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AT&T Schmoozing Lawmakers With Drinks, Tartare, and a Blonde for Its Latest Merger Deal

Phillip Dampier February 8, 2017 Astroturf, AT&T, Public Policy & Gov't No Comments

As your AT&T wireless bill soars to new heights, the phone company is spent your money on an exclusive inside-the-beltway private soirée to help win approval of its merger deal with Time Warner, Inc.

The little people (ordinary Americans and AT&T customers) were barred at the door for AT&T’s “Stars and Stripes Reception,” celebrating the grand opening of the AT&T Forum for Technology, Entertainment, and Policy. The party was heavy on lobbyists, lawyers, executives, and lawmakers that Bloomberg News reported were bathed in cool blue light and amply supplied with drinks and avocado tartare with melon carpaccio. Added bonus: free photos with a blonde in a slinky white gown promoting “Ice,” an AT&T original show seen on DirecTV.

AT&T doesn’t throw parties just to have fun. Its army of 100 lobbyists and a budget of at least $16.4 million to match leaves very little to chance. Only one company – Boeing – spends more time and money influencing lawmakers. But even a household name aerospace company cannot match the success AT&T has had getting its corporate agenda through in Washington, especially when the Republicans hold the majority. The company has spent more than $213 million schmoozing elected officials since 1998 alone.

The smell of power brought some important names to AT&T’s party, among them, Meredith Attwell Baker, former Republican FCC commissioner who accepted a high-paying lobbying job at Comcast just a few months after voting to approve its own merger deal with NBCUniversal. She was photographed by Washington Life magazine with Peter Jacoby, a former longtime AT&T lobbyist now lobbying for UnitedHealth Group, Bryan Cunningham, co-founder and principal at Polaris Consulting, which has advised AT&T on all of its merger deals since 2009 (along with just about every other large cable merger in the last seven years), and Shane Tews, a visiting fellow at the American Enterprise Institute also associated with the Koch Brothers-backed Heartland Institute, and two other DC consultant groups catering to big businesses that need a guide to help navigate and influence Washington.

Having fun: On the right is Republican strategist Ivan Garcia-Hidalgo, Hispanic Communications | Run PAC

In short, AT&T’s Forum is the embodiment of the D.C. “swamp” President Donald Trump has vowed to drain. Yet it confidently opened for business just a few days before his inaugural. Bloomberg News called the event part of AT&T’s search for “friends in high places.”

The phone company remains concerned about Mr. Trump’s rhetoric on the campaign trail that a merger between AT&T and Time Warner, Inc. would concentrate too much power in too few hands and was “an example of the power structure I’m fighting.”

But not concerned enough to believe their $85.4 billion deal is dead. In fact, D.C. insiders predict the transaction is likely to sail to approval with the Trump Administration’s Justice Department. Few believe the likely next head of the agency that reviews corporate mergers on antitrust grounds — Sen. Jeff Sessions (R-Ala.) is going to be too tough on AT&T. The president has yet to appoint an assistant attorney general for antitrust, who will be responsible for most of the transaction’s review. But Trump’s team was still considering Joshua Wright, a law professor that generally believes mergers are pro-consumer and has promoted a strict laissez-faire philosophy on antitrust enforcement, which foreshadows almost no enforcement at all.

So why throw lavish receptions for the important people in Washington?

“All of this outreach, all of this cultivation, is ensuring you have allies,” Meredith McGehee, strategic adviser to the Campaign Legal Center told Bloomberg News. “You get to know people. You invite them. You do the receptions. You start to cultivate champions on the Hill, so if an antitrust action comes about you can turn to those champions and say, ‘Hey I need you to push back. I need you to write letters.’”

Most of that attention will continue to be tilted towards Republicans, which have traditionally been more favorable to AT&T’s interests. AT&T donated 62% of the $2.7 million in campaign contributions to the GOP in the last election. Most of AT&T’s lobbyists are Republicans that took a trip through D.C.’s revolving door between Capitol Hill and K Street — home of the city’s top lobbying firms. Almost 60 of the 100 AT&T lobbyists used to work for Republican lawmakers or affiliated groups. Another 30 come from Democratic backgrounds — most formerly working for the Clinton Administration or Democratic lawmakers.

