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Merry Christmas from Comcast: Colo., Wash., Ore., Utah Getting Speed Upgrades on Dec. 16

Speed upgrades won't help customers if they exceed Comcast's market-tested 300GB usage cap that could extend nationwide in 2015.

Speed upgrades won’t help Comcast customers if they exceed a market-tested 300GB usage cap that could extend nationwide in 2015. (Image courtesy: “Funch”)

Comcast will double the broadband speeds of many of its broadband customers at no extra charge in the Pacific Northwest and Rocky Mountain region just in time for Christmas.

  • Performance will increase from 25Mbps to 50Mbps;
  • Blast! will increase from 50Mbps to 105Mbps;
  • Extreme 105 (105Mbps) will be replaced with Extreme 150 (150Mbps).
  • Certain areas will qualify for new speed plans of 305 and 505Mbps.

The new speeds are planned to begin on Dec. 16 and a modem reset may be required. Comcast indicates the speed increase excludes parts of New Mexico, Tucson, Ariz., and Fort Collins, Col.

These markets are not part of Comcast’s ongoing usage cap market trials testing a 300GB monthly usage cap with a $10 penalty for each 50GB customers exceed their allowance.

Although some customers are pleased about the speed increases, with usage caps potentially looming the benefits may prove fleeting.

One customer who has cut cable television and now streams all of his video entertainment online found Comcast would empty his bank account if the overlimit fee was in place in his area.

“I figured I’d go and see how much data I actually used in those months and found that I used 996GB in September, 706GB in October and 553GB in November,” wrote Funch. For the month of September, he would have owed Comcast an extra $140 in penalties on top of his usual Internet bill thanks to viewing Hulu and Netflix.

Customers in Comcast usage capped markets are turning down the video quality of Netflix to conserve their usage allowance, resulting in degraded video performance.

“They boost their speeds but then charge you more if you actually use them,” said Nashville customer Paul Frankel. “It’s the Comcast way.”

HD Smorgasbord: Rogers Tells Customers to Stop Worrying and Crank Up the Streaming Video

In a complete about-face for eastern Canada’s largest cable operator, Rogers Communications is inviting customers to take the brakes off their usage and go hog-wild with high bandwidth HD streaming and downloading with an unlimited use plan.

“Whether you use shomi, Netflix, YouTube or all three as your go-to streaming service(s), if you’re a subscriber to an unlimited Rogers Internet package, you don’t have to worry about streaming video in anything other than their highest-quality settings – the image is pristine and the sound is awesome,” the company writes on its online blog.

Rogers had argued for at least five years before Canada’s telecommunications regulator that compulsory usage caps and overlimit fees were necessary to manage congestion on their networks and to make sure that heavy users pay their fair share.

Those days of congestion are evidently over because Rogers takes customers through several tutorials to teach them how to turn up their streaming settings to deliver HD and 4K video streams.

“Rogers comes very close to implying it is Netflix and YouTube that compromise the video experience of customers, despite the fact Netflix created its user-definable video playback settings precisely to help Canadians manage usage allowances from companies like Rogers,” said online video analyst Rene Guerdat. “It’s clear that competition from independent providers offering unlimited use accounts has made Rogers’ usage cap regime impossible and they were forced to market an unlimited option of their own.”

Here is Rogers’ guide for cranking up the video quality of video streams, useful for anyone else who subscribes to these services as well:

shomi

This new video-streaming service for Rogers Internet or TV customers has three video-quality settings (Good, Better, Best). Each uses different amounts of bandwidth and offers different levels of viewing quality. These settings can be individually changed for each user profile, and can be made only from the Web application via the account holder’s profile.

To check / change your stream settings

  1. In a browser, go to shomi.com and log in with your account credentials.
  2. Go to the dropdown menu at the top far-right corner of the Web page.
  3. Select ‘Manage Account and Profiles.’
  4. Select the profile that you want to edit (or create a profile if it is a new profile), and under the ‘Manage Profiles’ menu you’ll see your ‘Max Video Quality’ settings.
  5. Click ‘Edit’ and then select the video-quality setting that you want.

Note: These profile settings update all devices except your Rogers cable box (if you’re using one).

Netflix

Netflix has streaming-video playback settings that use less data (in case you have a small monthly data cap). If you’re on an unlimited Rogers Internet package, though, you can get a better experience by streaming at the highest settings. Here’s how.

To check / change your stream settings

  1. In a browser, go to Netflix.ca and sign in with your Netflix username and password.
  2. If prompted, select the appropriate user profile you want to change.
  3. In the top-right corner, click the downward arrow, then click ‘Your Account.’
  4. In the Your Profile section, click ‘Playback Settings.’
  5. Click the radio button to select the highest-quality streaming setting (‘High’), then click ‘Save.’

