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2016 Edition: Fighting for a Better Deal from Time Warner Cable; Save $600+ Annually

badbillFor the fourth year, Stop the Cap! is pleased to bring you our advice on how to win yourself a better deal from Time Warner Cable. If you are paying regular price for Time Warner Cable service, you are throwing money away. There is no award for being a loyal cable customer these days. Only new customers and those willing to demand a better price get the best deals, while everyone else pays astoundingly high rates.

We are rarely surprised by anything, but even we confess astonishment as customers continue to show us their $180-250 cable bills. Most have been customers for decades and have never bothered to ask Time Warner if they could be getting a better deal. They should have asked us because the answer is absolutely yes. If you can devote about one hour a year and are willing to do some homework, even those coming off a promotion can save hundreds of dollars a year and get better service.

For those accustomed to badgering the cable company for a better deal year after year, we have some troubling news. Time Warner Cable is making things harder for you. In years past, customers only needed to use social media like Twitter or Facebook and ask for a better price and the cable company usually called back with a great promotional offer for the next year. Those days ended last fall, when the company began channeling current customer promotions almost exclusively through its national customer retention call centers. Even the oldest method of all — showing up at a local cable store with boxes in tow ready to turn in as you threaten to cancel service over its cost today often results in a shrug of the shoulders and an admission cable store employees are increasingly unable to offer customers promotions to entice them to stay. We saw this ourselves this week. As a result, Time Warner Cable lost that customer on the spot.

So why do cable companies play this game with their customers year after year? In a word, it’s all about the money. At least 80% of Time Warner Cable customers are still paying the company $10 a month to rent a cable modem customers can buy for themselves for as little as $50. Why do they keep paying? Because it’s a hassle or the customer believes they are incapable of installing their own. Even those who fought and won up to $1,100 in savings last year procrastinate after that promotion expires and put off trying to renew it. Why? Because few people relish debating for discounts. It’s a chore. But you say the same thing about doing your taxes, so it’s time to get some discipline and get this done. We’re even going to walk you through the process and share the tricks and traps you are likely to encounter along the way and how to get past them. How do we know? We have Time Warner Cable service too.

Heads Up: Time Warner Cable & Charter Communications — You may have read that Charter Communications is in the process of acquiring Time Warner Cable. Most state regulators with the exception of California (where approval isn’t a done deal at the time of writing) have approved the sale and federal regulators seem likely to follow, with a number of conditions Charter will have to meet going forward. For the rest of 2016, even if the deal is approved, we don’t expect many immediate changes. You are likely to see the Time Warner Cable name, packages, and pricing remain the same for most of this year. Next year, we expect Charter will want to retire Time Warner’s name and packages and move customers to their Spectrum product suite, at new customer pricing for all for the first year. We will update readers as needed to explain the transition, but it should not affect any promotions you win for at least the next year.

Getting Ready to Deal

courtesy: abcnews

Time to cut the cable TV bill down to size.

Based on reader input and our own experiences, you are going to find Time Warner Cable less willing to volunteer their lowest price promotions as they have in the past. Customer retention call center workers are trained to try to keep your business without giving away too much to customers threatening to leave. That is why doing your homework is essential before you call.

The most common reasons people call threatening to cancel service are:

  • a poor service experience
  • a rate increase or the end of a promotion that results in a higher rate
  • a better deal from the competition

When you call to cancel service, a representative will seek to understand your reasons and attempt to save you as a customer. If you respond you don’t like the picture quality or your Internet is constantly going out, you are unlikely to get a promotion. You’ll be offered a one-time service credit and a repair visit. If you are calling to cancel over a rate hike notice, they will probably offer a tepid promotion that effectively wipes out the rate increase, but still leaves you paying a lot more than you should. The best offers are designed in response to marketing from competitors trying to steal you away as a customer.

Doing Your Homework

This year your key word is: UPGRADED. Your local phone company just notified your neighborhood better service and a better deal is now available.

This year’s key word is: UPGRADED. Your local phone company just notified your neighborhood better service and a better deal is now available.

We believe the best deals will go to customers prepared to bring a competitor’s offer for them to match. If Time Warner’s local competitors are Google Fiber or Verizon FiOS, you are probably going to get a great deal without a lot of effort. In the northeast, Verizon FiOS and Time Warner Cable have had to face the fact if a customer of either doesn’t get an excellent deal to stay, they are going to switch to the other for one or two years and then switch back after the promotion expires. We’ve seen retention offers in these areas that even include high value gift card rebate offers normally reserved exclusively for customers able to prove (with their final bill) they are leaving one provider for the other. In areas where Time Warner Cable competes with AT&T U-verse, negotiations can get tougher. Time Warner Cable retention operators will listen to your claim you can get a better deal from AT&T or DirecTV and then try to trip you up by asking a lot of questions about 1-2 year contracts, HD fees, set-top equipment fees, broadband speeds, and other sneaky fees AT&T loves to slap on their bills but not always disclose in their advertising.

Things can get even tougher if their only significant competitor is Frontier Communications, HawTel, Windstream, CenturyLink, or other independent telephone companies. Most customers still can’t get TV service except through a companion offer with a satellite company and broadband typically comes in the form of underwhelming DSL. Time Warner Cable has a database of their competitors’ promotions and packages, and they respond to your price match request by trying to find the offer you want them to match in their system. When they find it (or something close to it), the call center operator will respond with a series of challenging statements to cut the apparent value of that promotion. For example, they will claim the competing offer does not include certain features Time Warner includes at no extra charge or doesn’t include various equipment, programming and other hidden fees that raise the price.

If you concede this, the price they will ultimately match is likely to be higher than what you originally thought. It may even sound reasonable to you, because you are used to “gotcha” and hidden fees that are already on your current Time Warner bill (fees the retention operator usually “forgets” to mention Time Warner also charges when they claim to be making an “apple to apple” comparison of the two offers.) That’s their game and it is designed to confuse and overwhelm you. We are going to teach you how to avoid getting on board their carnival carousel.

The key word for 2016 is: UPGRADED, as in their competitor ‘just notified you they have upgraded your neighborhood to a better level of service with a great limited time, local promotion just for customers like you.’

As AT&T and other phone companies continue to upgrade their networks to deliver video, phone and better broadband service, you can shut down the debate about DSL broadband speed and the many deficiencies of telephone company partnerships with satellite TV providers. Instead, you will explain the phone company can now match the speed Time Warner is selling (or at least the speed you need), and with services like Frontier FiOS TV/Vantage TV, CenturyLink’s Prism, Hawtel’s TV, and Windstream’s Kinetic TV, you don’t need a satellite dish to watch anymore.

A Time Warner Cable call center.

A Time Warner Cable call center.

But before we begin negotiations, a review of what you are already paying for is in order. Go and grab your latest Time Warner Cable bill.

If you are a broadband-only customer, you’ve probably received many offers to add television service. Those with cable television and broadband may be getting cards in the mail offering to add phone service for an additional $10 a month. Those customers identified as likely premium movie channel subscribers are getting offers to add multiple premiums at a special price. This practice is known as upselling, and it is how your $150 cable bill quickly rose to well over $200 once those limited-time promotions end and regular prices begin.

Here are some common cable TV add-ons that may be still lurking on your bill, are optional and may be removed on request:

  • Variety Pass (a/k/a Preferred TV): Just over 60 channels of lesser-known and slightly more expensive cable networks and their cousins. Includes MTV, Aspire, Cooking Channel, FOX Sports, Crime and Investigation Channel, GSN, LOGO, and National Geographic, among dozens of others. This package is very common and can often be downgraded to a 70+ Standard TV package.
  • HD Pass: Usually 4-6 channels of uniquely expensive basic cable networks. Most customers probably added this during the days of HDNet — a network Time Warner Cable dropped several years ago. Today, you are probably paying $3-5 a month extra for networks like beIN SPORTS, MGM HD, RFD HD, and Smithsonian. If these don’t interest you, drop this add-on.
  • TWC Sports Pass: More than two dozen additional sports channels that come at a hefty price. If you need to get your cable TV bill down, this is a good place to start.
  • TWC Movie Pass: Once affordable, this package of Disney Family Movies On Demand, TWC Movie Pass On Demand, and at least eight Encore movie channels has seen steady rate increases, especially over the last three years. It may no longer be worth it.
  • Various Premium Channels: HBO alone now costs $16.99 a month. Other premiums have also seen prices rise these last few years. But for $20-30 more, depending on the promotion, you can have every premium channel for a year, usually including HBO, Cinemax, Showtime, The Movie Channel, Epix, and Starz. Don’t leave your money on their table.
The TWC Digital Adapter was supposed to cost $0.99 a month. It's now $3.25.

The TWC Digital Adapter was supposed to cost $0.99 a month. It’s now $3.25.

With the latest round of rate hikes, renting equipment from Time Warner has gotten more expensive than ever. Do you still need a traditional set-top box in the guest bedroom or kids’ rooms if they are not even interested in cable TV? Each box and remote can add up to $7-9 a month depending on your package. DVR service is also increasingly costly because Time Warner charges customers for both the equipment and the service. An enhanced DVR capable of recording up to six shows at once is a nice addition, but it can easily add over $20 a month to your bill in equipment and service fees. If you find you aren’t using the DVR as often as you used to, it may be time to switch back to a traditional set-top box, which costs much less.

If you have TVs in spare bedrooms or the kitchen hooked up with Time Warner’s Digital Adapters, you will find the price for those has also increased dramatically. Initially promised for $0.99 a month, they now cost $3.25 each. This year, we recommend returning them and buying one or more Roku 2 2015 Edition ($70) units instead, which can deliver cable TV to your spare TV sets over your home Wi-Fi. (Also available on: Roku 3, All Roku 2 Models, Roku LT, Roku HD (2500X), the Roku Streaming Stick, Kindle Fire HD & HDX, Samsung Smart TV, Xbox 360 and Xbox One.) Time Warner provides their lineup on these devices with a free app. A one time equipment purchase will pay for itself in a few years, give instant access to Hulu, Netflix, and other services and offer a less frustrating experience.

Cable modems are another piece of equipment you should not be renting from Time Warner. These devices work with your Internet service and now cost $10 a month. The top recommended Arris (formerly Motorola) SB-6141 can be purchased on eBay for around $50 (for refurbished units) and from retail outlets for $70-80 (new). If you are still renting a modem from Time Warner, go and buy one today.

Am I Getting a Good Deal?

While tempting, these offers usually require upgrades that raise the price. For example, Whole House DVR mandatory service and equipment fees add $11.75 a month per cable box, with at least two boxes required.

While tempting, these typical Time Warner Cable offers usually require upgrades that raise the price. For example, Whole House DVR mandatory service and equipment fees add $11.75 a month per cable box, with a two-box minimum. That gift card offer is only good if you are able to prove you are switching from another provider and can produce a copy of your final bill.

This is the part people dread the most — having to haggle over their cable bill. How do you know if the offer Time Warner gives you is a good one? The answer is: by comparing it against the competition and what Time Warner would charge new customers for the same services. If it is within that range, you’ve done okay. If you keep pushing far beyond that, you are likely to find diminishing returns and increasing aggravation – sometimes an offer promised on the phone never even makes it to your bill, because it was offered in error. Then it becomes a dispute over crediting the difference between an offer promised and one actually received. We also don’t recommend people push for rebate cards, because even if you are offered one to keep your business, you usually will not qualify for it because you typically cannot meet the rebate’s terms and conditions, resulting in a rejection letter several months later from the third-party rebate processor.

To find out pricing of current promotions, start by visiting the phone company’s website to see what it has to offer. After that, it is off to Time Warner Cable’s website, pretending to be a new customer and creating a package similar or identical to what you receive today.

