harmful interference to Wi-Fi signals.

qualcomm lte-u

http://www.phillipdampier.com/video/CES2015 Qualcomm Demonstrates LTE-U 1-2015.mp4

At the Consumer Electronics Show in Las Vegas held in January, a Qualcomm representative went as far as suggesting LTE-U will improve home Wi-Fi service. (5:42)

RCRWireless News:

[Qualcomm] set up a screened room with eight pairs of access points occupying the same channel and added Wi-Fi access-point terminals in one room and LTE-U terminals in another. The results show the average throughput of 3.3Mbps with Wi-Fi alone more than doubled to 6.7Mbps when the LTE-U access point was introduced.

In another test to show that LTE-U is a better neighbor to Wi-Fi than Wi-Fi itself, they took eight Wi-Fi nodes and replaced four of them with LTE-U nodes, the result of which showed a 1.9Mbps increase in average Wi-Fi throughput. In almost every test, the LTE-U enhanced network outperformed traditional Wi-Fi.

Burstein

Burstein

Industry observer Dave Burstein is concerned advocates of LTE-U are trying to rush approval of the technology without verifying Qualcomm’s non-interference claims.

“The telcos are considering 40 and 80MHz channels that could easily swallow half of more of the Wi-Fi spectrum,” Burstein writes in response to an EE Times article about the technology. “If Wi-Fi is important, that’s a mistake to allow. Advocates are trying to rush it through even though there is not a single independent test or field trial.”

Qualcomm dismisses the interference complaints pointing to its own research showing the two standards can co-exist adequately. But multi-billion dollar wireless companies with nationwide Wi-Fi networks at stake are far less confident. In fact, LTE-U has already divided the two largest wireless carriers in the United States. Verizon Wireless is an original proponent of LTE-U while AT&T has expressed “concern,” a polite way of saying it isn’t happy. What separates AT&T and Verizon Wireless? AT&T has invested in a nationwide network of more than 34,000 Wi-Fi hotspots. Verizon offers just over 5,000, most for FiOS customers or those in especially high traffic venues.

A Stanford University professor with no ties to Qualcomm or the wireless industry privately shared his belief allowing 5GHz Wi-Fi signals to commingle with LTE-U is going to cause problems.

lte-u-unlicensed-spectrum-v3The development of “Wild West” Wi-Fi has always tracked differently than the licensed cellular/wireless business. Over more than a decade, evolving Wi-Fi standards have come to expect interference from other nearby Wi-Fi signals. In a densely packed city, more than two dozen Wi-Fi signals can easily be found all competing for their own space across the old 2.4GHz and newer 5GHz unlicensed bands.

Wi-Fi proponents credit its robustness to its “politeness protocol.” Before a wireless router or home hotspot fires up its Wi-Fi signal, it performs several tests to check for other users and constantly adjusts performance by backing off when it discovers interference from other signals. That is why a user can receive strong Wi-Fi signals but still endure reduced performance, as the hotspot accommodates nearby hotspots and other traffic.

It works reasonably well, according to Rupert Baines, a consultant at Real Wireless.

“But [Wi-Fi signals] are delicate, and they rely on implicit assumptions that there aren’t other things there (or aren’t too many),” Baines told EE Times. “In effect, they behave as though the unlicensed band were not technology neutral but were Wi-Fi only.”

The intrusion of LTE-U changes everything.

http://www.phillipdampier.com/video/Wireless Week Tuesdays with Roger LTE-Us Gain is Wi-Fis Loss 3-24-15.flv

On the March 24, 2015 episode of Tuesdays with Roger, Recon Analytics’ founder Roger Entner talks with Wireless Week about the questions raised as major carriers, including T-Mobile and Verizon Wireless, plan to launch LTE into unlicensed territory. Concerns abound, particularly for consumers and companies who rely on Wi-Fi and don’t want licensed use in unlicensed bands to interrupt that service. (7:31)

Change in and of itself is not necessarily a bad thing, especially if LTE-U is superior to Wi-Fi, and some proponents suggest it is. Jag Bolaria, an analyst at The Linley Group, argues LTE better manages data/call handoff better than Wi-Fi access points can. LTE is also a more efficient spectrum user than Wi-Fi.