Since President Trump began emphasizing the need for American jobs and investment, AT&T’s lobbying team has tailored its message accordingly. On inauguration day, AT&T took out a full-page ad in the Washington Post stating: “We employ more than 250,000 people.” AT&T CEO Randall Stephenson also reportedly emphasized AT&T’s investments in its network when he met privately with Mr. Trump in New York.

MegaMerger: Verizon Approaches Charter Communications About Buyout; Regulators Concerned

Verizon Communications has opened preliminary talks with officials close to Charter Communications about a possible merger of the two companies, concerning regulators worried the massive combined telecommunications company would have a near-monopoly on residential broadband service in New York and western Massachusetts.

The Wall Street Journal reports Verizon is working with advisers to study the potential transaction, and warned there is no guarantee a formal deal will materialize. A merger of Verizon and Charter would combine more than 114 million Verizon Wireless customers, 16 million landline customers, and over 6 million broadband customers with Verizon DSL or FiOS with Charter’s 21 million television, phone and broadband customers. The deal could fetch a price of more than $80 billion, no small amount for Verizon, already $100 billion in debt. An acquisition by Verizon would be a remarkable development for a cable company that became America’s second largest only eight months ago with the acquisition of Time Warner Cable and Bright House Networks.

Preliminary Talks

The newspaper reported Verizon CEO Lowell McAdam has talked with Liberty Broadband CEO Greg Maffei. Liberty has a 25% voting stake in Charter Communications, and Maffei is a close ally of John Malone, Charter’s largest single shareholder. McAdam’s back channel discussions have likely been designed to test Charter’s potential interest in a deal. For Malone and the former owners of Bright House Networks who control another 7% of Charter’s shares, making money appears to be their primary motivation and neither would likely to stand in the way of a deal.

McAdam

The newspaper was less certain about Charter’s CEO Thomas Rutledge. Rutledge is approaching his fifth anniversary as president and CEO of Charter Communications, now greatly enlarged with the combination of Time Warner Cable and Bright House. He spent the last 34 years in lesser roles at Cablevision, Time Warner Cable, and its predecessor American Television and Communications (ATC). Rutledge is reportedly interested in continuing his leadership role at Charter as it seeks to grow even larger, something unlikely to happen if Verizon acquires the cable company and rebrands it as Verizon under their own management. However, Rutledge’s personal interests will likely be secondary to the potential shareholder and executive windfall likely to come from any deal.

A Verizon/Charter Merger Would Establish a Broadband Monopoly in New York and Western Massachusetts

Verizon and Charter are the only significant direct competitors in residential broadband and landline telephone service in western Massachusetts and most of New York State, except a portion of New York City, Long Island and Westchester County (served by Altice’s Cablevision) and Rochester (served by Frontier Communications). A source at the New York Department of Public Service told Stop the Cap! this morning New York regulators would have a tough time approving a merger of this size and scope unless Verizon divested its landline and FiOS network in the state or Charter sold its cable properties in New York. A Verizon divestiture would likely attract Frontier Communications as a buyer, while a Charter sale of New York assets would probably bring bids from companies like Comcast or Altice.

“We would be very concerned about how this would impact broadband service competition and to lesser degree wireline service for New York,” the source, not authorized to speak to the media, told us this morning. “Gov. Cuomo has an ambitious agenda for broadband deployment in rural New York and this deal could also be a problem for the governor’s office. Verizon is perfectly aware of the regulatory challenges such a deal would face in Albany.”

Verizon’s Heavy Dependence on Wireless Was a Mistake

Verizon is under significant pressure to act after Wall Street punished the company for a poor fourth-quarter earnings report that illustrated the days of easy money in the wireless business seem to be over. Verizon suffered the third quarter in a row of sales declines after six years of continuous growth. Analysts point to increasing competition from T-Mobile and Sprint as the single biggest factor for Verizon’s struggles. As Verizon Wireless remained slow to cut prices and remained militant about not giving new and current customers access to unlimited data plans, customers have cut back on services or switched to other providers. Revenue dropped 4.9% in the last quarter and a growing number of Verizon’s most valuable postpaid customers are now leaving — mostly for T-Mobile and Sprint. Wireless churn reached a higher-than-expected 1.1% in the last three months.