PrismTV + Internet, from CenturyLink

PrismTV + Internet, from CenturyLink. This service is being introduced in a number of CenturyLink-served communities.

Along the way, take note of fine print disclosures about contract terms, equipment fees, surcharges, etc. Some new customer offers increase in price during the second year, but ignore that. You are only negotiating for a better price for one year. In general terms, you are probably going to find new customer prices averaging in this range:

  • Broadband only: $34.95/mo for 12 months (Standard service)
  • Triple Play (broadband, TV + Enhanced DVR, phone): $99.99/mo for 12 months (30Mbps service)
  • Double Play (broadband + TV): Expect to pay around $80-90 for Standard/Turbo/Extreme broadband with traditional 200+ channel Preferred TV (periodic promotions offer enhanced speed broadband at the higher side of this price range)

Be aware most promotions start with lowball offers that do not include equipment like the very popular and expensive DVR (with the equipment and service fee), and the additional cost of a second set-top box many people have in their master bedroom. There are also Broadcast TV and Sports Programming surcharges increasingly charged by providers, and the usual taxes and fees.

No, dealing with Time Warner Cable won't reduce you to tears.

No, dealing with Time Warner Cable won’t reduce you to tears.

If you want to save time and are comfortable with a triple play package including 200+ channel Preferred TV with DVR and one additional standard HD set-top box, Ultimate Internet (50Mbps or 300Mbps in Maxx-upgraded areas), and Unlimited local/nationwide home phone service with voicemail, you should be able to easily negotiate a price hovering around $120-130 a month. We pay closer to the high side of that range after subscribing to “whole house” DVR service, which allows you to watch shows recorded on a DVR in another room. That price represents about a $50/month savings over the $175 price we would pay with the lesser promotion they offered us after the most recent one expired. If you are in a more competitive market with an even better deal than we found from our local providers, Time Warner should be able to match it too.

It’s Time to Make the Cancel Call

We’re getting close to making that phone call. Just one more reminder: the retention operator will probably try to question your competitor’s deal. That is where our magic word UPGRADED comes in. You are going to stay resolute the competitor’s offer you negotiated and are telling Time Warner about specifically targeted those gotcha fees and hidden charges, which have all been waived or do not apply. To win your business after the upgrade, the price quoted is the “out the door” price exactly as it will be billed to you, without hidden fees, no term contracts, and no gotchas. You can acknowledge those fees are common among many providers, but they do not apply to you in this case.

Get a glass of water, a pen and paper, and be prepared to spend about 30 minutes total on the phone (most of that will be on hold as they change your account to add the promotion you just won).

Call 1-800-892-4357 and say “cancel service” when the automated system asks what you are calling about. From there, your call will be forwarded to a customer retention call center. The first thing you should ask when connected is the representative’s name and extension (or other identifying information). If your deal isn’t applied (or applied correctly) to your account, the name of the person you spoke with will go a long way to getting any problems straightened out.

timewarner twcYou will be asked why you are canceling service. You want to emphasize “it costs too much” and you have “found a better deal” elsewhere. You should expect the representative to start negotiations by attempting to downgrade your current service to save money. Do not play this game at this point in the call. Politely tell the representative you are not interested in a reduction in your services because you can get the same or better from the competition… at a lower price. Keep reminding them your concern is over the cost of the service, nothing else. Don’t get sidetracked talking about service problems or poor customer service. Address those issues at the end of the call.

Despite assertions Time Warner Cable customers won't endure extended hold times, at least 2/3rds of our recent calls were spent listening to hold music.

Despite assertions Time Warner Cable customers won’t endure extended hold times, at least 2/3rds of our recent calls were spent listening to hold music.

You will be asked to describe the deal from the competitor. Let them know that with recent upgrades in your area it covers all the TV channels you want to watch, has the same broadband speed you are getting now, and offers unlimited local and long distance calling to all the places you care about. Let them know you have already talked to the other company but after a family discussion, you decided to give Time Warner a chance to match or beat their offer and will stay as a customer if they can.

The retention operator will likely try to challenge the competitor’s offer, but each time politely remind them your offer either includes those fees/charges or waives them with no contract obligation and no cancellation penalties. Tell them that competitor is going all out to sign up new customers in your neighborhood.

At all times, be polite, persistent, and persuasive. If you are pleasant, representatives will often go the extra mile for you. Try saying, “is there anything else you can try to get me a better price,” “I really appreciate all of your help today,” and “thank you for looking into this for me.” If things seem to be going against you, remind them, “I know there must be something we can do together to get to a better deal,” “I know you might not be able to do this for me, but perhaps a supervisor could?” and “maybe I am approaching this wrong and we need to start over and try to find the best promotion we can, even if it means adding or changing something that will get me a better deal.”

At this point, the operator will put you on hold and review the promotional offers they can apply to your account. When they return to the line, hear them out but you need them to come within $5-10 of the deal you took to them. If they can’t, you can usually ask if a supervisor will grant you a one time service credit for the difference between the two prices, or to give you a free upgrade to faster Internet speed, a premium movie channel, or something else to sweeten the offer. Try to stay flexible over a few dollars either way. The representative cannot make up a deal, they have to find one in the system that matches your current services and enter the proper code(s) to apply it to your account. Write everything down and repeat it back as you go to make sure you both understand the terms. Also make certain to ask if ANY other fees or charges apply, and if they do, write them down. In most cases, the price you get will be before taxes and some surcharges.

If you find you are dealing with a difficult or intransigent representative, thank them for their time, hang up and call back in a few hours and try again. You never have to commit to a deal immediately. If you want to think about it, ask for the representative to note your account with the offer he or she made and ask their name so you can refer back to that conversation when you call back.

Save your notes. It is unfortunately all too common that the deal you were promised over the phone can look very different on your first bill. But if you kept your notes and the name(s) of representatives you spoke with, any problems can be fixed later with a corrected deal or service credits.

Amy Schumer calls Time Warner Cable. It wasn’t this bad for us, we swear! (4:45)

Time Warner Cable Reminds Los Angeles About Outrageous Cost of Sports TV

Phillip Dampier March 29, 2016 Consumer News, Time Warner Cable No Comments

SportsNet-LA-logoA bone toss by Time Warner Cable (just over a week before the opening of baseball season) to get Southern California satellite and cable providers to pick up carriage of the Los Angeles Dodgers’ SportsNet LA at a discount has backfired and further inflamed critics of the cost of sports programming.

Now two years old, the cable channel jointly owned by the Southern California division of Time Warner Cable and the Los Angeles Dodgers has been a sore spot for sports fans who don’t subscribe to Time Warner Cable or Charter Communications — the only two major providers offering the sports channel. It is the exclusive home of all-things-Dodgers and the Major League Baseball team was well compensated by Time Warner Cable with $8.35 billion for the 25-year deal.

Because of the huge amount of money on the line, Time Warner Cable priced SportsNet LA at $4.90 a month wholesale per subscriber — a stunning amount for a channel devoted to a single sports team. Providers serving Southern California, including DISH, DirecTV, Verizon, Cox, and AT&T, refused to carry the channel, and for two years Dodgers games have not been seen by more than half the region’s pay TV customers.

dodgersThe issue has sparked outrage among sports fans and politicians, who have complained about the ongoing impasse between Time Warner and other providers. Only Charter Communications, now in sensitive negotiations with the California Public Utilities Commission over its acquisition of Time Warner Cable, relented and agreed to pick up the channel for its customers last summer.

Time Warner Cable has consistently refused to allow the channel to be sold a-la-carte. Instead, every cable TV customer has to pay to make Time Warner’s expensive deal with the Dodgers pay off for the cable operator. Because other companies have consistently boycotted the network, Time Warner Cable has lost a reported $100 million a year from SportsNet LA.

That may explain why this year Time Warner Cable suddenly announced it would offer one year of the channel at a discount – $3.50 a month wholesale, closer in line with other regional sports channels.

Under normal circumstances, the price cut should attract other providers to get a deal signed, but these are not normal times in the cable television business.

Time Warner’s offer has been met with angry accusations of hubris in the Los Angeles sports press. None of the providers boycotting the channel seem interested in the deal either. The reason? The discount only lasts one year, after which the price shoots back up.

Imagine the customer service call centers at DirecTV and Verizon taking heated phone calls in March 2017 when the sports channel gets dropped for its too-high renewal rate.

hostage“Why would anyone give everyone a taste of something for a year?” Mark Ramsey, a media consultant based in San Diego, told the Los Angeles Times. “All the leverage goes to the seller, not the buyer. It’s a temporary fix. This is not a free sample for Sirius XM. Dropping a channel is worse than not carrying a channel.”

Cable subscribers, particularly non-sports-fans, are also incensed at the prospect of their TV bill going up $3.50-5.00 a month for a single channel.

The dispute continues to fuel speculation that these kinds of money disputes are sure to hurry the demise of the one-size-fits-all cable TV package. Around one-quarter of Americans don’t subscribe to cable or satellite and less than two-thirds of those that do are adults 18-29. That demographic reality spells eventual doom. Cable TV is increasingly a must-have service only among older Americans. At least 83% of those 50 and older subscribe to cable television. That number drops to 73% for those aged 30-49. The younger you are, the less likely you see a need for cable television.

As a-la-carte alternatives grow, an ever larger percentage of Americans are expected to abandon the cable package. So far, the only party that doesn’t seem to care much either way is the Dodgers — they got their $8.35 billion and can sit on it for the next two plus decades.

Time Warner Cable likely underestimated the blowback on its wholesale pricing plans for SportsNet LA, but seems happy enough for now to offer only a temporary discount. But it also gives their customers another excuse to scrutinize their cable bills, which now include a “sports programming” surcharge, and scream for a-la-carte across the board.

“So, I am supposed to be excited that TWC is going to lower the price of the Dodgers to other providers? Right?,” complained Scott Bryant from Apple Valley. “Now myself, and others who could care less about the Dodgers will be forced to add another $3.50 a month to get the Dodgers, a team I could care less about? This is a joke, right? It’s time to force all cable/satellite providers allow us to pick our own channels and pay for what we want. This is nothing more than corporate welfare. When I see another added fee to my bill for local sports coverage, I will do it, too! I’m an Angels fan. Forcing me to pay for the Dodgers is criminal. I’m a sports fan, but this is out of control. Where are my scissors?”

The Newest “Diversity Group” to Support Time Warner Cable’s Corporate Agenda Is…

NGLCC_Color_Logo_wTagTime Warner Cable has a new friend from the “diversity” community.

This week, the National Gay & Lesbian Chamber of Commerce (NGLCC) announced it has a new corporate partner in Time Warner Cable.

“Time Warner Cable is excited to partner with NGLCC and we look forward to new opportunities as we expand our supplier diversity program with LGBT-owned businesses,” said David Wiehagen, TWC’s vice president and chief procurement officer. “As a long-time supporter of diversity and inclusion, we believe that working with diverse suppliers is reflective of our employee and customer population and truly benefits the business.”

What benefits the business often doesn’t benefit customers, however. Many of the groups financially supported by Time Warner Cable end up penning advocacy letters to regulators and elected officials that support the cable operator’s corporate agenda.

While a press release from the gay business organization claimed the partnership will help “elevate its supplier diversity programs among peers and colleagues,” in most cases these partnerships are more about trading favors, advocacy, and PR opportunities.

“Time Warner Cable is a leader within the telecommunications industry that stands at the forefront of diversity and inclusion initiatives,” said Justin Nelson, NGLCC co-founder and president. “We are thrilled to welcome Time Warner Cable as a corporate partner as we know their commitment to supply chain diversity is unwavering.”