Last week, South Korea’s LG U+ demonstrated LTE-U was capable of 600Mbps speed, eight times faster than traditional LTE. But to accomplish that level of speed, LG U+ had to occupy 60MHz of bandwidth in the 5.8GHz band and allocate an extra 20MHz from its traditional LTE service. The company plans to further expand its use of South Korea’s 5.8GHz unlicensed band by occupying 80MHz of it to further boost speeds to 750Mbps. But the company did not say how the tests affected others sharing the same frequencies.

If LTE-U is superior, then why not gradually move every user towards the technology and away from Wi-Fi?

Aptilo Networks AB CEO Torbjorn Ward answers LTE-U is a solution in search of a problem.

“I think LTE on unlicensed sounds like a good idea if it wasn’t for the fact that there are four billion devices on Wi-Fi out there,” he told Light Reading, noting that 802.11ac can already run at 100Mbps, so there’s little need for the LTE boost. “I think when it comes to unlicensed, you can do a longer range with LTE, but I don’t see the full benefit.”

That does not seem to matter to LTE-U’s developers or cell phone companies that lack robust Wi-Fi networks of their own.

as-is

In the original Qualcomm/Ericsson proposal, both companies promote the fact they could launch LTE-U in the unlicensed Wi-Fi bands “as-is.” That is a big problem for AT&T and other Wi-Fi users because LTE-U evidently employs few, if any protection protocols in its initial specifications for other traffic. Verizon Wireless is reportedly lobbying against the development of interference protection protocols and has publicly asserted its interest in deploying LTE-U regardless of other users.

“In [the] USA, there are no requirements for unlicensed deployment that require changes to LTE air interface,” Verizon stated in its proposal: “New Band for LTE deployment as Supplemental Downlink in unlicensed 5.8GHz in USA.”

LTE-Unlicensed has been characterized as "rude" for not avoiding interference to other users.

LTE-Unlicensed has been characterized as “rude” for not avoiding interference to other users.

Clint W. Brown, business development director of mobility wireless connectivity at Broadcom, and a vice-chairman of the Wi-Fi Alliance counters it is premature to approve LTE-U in the unlicensed Wi-Fi band without more testing and information about its interference protocols.

“We’ve heard about the tests they’ve done, but it’s not factual,” Brown told EE Times. We haven’t seen the data and we don’t know how the tests were set up. First, I’d like to see if [LTE-U] can detect low-level signals. Second, I want to make sure it features a ‘Listen before Talk’ decision process so that LTE-U will wait for an opening rather than barging into the conversation already taking place in the unlicensed spectrum. Third, there should be a back-off mechanism, when it sees a collision. “We aren’t aware of any publicly available documents explicitly stating those attributes.”

The Federal Communications Commission has also now taken an interest and issued a public notice asking stakeholders and consumers to share their thoughts on LTE-U and a companion technology known as Licensed Assisted Access (LAA) that would hand off data sessions between a wireless carrier’s traditional 4G LTE network and LTE-U.

The makes the discussion political as well as technical. The FCC traditionally permits industry groups to define standards, but Republican Commissioner Mike O’Rielly now worries the FCC might butt into that process.

“The decision to jump into this space rather casually causes me great concern,” O’Rielly said. “In particular, any step that could insert the commission into the standards work for LTE-U comes with great risk. I will be vigilant in ensuring that the commission’s involvement does not result in taking sides with various stakeholders, hindering technological innovation, or having any say about what technologies should or should not be deployed.”

monopolyFor the moment, O’Rielly’s concerns about the FCC are premature as long as a division exists over LTE-U among many of the industry players:

  • Companies FOR LTE-U: Verizon, China Mobile, Qualcomm, Ericsson, NTT DoCoMo, T-Mobile USA, Deutsche Telekom, TeliaSonera, and China Unicom.  Equipment manufacturers also in support: Nokia, NSN, Alcatel-Lucent, LG, Huawei, ZTE, Hitachi, Panasonic, and others;
  • Companies AGAINST LTE-U (as now defined): Orange, Telefónica, Vodafone, AT&T, Sprint, SouthernLINC, US Cellular, DISH and a handful of vendors.

