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Bradford County, Pa. Complains About Poor Service, Frontier Sends ‘Cease & Desist’ Letter

The slow lane

The best way Frontier Communications believes it can resolve service problems in Pennsylvania is to threaten those complaining with a cease and desist letter that accuses the complainant of misrepresenting Frontier’s excellent service.

Bradford County, Pa. officials learned this first hand when Commissioner Darryl Miller wrote to Frontier alerting them that service outages in northeastern Pennsylvania are becoming a public safety issue. The company responded with a letter warning the commissioner to end the criticism or else.

“We’re simply looking for answers,” Commissioner Miller told WNEP-TV’s investigations reporter Dave Bohman. Miller adds he thinks it’s heavy-handed to use the words, “cease and desist.”

Miller isn’t the only one looking for answers. WNEP interviewed Susan Moore, who lives alone in the rural community of Orwell. Her phone service went out of service at least once a week over the summer.

“I’ve got a lot of health issues,” she told the TV station. The implications of not having landline service became all too clear to Moore in August when she needed to send for an ambulance.

Bradford County, Pa.

Bradford County, Pa.

Moore pressed her lifeline call alert button which relies on Frontier phone service to reach medical aid in case she falls and cannot get up or has a medical emergency. Nothing happened. Her phone service was out again.

“Without the phone service, my Life Alert doesn’t work,” Moore said. “That’s when I decided, as much pain as I was in, I got in a car and drove 20 miles to get to a hospital.”

Bradford County officials hear stories like Moore’s so often, they now eclipse complaints about potholes and taxes.

The problems affect both traditional landline dial tone service and DSL. If outages are not the subject of the complaint, slow and unresponsive Internet access usually is. Some customers were told Frontier oversold its DSL service in Bradford County and the company is waiting for federal broadband subsidies to improve service in the area.

Frontier Communications vice president Elena Kilpatrick said Frontier will spend part of a $2 million broadband improvement subsidy to deliver better service in Bradford County over the next six years. At the same time Frontier is tapping a ratepayer-funded subsidy to improve its existing service, the company is spending $10.5 billion of its own money to acquire Verizon landline infrastructure and customers in Florida, Texas, and California.

Despite the fact it will take up to six years to fully spend the subsidy, Kilpatrick claims the company has already upgraded phone and Internet service and fixed several problems reported by customers. She defended the company’s use of a threatening “cease and desist” letter sent to Commissioner Miller, claiming Frontier wanted the “misrepresentation of the facts” to stop.

Despite Kilpatrick’s claims, the complaints keep rolling in.

Randy, a Frontier customer in Bradford County reports he endures Frontier outages just about every Saturday since October, despite repeated service calls. Janise Groover wrote a Frontier technician tried to blame cobwebs for interfering with her Wi-Fi signals and poor DSL speeds — problems that are still unresolved — for which she pays Frontier $103 a month. Janice Bellinger complained her Frontier DSL connection drops “three or four times a day.” Customers in Monroe, Luzerne and Sullivan counties echoed Frontier service is dreadful in their areas as well.

Customers experiencing problems with their phone service in Pennsylvania can file an informal complaint with the state Public Utilities Commission and the FCC.

http://www.phillipdampier.com/video/WNEP Scranton Frontier Service Problems 11-16-15.mp4

WNEP in Scranton reports Frontier’s solution to a county commissioner’s complaints about service was to send him a “cease and desist” letter. (3:16)

Frontier Makes Excuses for Customer Losses: People Moved Away

frontierFrontier Communications continues to face challenges keeping customers in its legacy copper wire service areas, where only modest investments in network upgrades have proved insufficient to stop customers shopping around for better service.

Company officials reported a loss of about 30,000 residential customers during the last quarter, a drop of nearly 1% of its total customer base. Nearly 2% of Frontier’s business customers also took their business elsewhere, leaving the company with 3.1 million remaining residential customers and 294,000 business customers.

Frontier CEO Dan McCarthy blamed many of the customer losses on customers moving.

“During the summer, we do tend to see an uptick in customer [losses] that might have double play and in some cases triple play, as they move or make their decisions about moving their homes to a different location,” McCarthy said, claiming that most of Frontier’s losses overall came from voice-only customers.

As Frontier expands rural broadband opportunities, the phone company is still adding Internet customers, picking up a net gain of 27,200 broadband accounts. The company depends heavily on broadband to replace revenue lost from landline disconnects.

“We continue to see more customers choose higher-speed broadband products,” McCarthy said on a conference call to investors earlier today. “In the third quarter, 47% of the broadband activity was above the basic speed tier of 6Mbps. More than 70% of our residential broadband customers are still utilizing our basic speed tier, so we have substantial opportunity to improve our average revenue per customer as they upgrade their service.”

McCarthy offered no statistics about how many of Frontier’s DSL customers can substantially upgrade their speeds using Frontier’s existing infrastructure. Many Frontier broadband customers have complained their speeds reflect the maximum capacity of Frontier’s network in the immediate area, and many claim they do not consistently receive the speed level Frontier advertises.

Service is appreciably better in areas upgraded before being acquired by Frontier. McCarthy said some areas of Connecticut, acquired from AT&T, are now able to get speed “in excess of 100Mbps over our copper infrastructure.”

“Over time, we will be expanding the technology we use for 100Mbps in Connecticut to more of our markets elsewhere,” McCarthy promised. “In our FiOS markets, we already offer speed up to one gigabit and we have seen the benefit of offering these higher speeds as customers choose speed tiers to match their lifestyle choices.”

Frontier also separately notified the Federal Communications Commission it has no immediate plans to slap usage caps or metered service on customers.

“Frontier does not apply usage-based pricing to any of its broadband offerings,” Frontier said in an FCC filing. “Frontier has no plans at this time to offer a metered broadband service. We continue to monitor the market and continue to consider a usage-based offering as an option.”

Frontier suggested several factors would be considered when discussing usage-based billing: “the FCC’s Open Internet rules, policies of other companies, consumer demand, network capacity, and cost, among other factors.”

AT&T Leveraging Its DirecTV Acquisition to Cut Customer Promotions, Raise Prices

yay attWith one less significant competitor in the marketplace, AT&T feels safe cutting back customer promotions to raise prices and profitability, even if it means losing customers.

AT&T’s original argument for acquiring DirecTV was to negotiate cost savings from cable programmers by qualifying for greater volume discounts available from combining 5.7 million U-verse TV customers with DirecTV’s roughly 20.3 million U.S. subscribers. But AT&T has now made it clear it is keeping those savings for itself.

“We have our target to get to $2.5 billion or more in savings,” said John J. Stephens, AT&T’s chief financial officer, in a conference call with investors. “We already are realizing some of that in our content and supplier relationships. We really like our momentum here, and we are confident we can continue to expand margins and cut costs, even with pressure from our international operations.”

At the same time AT&T is enjoying billions in savings, in recognition of the fact its customers now have fewer competitors with whom they can do business, the time is right to cut back on money-saving promotional plans, effectively raising prices for customers.

“Because of our focus on profitability, we really got away from promotional pricing, and those customers who were cost-sensitive just had a propensity to churn,” Stephens said, referring to an industry term that means customers canceled service either because it got too expensive or they found a better deal elsewhere.



Stephens told investors its new pricing strategy, as expected, brought reductions in the number of U-verse video subscribers during the latest quarter. The company is also pushing more customers towards DirecTV and away from U-verse because programming costs are lower on the satellite platform. The new focus on profits means fewer customers are choosing AT&T and many existing DSL customers are resisting efforts to force them on to the U-verse platform.

“Net adds dropped with fewer promotions and shifting our focus to the lower content cost DirecTV platform,” Stephens admitted. “We added 192,000 IP broadband customers in the quarter, as migrations from our DSL base continued to slow. U-verse video losses also put some pressure on broadband numbers due to our high attachment rates.”

Stephens noted the customer growth declines occurred at the same time pressure on AT&T’s costs are dropping significantly. In October, the company signed an agreement with Viacom for its cable programming networks Stephens says represents “best-in-industry pricing,” made possible from the enhanced volume discounts AT&T now receives.

DirecTV will also allow AT&T to curtail additional U-verse expansion into its more rural service areas.

att directv“They don’t have television in these areas, or I should say we didn’t have a video offering,” Stephens said of AT&T’s rural customer base, mostly still dependent on DSL. With its ownership of a satellite TV provider, there is less urgency to expand rural U-verse. “These were generally out of the U-verse footprint, but now we do. And now we’ll be able to provide them with a video offering through DirecTV, and we’re very pleased with that. So we are hopeful that now this nationwide video service will help us in improving our overall broadband positioning.”

AT&T’s deal with the government to win approval of its merger with DirecTV committed the company to expand high-speed fiber optic broadband to at least 12.5 million customer locations and offer discounts to low-income customers. AT&T’s interpretation of the agreement means it will expand broadband service mostly in urban areas while continuing to allow its rural DSL broadband networks to lose customers.

“Over the last few years, the real trend has been a migration from DSL to IP broadband [eg. U-verse],” Stephens said. “And that’s been something that we’ve encouraged ourselves, and we’re beginning to complete that process or near completion where the DSL customers we have left is a much lower percentage than [those with U-verse] broadband capabilities from us.”

att cricket“I’m going to tell you, I think on the consumer side we’re down into the two million range on total DSL customers,” Stephens said. “[…] I would suggest to you it has changed dramatically over the course of four or five years, where it used to be 90% plus of our broadband base and now it’s a much lower percentage. So we’ve gone through that migration not completely, but almost completely.”

AT&T’s commitment to aid low-income customers is not clear, as customers report AT&T less willing to offer or extend money-saving promotions. On the wireless side of AT&T’s business, the company is increasingly pushing price-sensitive customers out of its network.

“Our focus is to provide the best customer experience while increasing profitability and not just chase customer counts,” Stephens said. “Our third quarter results drive that point home. We had our highest ever wireless service [profit] margins at 49.4%.”

In particular, AT&T is sacrificing its low-revenue feature phone customers by cutting back on handset choices and trying to shift certain prepaid customers to the less venerable Cricket brand. AT&T acquired Cricket from Leap Wireless in the spring of 2014. It completed a nationwide shutdown of Cricket’s competitive CDMA wireless network this fall and has pushed Cricket’s current customer base onto AT&T’s GSM network, often at a higher cost to customers.

Stephens reported AT&T Cricket customers now pay nearly $10 more a month than departing AT&T customers that maintained postpaid feature phones until the end of their two-year contracts.

“On the churn, first and foremost, yes, the feature phone churn is hitting us and having an impact on us, and those are decisions we made not to chase those customers,” Stephens informed investors. “[We] can’t make the math work not only on the pricing for those customers but the impact throughout our base.”