In turn, the NGLCC has been an unwavering opponent of Net Neutrality, favors big telecom mergers like the failed AT&T/T-Mobile acquisition and has generally opposed expanding Internet-related consumer protection.

Stop the Cap! Joins 21 Other Consumer Groups Asking FCC to Block Charter-Time Warner Cable Merger

charter twc bhOn Monday, Stop the Cap! joined 21 other public interest organizations in sending a joint letter urging the Federal Communications Commission to deny Charter’s bid to take over Time Warner Cable and Bright House Networks. Late last week, the Wall Street Journal reported that FCC Chairman Tom Wheeler may be planning to circulate a draft order approving the $90 billion merger.

The Center for Media Justice, CREDO Action, Daily Kos, Demand Progress, Free Press and Presente.org were among the media justice, Internet rights and public interest groups calling on the FCC to reject this deal, which would create a national broadband duopoly.

Together, Charter and Comcast would control nearly two-thirds of the nation’s high-speed broadband subscribers and would offer service to nearly 80 percent of U.S. households. The letter notes that this substantial increase in market power, coupled with Charter’s $66 billion in debt, would give the company both the incentive and the heightened ability to raise prices at will. This would broaden the digital divide, hitting low-income communities the hardest.

Stop the Cap! earlier filed objections to the merger with the FCC and in two states seen as critical to the deal – New York and California. In our view, no cable merger has ever resulted in better service or lower prices for consumers. Such deals deliver handsome sums to executives and shareholders while saddling customers with relentless rate hikes and no improvement in service. Charter’s history is troubling and its ability to meet its financial obligations while saddled in debt is dubious. Charter declared bankruptcy in 2009, after accumulating $21.7 billion in debt accumulated from years of mergers and consolidation efforts. As credit markets tightened up, Charter’s ability to manage its debt fell apart. Now the company is back to its old modus operandi, piling up debt buying Time Warner Cable — a much larger operation, and trying to combine it with Bright House Networks, another cable operator prominent in Florida.

Earlier this year, several of the signers delivered petitions to the FCC from more than 300,000 Americans opposing the merger, and thousands have called the agency in recent days to weigh in against the deal. Political leaders including Senate Democratic Leader Harry Reid have spoken out about the merger’s many harms.

“Too many Washington insiders have given up on challenging this deal despite its serious harms,” said Free Press policy director Matt Wood. “Instead of forecasting its chances for approval, the groups signing this letter will keep fighting to block this merger, along with the guaranteed price increases it would foist on people and communities who can least afford it.

“If Charter gets this merger approved, nothing will stop it from raising its rates for high-speed broadband and video customers who have nowhere else to turn. Temporary promises and weak conditions aren’t going to preserve competition and choice in the long run, and they’re not going to do anything to stop these price hikes. The FCC is charged with promoting the public interest, and there’s no way in which this merger benefits the public. Higher prices and fewer choices won’t help anyone but the companies pitching this bad bargain.”

“If its takeover of Time Warner Cable goes through, Charter will have a broadband footprint as big as Comcast’s,” said Demand Progress executive director David Segal. “This would turn an industry that’s already too concentrated into a duopoly, paving the way for higher rates today and the eventual formation of a new cross-sector behemoth that controls content production and delivery.

“Americans increasingly understand that corporate concentration is jacking up prices and lowering quality for all sorts of basic goods and services. At a hearing of a Senate antitrust subcommittee this month, lawmakers made it clear that they see companies that are allegedly too big to fix in many industries, not just the banking sector. This FCC must now decide whether it wants to stem the swelling tide of concentration, or enable these monopolies.”

Free Press and Stop the Cap! contributed elements of this story.

Time Warner Cable Maxx Heads to Syracuse, N.Y., Arrives in Wilmington, N.C.

syrSyracuse residents will be the first in upstate New York to benefit from Time Warner Cable’s Maxx upgrade program, which has been gradually moving across the cable company’s footprint.

This month customers will receive communications from TWC outlining its transition to a 100%-digital network. Moving to an all-digital lineup frees up bandwidth to make faster Internet speeds possible. Each analog channel takes the space of three to four HD channels and up to 12 digital networks.

The upgrade means customers using older analog-only televisions will need set-top boxes (or similar equipment) after Time Warner drops analog television service starting in April. The company plans to introduce Maxx service this year to all TWC customers in Syracuse and its suburbs, along with the following central and northern New York service areas: Auburn, Boonville, Burlington, Champlain, Clayton, Cortland, Dixon, Fulton, Gouverneur, Hamilton, Herkimer, Ilion, Indian River, Ithaca, Lake Placid, Lowville, Madison, Malone, Massena, Meridian, Ogdensburg, Old Forge, Oneida, Oswego, Potsdam, Rome, Saranac Lake, Utica, Watertown and West Carthage.

twc maxxBroadband speeds will increase starting later this spring, with customers experiencing increases up to six times faster, depending on their current level of Internet service. For example, customers who subscribe to Standard, formerly up to 15Mbps, will receive up to 50Mbps; customers who subscribe to Extreme, formerly up to 30Mbps, will receive up to 200Mbps; and customers who subscribe to Ultimate, formerly up to 50Mbps, will receive up to 300Mbps, with no change in their monthly plan price.

Some customers will need to switch out their modems to receive the faster speeds and they will be communicated with via mail, email and phone messages with information on how to get a new modem.

Further south, in Wilmington, N.C., some customers are already finding they have faster Internet speeds, if they happen to live in a neighborhood that is a part of the now completed first phase of the Maxx rollout. Customers throughout the rest of the Wilmington and surrounding areas will see their speeds increase by the end of summer 2016.

wilmington“Our customers have asked for faster Internet speeds and we’re now able to provide these faster speeds at no additional cost to all of our customers in the Wilmington area,” said Darrel Hegar, regional vice president of operations for Time Warner Cable. “This is just the beginning of the benefits customers will see from our TWC Maxx initiative that will enhance our Internet, video and reliability.”

In the Wilmington area, Time Warner Cable has rolled out more than 1,500 TWC Wi-Fi Hotspots located both in popular outdoor areas and in indoor small business locations throughout the area, like restaurants, cafes, salons and shopping malls, with more hotspots to be added through 2016. In upstate New York, Time Warner primarily offers Wi-Fi access through Business Class Internet customers that volunteer to host hotspots. In New York, Time Warner has focused most of its owned and operated hotspot buildout downstate, particularly in Manhattan.

Sanders, Warren Raise Doubts About Charter-Time Warner Cable-Bright House Merger

Sens. Sanders and Warren

Sens. Sanders and Warren

Democratic presidential hopeful Sen. Bernie Sanders (Ind.-Vt.) has expressed serious doubts about the claimed consumer benefits of a multi-billion dollar cable company merger between Charter Communications, Time Warner Cable, and Bright House Networks.

In a joint letter with Sens. Al Franken (D-Minn.), Ed Markey (D-Mass.), Elizabeth Warren (D-Mass.), and Ron Wyden (D-Ore.), Sanders told FCC Chairman Tom Wheeler and Attorney General Loretta Lynch the deal would create a “nationwide broadband duopoly, with New Charter and Comcast largely in control of the essential wires that connect most Americans to how we commonly communicate and conduct commerce in the 21st century.”

The senators explained that “broadband service is not a luxury; it is an economic and social necessity for consumers and businesses.”

The five Democrats believe the merger could have negative effects on consumer choice, competition, and innovation in broadband and online video. With Comcast and New Charter controlling at least two-thirds of the high-speed broadband lines in the country, Sanders and his colleagues are concerned this will allow Comcast and New Charter to raise rates while reducing broadband innovation, allowing the United States to fall even further behind other industrialized nations with superior broadband.

The senators asked the Department of Justice and the FCC to carefully evaluate how the proposed deal could impact the marketplace.

“New Charter must not only prove that this deal would not harm consumers, but they must also demonstrate that it would actually benefit them and promote the public interest,” the senators argued.

This week, New Jersey regulators approved the merger transaction in that state, leaving California as the last major challenge for Charter executives. Federal regulators are not expected to rule on the deal until the spring or summer.

Time Warner Cable Maxx Coming to Cincinnati

twc maxxTime Warner Cable will upgrade its Cincinnati area customers to Time Warner Cable Maxx service offering broadband speeds up to 200Mbps by this summer.

The Cincinnati Business Courier was the first to report on the upgrade, which has yet to be officially announced by Time Warner Cable, but has been confirmed by a company spokesperson.

The upgrade started Feb. 15 and is expected to be complete in some areas by June, in part thanks to the fact Time Warner’s network in northern Kentucky was inherited from Insight Communications, which Time Warner acquired in 2011. Insight had previously upgraded most of its facilities to all-digital service. Elsewhere, Time Warner has to first upgrade customers to all-digital cable television, which begins with a notification to customers that they will be losing analog television service and will need a set-top box or other equipment for each cable-equipped set in the home.

The conversion to all-digital service frees up bandwidth to boost broadband speeds, giving customers considerably faster service at no extra cost. Standard customers now subscribed to 15Mbps service will be upgraded to 50Mbps. Customers currently frustrated by Time Warner’s top speed of 50Mbps in Ohio will get an upgrade to 300Mbps. Former Insight customers will be the first to get the faster speeds, starting in March. Other Cincinnati area customers may have to wait until summer or fall before the new speeds arrive.

Some Time Warner customers may need to replace their current cable modem, including those now leased by the company for $10 a month.

To ease the transition, Time Warner Cable will provide existing TV customers with one or more digital adapters at no charge through at least June 29, 2017, provided they order an adapter by Oct. 22, 2016. Customers can consult Time Warner’s website for local updates and ordering information.

Charter’s Fairy Tales: Please Approve Our Deal and Trees Will Spontaneously Blossom

You've been flee¢ed

You’ve been flee¢ed

It’s time for some more Big Cable Fairy Tales, brought to you by the well-paid lawyers, lobbyists, and lackey sock puppets paid to tell regulators life is only worth living when you approve a colossal merger.

Kids, gather round for tonight’s prescient story of vague promises and non-committal commitments.

Once upon a time in the forest there was a big, bad old Mr. Wolf (better known to his friends as TWC) that had a nasty habit occupying a nearby bridge to grandmother’s house and charged humongous fees to cross it. One of his best customers was Little Red Riding Hood, who depended on the no longer state of the art bridge to cut her travel time to grandmother’s house by 75%. Every trip proved an aggravation for our Red. It was costly, closed to traffic far more often than it should, and was policed by that pesky wolf and his “take it or leave it” attitude.

One Sunday in January, an angry crowd had gathered, reading a notice tacked to a nearby tree. In small print, it was titled, “Toll Reconsideration Notification.”

The notice explained increased bridge beautification and maintenance expenses necessitated an annual toll adjustment. But no worries, it would amount to about the cost of one jar of jam in Red’s basket.

“If you bought it at Whole Foods,” muttered Hood to your eminent narrator.

(Last year’s toll hike was “less than a box of cookies,” the year before that was “a tin of tea.” Three years ago it was the cost of Red’s basket. Next year, we think she would do better just handing over her purse.)

This year one trip across the bridge would cost $7.50. If you bought a wolf-approved, bundled picnic basket at the gift store while on your journey, it would drop that toll to $6. The wolf told complainers that was evidence most would never have to pay that new price, so the toll hike was minimal. But the people remained suspicious. (There were stories this wolf also had a tendency to occasionally feast on customers when nobody was looking, but his lawyers denied it.)

Despite the bridge toll inflation and John Walsh looking for missing travelers, our Red knew if she wanted to get to grandmother’s house this week, she had to use the bridge, nefarious wolf or not. The only other bridge – run by old man Frank Bison, fell into the river last winter and he doesn’t think it is worth spending a lot of money to build a new one. Despite offers to take customers across in his leaky canoe, most decide to pass.