Burstein also uncovered evidence the wireless industry may be stacking the deck against increased competition and consumers. He found 11 of the world’s largest wireless companies (including AT&T, T-Mobile, and Sprint) quietly colluding on a proposal that would block anyone other than currently licensed LTE users from being able to use LTE-U on a standalone basis. The opaquely-titled proposal, “Precluding standalone access of LTE on unlicensed carriers,” is at least frank about its reasoning: “Standalone deployment in unlicensed spectrum implies drastically different business models from nowadays and might impact the value chain.”

In other words, if consumers are able to get savings from LTE-U using a new generation of non-traditional providers like Republic Wireless or Cablevision’s Freewheel that do not depend primarily on cellular networks, it could cost those 11 traditional wireless companies billions in lost revenue. To stop that, the companies propose requiring a special LAA “guard signal” to stop standalone access of LTE-U. Since only licensed cell phone companies have access to those frequencies, it automatically locks out new upstarts that lack mobile spectrum of their own.

Sneaky insertions like that may be exactly why the Obama Administration’s FCC is being more activist about monitoring the wireless industry, potentially cutting off anti-competitive proposals before they can become adopted as part of a formal technical standard.

http://www.phillipdampier.com/video/Fairness to Wi-Fi and LTE unlicensed 5-8-2015.mp4

RCRWireless News gets deep into the development of LTE-Unlicensed and how it will impact cellular infrastructure, Wi-Fi and small cells. (25:39)

Top Cable Lobbyist Laments Cable’s Self-Made Bed Has Weighed Down and Damaged the Industry’s Reputation

Powell

Powell

Decades of bad service, rate increases, and abusive employees have given the cable industry a bad name and America’s top cable lobbyist, former FCC chairman-turned-president of the National Cable & Telecommunications Association is sad about that.

“I hate the name […] cable,” Powell lamented Tuesday in Chicago during the opening of the NCTA-rebranded INTX 2015 show (formerly known as The Cable Show).

While years of bad service have done little to tangibly affect the industry’s fortunes in a barely competitive marketplace, Powell seemed convinced it was Comcast’s appalling reputation with customers (including regulators and politicians working in Comcast’s District of Columbia service area), that did more to derail its recent merger effort with Time Warner Cable than anything else.

intxCable’s bad reputation has come home to roost, allowing everyone to assume the worst and see a need to erect protective fences like Net Neutrality to keep cable companies from capitalizing on new fees for Internet usage.

As long as cable has a “frayed relationship” with customers, Powell said he believed the industry will lose more policy battles than it wins, and it should be aware of that.

But those in attendance later told Communications Daily (subscription required) they disagreed with Powell and believed the industry has faced down bigger threats than Net Neutrality and online video. They also disagreed with any name change that de-emphasized “cable” and complained the industry didn’t get enough credit for its role in bringing faster Internet to American homes.

Because cable operators both own the pipes and have a strong working relationship with content producers, many attendees believe cable is in an excellent position to face down competitors, because most depend on cable broadband to deliver their services.

http://www.phillipdampier.com/video/NCTA Michael Powell and ReCode Kara Swisher Kick off INTX 2015 5-5-15.mp4

NCTA president Michael Powell talks with ReCode’s Kara Swisher about the state of the cable industry and the Internet at the start of INTX ’15 in Chicago. (18:53)

Fla. Utility Says Negotiations With Verizon Make It Clear Verizon Will Exit the Wireline Business Within 10 Years

FPL_logo_PMS2925A Florida utility company has told federal regulators it is certain Verizon has a plan to exit its landline and wired broadband businesses within the next ten years to become an all-wireless service provider.