Stephens claimed profits are now AT&T’s number one priority.

“We’re going to be focused on profitable growth, not just chasing customer counts or specific targets,” Stephens said. “We’re going to really be focused on just getting the most profits out of the business.”

Frontier: Less is More – Deregulate² and Stop Bugging Us About Broadband Speeds

frontier frankRequiring Frontier Communications to increase broadband speeds could make the service unaffordable for rural and poor Americans, the company is arguing before federal and state regulators.

In separate filings with the New York Public Service Commission and the Federal Communications Commission, Frontier has asked both for further deregulation and less oversight to ease everything from minimum broadband speed definitions to video franchising regulations.

Frontier’s market focus is primarily on rural communities where it delivers traditional DSL broadband service, typically up to 6Mbps, although many customers complain they get lower speeds than advertised. The FCC is working to modernize the Lifeline program, which offers substantial discounts on basic telephone service to low-income Americans. The Commission is studying the possibility of requiring providers to offer Lifeline Internet access for the first time. What worries Frontier is the Commission’s proposed requirement that providers offer Lifeline Internet speeds starting at 10/1Mbps, something Frontier strongly opposes.

frontier dslFrontier’s ability to deliver consistent 10Mbps service in rural areas is the issue.

“Certain rural consumers […] may not currently have access to 10/1Mbps fixed Internet speeds and would thus be prevented from choosing to use Lifeline for a fixed Internet service,” Frontier wrote in its filing with the Commission. “Even if higher speeds are available, a minimum speed standard may prevent a customer from opting for a lower speed plan that may better meet their budget.”

Frontier told the Commission that most subscribers are happy buying 6Mbps service from Frontier, coincidentally the same speed it advertises as widely available across its service areas. Frontier argues if it was required to consistently provide 10Mbps service, the cost of the service may become unaffordable to many.

While Frontier argues against speed standards that are difficult for its aging copper-based network to consistently provide, it is using that same copper network as an argument against further regulation and oversight in New York.

“Traditional telephone service providers like Frontier continue to be legitimate and viable competitors in the marketplace—a testament to our tenacity and the quality of our services,” Frontier wrote in comments to the Public Service Commission. “To ensure that this continues to be the case, in the near-term, an immediate no-cost investment that the State can make in the existing copper-based network is to eliminate the regulatory requirements that apply to [traditional phone companies] but that do not apply to other telecommunications providers.

Frontier added, “consumers have a multitude of communications channels available to them including wireline and wireless voice services and wireline, wireless, cable and satellite broadband services.”

Frontier did West Virginia few favors when it took over Verizon's landline business in the state.

Frontier did West Virginia few favors when it took over Verizon’s landline business in the state.

Ironically, Frontier argued New York’s allegedly robust and fast broadband networks (offered by its competitors but usually not itself) are reason enough to support a “light regulatory touch.”

“Today, every municipality in New York has access to one or more wired or wireless networks that can provide voice, video and data services to residents and businesses,” Frontier claimed. “Over 95% of the state has access to the FCC benchmark speed of 25/3 Mbps and 98% of the State has 200kbps speed in at least one direction. New York’s broadband speeds are significantly faster than the national average and other countries.”

But Frontier failed to mention it is incapable of providing consistent access at or above the FCC benchmark speed because it still relies on a antiquated copper-based network throughout most of its New York service areas. Despite Frontier’s claims of offering quality service, the J.D. Power U.S. Residential Telephone Service Provider Satisfaction Study (2015) ranks Frontier dead last among all significant providers in the eastern U.S. It dropped Frontier this year from consideration for its Internet Provider Satisfaction Study, but a year earlier rated Frontier the worst ISP in the eastern U.S.

Although Frontier suggests it faces “robust competition” from “over 100 different broadband providers, especially at lower speeds,” in most of its service areas in New York it faces Time Warner Cable or no competitor at all.

Frontier’s latest defense over why it has failed to significantly upgrade its network infrastructure to remain competitive with cable is ‘customers don’t want or need faster speeds.’ While advertising lightning fast service on its acquired Verizon FiOS and AT&T U-verse networks, Frontier argues New York regulators “must keep in mind the consumer demands on broadband speeds.”

Frontier points to two rural broadband projects in New York, one in Hamilton County and the other in Warren County to make its speed argument (emphasis ours):

“These projects are examples of the importance of collaboration and innovation—rather than dogmatic adherence to performance requirements that are largely aspirational for many NYS citizen—in bringing high quality and transformative broadband access to unserved and underserved communities. Flexibility with regard to technology and broadband speed will enhance an already robust marketplace and result in greater affordability and access.”

Frontier has also told New York officials it wants to eliminate local oversight of video franchising and move New York to a “statewide video franchising” system to “promote competition and to streamline competitive entry into the video market in the state.”

“This will provide enhanced consumer choice as well as additional investment in broadband and video services,” Frontier argued. “In other states that have followed this model, such as Connecticut, consumers have a rich array of video providers and services from which to choose at competitive prices.”

That “rich array of video providers” in Connecticut is primarily Cablevision and Frontier. Frontier acquired a pre-existing U-verse network originally owned and operated by AT&T in the state.

Stop the Cap! Testimony to N.Y. Public Service Commission Advocating Major Telecom Study

logoOctober 20, 2015

Hon. Kathleen H. Burgess
Secretary, Public Service Commission
Three Empire State Plaza
Albany, NY 12223-1350

Dear Ms. Burgess,

New York State’s digital economy is in trouble.

While providers claim portions of New York achieve some of the top broadband speeds in the country, the vast majority of the state has been left behind by cable and phone companies that have never been in a hurry to deliver the top shelf telecom services that New Yorkers need and deserve.

The deregulation policies of the recent past have resulted in entrenched de facto monopoly and duopoly markets with little or no oversight. Those policies, instead of benefiting New Yorkers, are ultimately responsible for allowing two companies to dominate the state’s telecommunications marketplace.

In virtually all of upstate New York, the services consumers receive depend entirely on the business priorities of local incumbent providers, not market forces or customer demand. As a result, New Yorkers face relentless, unchecked rate increases, well-documented abysmal and unresponsive customer service, and inadequate broadband provided by a workforce under siege from downsizing, cost-cutting, and outsourcing.

Certain markets, particularly those in the New York City area, have at least secured a promise of better broadband from Verizon’s FiOS fiber to the home upgrade. But at least 100,000 New Yorkers have languished on Verizon’s “waiting list,” as the company drags its feet on Non Standard Installation orders.[1] In upstate New York, Verizon walked away from its FiOS expansion effort five years ago, leaving only a handful of wealthy suburbs furnished with fiber service while effectively abandoning urban communities like Buffalo and Syracuse with nothing better than Verizon’s outdated DSL, which does not meet the FCC’s minimum definition of broadband – 25Mbps.[2]

Cablevision’s broadband performance dramatically improved because of investment in network upgrades, and the company has been well-regarded for its broadband service ever since.[3] But the proposed new owner of Cablevision – Altice, NV — has sought “cost savings” from cuts totaling $900 million a year, which will almost certainly devastate that provider’s future investments, its engineering and repair crews, and customer service.[4]

At least downstate New York has the prospect for +100Mbps broadband service. In upstate New York, three providers define the broadband landscape for most cities and towns:

  • Time Warner Cable dominates upstate New York with its cable broadband service and has the largest market share for High Speed Internet. As of today, Time Warner Cable’s top broadband speed outside of New York City is just 50Mbps, far less than the 1,000Mbps service cities in other states are now on track to receive or are already getting.[5]
  • Verizon Communications is the largest ILEC in upstate New York. Outside of its very limited FiOS service areas, customers depend on Verizon’s DSL service at speeds no better than 15Mbps, below the FCC’s minimum speed to qualify as broadband;[6]
  • Frontier Communications has acquired FiOS networks from Verizon in Indiana and the Pacific Northwest, and AT&T U-verse in Connecticut. Frontier has made no significant investment or effort to bring FiOS or U-verse into New York State. In fact, in its largest New York service area, Rochester, there are significant areas that can receive no better than 3.1Mbps DSL from Frontier. The vast majority of Frontier customers in New York do not receive service that meets the FCC’s minimum definition of broadband, and some investors predict the company is “headed for financial disaster.”[7]

The competitive markets the DPS staff envisions in its report to the Commission are largely a mirage. When an ILEC like Frontier Communications admits its residential broadband market share “is less than 25% in our 27 states excluding Connecticut,” that is clear evidence the marketplace has rejected Frontier’s legacy DSL service and does not consider the company an effective competitor.[8]

While incumbent cable and phone companies tout ‘robust competition’ for service in New York, if the Commission investigated the market share of Time Warner Cable upstate, it would quickly realize that ‘robust competition’ has been eroding for years, with an ongoing shift away from DSL providers towards cable broadband.[9]

Frontier’s primary market focus is on rural communities where it often enjoys a monopoly and can deliver what we believe to be inadequate service to a captive customer base. The company is currently facing a class action lawsuit in West Virginia, where it is alleged to have failed to provide advertised broadband speeds and delivers poor service.[10]

Verizon’s ongoing investment in its legacy wireline network (and expansion of DSL to serve new customers) has been regularly criticized as woefully inadequate.[11] From all indications, we expect the company will eventually sell its legacy wireline networks, particularly those upstate, within the next 5-10 years as it has done in northern New England (sold to FairPoint Communications) and proposes to do in Texas, California, and Florida.[12] (Verizon also sold off its service areas in Hawaii, West Virginia, and much of its territory acquired from GTE.)