This setting will be your new default across all your devices. If you have multiple user profiles under your Netflix account, follow the above process for them, too.

YouTube

YouTube gives you a lot of playback control, and typically does a pretty good job of balancing video quality and connection. However, to ensure you’re seeing the best-quality video possible from YouTube, you can change the settings for the videos you watch. Here’s how.

Play a YouTube video in HD (when available)

  1. While playing a video, move your cursor over the player window. Video-player elements will appear.
  2. Click the gear icon in the lower right of the player.
  3. In the bottom of the pop-over menu that appears, click on the ‘Quality’ option.
  4. Select the highest video-quality setting and click it to apply.

Tip: Not all video content that’s uploaded to YouTube is available in full 1080p HD. If no HD option is offered, just choose the highest-quality setting that’s available.

Default to high-quality YouTube playback

Setting default playback behaviour on YouTube requires an account. If you have a Google account (Gmail, Google+, etc.), you already have everything you need.

  1. Log in to YouTube using your Google or Gmail account ID.
  2. Click on your username and, in the menu that appears, choose the gear icon. If you’re already logged in, click your profile image in the top-right corner to find the gear icon instead.
  3. In the left navigation pane, click ‘Playback.’
  4. Select ‘Always choose the best quality for my connection and player size.’
  5. Click Save in the top right.

Now, YouTube will give you the best-quality video it can, based on the above-mentioned factors. Double-click a video to launch it in full-screen and to get a full-HD version of the video, where available.

AT&T Sneaks Telecom Deregulation Amendment into Ohio’s Agriculture/Water Quality Bill

Phillip Dampier December 2, 2014 AT&T, Consumer News, Public Policy & Gov't, Rural Broadband 9 Comments
Ohio Gov. John Kasich is threatening to veto the state's Agriculture Bill if it reaches his desk with telecom deregulation inserted as an amendment.

Ohio Gov. John Kasich is threatening to veto the state’s Agriculture Bill if it reaches his desk with telecom deregulation inserted as an amendment.

AT&T’s lobbyists in Ohio have convinced state legislators to ignore a veto threat from the governor’s office and insert a deregulation amendment into an unrelated water quality and agriculture measure.

Retiring House Speaker Bill Batchelder (R-Medina) is shepherding AT&T’s latest attempt at total deregulation through the Ohio House of Representatives, claiming it will break down barriers for businesses in Ohio and give new businesses the infrastructure they need to make Ohio their home. Among Batchelder’s top donors is AT&T.

Critics contend the measure will disconnect up to 5% of rural Ohio from all telephone service because they live in “no signal bar” areas of the state.

The amendment, inserted into HB490 (at Sec. 4905.71), would end AT&T’s requirement to serve as a Provider of Last Resort, which has guaranteed that every Ohio resident seeking telephone service has had it for nearly 100 years. If the measure passes, AT&T can unilaterally disconnect service and leave unprofitable service areas, mostly in rural and poor sections of the state. Current Ohio law only permits a telephone company to end service if it can prove financial hardship and show that reasonable alternatives are available to affected residents. AT&T earned $128.75 billion in revenue in 2013 and is unlikely to meet any hardship test.

Although AT&T is unlikely to stop service in suburban and urban areas, ratepayers across the state would lose oversight protections from lengthy service outages, unreasonable billing standards and credit requirements, the ability to quickly connect or disconnect service and access to important low-income programs like Lifeline. Rural customers could be forced away from traditional landline and DSL service in favor of AT&T’s wireless network, which costs considerably more.

Current AT&T customers in Ohio can subscribe to landline service for around $20 a month in rural areas and broadband DSL for as little as $15 per month. AT&T’s wireless alternative costs $20 a month for voice service and at least $60 a month for wireless broadband (with a usage cap of 10GB per month and an overlimit fee of $10 per gigabyte). An average landline customer consuming 20GB of data would pay $35 a month for both voice and data services. The same customer using AT&T’s wireless voice and data alternative would pay $180 a month, mostly in overlimit penalties.

AT&T’s lobbying has riled Ohio’s Republican governor, John Kasich, who has threatened to veto any agriculture bill that reaches his desk with telephone deregulation attached.

att_logo“The telecommunications language will force the governor to veto this bill, as he has personally said and has also been repeated several times by other members of the administration,” Jim Zehringer, director of the Ohio Department of Natural Resources told the Ohio Senate’s Agriculture Committee during an informal hearing on the legislation. “We would be sacrificing all the great work done so far on this bill if these provisions are not removed.”

The AARP is concerned the measure will not only hurt rural Ohio, but elderly and poor residents who cannot afford wireless service.

“They will only have wireless telephone service with no price controls or guarantees for low-income Ohioans in these areas,” AARP Ohio wrote in a released statement about the proposal. “Additionally, there are areas of Ohio where wireless service is minimal, and to provide the speed needed for those receiving tele-health services in those areas will be even more expensive.”