Verizon Wireless is also having trouble attracting new customers. Analysts expected Verizon would add 726,000 customers during the last quarter, but only managed to attract 591,000. Wall Street punished Verizon’s latest financial results with a 4.4% slash in the stock price, Verizon’s worst day in more than five years.

Several Wall Street analysts have urged Verizon to diversify its business to reduce its dependency on wireless. In the last three years, Verizon has invested most of its attention and resources on bolstering its wireless network. In 2014, AT&T decided to spread its risk around with significant investments in its U-verse wireline broadband network, an acquisition of satellite-TV provider DirecTV, and its bid to buy content company Time Warner, Inc. In contrast, in 2014 Verizon spent $130 billion buying out its partner’s share of Verizon Wireless. That made UK-based Vodafone cash-rich and left Verizon mired in debt.

So far, Verizon’s diversification efforts have relied on acquiring affordable companies whose best days are long past, including AOL and Yahoo. An effort to entertain Millennials with video clips and other content over its go90 mobile app has largely been a flop, and investments in telematics and machine-to-machine wireless communications are years away from paying off, if they ever do.

Verizon May Want Charter’s Extensive Fiber Backhaul Network

Verizon executives have shown little interest in acquiring assets that rely primarily on linear/live television, which is why the company never moved to counter AT&T’s acquisition of DirecTV with an offer for its satellite competitor Dish Networks.

Verizon is very interested in fiber optics — ironic for a company that largely abandoned expanding its FiOS fiber to the home service seven years ago.

Verizon will need a lot of fiber assets to power the 5G wireless networks the company is interested in deploying. This will require a massive network of fiber-connected “small cells” that will deliver wireless services at speeds faster than today’s 4G networks. These small cells will be capable of serving individual neighborhoods or planned communities and could theoretically rely on Charter’s fiber backbone to deliver service. Without access to Charter’s network, Verizon would have to undertake to build out its own fiber network throughout its service areas.

Regulatory Climate Warms for Big Business Mergers

Although President Donald Trump has voiced his opposition to AT&T’s merger with Time Warner, Inc., his appointments to manage the day-to-day affairs of government are strident believers in deregulation and are unlikely to stand in the way of merger deals. The most likely opposition to a Verizon-Charter deal would come from state telecommunications regulators in New York and Massachusetts. On the federal level, significant opposition may be unlikely. Among the Trump appointees that would likely review a Verizon-Charter merger:

  • Joshua Wright is the leading contender to head the Justice Department’s antitrust division. He’s a conservative law professor who believes regulator reviews of corporate mergers should be hands-off to a degree that has failed to withstand court scrutiny. Wright’s approach during his term as a commissioner at the Federal Trade Commission was so business-friendly, some joked his middle name should be “Laissez-Faire.” He believes mergers rarely have a bad impact on competition and prices and in fact offer consumer benefits. Courts have blocked mergers he supported and judges have criticized his standards of proof that “had no support in the law.”
  • Sen. Jeff Sessions is Trump’s nominee for Attorney General. While Sessions claimed he had no problem blocking anti-competitive mergers and acquisitions, Wall Street believes the Trump Administration will not stand in the way of a frenzy of mergers. Evercore ISI’s Terry Haines made it clear what is likely to come from a Sessions-led Justice Department: “Sessions’ likely nomination and confirmation by the Senate, in which he has served since 1997, is a market positive for merger and acquisition activity. Sessions as attorney general would shift immediately from the current mostly ‘red light’ Obama antitrust/competition policy and move towards one that would be friendlier to M&A activity.”
  • The Federal Communications Commission would also scrutinize the deal, but under the chairmanship of Ajit Pai and a Republican majority, any significant opposition to the deal seems unlikely. Pai has never opposed any major telecommunications merger deal on principle, although he has fought with former chairman Thomas Wheeler over the terms and conditions the FCC sought to impose in return for the agency’s approval.