Mr. Bison

Mr. Bison

Mr. Wolf made a handsome profit every quarter charging tolls to travelers. This fact did not escape the attention of the head of the Sheep Consortium in the next valley over. For years, the Consortium felt under-appreciated. Their adventures were rarely told, because few people cared. The wolf had a better story, and anyway it was hard to respect the sheep after they overspent on their watchdog operation and bankrupted themselves for a time.

“That was so yesterday,” defended Dr. Flee¢e, the head of the Consortium. “This is a new sunny day.”

Or so he claimed. Out of view, Flee¢e paced a nearby paddock night after night, unable to sleep knowing that damn wolf got all the attention and a heckuva lot more toll revenue than he was getting.

So one night, Dr. Flee¢e and his friends paid $10 million dollars to the Magic Sparkle Pony grazing down by the investment bank to find a win-win solution for both the sheep and the wolf (but mostly the sheep, shhh.) The pony looked up, tilted his head briefly, and said just one word: SYNERGY. A cacophony of gratitude rose from the valley and gosh darn it, exclaimed Dr. Flee¢e, wouldn’t you know the silly pony had the answer? A merger! The wolf’s costs would drop, the sheep would finally be able to tap into a big piece of that toll operation, and only by working together would Little Red Riding Hood get the benefits of their new relationship:big sheep

  1. The ratty old bridge would be fully painted.
  2. The wolf promised to go vegetarian for up to three years.
  3. Little Red Riding Hood would be given a new basket (imported from Laos).

“Hey, wait a minute,” asked one of the sheep. “Didn’t the Three Little Pigs try this last year? They had more money than we do and some of them were turned into bacon after that surprising storm blew their house down.”

“But don’t you see the Magic Sparkle Pony solved that for us too?” responded another. “All we have to say is we’re not pigs and that counts for something. Besides, who doesn’t love sheep? This is going to work out fine.”

But there were still problems, especially with Ms. Hood and her fellow travelers.

It seems the Consortium didn’t promise Ms. Hood or anyone else would pay less on those trips to see grandma. They only promised the journey would be prettier and less confusing. Gone was the $7.50 toll, replaced with the all-new Flee¢ePa$$™ offering trips across the bridge bundled with: a 24/7 travel hotline, travel advice, books on travel, songs about travel, a coffee mug with a picture of Dr. Flee¢e traveling to his castle in Scotland, and the aforementioned Laotian wicker basket to cram it all into, for just $50 a month.

“Is this one of those Dr. Seuss tales that you have to be on something to appreciate?” asked Red. “I don’t drink coffee, nobody reads books anymore, and if I need travel advice I’ll ask someone I know. I don’t need all those things so why do I have to pay $50 instead of $5? Wait, who is paying for that castle?”

“Because it’s simpler, don’t you see,” said Dr. Flee¢e, eavesdropping in the corner. “We are going to be a different kind of bridge operator committed to creating jobs, offering the most innovative products and preserving this bridge.”

“For $50 a month,” coolly replied an exasperated Ms. Hood. “Stephen King wrote this, didn’t he? I have a better idea. We’re moving grandma to Chattanooga. They have high-speed rail.”

Stop the Cap! Files for Party Status in California’s Charter-TWC Merger Proceeding

stopthecap-logoStop the Cap! has filed a motion before California’s Public Utilities Commission (CPUC) to request party status in the Charter-Time Warner Cable merger proceeding, better positioning ourselves to influence the outcome.

As other consumer groups in California continue to formally oppose the merger, we are also filing to ask regulators to consider our request to impose conditions on the deal should the CPUC decide to approve it anyway. As we promised after the New York Public Service Commission approved the deal with significant conditions, we are once again taking a hard look at Charter’s three-year commitment not to impose data caps or usage pricing — a term we find completely inadequate.

cpucIt remains our belief three years is far too short a commitment, and it is unlikely consumers will find plentiful alternatives for broadband service should Charter impose caps in 2019 anymore than they can today. As a reminder to consumers and regulators, deal conditions imposed by regulators on the 2011 merger of Comcast and NBC-Universal have already begun to expire, with relatively little change in competition in the marketplace.

Our late filing for party status comes partly in response to inadequate public notice from Charter Communications and new information and suggestions that came as a result of the New York State PSC proceeding that would be directly informative and beneficial for California residents.

In states where public utility regulators have approved the transaction with ‘most-favored state’ provisions, any benefits we can win for consumers in California will also apply in New York and other states as well.

As always, we are extremely grateful to our newest member of the Stop the Cap! team, Matthew Friedman, who has dramatically strengthened our ability to monitor the marketplace on the west coast to broaden our consumer protection efforts.

We remain an all-volunteer organization, so if you’d like to join our team, use the Contact Us button at the top of the page and send a message. We’d love to have more volunteers helping identify and write about pressing broadband issues throughout the U.S. and Canada, and we’re happy to help with the editing.

The full text of our motion appears below:

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
MOTION OF STOP THE CAP! FOR PARTY STATUS

I. Introduction
Pursuant to Rule 1.4 of the California Public Utilities Commission’s (“CPUC” or the “Commission”) Rules of Practice and Procedure, Stop the Cap! respectfully requests to be granted party status in the above captioned proceeding.

II. Background and Interest in this Proceeding
Stop the Cap! is a consumer group founded in 2008 to fight against the introduction of artificial limits on broadband usage (such as data caps, usage based pricing, and speed throttling) and to promote better broadband speeds and service for consumers. Our group does not accept funding from lobbyists, companies, or any individual affiliated with the telecommunications industry. We return all corporate donations.

Stop the Cap! understands that this is a relatively late file for party status. While Stop the Cap! is generally opposed to this transaction, we feel that the Intervenors are strongly making the case that the Commission should deny the application, and we would refrain from contributing in that regard. However, should the Commission approve this transaction, Stop the Cap! has a deep and detailed knowledge of data caps and usage based pricing (DC/UBP) from our past 8 years of work on this very specific issue. This information and experience would definitely aid the Commission’s process of tailoring effective mitigation conditions, and our input would be complementary to the existing Intervenors’. Based on our direct experience at the recent Los Angeles PPH, we now understand that an issue as complicated as DC/UBP can’t be effectively dealt with by us as an informal commenter. We have no lawyers guiding us through this process —we are merely a group of individual consumers who have banded together to address a common concern. We therefore respectfully request that the Commission forgive our late filing, and note that we would still be able to take part in full in the discussion of relevant conditions, should this transaction reach that stage.

As a party, Stop the Cap! would aim to protect and promote the public interest of our members and other Californians on the issue of DC/UBP. We have attached the discussion we submitted at the Los Angeles PPH to this filing. It details how the issue of DC/UBP affects numerous other concerns in this proceeding, and presents significant and numerous harms to consumers, especially to low income ones. The submission lays out how DC/UBP can increase prices, foster anti-competitive behavior, circumvent net neutrality, hinder innovation and investment, slow broadband deployment, threaten network security, remove educational opportunities, and can even completely erase any “lifeline” broadband condition this Commission may design. The document also explains why the CPUC’s approval of this transaction would make DC/UBP much more likely to be imposed on existing Time Warner Cable subscribers. It details TWC’s repeated and public pledge to “NEVER” impose DC/UBP on its customers. It discusses why the Commission should be particularly suspect of New Charter when it comes to DC/UBP. Finally, it shows that Charter’s opening testimony actually supports a mitigation condition that sunsets based on a competition test, as opposed to an arbitrarily short three years. This is the kind of information we can present to aid in the Commission’s decision making process.

III. Notice
Service of notices, orders, and other correspondence in this proceeding should be directed to Stop the Cap! [extraneous information deleted]

IV. Conclusion
Stop the Cap!’s participation in this proceeding will not prejudice any party and will not delay the schedule or broaden the scope of the issues in the proceeding. For the reasons stated above, Stop the Cap! respectfully requests that the CPUC grant this motion for party status filing.

Dated: February 2, 2016
Respectfully submitted,

/s/ Matthew Friedman
Matthew Friedman
Stop the Cap!

Stop the Cap! Files Formal Opposition to Charter-TWC Merger in California

stcStop the Cap! this week formally filed our opposition to the merger of Charter Communications and Time Warner Cable with the California Public Utilities Commission (CPUC), citing our concerns about data caps/usage-based pricing, Internet competitiveness, affordability, and quality of service.

Matthew Friedman, Stop the Cap!’s new director of our California branch, spoke in opposition to the transaction at a public meeting held by the CPUC in Los Angeles on Tuesday. Friedman authored our formal 10,500-word opposition, particularly focusing attention on Charter’s commitment not to cap or meter broadband usage for only three years after the deal is approved.

Charter’s temporary “good behavior” commitments open Time Warner Cable and Bright House Networks customers to the potential of the same kind of usage caps and usage pricing being tested by Comcast, with little likelihood imminent competition will give consumers alternative cap-free choices.

Stop the Cap! proposed a permanent ban on compulsory data caps with New York regulators, which was not adopted. In California, we are asking the CPUC to consider allowing Charter’s “good behavior” commitments to expire only when customers have access to near-equivalent competitors offering unlimited service options, either from resellers of Charter’s broadband network or from existing or new competitors.

It is our view usage caps and usage-based billing represent an end run around Net Neutrality and will be used to limit online video competition.

We also repeat our assertion that Charter’s commitments for Time Warner Cable customers are less compelling than the benefits of Time Warner Cable’s own ongoing upgrade program, dubbed “Maxx.” Charter has committed to providing Time Warner customers with broadband speeds up to 100Mbps. Time Warner Cable Maxx offers a maximum speed of 300Mbps — three times faster than Charter.

Time Warner Cable’s $14.99 Everyday Low Price Internet option, available to any customer without conditions or contracts would be terminated, with customers forced to spend just under $60 for entry-level broadband service. Charter’s offers remove customer choices from the marketplace in an attempt to “simplify” pricing. But that will also force customers into packages with services they don’t want or need.

Here is our formal filing in full, also available for download:

Before the CALIFORNIA PUBLIC UTILITIES COMMISSION

      

Re: Application 15-07-009

Charter/Time Warner/Bright House Transfer

Comments on Data Caps and Usage Based Pricing and Statement of Opposition

January 26, 2016

Stop the Cap! California Branch, Matthew Friedman

 

Stop the Cap! is a consumer group founded in 2008 to fight against the introduction of artificial limits on broadband usage (usage caps, usage based pricing, 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.

Executive Summary

Part 1 of this document proposes a mitigation condition relating to data caps and usage based pricing (DC/UBP) that would not sunset after an arbitrary number of years. Instead, it would sunset based on the existence of actual competition in the wireline broadband marketplace.

This document details how data caps and usage based pricing present significant and numerous harms to consumers and competition in general, and why the CPUC’s approval of this transaction would make DC/UBP much more likely to be imposed on existing Time Warner Cable subscribers. We detail TWC’s long-standing, public, and vocal commitment against imposing DC/UBP. We explain why the Commission should be particularly suspect of Charter when it comes to DC/UBP. Finally, we show that Charter’s opening testimony actually supports the mitigation condition that is being proposed here.

Stop the Cap! believes that this transaction is clearly not in the public interest, and the Commission should deny the transfer. If however, for some reason the Commission decides to approve the transfer, we respectfully submit this mitigation condition to protect Californians from one of the severe harms this merger will certainly bring.

Part 2 of this document is a broader examination of why the transaction is not in the public interest. We detail how Time Warner Cable is stronger company with superior offerings to Charter, and we show why Charter is proposing a deal that is not only not in the public interest, but a large step backwards for consumers.