Across New York, service problems and controversial deals between telecom providers have made headlines. Here are just a few:

  1. Superstorm Sandy’s impact on Verizon’s legacy wireline network on Fire Island and in other downstate communities left many without service. Instead of repairing the damage, Verizon proposed to scrap its wireline network and substitute inferior wireless service with no possibility of wired broadband.[13] The DPS received a large number of comments from the public and local elected officials fiercely opposed to this proposal, one that Verizon eventually withdrew in the face of overwhelming opposition.[14]
  2. There are growing allegations Verizon may be underspending on its legacy wireline network and even worse, may be misallocating costs and revenues to deceive the Commission.[15] Some allege much of the company’s ongoing investments, charged to the wireline operation, in reality are for the benefit of its wireless network. This may have allowed Verizon Communications/New York to claim significant losses on its wireline books the company then argued justified rate increases on ratepayers.[16] A full scale accounting of Verizon’s books is essential for all concerned and corrective action may be necessary if these allegations are proven true.
  3. Verizon’s foot-dragging on FiOS buildouts in New York City led to a damning audit report commissioned by New York City Mayor Bill de Blasio this summer and oversight hearings were held last week by the City Council of New York.[17] [18] Despite Verizon’s creative definition of “homes passed,” a substantial number of New Yorkers cannot receive the benefits of “today’s networks” the DPS staff refers to. Instead, many are stuck with poorly-performing DSL or no service at all.[19] Regardless of whether fiber passes in front of, over, in between, or behind buildings, Verizon signed an agreement compelling them to give customers a clear timeline to establish FiOS service. It is apparent Verizon is not meeting its obligations.[20]
  4. The proposed sale of Time Warner Cable to Comcast led the Commission’s staff to admit the majority of respondents to requests for public input were strongly opposed to the merger and without substantial modifications concluded would not be in the public interest.[21] Comcast eventually withdrew its proposal in the face of overwhelming opposition.
  5. The proposed sale of Time Warner Cable to Charter Communications, where the DPS staff concluded as the application stood, there would be no public interest benefits to the transaction.[22]

Those are just a few examples of why aggressive oversight of telecommunications is critical for all New Yorkers. In most of these examples, the DPS never ruled one way or the other. The companies individually made their own decisions, and we believe they would have decided differently if they did not face grassroots opposition from consumers.

New Yorkers deserve an active DPS prepared to aggressively represent our interests, ready to investigate what Verizon is doing with its legacy wireline network, legacy wired broadband services, FiOS and Verizon Wireless. With Time Warner Cable having such a dominant presence in western and central New York, its sale should never be taken lightly, as it will impact millions of New Yorkers for years to come.

While the DPS seems prepared to passively wait around to discover what Time Warner Cable, Frontier and Verizon are planning next, the rest of the country is getting speed upgrades New York can only dream about.

Google Fiber and AT&T, among others, are aggressively rolling out 1,000Mbps fiber service upgrades in other states, while a disinterested Verizon refuses to invest further in FiOS expansion, leaving millions of New York customers with nothing better than DSL.

The lack of significant competition upstate is why we believe Time Warner Cable has not yet chosen any market in New York except New York City for its Maxx upgrade program, which offers substantially faster speeds and better service.[23] There is no compelling competitive reason for Time Warner to hurry upgrades into areas where they already enjoy a vast market share and no threat of a broadband speed race. So much for robust competition.

Charter’s proposed acquisition of Time Warner Cable proposes a modest upgrade of broadband speeds to 60-100Mbps, but as we wrote in our comments to the DPS regarding the merger proposal, upstate New York would be better off waiting for Time Warner Cable to complete its own Maxx upgrades over what will likely be 100% of its footprint in the next 24-30 months.[24] Time Warner Cable Maxx offers maximum broadband speeds three times faster than what Charter proposes for upstate New York, while also preserving affordable broadband options for those less fortunate. Approving a Charter buyout of Time Warner Cable will only set upstate New York back further.

We confess we were bewildered after reviewing the initial staff assessment of telecommunications services competition in New York. Its conclusions simply do not reflect reality on the ground, particularly in upstate communities.

It was this type of incomplete analysis that allowed New York to fall into the trap of irresponsible deregulation and abdication of oversight that has utterly failed to deliver the promised competition that would check rate hikes, guarantee better customer service, and provide New York with best-in-class service. In reality, we have none of those things. Rates continue to spiral higher, poor customer service continues, and New York has been left behind with sub-standard broadband that achieves no better than 50Mbps speeds in most upstate communities.

This summer, the American Customer Satisfaction Index told us something we already know. Americans dislike their cable company more than any other industry in the nation.[25] A survey of more than 14,000 customers by ACSI found service satisfaction achieving a new all-time low, scoring 63 out of 100.

“Customers expect a lot more than what the companies deliver,” said ACSI managing director David VanAmburg, who called poor customer service from cable operators “endemic.”

This year, Time Warner Cable again scored the worst in the country. As the only cable provider for virtually all of upstate New York, if residents in New York are given a choice between Time Warner Cable and the phone company’s slow-speed DSL, they are still likely to choose Time Warner Cable, but only because they have no other choices for broadband that meets the FCC definition of broadband.

Providers are quick to suggest consumers can turn to so-called competitors like satellite broadband or wireless Internet from mobile providers. They conveniently ignore the fact satellite-delivered Internet is such a provider of last resort, less than 1% of New Yorkers choose this option. Those that have used satellite broadband tell the companies providing it they rarely achieve the claimed speeds and are heavily speed throttled and usage capped.[26] It’s also costly, particularly when measuring the price against its performance.

Mobile Internet, which some ILECs have advocated as a possible replacement for rural wireline networks, is also a very poor substitute for wired Internet access. Wireless broadband pricing is high and usage allowances are low. Attempts to convince New Yorkers to abandon Verizon landline service in favor of Verizon’s 4G LTE wireless replacement have led to consumer complaints after learning their existing unlimited Verizon DSL service would be substituted for a wireless plan starting at $60 a month with a 10GB usage allowance.[27]

A customer with a 6Mbps DSL line from Verizon consuming 30GB of usage a month – hardly a heavy user – pays Verizon $29.99 a month for DSL service during the first year. In contrast, that same customer using Verizon Wireless’ home 2-5Mbps wireless LTE plan will pay $120 a month – four times more, with the added risk of incurring a $10 per gigabyte overlimit fee for usage in excess of their allowance.[28]

None of this information is a secret, yet it seems to have escaped the notice of the DPS staff in its report. Part of the reason why may be the complete lack of public input to help illuminate and counter incumbent providers’ well-financed public and government relations self-praise campaigns. If only actual customers agreed with their conclusions, we’d be well on our way to deregulation-inspired broadband nirvana.

Except New Yorkers do not agree all is well.

Consumer Reports:

Our latest survey of 81,848 customers of home telecommunications services found almost universally low ratings for value across services—especially for TV and Internet. Those who bundled the three services together for a discount still seemed unimpressed with what they were getting for their money. Even WOW and Verizon FiOS, which got high marks for service satisfaction, rated middling or lower for value, and out of 14 providers, nine got the lowest possible value rating.

What is it about home telecommunications that leaves such a sour taste in customers’ mouths? When we asked Consumer Reports’ Facebook followers to tell us their telecom stories, the few happy anecdotes of attentive service technicians and reliable service were overwhelmed by a tidal wave of consumer woe involving high prices, complicated equipment, and terrible service.[29]

The effective competition that would rely on market forces to deter abusive pricing and poor customer service is simply not available in a monopoly/duopoly marketplace. New entrants face enormous start-up costs, particularly provisioning last-mile service.

The nation’s telephone network was first constructed in the early half of the last century by providers guaranteed monopoly status. The cable industry developed during a period where regulators frequently considered operators to be a “natural monopoly,” unable to survive sustained competition.[30] Many cable operators were granted exclusive franchise agreements which helped them present a solid business case to investors to fund a costly network buildout. The end of franchise exclusivity happened years after most cable operators were already well established.

Today, those marketplace protections are unavailable to new entrants who face a variety of hurdles to achieve success. Some are competitive, others are regulatory. Google Fiber, which provides competitive service in states other than New York, publishes a guide for local communities to make them more attractive prospects for future Google Fiber expansion.[31]

For many overbuilders, pole attachment issues, zoning and permitting are significant obstacles to making new service available to residential and commercial customers. New York must ensure pole owners provide timely, non-discriminatory, and reasonable cost access. Permitting and zoning issues should be resolved on similar terms to speed network deployment.

Because a long history of experience tells us it is unreasonable to expect a competing telephone or cable company to enter another provider’s territory, in many cases the only significant possibility for competition will come from a new municipal/co-op/public-owned broadband alternative.

The hurdles these would-be providers face are significant. Incumbent provider opposition can be substantial, especially on a large-scale buildout. In rural areas, incumbents can and do refuse to cooperate, even on projects that seek to prioritize access first to unserved/underserved areas currently bypassed by those incumbents.

The effort to wire the Adirondack Park region is a case in point. Time Warner Cable has refused to provide detailed mapping information about their existing network, making it difficult to assess the viability of a municipal and/or a commercial broadband expansion project into these areas. Time Warner Cable maintains it has exclusivity to granular map data showing existing networks for “competitive reasons,” effectively maintaining an advantageous position from which it can strategically apply for state broadband expansion funding to expand its network using public funds.

Time Warner Cable benefits from access to publicly-owned rights of way and sanctioned easements. Without this access, their network would likely be untenable. As a beneficiary of that public access, making granular map data available to broadband planners is a fair exchange, and nothing precludes Time Warner from building its network into those unserved/underserved areas – something that might deter a would-be competitor’s business argument to overbuild a high-cost, rural area. The Commission should ask itself how many rural New York communities have two (or more) competing cable companies serving the same customers. If the answer is none, Time Warner Cable does not have a valid argument.

There is ample evidence the Commission needs to begin a full and comprehensive review of telecommunications in this state. It must build a factual, evidence-based record on which the Commission can build a case that oversight is needed to guarantee New Yorkers get the high quality telecommunications services they deserve.

Broadband and telephone service is not just a convenience. In September 2015, the Obama Administration declared broadband was now a “core utility,” just as important as telephone, electric, and natural gas service. Isn’t it about time the Department of Public Service oversee it as such?[32]

Respectfully submitted for your consideration,

Phillip M. Dampier

Director, Stop the Cap!