Florida Power & Light argued in a regulatory filing with the Federal Communications Commission it was clear Verizon had plans to exit its wireline business after the phone company suddenly informed regulated utilities like FP&L it no longer seemed interested in fighting over pole attachment fees and pole ownership and use issues. FP&L suggests that is a radical change of heart for a company that has fought tooth and nail over issues like pole attachment fees for years.

“Verizon has made it clear it intends to be out of the wireline business within the next ten years, conveying this clear intent to regulated utilities in negotiations over joint use issues and explaining that Verizon no longer wants to be a pole owner,” FP&L wrote to federal regulators. “Indeed, the current proposed [$10.54 billion sale of Verizon facilities in Florida, Texas and California] proves this point.”

Verizon has fought repeatedly with the Florida power company over the fees it pays FP&L to attach copper and fiber cables to the power company’s poles. Verizon Florida has repeatedly accused FP&L of charging unjust fees and at one point withheld payments to the utility worth millions.

In February, the FCC dismissed Verizon’s complaint for lack of evidence in the first-ever decision in a pole attachment complaint case involving an incumbent telephone company under a joint use agreement with an electric utility. The power company accused Verizon of lying when it promised concrete benefits to consumers if the FCC reduced joint use pole attachment rates. Suddenly, Verizon no longer seems to be interested in the issue.

verizon“Verizon has not increased its efforts to deploy wireline broadband in the last three years; and there is no evidence that Verizon has used the capital saved on joint use rates for the expansion of wireline broadband,” FP&L officials write. “Indeed, all of the evidence shows that Verizon is abandoning its efforts to build out wireline broadband.”

The power company is not about to just wave goodbye to Verizon. It filed remarks opposing the sale, claiming the benefits will end up in the pockets of executives and shareholders while customers get little or nothing. FP&L wants the FCC to enforce concrete conditions that guarantee Frontier will invest in upgrades to Verizon’s network, especially in non-FiOS service areas.

FP&L added it supports forward technological progress for the benefit of consumers, but the price of that progress should not be the abandonment of wireline customers, contractual obligations, and past promises to the FCC. The utility wrote it is not opposed to Verizon becoming a fully wireless company, but it should only be allowed to do so after it ensures that “its wireline house is in order.”

As things stand today, the utility argues Verizon is looking to abdicate on its obligation to deliver universal service and is no longer interested in maintaining its wired networks. FP&L points to Verizon’s efforts in 2013 to discard damaged wired facilities in favor of Voice Link, Verizon’s wireless landline replacement, in states including New York, New Jersey, and Florida.

“There should be no doubt that Verizon’s strategy to abandon wireline service in favor of wireless service extends beyond New York and Florida and beyond storm damaged and rural areas,” argues FP&L.

The utility points to Verizon’s successful effort to relieve itself of obligations to build a statewide fiber network in New Jersey that was supposed to be complete by 2010.

“Verizon, quite simply, has failed to build out wireline broadband in New Jersey because Verizon has no interest in doing so,” said FP&L. “As the sale of wireline facilities in Florida, Texas, and California […] clearly demonstrates, Verizon obviously is no longer interested in the wireline broadband business and sees its financial future in the wireless industry.”

Our Long Nightmare is Over At Last: Stop the Cap! Ponders the Failed Comcast-Time Warner Cable Merger

Phillip "Victory is Ours" Dampier

Phillip “Victory is Ours” Dampier

It has been 14 months since we heard for the first time Comcast was planning to acquire Time Warner Cable. It was the night of February 12, 2014. I still remember where I was the moment I first learned the news.

Stop the Cap! has maintained a civil relationship with Time Warner Cable for the most part over our seven-year struggle fighting usage caps, lousy broadband, and high prices. We fought one major battle with the company in April of 2009, when Time Warner executives planned a compulsory usage cap experiment on customers in Rochester, N.Y., Austin and San Antonio, Tex., and Greensboro, N.C.