Time Warner Cable Transition to Charter Brings Bill Shock, $200 Upgrade Fee

Higher bills, confusing and conflicting services and pricing, and badly trained customer service representatives are just a few of the problems afflicting customers transitioning from Bright House Networks and Time Warner Cable to service plans being gradually introduced around the country by Charter Communications/Spectrum. Stop the Cap! has collected more than 50 reports from customers experiencing problems, bill shock, lost access to Wi-Fi hotspots, and “bait and switch” promotions promised by one representative only to be reneged on later when the first bill arrives.

The $58/Month Charter Spectrum Rate Hike

Park La Brea resident Lydia Plona is one of dozens of customers in California that have complained to the Los Angeles Times about their soaring cable bills after Charter/Spectrum replaced Time Warner Cable in Southern California. It was among the first regions in the country to say goodbye to Time Warner Cable and hello to Charter and their Spectrum-branded service plans. Unfortunately, Charter has already worn out its welcome with customers like Plona. When Charter was done with her, the $96 Time Warner Cable bill she used to pay was replaced with a new $154 bill from Spectrum — a $58 rate hike per month, which amounts to almost $700 more a year.

Much of the Midwest just completed its transition away from Time Warner Cable and Bright House to Spectrum and confusing pricing and plans and expensive upgrade fees are troubling customers from Wisconsin to Ohio.

Want More than 60Mbps? Pay $199 Upgrade Fee

Micah Lane, a former Time Warner Cable customer in Columbus, Ohio faced a major dilemma — should he switch from his current Time Warner Cable broadband plan to Spectrum? He originally assumed the answer would be yes, believing he could upgrade from a 50/5Mbps Time Warner Cable plan to a 100Mbps Spectrum plan for around $30 more than he had paid Time Warner. He discovered an upgrade was ready and waiting, but would cost him a one-time $199 upgrade fee.

“I was told repeatedly when a Time Warner Cable customer moves to Spectrum, they are automatically assigned a base plan of 60Mbps,” Lane told us. “Any speed above that in a non-Time Warner Cable Maxx market is considered an upgrade subject to the $200 upgrade fee. My parents would not be happy with that on their bill.”

Stop the Cap! has communicated with a dozen Spectrum converts, and heard from at least 40 others about problems experienced with their plan transitions. The most common complaints reference a hard-to-avoid $200 broadband upgrade fee, charged even when moving from a 100Mbps Time Warner Cable plan to a 100Mbps Spectrum plan, and promised bundled package offers that ended up costing much more when the first bill arrived.

Charter’s standard broadband plan offers 60Mbps service.

“You better be ready for the fight of your life because I had to threaten to escalate my complaint to the Better Business Bureau and the FCC to get that $200 fee off my bill,” said Stop the Cap! reader Roger. “Nobody ever told me about the fee but it was applied to my online statement hours after I changed plans and of course there is no way to go back to Time Warner’s plans once you make the change.”

Charter/Spectrum has become increasingly intransigent about that $200 fee, which the company claims is necessary to verify your home connection is suitable for faster internet speeds. But some representatives have also blamed the fee on the need to recoup expenses from network upgrades, even when many of those upgrades were performed by Time Warner Cable before the company was sold.

“There is really massive confusion at Charter and the information you get is totally inconsistent from one operator to the next,” said Paul Friedrich in Cincinnati. He rents an apartment with a roommate and after being told the $200 upgrade fee was non-negotiable, he told Charter to stuff it. “We can get the same or better service without the upgrade fee from Cincinnati Bell so bye bye Spectrum. When we threatened them with canceled service, however, the fee magically disappeared!”

The “savings” Charter promised to bring Time Warner Cable customers have not exactly materialized in Ohio, either.

“I just called TWC/Spectrum to see if I could get upgraded internet,” wrote DSL Reports reader cmiz87 in Grove City. “I’m currently on the old 50/5Mbps plan. To upgrade to the 100/10Mbps plan would cost $104.99/month PLUS a $199.99 “activation” fee, even though I have my own modem. That is just for internet only.”