The Commission should deny this transfer.

The Proposed Transaction is Not in the Public Interest

Stop the Cap! strongly believes that it’s clear that the Commission should NOT approve this transaction. The testimony of the Intervenors has shown that the “benefits” Charter is claiming are tenuous at best, if even present at all. The only real benefit of this transaction appears to be to the applicants’ shareholders, and possibly not even them.

There are an immense amount of risks, potential harms, and even certain harms that will come to consumers if this transaction is allowed to proceed–more than were present even in the Comcast/TWC scenario. The certain harms far outweigh any potential benefits.

In these comments we focus on data caps and usage based pricing in particular. These practices are almost always detrimental to consumers, as TWC management has recognized, and they shouldn’t be imposed at all. One of the negative aspects of this proposed merger is that TWC customers would lose the “no data caps EVER” pledge from TWC. If for some reason the Commission decides to approve the transfer, the loss of TWC’s anti-data cap corporate attitude must be mitigated, and in a way that matches the permanence of TWC’s current pledge.

If, however, the Commission does decide to approve this transfer, the loss of TWC’s vocal commitment to NEVER impose DC/UBP must be mitigated, and it must be mitigated in a way that matches the permanence of TWC’s commitment. Mitigation conditions that are only temporary in nature are not sufficient to offset those harms.

Proposed Mitigation Condition

New Charter shall refrain from imposing data caps and/or usage-based pricing (DC/UBP) on all of its broadband offerings. New Charter will refrain from increasing prices on non-DC/UBP plans to compensate for this mitigation condition.

This mitigation condition shall sunset when ONE of the following scenarios comes to pass; however, the condition shall sunset only for those New Charter customers for whom one of the following scenarios is true. In all other New Charter areas where none of these scenarios exist, the mitigation condition shall remain in force.

  1. There are at least three (including New Charter) competing wireline broadband providers for the area in which New Charter wishes to sunset this mitigation condition. Resellers leasing lines from New Charter may be counted as competitors only if New Charter does not impose any sort of usage based billing or data caps on the resellers.
  1. There are at least three competing broadband providers (both wired and wireless) for the area in which New Charter wishes to sunset this mitigation condition, and the wireless providers offer a non-usage-based billing plan that is no more expensive than similar non-usage-based billing plans offered by the wireline providers. Providers that offer unlimited data but throttle speed after a certain amount of data is consumed shall be considered as utilising data caps for the sake of this evaluation.

Should a New Charter customer demonstrate that the competing wireless provider is unable to supply actual broadband speed to their physical address (for instance, due to poor reception), then New Charter shall continue to offer that customer data plans not subject to DC/UBP. Additionally, New Charter shall refrain from increasing the price of this non DC/UBP plan above the cost of the comparable DC/UBP plan (before considering any data overage fees).

  1. There is a functional community-owned broadband alternative available to the customers for which New Charter wishes to sunset this mitigation condition.

This condition defines “broadband” as providing the minimum broadband speed as set by the FCC at the time of evaluation for sunsetting.

What is DC/UBP?

“Usage Based Pricing” (sometimes referred to as “Metered Billing” or “Data Caps”) is when an Internet Service Provider places an upper limit on the amount of data a customer can use in a given month. Typically in wireline internet situations, if the customer goes over their monthly allowance, they are charged an additional fee for a set amount of additional data. If this additional data allotment is used, the customer is charged again for a second allotment, and so on until the monthly billing period ends. For instance, Comcast charges its data capped customers $10 for each additional 50GB used.[1] A good way to understand DC/UBP is to begin with what it is not.

DC/UBP is NOT about network management

This assertion has been debunked by scientific research for almost ten years,[2] and now even ISPs themselves are acknowledging the same. In January 2015, National Cable and Telecommunications Association president Michael Powell told a Minority Media and Telecommunications Association audience that while a lot of people had tried to label the cable industry’s interest in the issue as about congestion management, “That’s wrong,” he said. “Our principal purpose is how to fairly monetize a high fixed cost.”[3] However, even this explanation is myth-based. (See discussion next section.)

On 14 August 2015, Comcast’s Vice President of Internet Services, Jason Livingood, stated publicly that DC/UBP was not a network management decision, but a “business decision” that he had no part in making.[4]

Then, on 5 November 2015, an internal Comcast document instructing CS Reps how to answer questions about DC/UBP was leaked. That document instructs Comcast personnel “Do not say: The [DC/UBP] Program is about network management. (It is not.)[5]   (Emphasis added).

Time Warner Cable’s CEO Robert Marcus similarly has spoken about DC/UBP as a business decision (and is his opinion a bad one).[6]

DC/UBP is NOT about pricing fairness

If DC/UBP were truly about pricing fairness, subscribers would pay for exactly the amount of data they used, and no more. This model would be like water or power: there would be no monthly charge whatsoever (or perhaps only a miniscule one): if you used a kilobyte, you’d pay for a kilobyte. If you happened to be on vacation for a month and didn’t use any data, then your broadband bill would be zero. There would be no startup or termination charges. There would be no modem fees, just as there are no gas meter or electrical transformer fees. Tight government regulation over pricing would be beneficial as well.

None of these conditions is present in any of the wireline DC/UBP plans in the US currently, and none that I know of anywhere in the world, though I haven’t done an extensive search. Regardless, it’s clear that the purpose of DC/UBP is not to provide “pricing fairness.”

The GAO’s explanation of DC/UBP

In 2014, the U.S. Government Accountability Office performed a study on DC/UBP. The GAO determined that while it is possible for providers to employ DC/UBP to the consumers’ advantage, “providers facing limited competition could use UBP to increase profits, potentially resulting in negative effects, including increased prices, reductions in content accessed, and increased threats to network security. Several researchers and stakeholders that the GAO interviewed said that UBP could reduce innovation for applications and content if consumers ration their data.”[7]

Simply put: absent sufficient competition, the purpose is two-fold. First, DC/UBP allows cable providers to use their monopoly (or in some much rarer cases duopoly) powers to extract additional revenues from customers. Upon the imposition of DC/UBP, the vast majority of customers have no competing provider of wireline broadband to whom they can turn.[8]

Secondly, DC/UBP gives cable internet providers the ability to use their “terminating monopoly” power to quash competition to their core video offerings. For instance, SlingTV CEO Roger Lynch in early December accused Comcast of setting its data caps just low enough to prevent customers from replacing cable TV with online video streaming.[9]

To see how this terminating monopoly power works, consider one of the increasing number of “cord cutting” households. By some estimates, 1 in 7 Americans are currently television cord-cutters.[10] These consumers do not subscribe to cable television. Instead, they purchase broadband only and subscribe to services such as Hulu, Netflix, Vudu, YouTube, Crackle, Fandor, etc. These services offer direct competition to cable providers’ video offerings. The imposition of “usage based billing” can artificially increase the price of cord cutting so that it is no longer a viable option for consumers.

A typical “cord-cutting” home uses an average of 328GB/mo,[11] exceeding most data-capped plans’ initial allowances. In fact, in October the Associated Press reported that 8% (and rising) of Comcast customers regularly exceed their data allowances and are charged overage fees.[12] As the emergence of UHD and 4k video offerings by streaming services such as Netflix and Amazon continues, these percentages will rise dramatically.[13] Since cable operators’ core video offerings are excluded from a user’s data count, it can quickly become cheaper to subscribe to a bloated cable package than pay data overage fees in addition to a la carte streaming service subscriptions. Then consumers must pay still more additional fees for DVRs to replace streaming’s de facto “on demand” nature. And yet more fees for additional cable boxes. This then is the true purpose of DC/UBP: increasing revenue, in part from overage fees and in part from pushing consumers into traditional cable packages with additional fees.

Potential Public Harms from DC/UBP

DC/UBP financially harms ratepayers, especially lower income customers

The effect of the financial penalties that streaming Netflix (and other such services) carries under DC/UBP plans will push consumers to New Charter’s own, more expensive, subscription offerings since watching video through New Charter’s traditional cable network would not count against consumers’ data allotments. These services are bundled such that subscribers must pay for hundreds of channels they have no interest in in order to get the 10-20 that they actually want to watch, thus artificially inflating their cable bill. (For instance, a recent Civic Science survey found that 56% of pay-tv subscribers would drop ESPN from their lineup in order to save $8/mo on their cable bills.[14] Cable companies, however, do not offer this as an option.) When DC/UBP is not present, cord-cutting is cheaper than cable, sometimes significantly so depending on the type of television in which the cord-cutter is interested.[15] Lower income Californians will be hit especially hard as DC/UBP forces them into those bloated, expensive cable “bundles.” For lower income viewers, this money-saving alternative will no longer be accessible since their prices are artificially inflated by DC/UBP.

This in turn stifles demand for broadband, running counter to Section 706(a)’s mandate. The CPUC has a statutory duty to protect ratepayers from a monopoly player stifling competition and investment, and that mandate is not limited to an arbitrary number of years.

The Commission is correct to want to expand broadband access to underserved areas, but it must also protect against that same access being used to prevent lower-income Californians from saving money on television bills by “cord-cutting.”

New Charter can use DC/UBP to circumvent Net Neutrality rules

Comcast is currently attempting an end-run around net neutrality rules and strongly pushing customers to their new streaming service “Stream TV” over competitors such as Hulu and Netflix. Comcast is exempting their own (more expensive) cord-cutting streaming service from usage-based metering, while competing services count against subscribers’ data allotments. While this is illegal under net neutrality, Comcast is arguing that since Stream TV exclusively uses its own IP network, and not the internet per se, net neutrality doesn’t apply.[16] As Wired.com put it, “Comcast may have found a major net neutrality loophole.”[17] (Note that this example directly contradicts the testimony of Charter’s Dr. Scott Morton.[18])

This is a loophole that New Charter could also use in order to attempt to circumvent net neutrality regulations. However, if the CPUC bars New Charter from instituting DC/UBP, this end-run loophole would be closed, and New Charter would not be able to engage in the anti-competitive customer-harming behavior that Comcast is now attempting.

It’s important to note here that the Commission cannot rely on the federal government to provide this protection to Californians. A number of U.S. Congress members have filed briefs requesting that courts overturn the FCC’s net neutrality rules.[19] Further, at the time of this writing, a number of house members are attempting to insert a net neutrality defunding clause into the omnibus spending bill.[20]

Under a Republican president and Congress, it’s clear that California should expect the federal government to abandon any and all open internet and net neutrality regulations. But as with climate change and carbon emissions legislation, California has the opportunity to lead the country by ensuring net neutrality and protecting competition, in part by adopting this proposed mitigation measure.

DC/UBP also gives ISPs the ability to leverage sponsored data programs. Such programs pose an existential threat to net neutrality, but on a more basic level, harm consumers by increasing fees for the services that participate. Sponsored data programs also present a barrier to entry for new, innovative, and less well-funded competing services.[21]

DC/UBP facilitates anti-competitive behavior

As the GAO report put it,  “…fixed providers—many of whom also provide television video content—could use UBP as a means to raise the price for watching online streaming video services—a competitor to their video services—as households continue to substitute television with streaming video.”[22] New Street Research analyst Jonathan Chaplin points out that usage-based billing would be one of Charter’s strongest potential weapons against online video competitors.[23]

DC/UBP hinders innovation and investment

Again, from the GAO report:

“Because UBP can make it more expensive to watch data-heavy content such as streaming video, it may discourage people from accessing such content and, therefore, discourage them from eliminating their television service. This might adversely affect firms that provide online video streaming services and reduce competition and innovation in the market for providing streaming video content, thereby negatively affecting consumers.