Just as we had done with Frontier Communications a year earlier, we successfully beat down their efforts to impose usage allowances on customers already paying a significant chunk of money for broadband Internet access. After that battle ended, Time Warner Cable changed their position on usage caps and stated emphatically that customers should always have the option of unmetered/unlimited access. They have kept their word. In fact, their optional usage cap experiments have been a spectacular flop, attracting less than 1% of their customer base and delivering the message we’ve tried to get across the industry for years: customer hate usage caps, usage-based billing, and speed throttles.

Comcast is a company that long ago stopped listening to their customers. It applied an arbitrary usage cap on all their customers in retaliation for a FCC decision that disallowed them from running hidden speed throttles on peer-to-peer Internet traffic. Comcast lied about throttling traffic, paid homeless people to stack a hearing on the issue to keep company critics out of the room, and slapped the caps on in the fall of 2008 with the flimsy excuse it represented “fairness” to customers. Only later, we would learn usage caps were never about “fairness” or good traffic management. It’s just a way to deter customers from spending too much time on the Internet, especially if that time is spent watching online videos. Too much time spent watching Netflix might convince you your cable TV package isn’t necessary any longer.

comcast twcComcast customer service horror stories reached a level unparalleled by other cable companies when a Comcast predator-installer was convicted of raping and strangling to death 23-year old Comcast customer Urszula Sakowska,  whose lifeless body was found in a bathtub inside her Chicago-area home back in 2006. But Triplett’s violent service calls didn’t stop there. He also faced charges in the death of 39-year old Janice Ordidge, a Comcast customer in Hyde Park. Those two Comcast customers lost their lives. In 2009, another Comcast installer set a Pennsylvania customer’s house on fire. Other installers stole jewelry right out of customers’ homes. Others have exposed themselves in front of female customers or fallen asleep on their couches.

Billing errors are the stuff of legend at Comcast. Offshore call centers with language barriers, inept customer service, and long, long, long lines at cable stores with windows only partially manned by agents sitting behind bullet-proof glass also helped cultivate a customer relationship that can best be described as “perp and victim.”

Comcast isn’t just a bad cable company, it’s a menace. We didn’t have to spend hours proving our case. Fortunately, Comcast’s appalling reputation preceded it. Outside of two executive suites in Philadelphia and New York, nobody was for supersizing Comcast. Just to make sure our regulators knew this, we traveled to Buffalo in June of last year to testify at a Public Service Commission hearing on the subject of the merger. We didn’t mince words.

Sure, there were non-profit groups like the Boys & Girls Club that absolutely sullied their reputation pushing for the merger (Comcast wrote large checks to the organization so you need not give the group a single penny of your money in the future). “Civil Rights” organizations like the Urban League, NAACP, and others that used to defend minority rights now concern themselves with defending the interests of giant cable companies, just as long as they get a nice check in the mail with Comcast’s name on it. Among the worst of all – Shakedown Al Sharpton who will either be your merger deal’s best friend or will go away and leave victims of racism in peace, if you cut his organization a big fat check. (Now that the merger has collapsed, perhaps Comcast-owned MSNBC will end the thinly veiled quid-pro-quo arrangement it has with the man that gives him an hour a night to perform a talent train wreck.)

My own state assemblyman, Joe Morelle, who served as New York’s interim assembly speaker for about five minutes literally plagiarized his letter in support of the Comcast merger (after cashing their check) almost word-for-word from Comcast press releases and congressional testimony. Say it ain’t so, Joe!

morelleN.Y. State Assembly Leader Joe Morelle: “The combination of Comcast and Time Warner Cable will create a world-class communications, media and technology company to help meet the increasing consumer demand for advanced digital services on multiple devices in homes, workplaces and on-the-go.”

 

cohenDavid Cohen, executive vice-president, Comcast: “The combination of Comcast and TWC will create a world-class communications, media, and technology company to help meet the insatiable consumer demand for advanced digital services on multiple devices in homes, workplaces, and on-the-go.”