Especially aggravating to many Time Warner Cable customers in non-Maxx service areas is the special treatment Maxx customers received when their areas were converted to Charter Spectrum. Customers with at least 200Mbps service were initially transitioned from their Time Warner Cable Maxx service plans to Charter Spectrum’s 300Mbps plan without any upgrade fee. For those areas where the clock ran out waiting for Maxx upgrades when Charter completed its deal to acquire Time Warner Cable, it’s ‘pay $200 or no upgrade for you.’

“Customers in northern Kentucky [were already getting] 300Mbps service as a free upgrade for the last six months,” noted DSL Reports reader dougm0. “Last year Time Warner Cable was going door-to-door in my neighborhood in Cincinnati [telling us] you will get 300Mbps service free in a couple of months. Just two weeks ago I chatted with a rep that said I would still get a 300Mbps upgrade automatically when launched.”

Now Charter/Spectrum is charging what he calls “this bogus $200 fee.”

“My wife and I are planning our exit from Charter and going back to Cincy Bell,” he reports. “Free install and same speed for less.”

Business Class for 300Mbps

In Reno and other cities, some Charter customers are moving to Business Class service to get 300Mbps service, which is not yet available in most former Time Warner Cable areas. But it will not be cheap. New customers can sign up with a promotion for as little as $159/month, but after two years that price jumps to $279.

Residential Pricing Confusion

Charter’s residential pricing seemed simple enough when it was announced. But in practice, readers report it is all over the map. In Wisconsin, one customer in Franklin signed up for 300Mbps service for $110 per month and agreed to pay the $200 upgrade fee. But in Green Bay, Spectrum is charging $110 a month for 100Mbps — half the speed — along with the $200 upgrade fee. That was a dealbreaker. In Kenosha, one customer moving from a Time Warner Cable internet plan to Charter Spectrum’s basic 60Mbps plan found two unpleasant surprises on his bill:

01/19/2017 Change Of Service Fee $52.74
01/19/2017 Spectrum WiFi Activation $10.54

Adding even more confusion were prices quoted to another customer in West Wauwatosa:

  • Ultra: 300/20Mbps, $105/mo, $199.99 upgrade fee
  • Regular: 60/5Mbps, $68.63/mo, no upgrade fee

Confusion for Some Legacy Time Warner Cable Customers As Well

A surprise last upgrade for Time Warner Cable customers in Rochester, N.Y.

In markets that still have not transitioned to Charter Spectrum, there is confusion to be found there as well. Upstate New York will see an introduction to Spectrum service plans in February-March, but a few Time Warner Cable upgrades have been quietly introduced in the meantime. Rochester, N.Y., which never made it officially to the Maxx city upgrade list, now has 100Mbps broadband as an option, but representatives denied it for at least a week when customers called to upgrade.

The new speed option was supposed to only be offered to customers qualified to get it, as upgrades were gradually completed around the area, but a website issue marketed the upgrade to everyone, including to some customers as far away as Buffalo.

For those successfully signing up with what is likely to be their last Time Warner Cable plan, many are hoping the investment will help them avoid the $200 upgrade fee when Spectrum’s 100Mbps plan becomes available in the next month or two. But some former Time Warner Cable customers in other cities already transitioned and two Charter representatives we queried about this scenario say they will be out of luck.

Customers start with a 60Mbps standard internet plan from Charter in non-Maxx areas. If a customer chooses a higher speed plan, even if they had 100Mbps from Time Warner Cable before, the $200 upgrade fee still applies. Both representatives claimed the fee was mandatory.

But some of our readers report success in getting that fee off their bills or it was never charged. Speaking to a supervisor or making a service change with an executive level customer service representative can make a big difference avoiding that fee. Customers who establish contact with a Charter representative as a result of a Better Business Bureau or FCC complaint were able to get the fee consistently waived. Results were more mixed when talking to Charter Spectrum’s regular sales department, even when asking for a supervisor to intervene. It may be a case of finding a representative with the authority to waive the fee.