In addition, two industry stakeholders we interviewed believe UBP could in general inhibit innovation that results from experimentation and unlimited access to the Internet. Greater innovation could result in the development of more content and applications that consumers demand and value. Some Internet users, such as heavy data users, may pay more for access under UBP. As a result, some of them may limit their Internet use—as mentioned earlier, some focus group participants said that they have reduced their mobile data usage as a result of UBP—particularly of data-heavy content and applications such as online learning and video. This could lead to reduced use of some beneficial Internet applications and innovation in such applications. For example, one public interest group said that the limits that UBP may impose on the market for innovative applications and content may limit the potential of new startups.”[24]

The report goes on to discuss additional ways DC/UBP might reduce innovation, and the above citation is worth reading in full.

These are the same concerns present in Commissioner Florio’s Alternate Proposed Decision in the Comcast proceeding.[25] The alternate PD discusses these concerns as potential harms of Comcast creating a bottleneck between retail subscribers and edge providers, however, the same concerns are equally applicable to an ISP instituting DC/UBP.

DC/UBP has negative effects on network security

According to a 2012 study, DC/UBP may result in consumers—in an attempt to reduce data usage—foregoing automatic security updates to their computers, which could have negative implications for network security.[26]

DC/UBP removes educational opportunities for lower income citizens

In a June 2014 article, US News and World Report explained how online education can provide a significantly lower-cost and more flexible path to a degree. The article cites a Georgia Institute of Technology announcement that it would be offering an online master’s degree in computer science for $6,600 – about $35,000 less than its on-ground program.[27]

The online education model can put a higher degree in reach for countless people who otherwise could not afford that opportunity. However, this model relies heavily on video teleconferencing and video lectures. DC/UBP could inflate the price of online education such that it too could be unaffordable for lower-income Californians, completely pricing them out of higher degrees that could move them out of poverty into the middle class.

Charter could use DC/UBP as a loophole to completely avoid providing “Lifeline” low cost internet service, thus increasing the digital divide.

Envision a worst-case scenario where New Charter agrees to carry on TWC’s existing $14.99 low-cost plan, but caps the data at 5GB, then charges (as Comcast is currently trialing) $10 for each additional 50GB the subscriber uses. For a typical cord-cutting household that uses approximately 330GB of data a month, that would make the price of this “low-cost lifeline” plan $79.95/mo. A “low-cost” internet option of $80/month will do nothing to close the digital divide.[28]

Mitigating the Loss of TWC’s Commitment Against DC/UBP

Time Warner Cable has frequently stated publicly that it will “NEVER” impose DC/UBP. Over time, TWC has demonstrated an extremely different corporate culture and attitude towards DC/UBP than Charter has demonstrated. TWC’s CEO Robert Marcus has time and again made it clear that compulsory usage caps are off the table at Time Warner Cable – a lesson TWC learned after customers pushed back and forced it to shelve a usage cap experiment planned for Rochester, N.Y., Greensboro, N.C., and Austin, San Antonio, and Beaumont, Tex. in April 2009.[29]

TWC subsequently admitted their flirtation with DC/UBP was a mistake. That story, along with the pledge to never impose usage-based billing, is still on Time Warner Cable’s official blog at the time of this writing.[30]

The company has never raised the possibility of compulsory usage limits or usage-based billing again. In fact, Marcus often seems to be evangelizing AGAINST DC/UBP in general. On an October 2014 Wall Street analyst conference call, Marcus stated “We have no intention of abandoning an unlimited product we think is something that customers value and are willing to pay for. 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.”[31]

It’s notable that while Comcast maintained the price point of the plans it converted from unlimited to mandatory UBP, TWC’s optional UBP plans came with a price discount. However, the discounts on those packages were minimal, and as of 11/21/2015 those packages are no longer advertised on the TWC website.

Marcus has continued to be publicly vocal about TWC’s decision to keep its non-usage-based pricing intact. He spoke to this point at the Deutsche Bank Media, Internet, and Telecom Conference in March of 2014,[32] and again in a July 2015 investor conference call.[33]

On an October 2015 investor call Marcus was questioned by analyst Jonathan Chaplin on TWC’s lack of DC/UBP. Marcus responded that the way to increase revenue was to deliver more utility. DC/UBP is the opposite of that, he said.[34]

If the CPUC approves this transaction without mitigation, it will be allowing for the destruction of the largest US wireline broadband entity dedicated to NEVER instituting compulsory DC/UBP in favor of a mere three year commitment. It would forever remove a policy competitor that subscribers to other wireline broadband providers could point to and say, “Yes, a cable company can be profitable without DC/UBP.” More directly, the loss of TWC’s corporate culture and belief that DC/UBP is a poor business decision would be an immense harm to current and future TWC customers.

Charter Is Particularly Suspect Concerning DC/UBP

This merger’s financing model gives New Charter every incentive to impose DC/UBP

Post-merger, New Charter will be in a precarious financial position.[35] One of the strongest incentives for rate increases is the level of debt Charter Communications will assume in this transaction. The New York Department of Public Service staff, in examining this transaction for that state, concluded that New Charter’s debt and lowered credit rating “represents the single most substantial risk of the proposed transaction.”[36]

Charter’s Mr. Fisher disagrees with this analysis in his opening testimony, stating that “New Charter will be financially healthy to the benefit of its shareholders and consumers throughout the State of California.”[37] [emphasis added]. If this is true, then this proposed mitigation will help ensure that consumers do in fact see some of those benefits, and that they are not all given only to shareholders, an occurrence that happens far too often in transactions such as the one currently under consideration. This is especially important since when Mr. Fisher later lists the benefits that will come from the merger, none of the benefits he lists are in the area of consumer pricing.[38] As we detail later in these comments, prices will actually go UP after the merger.

Charter has provided inaccurate information about their history with DC/UBP

Charter’s expert Dr. Fiona Scott Morton, a professor of economics at the Yale School of Management, stated in FCC testimony:

“For 3 years, New Charter will not charge consumers additional fees to use specific third-party Internet applications, or engage in zero-rating (discriminatory exemptions from a data cap).

These binding commitments provide further assurance beyond the economic reasoning I describe below — assurance that New Charter will not engage in these types of conduct: charging higher interconnection fees, using discriminatory data plans, or reducing the quality of OVD signals. (Note that Charter already does not have data caps for its residential broadband customers. Notwithstanding the dramatic but welcome rise in data usage by broadband customers, Charter has not had an active data cap since January 2012.)”[39]

But this statement is simply incorrect. As of November 2013 Charter had data caps ranging from 100-500GB.[40] Customers in some areas were called by Charter for exceeding their usage allowance,[41] and usage rationing remained in Charter’s Acceptable Use Policy until late 2014,[42] not January 2012 as Dr. Scott Morton claims. In fact, as of 21 November 2015, Charter’s AUP still allows it to define “excessive use of bandwidth” however it sees fit, and take any action that Charter in its sole opinion it deems reasonable.[43] Dr. Scott Morton does not believe Charter has any interest in imposing data caps on customers, despite the fact Charter quietly shelved existing caps on Oct. 1, 2014, just several months before unveiling its bid for both Time Warner and Bright House, neither of which have capped customer usage.[44]

The FCC is rightly concerned about this discrepancy, and has requested that Charter detail when it adopted bandwidth usage caps, when it dropped them, and why.[45] The CPUC would be right to be concerned as well.

Charter has a history of misleading customers and regulators.

For example, Charter advertises Spectrum TV Stream service at $12.99/mo, when most users will actually pay at least $20/mo, some more.[46] While some “padding” via fees is unfortunately normal, this is upwards of a 50% differential. Note that this is in direct contradiction to Mr. Fisher’s opening statement to the CPUC, in which he claims that Charter “does not separately charge users incremental fees that other providers in the industry commonly add on to the advertised price… As a result, consumers have a clearer understanding of… the price that they will see on their bill.”[47]

Another example: The FCC is concerned about 26% owner John Malone’s involvement with this merger, as he has engaged in anticompetitive behaviour in the past.[48] Malone, whom Senator Al Gore once referred to as “The Darth Vader of telecom,”[49] is currently best known as the owner of SiriusXM satellite radio. The two satellite companies merged in 2008 with a mitigation condition forbidding any rate hikes for three years.[50] Upon the expiration of that condition, SiriusXM promised investors an immediate price hike.[51] Based on past history, there’s no reason to believe that any mitigation conditions the CPUC imposes on this transaction won’t be discarded immediately upon expiration.

And a third example: on 20 January 2016 Charter released the results of a survey that it sponsored itself. Charter claims that the results show public support for the merger. However, the statements Charter used in the poll pertaining to data caps were extremely misleading. Respondents were told by the pollster that  “Charter has said that it will not impose data limits on customers after the merger.”[52] However, there was no mention of the incredibly brief 3 year time limit on this commitment, nor the fact that Time Warner has promised for years to never impose data limits on customers. It is definitely misleading, possibly deceitful, for Charter to use responses to this deceptive statement as “proof” of public support for this transaction.

A fourth example: Dr. Scott Morton’s November 2 statement is less than forthcoming in many regards. On Page 10 (Section 27) Dr. Scott Morton completely omits a fourth characteristic of a valuable MVPD partner: the commitment to refrain from implementing DC/UBP. Implementation of DC/UBP would artificially increase the cost of the OVD’s product to the consumer, thus decreasing demand for that service. This increased cost over which the OVD has no control is in effect a barrier to market entry, and therefore a disincentive to innovation and reduction of competition.

It’s also telling that Dr. Scott Morton’s conclusion in Part 49 is that Charter’s “technology” promotes entry of OVDs. Conspicuously absent is the statement that Charter’s “policies” promote entry of OVDs. Even more conspicuous is that as noted in Part 128, Charter promises a mere three years of refraining from disadvantaging OVDs. What Charter is promising is both flimsy and transparent: “You have nothing to worry about, but only hold us to it for three years.”

Still further, in Part 130, Dr. Scott Morton notes Netflix’s statement that “Charter’s new peering policy is a welcome and significant departure from the efforts of some ISPs to collect excess tolls to the Internet.” However, the CPUC must guard against New Charter shifting these “excess tolls” directly onto subscribers as the GAO report referenced earlier warned. DC/UBP would be a prime means for New Charter to do just that.

A fifth example: the opening testimony of Charter’s Mr. Falk is likewise misleading on a number of points. Mr. Falk claims that the merger will come with “no countervailing harms,”[53] however, according to his own statement, there are clearly price increases coming for many TWC customers.[54] Mr. Falk testifies about Charter’s “customer friendly billing practices,” but in reality those practices are not friendly to consumers at all.[55] Mr. Falk then goes on to make a claim that is flatly contradicted by his own expert’s testimony to the FCC,[56] makes misleading statements about the significance of wireline competition,[57] and a statement that is materially false regarding pricing of Charter’s base internet speed tier.[58]

Charter has flatly failed to comply with multiple Commission rulings.

Charter has refused to comply with certain requirements of DIVCA even though the company submitted an affidavit to the Commission swearing to do so.[59] More recently, Charter ignored the January 20 ALJ ruling of A.15-07-009, which required that “Charter and TWCIS shall provide notice to their respective customers not less than 5, nor more than 30 days, prior to” the

Los Angeles Public Participation Hearing scheduled for January 26.[60]  As of the morning of January 25, I had received no such notice either by email or postal mail, even though I hold not one but two California-based TWC accounts. Note that I did check my SPAM folder, and no notices had been diverted there.

The point being… both consumers and the CPUC should be extremely suspect of anything Charter says regarding the benefits of this merger, including their reasoning that DC/UBP is something that they have no interest in instituting. Mitigations should be designed to protect consumers against a potentially hostile and untrustworthy monopolistic player, particularly around an issue as nuanced and complex as usage based pricing.