[1] http://stopthecap.com/2015/10/19/n-y-city-council-investigates-verizon-foot-dragging-fios-possible-contract-violations/
[2] http://www.wsj.com/articles/SB10001424052702303410404575151773432729614
[3] https://www.fcc.gov/reports/measuring-broadband-america-2014
[4] http://variety.com/2015/biz/news/altice-group-patrick-drahi-cablevision-bid-1201599986/
[5] http://www.pcmag.com/slideshow/story/310861/if-you-want-gigabit-internet-move-here/1
[6] https://www.fcc.gov/document/fcc-finds-us-broadband-deployment-not-keeping-pace
[7] http://seekingalpha.com/article/2888876-frontier-communications-headed-for-financial-disaster
[8] http://seekingalpha.com/article/2633375-frontier-communications-ftr-ceo-maggie-wilderotter-q3-2014-results-earnings-call-transcript?part=single
[9] http://www.leichtmanresearch.com/press/051515release.html
[10] http://www.wvgazettemail.com/article/20141020/GZ01/141029992
[11] http://www.cwa-union.org/news/entry/cwa_calls_for_regulators_to_investigate_verizons_refusal_to_invest_in_landl
[12] http://stopthecap.com/2015/05/05/fla-utility-says-negotiations-with-verizon-make-it-clear-verizon-will-exit-the-wireline-business-within-10-years/
[13] http://money.cnn.com/2013/07/22/technology/verizon-wireless-sandy/
[14] http://documents.dps.ny.gov/public/MatterManagement/CaseMaster.aspx?Mattercaseno=13-C-0197
[15] http://www.cwa-union.org/news/entry/cwa_calls_for_regulators_to_investigate_verizons_refusal_to_invest_in_landl
[16] http://newnetworks.com/publicnn.pdf/
[17] http://www1.nyc.gov/office-of-the-mayor/news/415-15/de-blasio-administration-releases-audit-report-verizon-s-citywide-fios-implementation
[18] http://arstechnica.com/business/2015/10/verizon-tries-to-avoid-building-more-fiber-by-re-defining-the-word-pass/
[19] http://www.nytimes.com/2015/08/27/nyregion/new-york-city-and-verizon-battle-over-fios-service.html?_r=0
[20] http://www.nyc.gov/html/doitt/downloads/pdf/verizon-audit.pdf
[21] http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId={0A5EAC88-6AB7-4F79-862C-B6C6B6D2E4ED}
[22] http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId=%7BC60985CC-BEE8-43A7-84E8-5A4B4D8E0F54%7D
[23] http://www.timewarnercable.com/en/enjoy/better-twc/internet.html
[24] http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId={FCB40F67-B91F-4F65-8CCD-66D8C22AF6B1}
[25] http://www.marketwatch.com/story/the-most-hated-cable-company-in-america-is-2015-06-02
[26] https://community.myhughesnet.com/hughesnet?topic_list%5Bsettings%5D%5Btype%5D=problem
[27] http://www.verizon.com/home/highspeedinternet/
[28] http://www.verizonwireless.com/b2c/lte-internet-installed/
[29] http://www.consumerreports.org//cro/magazine/2014/05/how-to-save-money-on-triple-play-cable-services/index.htm
[30] http://www.citi.columbia.edu/elinoam/articles/Is_Cable_Television_Natural_Monopoly.pdf (p.255)
[31] https://fiber.storage.googleapis.com/legal/googlefibercitychecklist2-24-14.pdf
[32] http://thehill.com/policy/technology/254431-obama-administration-declares-broadband-core-utility-in-report

Shillplex: FCC Gets Curiously Similar Letters of Support for the Charter/Bright House/TWC Merger

moneymouthIf the Federal Communications Commission weighed comments for and against the merger of Charter-Time Warner Cable-Bright House Networks based on volume, it would likely be a done deal.

A major lobbying effort by the cable companies involved in the transaction has been underway to encourage politicians, business associations, non-profit groups, and programmers to write the FCC asking the deal be approved. Many are responding, including politicians receiving political donations and/or seeking expanded service for their communities, non-profits that depend on financial contributions from one or more of the companies involved, programmers that live or die based on winning carriage agreements with Charter, Bright House, and Time Warner Cable, and other groups with missions that seem miles away from a multi-billion dollar cable merger.

Stop the Cap! examined many of these curious letters of support. What, for instance, might motivate the New York Snowmobile Association to navigate the cumbersome comment filing systems of both the New York Public Service Commission and the Federal Communications Commission to express glowing support for a cable merger?

The International Soap Box Derby is all-in on the merger of Charter-TWC-Bright House.

The International Soap Box Derby is all-in on the merger of Charter-TWC-Bright House.

What made the Maccabi World Union, the largest Jewish sports organization in the world, enthusiastic enough to dwell on a marriage of three cable companies?

How could the Montana Stockgrowers Association set aside their interest in helping state cattle ranchers to deliver safe and wholesome beef to American dinner tables to ponder modem fees in their letter to the Commission?

One Los Angeles non-profit organization contacted by Stop the Cap! shed some light on the subject, if we agreed to keep their name private.

“Like many non-profits, when Time Warner Cable makes a financial contribution to our organization, they attempt to find ways where both our organization and their company can benefit from goodwill generated by charitable contributions,” the director told Stop the Cap! “When the deal with Charter and Time Warner was announced, we received a gently worded request to participate in the public discussion about the merger.”

The group received information containing talking points about the deal’s benefits to consumers and businesses and was asked to consider using those points in a letter to state and federal regulators that would present a positive view of the deal.

“Non-profits need the contributions of large companies like Time Warner Cable and Charter, which both serve parts of Los Angeles County, to fund our programs,” the director said. “There isn’t any pressure on us to write the letters, but since they are in the public record, we know the cable companies know who wrote and who did not.”

charter twc bhThe director of this particular organization had qualms about getting involved in a regulatory matter that did not involve the organization he leads, but he was overruled by his board of directors.

“Money is tight,” the director added. “I don’t want to comment on Charter Cable’s performance in Los Angeles except to say it is the main reason I use someone else.”

The director of the group would not comment when asked if it was uncomfortable signing a letter in support of a company who has failed to meet their personal expectations.

The fact non-profit groups spend time and resources writing letters on behalf of their donors bothers others as well.

Shawn Sheridan of Turlock, Calif. exhaustively researched over 250 pieces of correspondence the FCC has received in favor of the Charter acquisition, and he is not happy about what he found.

“The current public comments process has been infiltrated to purposely influence the independent review process,” Sheridan writes in a letter to the FCC. “I suggest to the Commission that conducting an independent analysis of the comments received from the public for [this merger] would reveal a nationwide campaign to improperly affect the Commission’s independent review of the applications, and reveal unique characteristics of who has and has not commented publicly.”

Sheridan categorized all the letters arriving from state/local representatives, Chamber of Commerce chapters, and non-profit groups:


Letters from different chapters of the Chambers of Commerce, which typically count Time Warner Cable, Charter Communications, and/or Bright House Networks as dues-paying members, were oddly uniform in their praise of the transaction.

The Minnesota Chamber of Commerce, for example, didn’t seem too interested in getting into the specifics of the deal, satisfied instead to request “the FCC approve all matters related to this merger promptly.”

Dozens of other chapters of the business association used similar language praising the merger proposal. Notice the references to “$2.5 billion” promised to be spent on commercial fiber optics and “one million new residential lines” mentioned in a handful of the filings with the FCC:

The Minnesota Chamber of Commerce advocates giving Charter whatever it wants.

The Minnesota Chamber of Commerce advocates giving Charter whatever it wants.

  • “The Missoula Area Chamber of Commerce is the voice of business in Missoula County….We are excited by New Charter’s commitment to invest $2.5 billion into networks in commercial areas.”
  • “As a member-driven organization, the Montana Chamber of Commerce represents the interests of business, ranging from small mom-and-pop operations to large companies….The new company would commit $2.5 billion to the commercial sector and would build out residential lines, improving both industry competition and local infrastructure.”
  • “With nearly 700 members that employ more than 12,000 people, the Fremont Chamber of Commerce represents a vibrant, regional business community in eastern Nebraska….Specifically, we are told, the greater financial strength of the unified operations would lead to investment of at least $2.5 billion to upgrade commercial lines to fiber-optics….Therefore, based on their assurances to us, we believe New Charter would be a great partner….”
  • “The Florida Chamber of Commerce is pleased to support Bright House Network’s merger with Charter Communications and Time Warner Cable into New Charter….New Charter would be committed to infrastructure investment. It would devote at least $2.5 billion towards commercial networks, contributing important upgrades and competition into this influential market.”
  • [Clearwater Regional Chamber of Commerce:] “We understand that New Charter plans to invest $2.5 billion toward commercial networks, contributing important upgrades and competition
  • into this influential market and to provide substantial investment throughout the entire State.”
  • [Lakeland Area Chamber of Commerce:] “For example, New Charter has committed to $2.5 billion in commercial networks and would build out one million residential line extensions.”
  • [San Diego Regional Chamber of Commerce:] “The proposal promises to bring in at least $2.5 billion in new commercial infrastructure investment, much of which will be invested in areas
    where the Charter Communications currently does not operate.”
  • “With more than 10,000 members, the Greater Cleveland Partnership (GCP) is a membership association of Northeast Ohio companies and organizations and one of the largest metropolitan
    chambers of commerce in the nation….Specifically, it would commit at least $2.5 billion to build out commercial network lines and put up one million new residential lines….”
  • “The Buffalo Niagara Partnership is the region’s private sector economic development organization and regional chamber of commerce….In the near future, our state will benefit from
    a $2.5 billion expansion in the build-out of networks into commercial sectors.”
  • “At the Finger Lakes Chamber of Commerce, we serve as the voice of our local business community….We have [been] made aware of a major change in the cable broadband industry. The potential merger of Charter Communications, Time Warner Cable, and Bright House Networks into New Charter….”

The language that implies these are not spontaneous, coincidental pieces of correspondence was couched using phrases like, “we are told,” “we understand,” and “we have [been] made aware.”

These talking points actually originate from Charter Communications’ Resource Center, which distributes pro-merger information to organizations in Time Warner Cable and Bright House Networks’ service areas. The references to $2.5 billion for commercial upgrades and line extensions to one million new residential customers originate in documents like this, tailored in this case to New Yorkers.

Some organizations devote more time to customizing their correspondence than others. The Business Council of New York State and the Orange County Partnership couldn’t be bothered, and essentially cut and paste nearly identical language in their “individual” letters of support:


“We recognize that the information and communications sector is an increasingly critical component of a healthy economy….The Business Council understands that access to a reliable 21st Century communications infrastructure—with competitive options for service—is essential for New Yorkers in their homes, schools and workplaces.


“The Partnership recognizes that the information and communication sector is an increasingly critical component of a healthy economy….We also understand that access to reliable 21st Century communications infrastructure, with competitive options for service, is a necessity for Orange County residents in their homes, schools and workplaces.

...and the chances of a multibillion dollar cable merger winning regulatory approval.

…and the chances of a multibillion dollar cable merger winning regulatory approval.

Dominic J. Jacangelo was so nice, he liked Charter Communications’ merger twice — once on the letterhead of the New York Snowmobile Association, where he serves as executive director, and in a nearly identical letter signed by Jacangelo as Supervisor of the Town of Poestenkill, N.Y. He cited the same talking points the various Chambers of Commerce did.

Representing the interests of 2.5 million people worldwide or its member Time Warner Cable?

Representing the interests of 2.5 million people worldwide or its member Time Warner Cable?

Sheridan disputes how merger supporters often attempt to give their views more weight by implying their positions are shared by their constituents. The Orange County Business Council claimed in its letter it represented nearly 300 Southern California businesses employing over 250,000 in the region and more than two million globally. Sheridan doubts more than 2.25 million people, many working outside the country, support the cable merger as much as OCBC suggests.

A larger question is what motivates the letter writers to weigh in on a cable merger in the first place?