“Even the representative agreed with us it was unfair to charge us $200 for moving from 100Mbps with Time Warner Cable to 100Mbps with Charter Spectrum,” another Stop the Cap! reader in Texas told us. “But they couldn’t do anything about it. When we threatened to cancel, a retention representative finally intervened and got the fee off the bill, only to have it return a month later. We filed a complaint with the Better Business Bureau and that finally worked to get the fee removed. But my neighbor couldn’t get anyone to budge on that fee.”

Wi-Fi Woes in Florida

Bright House Networks customers are also experiencing transition troubles. Residential customers reportedly lost any static IP addresses they signed up for when they converted to a Charter Spectrum residential plan. Static IP addresses are still available for Spectrum commercial plans. More troubling for many is the loss of access to Bright House Network’s secure Wi-Fi network.

Customers in central Florida who switched from a Bright House plan to a Charter Spectrum plan lost access to “BHN Secure,” “Bright House Networks,” and secured “CableWiFi” hotspots formerly administered by Bright House. Customers used to access those secure networks using their My Services Bright House username and password. But after transitioning to a Charter Spectrum plan, those credentials no longer work. Customers can still use their Bright House Road Runner e-mail address and password to get access to the very insecure open “CableWiFi” hotspot option, but those doing so should exercise extreme caution using it for any confidential communications, banking, or other sensitive online activities.

Charter’s Bad Advice: Change Your Wi-Fi Password to Your Favorite Sports Team!

Techcrunch noticed some very bad advice coming from Charter’s social media team on Twitter, recommending their 31,700 Twitter followers change their Wi-Fi passwords in support of their favorite sports teams.

Change your WiFi password and show guests where your loyalty lies! #ThatsMyTeampic.twitter.com/7kg04D7GN9

— Spectrum (@GetSpectrum) January 23, 2017

The original tweet has been deleted, no doubt after someone realized the dangerous security lapse it introduced to Wi-Fi hackers who could probably guess the favorite teams of the locals.

The FrankenBundle: Fewer Options, Less Confusion, Higher Prices Later

In Indianapolis, former Bright House Networks customers are being told having fewer options is a good thing.

WRTV-TV talked with Charter spokesman Mike Pedalty, who called his former employer’s packages a “Frankenbundle:”

“We kept adding things and confusing customers, where they didn’t understand what we were adding on and how it was packaged,” Pedalty told the TV station. Now he says most customers will choose from three basic TV packages and ‘best of all you won’t have to fight for a promo rate every year, when your current package expires.’

That’s because Charter has no intention of negotiating a better deal for you as prices gradually increase.

Back in Los Angeles, Plona understands what merger benefits she is really getting from the deregulatory atmosphere that permitted Charter to buy Time Warner Cable.

“When you let these companies do as they please, all they do is raise our rates,” Plona said. “It seems like prices go up every time you deregulate.”

Meet America’s Next FCC Chairman, An Ex-Verizon Lawyer That Snuggles With AT&T’s Talking Points

Phillip Dampier January 24, 2017 Editorial & Site News, Public Policy & Gov't 1 Comment

Ajit Pai

Meet America’s next chairman of the Federal Communications Commission Ajit Varadaraj Pai (born January 10, 1973): a lawyer formerly representing Verizon who wants to take a “weed-wacker” to Net Neutrality, thinks data caps represent innovation, opposes almost every consumer protection measure introduced by his predecessor Thomas Wheeler, and believes the best solution to improving broadband is to take pressure off companies like Comcast, AT&T, Charter, and Verizon.