 

There was not a doubt in my mind that replacing Time Warner Cable with Comcast would be a disaster for Time Warner Cable customers. Despite promises Comcast would upgrade Time Warner’s network, it would also upgrade customer bills, resorting in higher priced service, higher modem fees, and lousy customer service. Comcast vice president David Cohen also made it clear usage caps would be a part of our life within five years. No amount of protesting or rational argument would stop Comcast from being Comcast. Don’t like it? Just try to cancel.

Time Warner Cable can be bad but it is no Comcast.

Malone: Waiting in the wings?

Malone: Waiting in the wings?

Life will be just fine without Comcast, but danger lurks on the horizon. Still interested in the possibility of taking over Time Warner Cable is the smaller Charter Communications, now effectively controlled by cable magnate John Malone (he owns his own castles). Malone has a long history of enriching himself at the expense of customers with no other choices for cable/broadband service. He used to control Tele-Communications, Inc. (TCI), a cable company that literally threatened city officials who didn’t do what TCI wanted.

We remain unsure exactly what will happen next. Charter could bid aggressively to buy Time Warner Cable, Time Warner Cable could go it alone, or Time Warner Cable could start buying other cable companies (like Charter).

What we hope will happen is Time Warner Cable will refocus its energy on expanding its Maxx upgrade program as quickly as possible to reach all Time Warner Cable markets with faster broadband and a better cable TV experience. We also hope the company will stand by its word that compulsory usage caps are off the table.

I’d like to thank all of our readers who took the time to get involved in the fight and helped make a difference. Wall Street and Washington, as well as Comcast CEO Brian Roberts are all shocked the merger deal collapsed after a torrent of criticism from consumers. It also left state regulators cautious about how to proceed. New York’s Public Service Commission delayed making a decision eight times, recognizing the merger as a hot potato.

Our experience demonstrates that ordinary citizens can wield considerable power when unified and involved. We’ve proved that with multiple victories on the usage cap front as well as the AT&T/T-Mobile merger and Net Neutrality.

Let the fight for better broadband continue!

FCC Staff Recommends Sending Comcast/TWC Merger to Seventh Level of ‘Deal-Killing’ Hearing Hell

fat+lady+sings-featureThe staff at the Federal Communications Commission decided Wednesday to make a non-decision decision regarding the merger of Comcast and Time Warner Cable, and are recommending turning over the matter, including millions of pages of company documents and 14 months of investigative findings to an administrative law judge to sort out.

The procedural move, dubbed by many regulatory experts as a “deal-killer,” is known officially as a “hearing designation order.” But executives at Comcast know it really means the FCC is sending a strong signal it does not believe the merger is in the public interest.

The sudden recommendation by the FCC is seen by some observers as a coordinated move with the U.S. Department of Justice to let Comcast CEO Brian Roberts know the deal is in serious peril. In 2011, the Justice Department declared its opposition to another blockbuster merger between AT&T and T-Mobile, and the FCC announced its own opposition just a few hours later. The merger was declared dead shortly thereafter.

Placing the matter in the hands of an administrative law judge would mean a drawn-out, complicated hearing that would probably last longer than the 1995 trial of O.J. Simpson. Few companies bother. Even if Comcast decides it will fight, if the Justice Department successfully challenges the merger in court, the hearing designation order is moot and the merger fails.

Most observers expect Comcast will call off the merger before dragging the matter out in a court or hearing room.

The Wall Street Journal broke the story last night, calling it a “significant roadblock.”

Wall Street analysts were more direct.

“The fundamental problem with this transaction is there is no major constituency outside of Comcast and Time Warner Cable that want it to move forward,” said Rich Greenfield, analyst at BTIG Research, which has been predicting the deal falls apart. Mr. Greenfield noted that it would be a “very uphill battle” for Comcast to prove its case through the FCC’s hearing process that its merger is in the public interest. “Is it really worth spending more time and resources to fight the government?”

elephant“I’d never say anything was 100 percent dead, but this is in the 99 percent category,” Greenfield added. “It’s not every day that you have a transaction that is universally hated by everyone outside of Philadelphia,” where Comcast is based.