For the ranchers in Montana, the desire for more rural broadband is well known. Cable operators usually don’t provide service to large, expansive ranches where a herd of cattle often vastly outnumbers the local population.

For Mr. Jacangelo, his LinkedIn page cites his talents for developing “professional relationships with business sponsors and [supporters], which might be helpful as the town of Poestenkill, like many other rural communities in upstate New York, seek expanded broadband service.

In 2009, the Maccabi World Union partnered with Jewish Life Television to provide in-depth coverage of the Maccabiah Games, a global sporting event. U.S. viewers see coverage of those games over Jewish Life TV, a cable network that reaches Time Warner Cable and Bright House customers, but not Charter Cable customers. A takeover of Time Warner and Bright House by Charter Communications could risk the end of that carriage agreement. Supporting Charter at its time of need may establish enough goodwill to guarantee JLTV will be a part of the “New Charter” lineup.

Sheridan’s research also discovered, as of Oct. 9, 2015:

  • With a total of 31 letters from politicians in the state of Texas, not one came from a local official. Eighteen Chambers of Commerce in Texas sent letters in support of the deal;
  • No state-level representatives weighed in on the deal in New York either, although 30 local and county leaders gave their support;
  • One third of the 28 states where Charter provides service had no comment on the merger, pro or con, hardly representing a nationwide groundswell of support;
  • Charter Communications’ corporate headquarters, formerly in Missouri and now in Connecticut, also drew little hometown interest. Just one letter from a state-level politician in Missouri reached the FCC. There were no letters from Connecticut at all;
  • Of 258 unique commenters sending letters in support of the merger, 211 (82%) claimed to represent the interests of their members and affiliates without providing supporting evidence that was true. Most of those organizations received direct financial support or in-kind contributions from one or more of the involved cable operators or counted them as dues-paying members;
  • Not counting Time Warner Cable or Bright House’s combined 13+ million customers, only about 30 unique consumers submitted a comment to the FCC regarding the merger, representing 0.000005% of Charter’s six million customers.

Comcast, Frontier: It’s Too ‘Hilly and Woodsy’ to Bring Broadband to Rural Connecticut

no signalAn aversion of open, hilly landscapes and trees is apparently responsible for keeping residents of rural Connecticut from getting broadband service from the state’s two dominant providers — Comcast and Frontier Communications.

In the Litchfield Hills of northwestern Connecticut, you can visit some of the state’s finest antique shops and Revolutionary War-era inns, tour vineyards and even establish roots in the Upper Naugatuck Valley in towns like Barkhamsted, Colebrook, Goshen, Hartland, Harwinton, Litchfield, Morris, New Hartford, Norfolk, Torrington, and Winchester. Just leave your cellphone, tablet, and personal computer behind because chances are good you will find yourself in a wireless dead spot and Internet-free zone.

Obtaining even a smidgen of cell phone service often means leaning out a second story window or worse, climbing the nearest church steeple. The wealthiest residents, often second-homeowners from New York or California, can afford to spend several thousand dollars to entice the cable company to extend a coaxial cable their way or buy commercial broadband service at eye-popping prices from Frontier Communications, which acquired AT&T’s wireline network in the state. But for many, dial-up Internet remains the only affordable or available option.

Despite the area’s significant number of high income residents ready and willing to pay for service, Comcast and Frontier blame hilly terrain and dense woods for staying away. Those excuses get little regard from residents who suggest it is all about the money, not the landscape.

Northwest Connecticut region is shown in green and the Litchfield Hills region in blue.

Broadband-challenged areas in northwest Connecticut are shown in green and the often “No signal” and “No Internet” Litchfield Hills region is shown in blue.

Despite the need for service, deregulation largely allows cable and phone companies to decide where to offer broadband service, and arguments about fulfilling a public need and performing a community service don’t get far with Wall Street and shareholders that constantly pressure companies to deliver profits, not expensive investments that may never pay off.

State Rep. Roberta Willis (D-Salisbury) told the Register Citizen News the status quo is not acceptable — telecommunications companies are not doing enough to build out their networks.

“You just can’t say it’s the topography and walk away,” she told the newspaper. “If electricity companies were deregulated like this there would be no electricity in my district.”

Comcast spokeswoman Laura Brubaker Crisco claims the company extended cable service nearly 62 miles in northwest Connecticut since 2005 (ten years ago) and completed nearly 100 projects extending fiber more than 10 miles in the past two years. But many of those projects overhauled Comcast’s existing middle-mile network and extended cable service to profitable new markets serving commercial customers, especially office parks and commercial storefronts. Comcast’s other priority was to reach new high-income residential developments being built as the area continues to grow. Rural customers who could not meet Comcast’s Return On Investment formula in 2005 are still unlikely to have service in 2015 unless population density increases in their immediate area.

Connecticut's effort to extend gigabit fiber statewide is dismissed as a waste of money by incumbent cable operators.

Connecticut’s effort to extend gigabit fiber statewide is dismissed as a waste of money by incumbent cable operators.

Crisco admits Comcast does not wire low density areas and isn’t surprised other providers won’t either.

Frontier prefers to blame the area’s topography for keeping broadband out.

David Snyder, vice president for engineering for the east region of Frontier Communications, told the newspaper “it’s just natural the investment and the time become more challenging.”

Frontier does say it has expanded broadband to 40,000 additional households in Connecticut since taking over for AT&T a year ago. But nobody seems to know exactly who can get broadband in the state and who cannot. The have-nots are the most likely to complain, and those businesses that serve visitors are in peril of losing business without offering reasonable Wi-Fi or Internet access. Rural families with school-age children are also at risk from having their kids fall behind those that can get broadband.

Wireless Internet Service Providers, which offer long-range wireless broadband in rural areas, complain the federal government is wasting money on studies instead of helping to underwrite solutions that can quickly bring Internet access to the rural masses.

Others believe talking to Frontier and Comcast is futile. They prefer to follow the lead of western Massachusetts, where 24 small communities across the region have joined forces to build a public fiber to the home broadband network. One estimate suggests 22 Connecticut towns covering 200,000 residents could be reached with a bond-financed fiber network completed by 2018. That network would likely reach more unserved customers than Frontier or Comcast will elect to serve over the next three years combined.

A separate effort to establish gigabit fiber broadband across the state — the CT Gig Project — promptly ran into a buzzsaw of opposition, primarily from incumbent telecommunications companies that refuse to offer that service now. With a threat to current profitable business models, it was not unexpected to hear opposition from Paul Cianelli, CEO of the New England Cable & Telecom Association — a cable company lobbying group.

He called public broadband unnecessary and “potentially disastrous.” He wants assurances no government subsidies or loan guarantees are given to the project. He also said providing gigabit service was unnecessary and faster Internet speeds were not important to the majority of customers in the state. Public broadband proponents respond Cianelli should tell that to the residents of Litchfield Hills and other unserved and underserved communities.

Stop the Cap!’s Formal Testimony to N.Y. PSC Opposing Charter/Time Warner Cable Merger

charter twc bhSTATE OF NEW YORK



Joint Petition of Charter Communications and Time

Warner Cable for Approval of a Transfer of Control

of Subsidiaries and Franchises, Pro Forma                                Case 15-M-0388

Reorganization, and Certain Financing Arrangements.                               


Statement of Opposition to Joint Petition and

Response to Redacted Comments of DPS Staff

Phillip M. Dampier, Director and Founder: Stop the Cap!

Rochester, New York

September 25, 2015

Stop the Cap! is a Rochester-based consumer group founded in 2008 to fight against the introduction of artificial limits on broadband usage (usage caps, consumption billing, speed throttling) and to promote better broadband speeds and service for consumers. Our group does not solicit or accept funding from lobbyists, companies, or others affiliated with the telecommunications industry. We are entirely supported by individual donors who share our views.


Our opposition to the Joint Petition is based on our belief it does not meet the “public interest”  test established in Section 222 of the New York Public Service law, and must therefore be denied.

For the sake of brevity, we wish to associate ourselves with most of the views of the DPS Staff contained in their redacted comments regarding this case, published on the DPS website on September 16, 2015. Most of our testimony will seek to expand on their findings or add additional information to the record for the Commission’s consideration.

As we stated in our remarks regarding the Comcast-Time Warner Cable merger, New York law obligates the applicant alone to demonstrate its proposal is in the public interest. If the Commission finds the application does not meet the public interest or provide sufficient public benefits, it should be rejected. The DPS staff has reported to you Charter Communications and Time Warner Cable have not met their burden. We agree.

The DPS staff then proposes a mitigation strategy in an effort to tip the balance in favor of the applicant. It remains our view it is not the Commission’s responsibility to help tip the balance in favor of an applicant that has failed to meet its burden.

Nevertheless, we offer the Commission our insight about Charter Communications, its proposals, and the DPS staff recommendations with the hope it will be useful to win commitments from Charter should the Commission choose to proceed with approval, enforcing modifications to deliver the public interest benefits consumers across New York tell us they actually want and need from their providers.


Phillip Dampier

Phillip Dampier

New York State, particularly across the upstate region, is not well positioned to take advantage of next generation broadband networks. Just two providers deliver telecommunications services to the majority of New York: Verizon Communications and Time Warner Cable. Although Frontier Communications and Cablevision also deliver service, their service areas are much smaller than the two dominant incumbents. The decisions Verizon and Time Warner Cable make about their investments in broadband and telephone service affect millions of New Yorkers.

Many New York residents have only one choice for Internet service that meets the Federal Communications Commission’s definition of broadband: 25Mbps download speed and at least 3Mbps upload speed.[1] In areas where Verizon FiOS is not available, Time Warner Cable is the only significant provider consistently providing service options at or above 25Mbps. The most common alternative is DSL, which rarely meets the FCC’s minimum definition of broadband.

With this in mind, the FCC reported 53 percent of rural Americans lack access to broadband service achieving speeds of 25Mbps or better. As much as 20 percent still lack access to broadband at speeds achieving the FCC’s old benchmark of 4Mbps. Upstate New York, in particular, is a long way away from achieving the goals of 100Mbps broadband set by Gov. Cuomo, unless you have access to a cable broadband provider.

In Rochester, the majority of residents have only one choice for a provider that meets the FCC’s definition of broadband: Time Warner Cable. While Frontier Communications has made investments to improve their wireline network, only a small minority of customers qualify for DSL service that can meet the FCC’s benchmarks.

While Verizon Communications has done an admirable job delivering its fiber to the home service FiOS to portions of New York, the company has suspended expansion of the service and has not even met its service obligations in cities like New York.[2]

Even more concerning is the fact none of the significant incumbent providers serving New Yorkers have expressed any interest in providing residential gigabit speed service. Google Fiber has not announced any expansion into New York State and other significant gigabit speed providers, including AT&T, do not provide wireline service in New York.