Pai has been a commissioner at the FCC since 2012 where he and his fellow Republican Michael O’Rielly have strongly opposed most of Chairman Wheeler’s pro-competition agenda and broadband reforms:

  • Pai and his chief of staff Matthew Berry vocally opposed efforts by Wheeler to monitor and manage providers’ implementation of data caps and zero rating schemes that exempt provider-preferred content from usage allowances or speed throttles. Pai said Wheeler’s inquiries to carriers regarding zero rating practices showed “the era of permissonless innovation is over,” followed by a Tweet from Mr. Berry complaining that, “If you come up with an innovative service, you will be hauled into FCC to explain yourself.” In 2012, Pai decried allowing Net Neutrality to take hold because it could lead to eventual regulation of usage-based pricing policies.
  • Pai fiercely opposes Net Neutrality and told an audience at the conservative Free State Foundation in December he will remove “outdated and unnecessary regulations” and “fire up the weed-wacker and remove those rules that are holding back investment, innovation, and job creation.”
  • In 2015, Pai cut and pasted large sections of AT&T’s website into a dissent over the FCC’s plan to fine the phone giant $100 million for deceiving customers about its “unlimited data” plan. Pai’s statement defended AT&T’s business practices and blamed consumers for not understanding AT&T’s definition of “unlimited.”
  • Pai voted against the Charter – Time Warner Cable/Bright House Networks merger not because he opposed it. He was upset that Chairman Wheeler insisted on a seven-year ban on Charter implementing data caps. “Chairman Wheeler’s order isn’t about competition, competition, competition; it’s about regulation, regulation, regulation. It’s about imposing conditions that have nothing to do with the merits of this transaction. It’s about the government micromanaging the Internet economy,” said his spokesperson.
  • Pai partly dissented from the AT&T buyout of DirecTV because he didn’t like the deal’s conditions mandating affordable internet access for consumers, marketplace protections for competing online video services, and a strongly empowered compliance officer assigned to make certain AT&T met its obligations — a lesson the FCC learned after Comcast was accused of skirting its obligations in its acquisition of NBCUniversal.
  • Complained Comcast’s efforts to buy Time Warner Cable would be dead on arrival ‘because the Obama administration has shown itself much less likely to approve major telecom mergers — such as the blocked AT&T-T-Mobile merger — than a Republican administration might be.’
  • Opposed Wheeler’s effort to force open the set-top box marketplace to competition so consumers can buy their own cable boxes at a lower cost.
  • Called Wheeler’s push to have the minimum broadband speed standard reset to 25Mbps “incoherent,” claiming that 71 percent of consumers who can already buy access at those speeds don’t want or need it and that there was no need to push wired providers to deliver faster access because Verizon and AT&T already offer 4G LTE service to 98.5% of America.

Where your next FCC complaint will likely end up.

“Ajit Pai has been on the wrong side of just about every major issue that has come before the FCC during his tenure,” noted Craig Aaron, president of Free Press. “He’s never met a mega-merger he didn’t like or a public safeguard he didn’t try to undermine. He’s been an inveterate opponent of Net Neutrality, expanded broadband access for low-income families, broadband privacy, prison-phone justice, media diversity and more.”

In contrast, Comcast was thrilled with President Trump’s appointment.

“We commend [Pai’s] tireless efforts to develop and support policies that benefit American consumers and spur greater investment and innovation in broadband technologies to connect all Americans and drive job creation,” said David Cohen, senior executive vice president and chief diversity officer at Comcast. “This is a terrific appointment for the American consumer and the companies the FCC regulates and we look forward to continuing to work with Chairman Pai in his new role.”

That may not be too surprising, considering he spent his formative years in Washington as an associate general counsel at Verizon, where he helped the company deal with pesky regulatory matters. Pai has already given the public clues about how he is likely to respond to consumer complaints about the state of American broadband.

In January 2016, Pai complained the FCC should not be responding to the whims of public interest and consumer groups that “protest a particular [provider] offering,” referring to T-Mobile’s zero rating plan, claiming the “agency is going to jump to the tune” as a result. When the FCC starts scrutinizing providers over their “highly competitive and innovate service[s],” that represents the “very definition” of regulatory uncertainty.

For Pai, the ultimate sin seems to be bothering the incumbent telecom giants, who in his view seem to know what is best for America. So he is very likely to stay out of their way.

Big Red Verizon Really Wants to Own a Cable Company – Charter or Comcast Will Do Nicely

Shhh… Don’t tell anyone except the newspapers, trade journals, everyone else….