Charter’s Opening Testimony Supports this Proposed Condition

New Charter should not object to this proposed mitigation condition, since it is substantially supported by Dr. Scott Morton’s November 2 statement, as well as the opening testimony from Mr. Fisher, the Senior VP of Corporate Finance at Charter, and Mr. Falk, Charter’s Senior VP for State Government Affairs.

In her November 2 testimony, Part 132, Dr. Scott Morton discusses New Charter’s open internet commitments. While not addressing DC/UBP directly, in her discussion of other conditions addressing issues such as paid prioritization, zero rating, throttling, etc, Dr. Scott Morton states that the fact these conditions have a finite life should not be cause for concern. She explains that in three years’ time market conditions would be such that “a strategy of foreclosure or otherwise trying to impede OVDs would be even more unprofitable for New Charter.”

Dr. Scott Morton then suggests that should New Charter decide to engage in anticompetitive behaviour in three years’ time, consumers could simply switch to an alternate broadband provider. However, as Dr. Scott Morton goes on to point out, there is currently a lack of competing broadband providers in most of New Charter’s proposed footprint. Other experts have also testified that the US market for fixed broadband is not effectively competitive, and this situation will persist for the foreseeable future.[61] This is true for New Charter’s proposed footprint in California as well.[62]

“Currently AT&T/Verizon have usage allotments that make it economically unattractive to use wireless as an in-home broadband service,” Dr. Scott Morton explains. “T-Mobile and Sprint do offer “unlimited” plans, however, they… de-prioritize traffic above usage thresholds…”[63] So even by her own testimony, wireless providers do not count as potential broadband competition for New Charter.

Dr. Scott Morton goes on to examine what little wireline broadband competition does exist, but as the CPUC is well aware, the companies she cites are not available in most of New Charter’s proposed footprint.

In summary, Dr. Scott Morton testifies that in three years time there will be adequate broadband competition present to prevent New Charter from behaving in an anti-competitive manner. If she is correct, then this proposed mitigation condition will sunset based on the existence of that very competition. If she is incorrect about the amount of time it takes for that competitive marketplace to form, then this mitigation will simply continue to protect consumers until the competition Dr. Scott Morton discussed does actually come into existence.

The mitigation condition being proposed here simply ensures that New Charter only has the ability to behave in an anticompetitive way when the “competing broadband provider[s]” Dr. Scott references are actually in existence. It’s designed in a way to be fair to both consumers, and New Charter.

Why Competition Must Be the Only Trigger for Sunsetting this Condition

The 2014 GAO report examined four mobile providers that impose DC/UBP. ALL OF THEM have increased the variety of plans offered, but even more significantly, ALL OF THEM have increased the amount of their monthly data allowances. That’s not true of the fixed internet providers studied. Some of those providers have introduced higher priced, higher speed plans that also come with increased allowances, but NONE of them have increased the data allowances without an accompanying price increase.[64]

The obvious difference between the wireless and wireline providers’ circumstances is the presence of competition in the mobile sphere, and the lack of competition in the wireline sphere. The GAO report affirms this analysis.[65] The report goes on to explain that without adequate competition (and much evidence proves that duopoly markets do not constitute effective competition[66]), wireline customers have fewer plan choices. Only two of the wireline providers examined even offered discounted UBP plans. The two that did offer discounted plans offered discounts far inferiour to the discounts offered by the more competitive wireless market.[67]

For further evidence, consider the example of Comcast’s usage-based pricing “trial.” Comcast’s DC/UBP policies have resulted in a deluge of FCC complaints, potentially upwards of 11,000.[68] Comcast customers report gross inaccuracies in the company’s data meter, resulting in erroneous overage charges.[69] Customers are also reporting that once they pay Comcast’s $35 add-on for truly unlimited service, speeds for services that compete with Comcast (such as Netflix and Hulu) actually DROP.[70] The company then uses these speed issues to attempt to force customers into renting a modem from Comcast. When pressed hard enough by customers with technical knowledge of modems and routers, however, Comcast reps finally do resolve the speed issues remotely.[71]

The logical action for these customers would be to leave Comcast for a different provider; however, for the vast majority of them there is no other provider available. While admittedly Comcast is a different company from Charter, this example underscores the absolute necessity to sunset mitigation conditions only when actual wireline competition exists in the market…  NOT after an arbitrary number of years. As Commissioner Florio’s Alternate Proposed decision stated:

“We find that conditions that only temporarily or incompletely mitigate identified harms to the public interest are not sufficient to offset those harms. Such conditions also do not ‘preserve the jurisdiction of the commission,’ as required by § 854(c)(7).[72]

Summary on DC/UBP

In the Comcast proceeding, the Proposed Decision offered a condition (specifically #17) which would have restricted Comcast from implementing either data caps or mandatory usage based pricing (DC/UBP) for a period of five years. However, as Commissioner Florio’s Alternate Proposed Decision noted, that condition would have been insufficient to effectively mitigate the underlying potential harm due to the condition’s temporary nature.

Many mitigation conditions in the Comcast PD had no sunset clauses at all, such as Conditions 11 and 12 expanding the Internet Essentials program. Just as a sunset for the expansion of IE would have been unreasonable, so the sunset clause for the prohibition on DC/UBP was inadequate. Additionally, it would have run afoul of the Commission’s mandate under § 854(c)(7).

The behaviour of companies in this industry in general, and Charter’s past behaviour specifically, makes it clear that the CPUC should not take a risk on Charter’s less-than-compelling offer of a mere three year delay of the institution of data caps and usage-based pricing.

Beyond this particular issue, we believe that there is overwhelming evidence that this merger clearly would not be in the best interest of Californians, and that the CPUC should deny the transfer of licenses. However, should the CPUC for some reason allow the transfer to take place, we’d strongly request that the CPUC tailor the mitigation condition concerning data caps and usage-based pricing as this paper has suggested. Only a mitigation condition designed in this way would truly protect Californians, yet also be fair to New Charter by allowing the condition to sunset when the competition that Charter’s experts have testified is so important actually comes into existence.

Part 2 — Additional Reasons This Transaction is Not in the Public Interest

Time Warner Cable’s Superior Recent Upgrade Performance

The most important question before the Commission is which cable operator is better positioned to deliver the services customers in this state want and need. We argue that 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. Time 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[73]:

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 was serviced with Maxx upgrades by the end of 2015, and Marcus has indicated additional cities will receive upgrades in 2016.[74]

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[75]. “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 30 January 2014[76], 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. Note that in Los Angeles these speed increases came with no corresponding price increase. In evaluating this transaction in New York, the NYDPS staff noted, “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.” The CPUC should examine this issue as well.

Charter, on the other hand, is saddled with debt servicing costs and more expensive credit, both of which are deterrents to investment and are likely to limit the scope of Charter’s ongoing system upgrades and maintenance, not to mention also placing upward pressure on the prices New Charter will charge consumers. 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.

Charter’s upgrade proposal is, in fact, both technically and 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 it claims.

Charter Communications’ Network Upgrade Proposal Is Not a Good Deal for California

Time 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 for a markedly higher price. The extra expense over the TWC 50Mbps plan does not justify a mere 10Mbps speed increase. (Currently in Los Angeles, TWC offers 200Mbps for $65/mo… roughly the same price as Charter’s 60/5 plan. TWC’s plan is over three times as fast as Charter’s for nearly the same amount). But perhaps more concerning, this 10Mbps increase comes at a high cost to customers looking for more budget-priced service than 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 Charter charges for their 60Mbps tier, or those who have no interest in streaming media.

Time Warner Cable offers its $14.99 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 Californians 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 larger, superior product line for less money at ALL speed levels in California. Charter would bring Californians fewer options at more expensive prices.

Charter’s proposed solution to serve low-income Californians is the 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[77] 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 aren’t eligible until you pay it 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.

Families 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 that 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 Californians are simply not adequate.

Charter Communications’ Cable Pricing Is More Expensive and Less Flexible than Time Warner Cable’s Pricing

Charter’s commitment to improve cable television does not offer any significant benefit to 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,”[78] 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.[79]

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).[80]

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. However, Time Warner allows customers to effectively purchase their set top boxes in the form of the Roku device, giving consumers the ability to completely eliminate the set top box rental fee is they so wish.[81]

Other Points the Commission Should Consider in Reviewing This Transaction

  • California must receive ‘most favored state’ status, meaning that whatever conditions other state commissions get from Charter must automatically apply to all Californians as well.
  • The Commission must insist that rural California is treated equally to the Los Angeles market. If this transaction is approved, Charter must be compelled to commit to continue Time Warner Cable’s Maxx upgrade initiative across all of its service areas in California, to be completed within 30 months. Nothing less than that should be acceptable to the Commission. We agree with the New York DPS staff’s recommendation that Charter also be compelled to upgrade facilities to support gigabit broadband, and that should apply to California as well.This upgrade 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[82], MidContinent[83], Cox[84], and Mediacom[85] 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 the likes of Carlsbad, Hesperia, Jurupa Valley, and beyond.
  • 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.

Again, we feel Commissioner Florio’s Alternate PD in the Comcast matter applies equally well here and that the application should be denied. If the Commission feels it must approve this transaction, however, the conditions that accompany it to achieve a true public interest benefit must be meaningful and ongoing. Any failure of New Charter 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.
Conclusion

Cable operators know that 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 to no chance that 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 utmost seriousness. Customers will likely live with the decision that this Commission makes for the next 20 years or more.

As the Commission must realize, this transaction does not involve just entertainment. Several months ago the Obama Administration declared broadband Internet access a “core utility:”[86]

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

Our group strongly believes that California should not take a risk on Charter’s less-than-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 Californians, offers more broadband options and faster speeds, 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 packages.

[1] Comcast XFinity website: http://goo.gl/OlWFu3

[2] For instance: “Internet traffic is growing fast — but capacity is keeping pace” Telegeography. 3 September 2008. https://goo.gl/OFBPHX; and Bode, Karl. “The ‘Bandwidth Hog’ is a Myth” DLSreports. 30 November 2011. https://goo.gl/lv6jE5

[3] DSLreports.com (https://goo.gl/0sZasc)

[4] Brodkin, Jon. “Comcast VP: 300GB data cap is ‘business policy’ not ‘technical necessity’ Ars Technica.  14 August 2015. http://goo.gl/1lAFwJ

[5] Morran, Chris. “Leaked Comcast Doc Admits: Data Caps Have Nothing To Do With Congestion” Consumerist. 6 November 2015. http://goo.gl/Uq9o5c

[6] TWC 2014 Q3 Earnings Call. http://goo.gl/Oz9hnL

[7] U.S. Government Accountability Office. “FCC Should Track the Application of Fixed Internet Usage-Based Pricing and Help Improve Consumer Education. November 2014. http://www.gao.gov/products/GAO-15-108

[8] Reply Testimony of Lee L. Selwyn. 15 January 2016. Pages 75-77.

[9] Brodkin, Jon.  “Sling CEO: Comcast data caps so low they hurt competing video providers” Ars Technica. 7 December 2015. http://goo.gl/w98cqJ

[10] Pew Research Center “Home Broadband 2015” report. Page 19, as cited in NHMC reply testimony.

[11] Brodkin, Jon. “Watch out for data caps: Video hungry cord-cutters use 328GB a month” Ars Technica. 14 May 2014.  http://goo.gl/0O8vtR

[12] Arbel, Tali. “How Comcast wants to meter the internet” Associated Press. 27 October 2015. http://goo.gl/tnc66p

[13] Horn, Leslie. “You can burn through your entire broadband data cap in one long weekend” Gizmodo. 18 February 2014. http://goo.gl/Z0yQfY; and also Reply Testimony of Lee L. Selwyn, 15 January 2016, page 114.