In contrast, in states including Texas, North Carolina, Georgia, Missouri, and Tennessee, many consumers have the option of choosing at least two gigabit service providers (Google or AT&T) as well as municipal or public broadband providers such as EPB, which serves the Chattanooga area. Time Warner Cable has focused much of its upgrade activity on these communities to remain competitive, delivering 300Mbps broadband service for the price it used to charge for 50Mbps speeds.

In western New York, the fastest broadband speed most residential customers can buy is just 50Mbps. Charter Communications proposes to increase that speed in some areas to a maximum of 100Mbps, along with their entry level 60Mbps plan. Although helpful, that offers little solace to residents and small businesses that would like the option to purchase considerably faster Internet speeds that are now becoming available in other parts of the country.

The Commission’s decision will have an enormous impact on what kinds of telecommunications services will be available to New Yorkers for years to come. Verizon has shown no interest in resuming fiber service upgrades, so most customers will continue to purchase Internet access from the incumbent cable operator to obtain the broadband speeds they require. Today that usually means Time Warner Cable. Sometime next year, that could be Charter Communications.

Time Warner Cable vs. Charter Communications

The most important question before the Commission is which cable operator is better positioned to deliver the services customers in this state want and/or need. We argue that operator is Time Warner Cable, not Charter Communications.

Since the termination of the Comcast-Time Warner Cable merger, Time Warner Cable has responsibly invested in their infrastructure without assuming an irresponsible amount of debt.

twc maxxTime Warner Cable CEO Robert Marcus reported significant progress in their first quarter 2015 report to shareholders and customers, despite the distraction of the Comcast merger[3]:

Over the past 16 months, we’ve made significant investments to improve our customers’ experience:

  • Investing more than $5.2 billion to, among other things, improve the reliability of our network and upgrade customer premise equipment – including set-top boxes and cable modems – with the latest technologies and expand its network to additional residences, commercial buildings and cell towers;
  • Launching TWC Maxx, which features greater reliability, all-digital video, advanced TV services, standard tier of Internet speeds at 50 Mbps, and higher tiers of service up to 300 Mbps. New York, Los Angeles and Austin are complete; Dallas, San Antonio and Kansas City are underway; Charlotte, Raleigh and Hawaii are slated for later this year; and San Diego is expected to be done in early 2016;
  • Introducing Enhanced DVR, a six-tuner set-top box that allows customers to record up to six shows simultaneously and store up to 150 hours of HD content;
  • Increasing the number of Cable Wi-Fi hotspots available to our customers to 400,000;
  • Rolling out our cloud-based video guide to 8 million set-top boxes to date. The guide also makes it easier to browse our On Demand library, which now sits at 30,000 free and paid titles and continues to grow;
  • Expanding our industry-leading TWC TV app – which allows customers to watch live TV and On Demand content and control and program their DVR from inside and outside the home. TWC TV is now available on Xbox One, Xbox 360, Amazon Kindle Fire HD and HDX tablets, Android and IOS phones and tablets, Fan TV, PCs, Samsung TV and Roku;

Serving customers on their schedules rather than ours. We expanded one-hour appointment windows across the company and in Q1 met that window 97 percent of the time. We continue to add nighttime and weekend appointments.



Since that report, Time Warner Cable has announced new Maxx service upgrade areas – Greensboro and Wilmington, N.C. At least 45 percent of Time Warner Cable’s national footprint will be serviced with Maxx upgrades by the end of this year, and Marcus has indicated additional cities will receive upgrades in 2016.[4]

Marcus has indicated repeatedly he intends to see Maxx service upgrades extend even further. On the January 29, 2015 quarterly results conference call with investors, Marcus indicated Maxx upgrades delivered tangible benefits to the company, including increased customer satisfaction, higher network reliability, and a stronger product line. Based on those factors, it would be logical to assume Time Warner Cable would continue its upgrade project, and indeed Marcus confirmed this in his remarks:

“Our aim is to have 75% of our footprint enabled with Maxx […] by the end of [2016], and my guess is we’re continuing to roll it out beyond that,” said Marcus[5]. “So the only question is prioritization, and obviously as we think about where to go first, competitive dynamics are a factor. So that includes Google, although it’s not explosively dictated by where Google decides to go. In fact I think we announced the Carolinas before Google did their announcement this week. So competitors are certainly relevant obviously.

At the rate Time Warner Cable has been rolling out Maxx upgrades, which were first announced on January 30, 2014[6], with 45% of its service area upgraded within 23 months, it is likely the company would complete its Maxx upgrade to all of its service areas within the next 24-30 months. The DPS staff also notes, “there is no indication that Petitioner’s plan for converting to all-digital in New York is any different from Time Warner’s existing plan.”

Charter’s upgrade proposal is, in fact, generally inferior to what Time Warner Cable is accomplishing on its own. We strongly recommend the Commission carefully consider whether Charter’s proposal is as truly compelling as they claim.

Charter Communications’ upgrade proposal is not a good deal for New York.

We agree with the DPS staff’s conclusion Time Warner Cable, on its own, would likely complete its Maxx upgrade program across upstate New York at or around the same time Charter’s proposed upgrades would be complete. Therefore, when comparing Charter’s proposal with Time Warner Cable’s existing service, we urge you to use Time Warner Cable Maxx service as the benchmark, not the existing level of service provided in upstate New York today.

chartersucksTime Warner Cable Maxx offers 50/5 Mbps speeds under its most popular Standard plan. In contrast, Charter proposes to offer 60/5Mbps service under its most-popular Spectrum plan. While Charter’s offer is superior at first glance, it comes at a cost to customers looking for more budget-priced service or those seeking faster speeds.

Charter has no plans to continue Time Warner Cable’s $14.99 Everyday Low Price Internet service – a very important offer for low income residents and senior citizens who are unable to afford the nearly $60 regular price both companies charge for their 50 or 60Mbps tiers. Time Warner Cable offers this tier without preconditions, restricted qualifiers, contracts, or limits on what types of services can be bundled with it. Any consumer qualifies for the service and can bundle it with Time Warner Cable telephone service for an additional $10 a month, which offers a nationwide local calling area, as well as free calls to the European Union, Mexico, Puerto Rico, and several Asian nations.

The loss of a $25 plan that includes basic Internet access and a bundled, 911-capable telephone line would be devastating to low-income New Yorkers and senior citizens. During the Comcast-Time Warner Cable hearings, no topic elicited as much interest as Internet affordability. Time Warner Cable clearly offers a superior product line for these customers, including two other Internet service tiers offering stepped up Internet speeds in $10 increments. These options would be unavailable from Charter.

Charter’s proposed solution to serve low-income New Yorkers is adoption of Bright House Networks’ Connect2Compete program, which offers restricted access to $9.95/month Internet service for those who qualify.

Stop the Cap! investigated Bright House Networks’ existing offer in a report to our readers[7] in June 2015, and we urge the Commission to look much more closely at the specific conditions Bright House customers have had to endure to qualify to subscribe:

1) You must have at least one child qualified for the National School Lunch Program. They need not be enrolled now.

2) You cannot have been a Bright House broadband customer during the last three months. If you are a current customer, you must first cancel and go without Internet service for 90 days (or call the phone company and hope to get a month-to-month DSL plan in the interim.)

3) If you have an overdue bill older than 12 months, you are not eligible until you pay that bill in full.

4) Bright House does not enroll customers in discounted Internet programs year-round. From a Bright House representative:

“We do participate in this particular program, however, it is only around September that we participate in it. This is a seasonal offer that we have which can only be requested from the middle of August to the middle of September, which is when most start up with school again for the year.”

5) Bright House does not take orders for the Low-Income Internet plan over the Internet. You have to enroll by phone: (205) 591-6880.

connect2competeFamilies fall into poverty every day of the year, and poverty-stricken families move from one school district to another every day of the year. So it’s horribly unfair to tell them they’d qualify for this program if only they had fallen into poverty sometime between the middle of August and the middle of September.

It has been our experience covering service providers across all 50 states that most design these low-cost Internet access programs with revenue protection first in mind. Charter Communications is no different. As with Comcast, Connect2Compete is only available to families with school age children. Applicants face an intrusive, complicated, and time-restricted enrollment process designed to dampen and discourage enrollment.

The interest in meeting the needs of low-income customers would be laudable if not for the insistence otherwise-qualified existing customers cannot downgrade their regular price broadband plan to Connect2Compete unless they voluntarily go without Internet service for three months.

We strongly recommend Charter Communications be compelled to continue Time Warner’s $14.99 Internet plan, but at speeds no less than 25Mbps, the minimum definition of entry-level “broadband” by the FCC. We also recommend Charter be required to further discount this plan to $9.95 a month for qualified customers who meet a simple income test the Commission can define and establish. These discount programs should not just be available to families with school-age children. Everyone needs affordable Internet access, whether you are single and looking for your first job or a fixed income senior citizen.

All restrictions for existing customers or those with an outstanding balance must be prohibited and sign-ups must be accepted 365 days a year with re-qualification occurring not more than once annually.

Charter’s broadband offers for lower-income New Yorkers are not adequate, and neither are their plans for customers who need enhanced service.

Time Warner Cable Maxx delivers a more compelling offer for consumers and small businesses that need much faster Internet access. Charter’s upgrade will offer customers two choices: 60 or 100Mbps service. Time Warner Cable Maxx offers considerably more[8]:


Charter Communications has only committed to provide customers with unlimited Internet access for three years. Time Warner Cable CEO Robert Marcus has repeatedly made it clear compulsory usage caps are off the table at Time Warner Cable – a lesson they learned after customers pushed back and forced them to shelve a usage cap experiment planned for Rochester and other cities in April 2009[9]. The company has never raised the possibility of compulsory usage limits or usage-based billing again.

“We have no intention of abandoning an unlimited product we think that something that customers value and are willing to pay for,” said Time Warner Cable CEO Robert Marcus. “The way we’ve approached usage-based pricing is to offer it as an option for customers who prefer to pay less because they tend to use less. And we’ve made those available at 5 gigabytes per month and 30 gigabytes per month levels.[10]

Time Warner Cable again offers a better choice for New Yorkers. With many New Yorkers having no practical alternatives, imposing usage limits or forcing customers into even higher-priced usage billing plans would only make New York even less attractive for those who need high quality Internet access for education, telecommuting, or to assist in running a small business. Google Fiber, in contrast, offers 1,000Mbps service with no usage caps at all. Many other providers also have no plans to introduce usage caps.