Well-placed sources inside Verizon are leaking like a sieve to the media about the phone giant’s ambition to own and operate a large cable company.

In what may be a trial balloon to test the waters with the incoming Trump Administration, at least two “well-placed sources” have told the New York Post Verizon CEO Lowell McAdam is seriously contemplating countering AT&T’s buy of DirecTV and its attempted acquisition of content company Time Warner, Inc., with the buyout of a major national cable operator.

Verizon’s primary interest, according to multiple sources, is expanding available content to fill its current and future wireless platforms, especially 5G. Acquiring a cable operator would make content deals easier and more affordable because of volume discounting. It would also allow Verizon to directly sell cable products and services without investing in further FiOS expansion.

The CEO told friends at the Consumer Electronic Show in Las Vegas that he “wants to buy into cable.”

The most likely targets would have to be large cable operators with a national footprint, and a source told the tabloid two companies qualified: Charter or Comcast.

“Altice is too small,” the source speculated. That would also count out other medium-sized companies like Cox and Mediacom, because they have too limited a service area to be of much use to Verizon.

No final decision has been made, the newspaper notes, adding no talks are underway between Verizon and any cable company at present. Should Mr. Trump repeat the earlier objections to the AT&T-Time Warner, Inc., merger he made last October, any marriage of Verizon with a cable operator would be unlikely. Trump cited unchecked media consolidation as his primary reason for opposing AT&T’s latest acquisition deal, but he has not repeated those objections recently. Last week Trump met with AT&T CEO Randall Stephenson in New York.

McAdam originally planned to use Verizon’s acquisition of Yahoo! as a way to broaden the phone company’s content library, but that yet-to-be-finished deal has been in turbulence since media reports exposed major security breaches of Yahoo’s e-mail and portal sites.

A deal with Charter is more likely than a buyout of Comcast because Charter’s most significant shareholder – John Malone, has no allegiance to keeping Charter Communications independent. Charter also lacks the kind of complications that an acquisition of Comcast could bring – notably Comcast’s ownership of NBC and its dozen owned-and-operated TV stations.

Malone has a long history of dispassionately buying and selling large telecom assets, including the cable company Tele-Communications, Inc. (TCI) he helped build from a handful of cable systems into what used to be the nation’s largest cable operator. In 1999, TCI was sold and rebranded as AT&T Broadband and Internet Services. Three years later, most of those cable systems were again sold to their present owner Comcast.

Verizon may argue it has already divested significant amounts of its FiOS service to Frontier Communications in the Pacific Northwest, Indiana, Texas, California, and Florida, limiting antitrust concerns. But state regulators, particularly in New York, are likely to raise serious objections if Verizon, already the dominant telephone company in New York (except Rochester) attempts to acquire Charter, the only significant cable operator in upstate New York and Manhattan. That would leave the vast majority of New York with a classic telecom monopoly, with only one provider for landline and broadband service.

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  • Josh: All the more reason to dump cable and do free ATSC over the air. Of course they want to take away even MORE of our bandwidth so Verizon or Comcas...
  • Lee: DSL lines are not shared. COAX and Fiber lines are shared. You will NOT get a coax or fiber line for home use that is not shared, and there is no reas...
  • kevin: Nope - just had my TWC bill increase over 170 without any premium channels. They say nothing they can do, all packages are more and if I switch now t...
  • Florence Sundberg: Hi, I checked again and neither Verizon, Charter, Comcast or Infinity offer services in Litchfield...I don't understand why not...they don't offer Int...
  • Florence Sundberg: Hi, you will probably be surprised that I do not pay as much as you may pay...since I only moved in here about a year and a half ago, I have the start...
  • Jackie Larkin: Hi Florence, Verizon does offer internet and so does Charter. I believe you could get phone service from them too. If you have an older TV, you h...
  • Florence Sundberg: Feb. 17th...I was just in Torrington yesterday to go to Staples. Thanks for the tip about Optimum...they don't even bother to give us updates about t...
  • Jackie Larkin: Thanks for answering Florence. I know that if you threaten Optimum with cancellation they will send you to their "Retention Unit" and remove the five...

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