[14] Frankel, Daniel. “Survey: 56% of pay-tv customers would ditch ESPN in order to save $8 every month.” FierceCable. 13 Jan 2016. http://goo.gl/CQRCpp

[15] Heisler, Yoni. “How much money does cutting the cord really save?” BGR.  12 November 2015. https://goo.gl/tmiQL2; also Jones, Stacy. “Cost of cable TV vs internet streaming” Bankrate. 24 November 2014. http://goo.gl/tGJqK5

[16] Brodkin, Jon. “Comcast launches streaming TV service that doesn’t count against data caps” Ars Technica. 19 November 2015. http://goo.gl/ITJusN

[17] Finley, Klint. “Comcast may have found a major net neutrality loophole” Wired. 20 November 2015. http://goo.gl/zyFJku

[18] 2 November 2015 Statement of Dr. Scott Morton, Parts 132-133, pages 48-49.

[19] Brodkin, Jon. “House Republicans urge court to throw out net neutrality rules” Ars Technica.

11 November 2015. http://goo.gl/TBV56e

[20] Fung, Brian. “Republicans are trying to defund net neutrality. Will it work?” Washington Post. 24 July 2015.  https://goo.gl/Shk99e

[21] Ravenscraft, Eric. “Sponsored Data Is The Newest, Biggest Threat to Net Neutrality” Lifehacker. 20 January 2016. http://goo.gl/SXtl9C

[22] GAO “Report to the Ranking Member, Subcommittee on Communications and Technology, Committee on Energy and Commerce, House of Representatives” (GAO-15-108) page 26. http://www.gao.gov/assets/670/667164.pdf

[23] Dampier, Phillip. “Wall Street: Usage Caps Are an Important Weapon in Fight Over Cord-Cutting.” Stop the Cap!  18 January 2016. http://goo.gl/FKhsFO

[24] GAO “Report to the Ranking Member, Subcommittee on Communications and Technology, Committee on Energy and Commerce, House of Representatives” (GAO-15-108) page 26.

[25] CPUC A.14-04-013, A14-06-012 Alternate Proposed Decision, pages 71-72.

[26] Marshini Chetty, Richard Banks, A.J. Bernheim Brush, Jonathan Donner, and Rebecca E. Grinter. “‘You’re Capped!’ Understanding the Effects of Bandwidth Caps on Broadband Use in the Home.” ACM Conference on Human Factors in Computing Systems. May 2012.

[27] Haynie, Devon. “Why Online Education May Drive Down the Cost of Your Degree” US News and World Report.  3 June 2014.  http://goo.gl/HSH1Pp

[28] Kehl, Danielle and Lucey, Patrick. “Artificial Scarcity: How Data Caps Harm Consumers and Innovation”  Open Technology Institute. 30 June 2015. https://goo.gl/zt5Jj9

[29] Yao, Deborah. “Time Warner Cable shelves some Internet cap plans” ABC News. 18 April 2009.  http://goo.gl/YynOiM

[30] Simmermon, Jeff. “Launching An Optional Usage-Based Broadband Pricing Plan In Southern Texas” TWC “Untangled” Blog. 27 February 2012.  http://goo.gl/PoS5nR

[31] Dampier, Phillip. “Time Warner Cable Recommits: No Mandatory Usage Caps As Long As Company Remains Independent” Stop the Cap! 30 October 2014.  http://goo.gl/6vxXNx

[32] Dampier, Phillip. “Time Warner Cable Admits Usage-Based Pricing is a Big Failure; Only Thousands Enrolled” Stop the Cap! 13 March 2014. http://goo.gl/lCqp4k

[33] Q2 2015 Time Warner Cable Results-Earnings Call. 30 June 2015. http://goo.gl/JINiwn

[34] Q3 2015 Time Warner Cable Earnings Call. 29 October 2015. https://goo.gl/piDDDc

[35] Media Alliance Reply Testimony to Joint Applicants Opening Testimony, pages 2-3. 15 January 2015.

[36] “Redacted Comments of the New York State Department of Public Service Staff” September 16, 2015. Page 39. http://goo.gl/C1Xpph

[37] Opening Testimony of Charles Fisher, page 6.

[38] Id at 7-8.

[39] “Statement of Dr. Fiona Scott Morton re the Merger of Charter, TWC, and BHN” 2 November 2015. Page 48. http://goo.gl/eEtY5Z

[40] Higginbotham, Stacey. “Want to know if your ISP is capping data? Check our updated chart.” GigaOm. 15 November 2013. https://goo.gl/owGq96

[41] DSL Reports: https://goo.gl/1RXjgm

[42] DSL Reports: https://goo.gl/aoFvuT

[43] “Charter Residential Internet Acceptable Use Policy.” https://goo.gl/8ICMe1

[44] Testimony of Laura Blum Smith, 15 January 2016. Page 14.

[45] Eggerton, John. “FCC Seeks Data Dump from Charter, TWC, Brighthouse” Multichannel News. 23 September 2015.  http://goo.gl/nJEazB

[46] Dampier, Phillip. “Charter and Time Warner Cable Try Internet-Only TV Service to Combat Cord-Cutting, Cord-Nevers” Stop the Cap! 26 October 2015.  http://goo.gl/doimuR

[47] Opening Testimony of Charles Fisher, page 4.

[48] Shields, Todd. “Cable Magnate Malone’s Stakes Scrutinized in Charter-TWC Deal” Bloomberg News. 9 November 2015. http://goo.gl/s6VTMw

[49] Kang, Cecilia and Fung, Brian. “The Darth Vader of Telecom is Back” Washington Post. 26 May 2016.  https://goo.gl/qWS480

[50] Lasar, Matthew. “Sirius/XM merger approved with new conditions” Ars Technica. 28 July 2008. http://goo.gl/LO4aaQ

[51] Lieberman, David. “Sirius XM CEO Mel Karmazin Vows Big Vows Big Consumer Price Hike (If the FCC Allows It)” Deadline Hollywood. 3 May 2011.  https://goo.gl/tTYZE3

[52] Cox, Kate. “Poll Sponsored By Charter Says Charter Is Great, More Charter is Greater” Consumerist. 20 January 2016. http://goo.gl/Xp0wsJ

[53] Opening Testimony of Adam Falk, page 2.

[54] Charter currently charges just under $65/mo for its 60Mbps tier of standalone internet with wireless gateway (outside of promotions). In Los Angeles, though, Time Warner Cable offers for that exact same amount 200Mbps also with a wireless gateway. Time Warner provides over three times the speed Charter does for the same price. That certainly is a countervailing harm to consumers.

[55] Unlike Time Warner, Charter bakes its modem fee into the internet plan. So every single customer is paying that modem fee… even if they own their own modem (like many Time Warner customers do). Not only is that not a “customer friendly billing practice,” but it’s another countervailing harm as well. Later on page 18 of his opening statement, Mr. Falk says “New Charter will bring base speed tiers from 15 Mbps to Charter’s current standard of 60 Mbps at uniform pricing within a year of closing.” Those unfortunate consumers get to take a double hit: not only will Charter be increasing the price of the comparable tier, but they will be taking away even the option to have a cheaper tier should the customer want it. It’s a massive price hike with fewer options available. That certainly doesn’t sound like the “customer friendly billing practices” Mr. Falk is touting, nor does it make his claim that consumers will face no harms from this merger ring particularly true.

[56] On page 3 of his opening statement, Mr. Falk claims that New Charter will face “other forms of competition (e.g., wireless providers).” But as described above, Dr. Scott Morton admits that wireless providers are actually NOT competition for New Charter’s internet offerings.

[57] Also on page 3, Mr. Falk states that “New Charter will face significant competition from wireline competitors (e.g., AT&T and Frontier).” But in reality, the areas where AT&T and/or Frontier (or even Verizon) actually overlap New Charter territory is extremely limited. And at any rate, this proposed mitigation condition would sunset where that overlap is present.

[58] Mr. Falk’s states: “Charter offers its base 60 Mbps service at lower prices than other providers for comparable service, without modem fees…” This simply isn’t true. Currently, Time Warner offers a 50 Mbps off contract for $45/mo. That’s comparable and significantly less expensive than Charter. TWC also offers 100Mbps at $55/mo… still less than Charter’s price for the slower 60Mbps. Mr. Falk’s statement is simply false.

[59] Testimony of Marc Puckett on behalf of Intervenor Town of Apple Valley, page 2. 15 January 2015.

[60] CPUC ALJ Ruling A.15-07-009 page 2.

[61] Testimony of Martyn Roetter on behalf of the County of Monterey. 15 January 2015. Page 1.

[62] Reply Testimony of Lee L. Selwyn. 15 January 2016. Page 116.

[63] Statement of Dr. Scott Morton. 2 November 2015. Page 51, footnote 187.

[64] USGAO. “Report to the Ranking Member, Subcommittee on Communications and Technology, Committee on Energy and Commerce, House of Representatives” (GAO-15-108). November 2014. Page 11. http://www.gao.gov/assets/670/667164.pdf

[65] Id. at 23.

[66] Reply Testimony of Lee L. Selwyn. 15 January 2016. Page 132.

[67] Id pages 24-25.

[68] Brodkin, Jon. “Complaint Factory: Angry Internet subscribers tee off against Comcast, Verizon, AT&T.” Ars Technica. 29 December 2015.  http://goo.gl/484NYO

[69] Dampier, Phillip. “Comcast Customers Buy $35 Usage Cap Insurance, Report ‘Unlimited’ is Slower Than Ever.” Stop the Cap! 28 December 2015.  http://goo.gl/SMfsOg

[70] Id.

[71] Id.

[72] CPUC A.14-04-013, A14-06-012 Alternate Proposed Decision, page 77.

[73] TWC Untangled Blog. 30 April 2015. http://goo.gl/6gp3er

[74] TWC Untangled Blog. 14 July 2015. http://goo.gl/eWZEGl

[75] TWC Q4 2014 Earnings Call Transcript on Seeking Alpha. http://goo.gl/c8QZtR

[76] TWC Untangled Blog. 14 July 2015. http://goo.gl/jafclZ

[77] Dampier, Phillip. “Bright House’s Mysterious Internet Discount Program Charter Wants to Adopt Nationwide” 25 June 2015. http://goo.gl/DVlwpF

[78] Baker, Liana. “Analysis: Charter’s bid for Time Warner Cable hinges on Rutledge’s skill. Reuters. http://goo.gl/QndjSd

[79] Charter Channel Lineup. https://www.charter.com/browse/content/tv#/channel-lineup

[80] Senator Ed Markey Press Release. 30 July 2015. http://goo.gl/PNy2b0

[81] Mlot, Stephanie. “Replace your Time Warner Cable Box with a Roku” PC Magazine. 10 November 2015. http://goo.gl/GkSbu7

[82] Baumgartner, Jeff. “Suddenlink Boots Up 1-Gig Broadband” Multichannel News. 9 July 2015. http://goo.gl/U2SK4X

[83] Midco Press Release. 17 November 2014. https://goo.gl/pKmChH

[84] Baumgartner, Jeff. “Cox Plots DOCSIS 3.1 Plans” Multichannel News. 22 September 2015. http://goo.gl/LDIFsR

[85] Baumgartner, Jeff. “Mediacom Sets Residential 1-Gig Rollout” Multichannel News. 9 September 2015. http://goo.gl/MGFQ02

[86] Trujillo, Mario. “Obama administration declares broadband ‘core utility’ in report” The Hill. 21 September 2015. http://goo.gl/5vazOL

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