Charter Communications has a history of capping their customers’ usage. Less than three months before announcing it would acquire Time Warner Cable, Charter Communications quietly dropped usage caps in place on its broadband plans since 2009, without explanation and the FCC now wants to know why, as they also contemplate the impact of the merger[11] [12]. In addition to the anti-consumer practice of placing customers on an unnecessary usage allowance, such usage limits may also be established for anti-competitive reasons to limit exposure to online video streaming, which competes directly with cable television. Customers who watch a lot of online video are those most likely to face service suspension or find overlimit usage fees applied to their bill.

junk3Almost all of Charter’s so-called customer-friendly commitments and policies have a very unfriendly expiration date of three years, which should be unacceptable to the Commission. There is no reason Charter cannot extend its commitments to not charge modem fees, adhere to the basic principles of Net Neutrality, and not impose usage caps or other forms of usage billing permanently. Without such a commitment, consumers could soon pay much higher prices for broadband service, and without robust competition unlikely to develop in most of New York over the next three years, there will be every incentive for Charter to further boost earnings by imposing modem fees and usage pricing on its customers.

One of those incentives is the level of debt Charter Communications will assume in this transaction. DPS staff is correct when they noted New Charter’s debt and lowered credit rating “represents the single most substantial risk of the proposed transaction.”[13]

Debt servicing costs and more expensive credit are both deterrents to investment and are likely to limit the scope of Charter’s ongoing system upgrades and maintenance. Charter is a much smaller cable operator than Time Warner Cable, and is itself still in the process of repairing and upgrading its own cable systems and those it acquired in earlier acquisition deals. Time Warner Cable, in contrast, is in a much stronger financial position to carry out its commitments associated with the Maxx upgrade program.

consumer reportsSpecifics about Charter’s commitments to expand service into unserved areas of New York were either vague and non-specific or redacted. The past history of winning expansion commitments from cable operators who rely on Return On Investment (ROI) formulas to determine which homes and businesses they will serve have met with limited success.

The pervasive problem of rural broadband availability is unlikely to be resolved substantially by this transaction without the strongest buildout requirements. But even that is unlikely to be of much help for large sections of New York outside of existing video franchise areas. Compelling Charter Communications to adopt universal service obligations within all existing Time Warner Cable franchise areas may be a good start. Under such a requirement, any consumer or business that wants cable service and lives within the geographic boundaries of an existing franchise area would receive it upon request without construction fees, surcharges, or other passed-along fees to reach that customer, regardless of their distance from the existing cable plant or ROI formula. The largest impact of this would be to extend cable service into business parks and commercial buildings, which often lack cable service, but many suburban and exurban residential customers would also benefit.

But the Commission must look carefully at Charter’s financial capacity to meet these obligations after assuming control of a company much larger than itself. No commitment is worth much if a company ultimately fails to deliver on it.

An overburdened cable operator is also unlikely to make substantial investments in improving customer service, and that makes the risk of depending on Charter Communications to improve Time Warner Cable’s already poor customer service rating doubtful. Competition is the biggest incentive to improve customer service and responsiveness, and that is unlikely to prove much of a factor for large sections of New York over the next few years. In fact, we argue customer service is likely to deteriorate for New Yorkers in the short term because of the disruptiveness of any ownership change and eventual billing system integration. Again, Charter’s proposal offers no compelling public interest benefit to New Yorkers. The fact DPS staff is proposing a performance incentive mechanism to compel service improvements illustrates absent punitive measures, Charter Communications is unlikely to offer any improvement over Time Warner Cable, and may in fact perform worse.

Consumer Reports rates both companies’ Internet Service poorly[14]:

  • Charter: 63 (Reader Score), Poor Value, Fair Reliability, Good Speed, Mediocre Phone/Online Support, Fair In-Home Support
  • Time Warner Cable: 57 (Reader Score), Poor Value, Fair Reliability, Fair Speed, Mediocre Phone/Online Support, Fair In-Home Support

Virtually nothing Charter Communications has offered as a public interest benefit meets that criteria. Its commitment to improve cable television does not offer any significant benefit to New York cable TV subscribers. Both Time Warner Cable and Charter propose to move to all-digital cable television to free up bandwidth to offer improved broadband.



While consumers clamor for smaller, less-costly cable television packages, Charter Communications’ CEO Thomas Rutledge is credited for inventing the “triple play” concept of convincing customers to package more services – broadband, television and telephone — together in return for a discount. Reuters cited his penchant for “simplified pricing,”[15] which is why Charter offers most customers only two options for broadband service and one giant television package dubbed Spectrum TV containing more than 200 channels.[16]

Unfortunately, any benefits from an all-digital television package are likely to be dismissed when customers get the bill. Currently, many Time Warner Cable customers watch analog television channels on television sets around the home without the need to rent a costly set top box. Any transition to digital television will require the rental of a set top box or purchase of a third-party device to view cable television programming. These can represent costly add-ons for an already high cable bill.

With approximately 99 percent of customers renting their set-top box directly from their pay-tv provider, the set-top box rental market may be worth more than $19.5 billion per year, with the average American household spending more than $231 per year on set-top box rental fees. These are some of the findings from Senators Edward J. Markey (D-Mass.) and Richard Blumenthal’s (D-Conn.) query of the top-ten pay-tv multichannel video programming distributors (MVPDs).[17]

Passed by Congress in December, the STELA Reauthorization Act of 2014 repealed the set-top box integration ban, which enabled consumers to access technology that allowed use of a set-top box other than one leased from their cable company. Without the integration ban, by the end of this year, cable companies will no longer be required to make their services compatible with outside set-top boxes, like TiVo for example, bought directly by consumers in the retail marketplace.

American cable subscribers spend, on average, $89.16 a year renting a single set-top box. The average set-top box rental fee for each company was used to calculate an overall set-top box rental cost average across companies: $7.43 a month, or $89.16 per year. Considering many homes rent a DVR box to make and view recordings and maintain less-capable boxes on other televisions, the total cost adds up quickly. The average household spends $231.82 a year on set-top box rental fees, according to Sens. Markey and Blumenthal.

Charter proposes to introduce a new generation of set top boxes but as far as we know, has not disclosed the monthly cost of these IP-capable boxes to subscribers. We anticipate they will cost more than the current equipment provided by Time Warner Cable, which has also been increasing the cost of its set top box rentals.

Time Warner Cable’s entry level Digital Transport Adapters, which convert digital/HD signals for older analog-only television sets, almost tripled in price over just one year. Originally introduced for $0.99 a month, the rental fee increased this year to $2.75 a month for customers in Rochester.[18]

Other points the Commission should consider in reviewing this transaction:

  1. DPA staffers claim the transaction is unlikely to alter the competitive landscape because Charter Communications and Time Warner Cable do not have overlapping service areas. While it is true Charter and Time Warner don’t compete for the same customers, it is inaccurate to suggest the transaction will not alter competition. Cable industry consolidation is underway, in part, to help larger combined operators secure better volume discounts for increasingly expensive video programming.

    AT&T’s primary motivation to acquire satellite provider DirecTV was to secure better prices for video programming, both for DirecTV customers but more importantly for its own, much smaller, U-verse TV operation.[19]

    The cost barrier for new, directly competing entrants into the cable television business is well-recognized, even by smaller independent cable television providers that are having difficulty staying profitable and maintaining investments in broadband as they lack the ability to secure similar volume discounts for themselves. The American Cable Association, representing small operators, warned the FCC “existing providers of both broadband and MVPD services and new entrants will be deterred from expanding their broadband networks or otherwise undertaking new builds” as a result of increasing programming costs.[20]

    As a result, it is unlikely a new provider will be able to develop a sustainable business model that includes cable television while paying wholesale programming costs that are dramatically higher than what combined companies like New Charter will pay.

  2. The Commission must insist that upstate New York is treated equally to the New York City market. If the deal is approved, Charter must be compelled to commit to continue Time Warner Cable’s Maxx upgrade initiative across all of its service areas in New York State, to be completed within 30 months. Nothing less than that should be acceptable to the Commission. We agree with the DPS staff’s recommendation that Charter also be compelled to upgrade facilities to support gigabit broadband, but this should be extended to include all of its service areas in New York, not just the largest cities.

    This does not pose a significant challenge to any cable operator. With the upcoming introduction of DOCSIS 3.1 technology, cable operators even smaller than Charter will support 1Gbps broadband speeds as they drop analog television signals. Suddenlink[21], MidContinent[22], Cox[23], and Mediacom[24] already have gigabit deployment plans in the works. If Fargo, N.D. is getting gigabit broadband from MidContinent Communications in the near future, Charter should have no problem offering similar service to customers in Jamestown, Penn Yan, Watertown, Binghamton, and beyond.

  3. The Commission must establish and enforce meaningful enforcement mechanisms should Charter fail to achieve its commitments as part of this transaction. Cable consolidation has never significantly benefited consumers. Charter is not guaranteeing Time Warner Cable customers will receive a lower bill as a result of this merger. Nor is it committing to pass along the lower prices it will achieve through negotiations for video programming volume discounts. Cable rates, especially for broadband, will continue to increase. Without meaningful competition, there is no incentive to give consumers a better deal or better service.

    That is why if the Commission feels it must approve this transaction, the conditions that accompany it to achieve a true public interest benefit must be meaningful and ongoing. Any failure to deliver on those commitments must include a direct benefit to customers, not just to the state government. If fines are imposed, customers should receive a cash rebate or equivalent service credit for services not provided as part of any agreement.

Cable operators know once they secure a franchise or become the incumbent provider, no other cable company will negotiate with city officials to take over that franchise if the current provider’s application is denied during renewal. Once Charter (or any other cable company) establishes a presence, there is little or no chance a community will be able to get rid of that provider if it fails to perform. That is why any franchise transfer that comes from an acquisition or merger must be treated with the upmost seriousness. Customers will likely live with the decision the Commission makes for the next 10-20 years or more.

dpsAs Time Warner Cable customers loudly reminded the Commission in the Comcast merger proceeding, there is such a thing as a cable operator even worse than Time Warner Cable, already one of the lowest rated companies in the country. Comcast’s reputation preceded its intended entry into New York on a massive scale and the application was eventually withdrawn.

As the Commission must realize, this transaction does not just involve entertainment. Last week the Obama Administration declared broadband Internet access a “core utility.”[25]

“Broadband has steadily shifted from an optional amenity to a core utility for households, businesses and community institutions,” according to a report from the administration’s Broadband Opportunity Council. “Today, broadband is taking its place alongside water, sewer and electricity as essential infrastructure for communities.”

Unfortunately, the federal government has seen to it that this core utility is provided without the ability of local and state governments to properly deliver needed oversight. While the Public Service Commission lacks the authority to enforce consumer protections and quality of service standards for Internet access, it retains the very powerful ability to determine whether a company seeking to make a fortune selling consumers broadband service in a monopoly/duopoly market for many New Yorkers is a good or bad thing for consumers.