“No, the Comcast deal isn’t dead yet,” said telecom analyst Craig Moffett on Thursday. “But it’s a bit like an elephant that has been dropped out of an airplane. At around 10,000 feet, it is technically still alive. But it is falling fast, there’s not much you can do to stop it, and its odds of survival are pretty low when it hits the ground. Engaging in a war of attrition with the U.S. government is generally a bad idea and one rarely undertaken.”

The usually brash and confident Comcast was uncharacteristically muted in their response to the latest DOJ and FCC developments.

“As with all of our DOJ discussions in the past and going forward, we do not believe it is appropriate to share the content of those meetings publicly, and we, therefore, have no comment,” said a Comcast spokeswoman.

The apparent looming defeat of the Comcast/Time Warner Cable merger would be a testament to unified opposition from consumers, programmers, competitors, and emerging online video distributors that might one day fully challenge traditional cable television.

“In a democracy like this, you have gather your forces to say no to politically powerful people,” Mark Cooper, a Comcast opponent and research director at the Consumer Federation of America, told the Philadelphia Inquirer.

http://www.phillipdampier.com/video/CNN Death sentence for Comcast merger 4-23-15.mp4

A death sentence for the Comcast-Time Warner Cable merger? Analysts think so. CNN reports on the history of a merger deal that used to be “inevitable.” (1:42)

Comcast-Time Warner Cable Merger Setback

http://www.phillipdampier.com/video/CNBC Comcast-TWC merger setback 4-23-15.flv

The Wall Street Journal is reporting the FCC is issuing a “hearing designation order” for the Time Warner Cable-Comcast proposal, with Henry Blodget, Business Insider. (2:10)

The FCC, the DOJ, and the Case for Blocking the Comcast-Time Warner Cable Deal

http://www.phillipdampier.com/video/Bloomberg FCC DOJ and the Case for Blocking Comcast-TWC Deal 4-23-15.flv

Comcast earned the opposition of the Federal Communications Commission, along with the Department of Justice, as it seeks to complete a $45.2 billion acquisition of Time-Warner Cable. Bloomberg’s Alex Sherman Reports on “Bloomberg Surveillance.” (2:17)

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  • Charles Bingham: I did but customer no service was no help - said it did no good to have pass word with symbols, cap and small letters and #'s. IF only I had an alte...
  • Phillip Dampier: That assumes this customer had access to a working usage meter and notification messages and ignored them. Evidently it was big enough of a problem fo...
  • Are you kidding me...: "Over the years" people are using the internet differently. If your bill went up, you have usage. Responsible would be calling and talking to them ab...
  • Charles Bingham: Actually my usage has decreased over the years as I sold my business and only kept the internet for a few tax returns that I still do, no employees no...
  • Are you kidding me...: This entire article reeks of "poor me, I'm a victim and I can't be responsible about my own Internet usage, my own bills or my own actions." Grow up....
  • a gci customer: even with the new plans, you are still data capped, they just speed rate you at that point vs charging you for overages. You are given the ability t...
  • random-gci-customer: How do you think their Senior Vice President of Consumer services funds his opulent exotic car collection??? https://www.dropbox.com/s/uj7yh1r7hcfc03...
  • whyatt: Well this is what I know. There are 4 internet plans called r:10 r:50 r:100 and RED. And these plans are cheaper than the old plans. Those old plans u...
  • oobovigif: Well I guess they don't want the Tax Breaks anymore either. They just need to seriously Stop with all this BS about lack of Spectrum. They have Plenty...
  • Charles Bingham: Our office's bill has run around 69-70 dollars per month for years, we recently were charged $600 for overages, which no one can explain....
  • Frank: http://www.courtrecords.alaska.gov/eservices/?x=LiAWixBRFXgASCva78TP8tyxxz9FDyOInBEO6Vhs*oeKrNSUEuntXI93HZMTvVCKpCvwGdrTi4*WQ32g9zkhdg Here is a li...
  • Frank: Here is a link of two lawyers that filed a class action lawsuit against GCI. http://www.courtrecords.alaska.gov/eservices/?x=LiAWixBRFXgASCva78TP8tyx...

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