Our group strongly believes New York should not take a risk on Charter’s less-then-compelling offer when Time Warner Cable has demonstrated it is in a better financial position and has a proven track record of delivering on its commitments to improve service with its Maxx upgrade project. Time Warner Cable has superior options for low-income New Yorkers, has a large number of New York-based call centers providing valuable employment for our residents, offers more broadband options and faster speeds for entrepreneurs remaking themselves in the digital/information economy, and has committed to providing unlimited Internet access – a critical prerequisite for consumers choosing to drop cable television’s one-size-fits-all bloated video package and watch only the shows they want to see and pay for online.

We urge the Public Service Commission to deny Charter’s application. If it sees fit to make a different choice, we strongly recommend you demand the best possible deal for New York consumers and businesses that, as the DPS staff wrote, deserve best-in-class communications services.

  • [1] http://stopthecap.com/2015/02/03/fcc-now-defines-minimum-broadband-speed-25mbps-everything-less-now-slowband/
  • [2] http://www1.nyc.gov/office-of-the-mayor/news/415-15/de-blasio-administration-releases-audit-report-verizon-s-citywide-fios-implementation
  • [3] http://www.twcableuntangled.com/2015/04/twc-gains-momentum-with-best-ever-subscriber-growth-customer-enhancements/
  • [4] http://www.twcableuntangled.com/2015/07/twc-maxx-expands-rollout-in-2015/
  • [5] http://seekingalpha.com/article/2864536-time-warner-cables-twc-ceo-rob-marcus-on-q4-2014-results-earnings-call-transcript?
  • [6] http://www.twcableuntangled.com/2014/01/get-the-details-on-twcs-plan-to-transform-ctv-internet-experience/
  • [7] http://stopthecap.com/2015/06/25/bright-houses-mysterious-internet-discount-program-charter-wants-to-adopt-nationwide/
  • [8] http://www.timewarnercable.com/en/enjoy/better-twc/internet.html
  • [9] http://abcnews.go.com/Technology/story?id=7368388
  • [10] http://stopthecap.com/2014/10/30/time-warner-cable-recommits-mandatory-usage-caps-long-company-remains-independent/
  • [11] http://stopthecap.com/2015/09/23/fcc-demands-details-about-charters-suddenly-retired-usage-caps/
  • [12] http://www.multichannel.com/news/fcc/fcc-seeks-data-dump-charter-twc-bright-house/394010
  • [13] http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId={C60985CC-BEE8-43A7-84E8-5A4B4D8E0F54} (p.39)
  • [14] http://www.consumerreports.org/cro/electronics-computers/computers-internet/telecom-services/internet-service-ratings/ratings-overview.htm
  • [15] http://www.reuters.com/article/2014/01/30/us-charter-timewarnercable-rutledge-anal-idUSBREA0T01D20140130
  • [16] https://www.charter.com/browse/content/tv#/channel-lineup
  • [17] http://www.markey.senate.gov/news/press-releases/markey-blumenthal-decry-lack-of-choice-competition-in-pay-tv-video-box-marketplace
  • [18] http://stopthecap.com/2014/12/22/time-warner-cable-deck-halls-8-modem-fees-fa-la-la-la-la-la-la-la-la-2-75-dta-fee/
  • [19] http://www.usatoday.com/story/money/2015/07/24/fcc-approves-ts-acquisition-directv/30626421/
  • [20] http://www.americancable.org/node/5229
  • [21] http://www.multichannel.com/news/technology/suddenlink-boots-1-gig-broadband/392087
  • [22] https://www.midco.com/PressRoom/2014/midcontinent-bringing-gigabit-internet-access-to-the-northern-plains/
  • [23] http://www.multichannel.com/news/distribution/cox-plots-docsis-31-plans/393996
  • [24] http://www.multichannel.com/news/cable-operators/mediacom-sets-residential-1-gig-rollout/393585
  • [25] http://thehill.com/policy/technology/254431-obama-administration-declares-broadband-core-utility-in-report

Clear WiMAX Ends Nov. 6: You Don’t Have to Go Home But You Can’t Stay Here

If you are among the dwindling number of customers still using Sprint’s Clearwire 4G WiMAX service, the wireless provider would like you to leave.

After about a year of successive warnings it was preparing to decommission its aging WiMAX network in favor of LTE service, nobody can accuse Sprint of not giving its customers fair warning. The top banner on the Clear.com website is now festooned with red text giving customers one last chance to move on.

clear bye bye

In brief, the last Sprint WiMAX cell tower will cease functioning Nov. 6 2015 at 12:01am EST. Sprint is repurposing many of its former WiMAX cell sites to support expanded 4G LTE service in the carrier’s perennial network makeover.

wimaxDespite this, there still remains a loyal user base for WiMAX service — many in semi-rural areas using the service until the last days for wireless home broadband. The alternative is usually very expensive mobile data service from Verizon, AT&T, Sprint or T-Mobile, or one of several resellers. But usage caps can be stingy and overlimit fees high.

We also found several businesses, including a small auto servicing chain in western New York, still occasionally relying on Clear WiMAX-powered guest Wi-Fi, apparently unaware the service is soon to disappear. Time Warner Cable is often the chosen replacement for Clear’s business customers in the northeast as the cable company aggressively markets business broadband service coupled with free customer/public Wi-Fi access for around $90 a month.

Although WiMAX is nearing extinction in the United States, it remains in service in places like Ukraine and Azerbaijan. In Calgary, Platinum Communications continues to offer WiMAX wireless broadband in rural parts of Alberta between Edmonton and Calgary and large sections of the flat, open prairie of southeastern Alberta, including the communities of Lethbridge, Brooks, and Medicine Hat.

Blue Ridge Communications Rations Internet Usage With Hard Usage Caps

blue-ridgeA tiny cable company serving communities around the Blue Mountain in eastern Pennsylvania has a big appetite for rationing Internet usage by imposing data caps and overlimit fees on their 170,000 customers.

Effective Sept. 1, Blue Ridge dropped off-peak unlimited use service and imposed a 24-hour rationing plan on its customers, including a familiar overlimit fee of $10 per 50GB of excess usage — the same fee created by AT&T and adopted by several other cable and phone companies.

Customers on the lowest priced plans are most at risk of encountering overlimit fees, which most providers claim are designed to make heavy users pay more for access. In the past, the company maintained rarely enforced “soft caps” and off-peak unlimited usage starting at 5pm. The “hard caps” arrived Sept. 1 with claims the company generously doubled the allowance for some customers, without mentioning it also eliminated off-peak unlimited usage. In terms of “fairness,” the heaviest users signed up to the fastest speed tiers get the most generous allowances while those at lower-price tiers are most likely to encounter an overlimit penalty fee:

  • Web Surfer $42.95 (1.5Mbps Download/384kbps Upload) – 150GB per month (no change)
  • G5 $52.95 (5Mbps/384kbps) – 300GB per month (was 250GB)
  • G10 $57.95 (10Mbps/800kbps) – 400GB per month (was 250GB)
  • G15 $67.95  (15/2Mbps) – 500GB per month (was 250GB)
  • Dream 60 $84.95 (60/3Mbps) – 600GB per month (was 250GB)
  • Dream 100 $124.95 (100/5Mbps) – 700GB per month (was 250GB)
Blue Ridge Communications is headquartered in Palmerton, Pa.

Blue Ridge Communications is headquartered in Palmerton, Pa.

To avoid a higher bill, customers will have to check a company-sponsored, unverified usage meter on Blue Ridge’s website and be ready to upgrade to a more costly Internet plan. Blue Ridge customers already pay substantially more for Internet service than other customers pay in the region. A Comcast subscriber in eastern Pennsylvania now pays $29.99 a month for the first 12 months of 25Mbps service, after which the price increases to as much as $66.95 a month. A less expensive 6Mbps tier costs $49.95 from Comcast, and a much faster 150Mbps tier is also available for $78.95, $46 less than what Blue Ridge charges for service that is 50Mbps slower.

“It’s no dream at 60 or 100Mbps, it’s a straight up gouging nightmare wrapped in greed and lies,” says Stop the Cap! reader Thomas, who lives in Palmerton and calls Blue Ridge’s parent company a local media and entertainment dictatorship. “My friends and relatives are stunned when I tell them one local company controls cable, telephone, wireless, the newspaper and the local news channel. It’s all Pencor through and through.”

Pencor Services, Inc., (Pennsylvania ENtertainment, COmmunications and Recreation) holds a unique position in eastern Pennsylvania. The rural character of the region has allowed Pencor to own and operate a large number of media and telecommunications companies. Pencor owns both Blue Ridge Communications — the cable operator and two local phone companies — Palmerton Telephone and the Blue Ridge Telephone Company. DSL service is offered, but it is “powered by” PenTeleData, another Pencor-owned operation. Wireless service is provided by Pencor-owned Pencor Wireless. In certain other markets, phone companies like Frontier Communications offer some competition, mostly low-speed DSL.

Pencor and its businesses have a substantial presence throughout the Blue Mountains region.

Pencor and its businesses have a substantial presence throughout the Blue Mountain region.

Residents get much of their local news from BRC TV-13, the local news channel on the Blue Ridge system serving Carbon, Monroe, Wayne & Pike counties and parts of Lehigh, Schuylkill, Northampton and Berks counties. BRC TV-11 provides local news on the Blue Ridge system serving Northern Lancaster County. Both stations are also owned by Pencor. So is the Lehigh Valley Press and the Times News newspaper operations.

A Facebook group has been organized to fight Blue Ridge on its new data caps.

A Facebook group has been organized to fight Blue Ridge over its new data caps.

Coverage of the usage cap imposition and customer reaction to it, best characterized as hostile, came from media not owned by Pencor.

Milfordnow! reported “when analyzing similar cap programs that have been implemented by other cable companies, it is apparent that bills may be rising substantially for heavy users.”

The cable company countered it expected only 3% of customers to affected by the new caps, which has some customers wondering why they need them at all.

“You have to wonder if caps affect almost nobody, why do companies spend so much time and energy imposing them,” said Thomas.

“Everything from downloads to YouTube, Netflix and even online gaming count against their new 24-hour cap,” Milford resident John Ferry III told the Pocono Record, reporting his latest bill was about $46 over previous charges. “They are telling people they have doubled the cap, but this is not true. By removing the off-peak time, which was essentially a free period, there is no math that makes it double.”

Blue Ridge customers have begun to organize a pushback against the data caps through a new Stop Blue Ridge Cable Data Caps Facebook page.

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