Interested Ohio residents can share their feelings with their state legislators and the governor’s office.

  • Locate your Ohio House Representative: http://www.ohiohouse.gov/ or call 1-800-282-0253 and ask to be connected to your local representative.
  • Governor John Kasich’s Office Phone: (614) 466-3555

Nashville Comcast Customer Paying for Business Service to Avoid Usage Caps Faces $2,789 Cancelation Fee

Phillip Dampier November 19, 2014 Comcast/Xfinity, Consumer News, Video No Comments

comcast business cancelA Nashville web developer who signed up for usage-cap exempted Business Class service in one of Comcast’s usage-based billing trial cities received a bill for nearly $3,000 in early termination fees after he was unable to transfer his Comcast Internet service to his new address.

Adrian Fraim followed the lead of other savvy Comcast customers who have managed to avoid the company’s usage caps by signing up for cap-free Business Class service. For years, Comcast has offered small businesses a commercial service for only slightly more than residential service, without any usage limits. But any customer is free to sign up.

Fraim thought he was getting a good deal and was happy with his broadband service, but Comcast took him to school when he tried to move service from Antioch to his new address in Clarksville, which he later discovered was outside of Comcast’s service area. The cable company treated his move as a violation of his three-year service contract and billed him an early termination fee of $2,789.

“I was just blown away,” Fraim told WSMV-TV. “That’s way too much money for somebody like me to be able to pay. They kept telling me the same thing, ‘you’re under contract, that’s what the contract says.'”

Only Fraim has never seen a printed Comcast contract. The company only offers its general service agreement and acceptable use policy online and it implies commercial customers are under a one-year contract.

In fact, Comcast’s terms require early-canceling customers to pay 75% of the amount they would have paid on their monthly bill under contract and 100% of any waived custom installation fees. A customer with a $100/mo broadband bill would owe a termination fee of $75 a month for each of up to 36 months of service.

etf

“I didn’t think that was fair, to pay an early termination fee, because I wanted to keep their service,” Fraim said. “And due to them not offering it in my area, I feel like I was being punished because they don’t offer the service here.”

Comcast didn’t seem to care about Fraim’s predicament until reporters called the cable company.

Faced with the prospect of leading the local evening news, Comcast turned Fraim’s frown upside down and finally relented.

Spokesman Alex Horwitz said Comcast does have early termination fees, but because of the extenuating circumstances, “the new location is not serviceable by Comcast,” they will waive the fee.

Comcast has not modified its contract to offer that “get out of penalty jail free”-card to other customers, so be certain to carefully consider the term length of your contract and be sure you have no plans to move outside of a Comcast service area before signing it, unless you have very deep pockets.

http://www.phillipdampier.com/video/WSMV Nashville Man questions 3000 Comcast bill 11-17-14.mp4

WSMV talks with Nashville web developer Adrian Fraim who discovered a nasty surprise when he moved outside of Comcast’s service area – a $2.789 early termination fee. (2:08)

Net Neutrality: President Obama Calls on FCC to Reclassify Wired/Mobile Broadband Under Title 2

tollIn a major victory for net roots groups, President Barack Obama today announced his support for the strongest possible Net Neutrality protections, asking the Federal Communications Commission to quickly reclassify broadband as a “telecommunications service” subject to oversight and consumer protection regulatory policies that would prohibit paid fast lanes, the blocking or degrading of websites for financial reasons, and more transparency in how Internet Service Providers handle traffic.

“For almost a century, our law has recognized that companies who connect you to the world have special obligations not to exploit the monopoly they enjoy over access in and out of your home or business,” said the president. “That is why a phone call from a customer of one phone company can reliably reach a customer of a different one, and why you will not be penalized solely for calling someone who is using another provider. It is common sense that the same philosophy should guide any service that is based on the transmission of information — whether a phone call, or a packet of data.”

“’Net neutrality’ has been built into the fabric of the Internet since its creation — but it is also a principle that we cannot take for granted,” President Obama added. “We cannot allow Internet Service Providers (ISPs) to restrict the best access or to pick winners and losers in the online marketplace for services and ideas. That is why today, I am asking the Federal Communications Commission (FCC) to answer the call of almost four million public comments, and implement the strongest possible rules to protect Net Neutrality.”

The president’s call will likely force FCC chairman Thomas Wheeler to abandon efforts to reclassify only certain types of Internet traffic under Title 2 regulations while leaving consumers vulnerable to paid fast lanes and other traffic monetizing schemes. Wheeler was rumored to be working on a limited Net Neutrality plan that would protect large online video content distributors like Netflix and Amazon from unfair compensation deals with ISPs. The plan would have given the FCC authority to review agreements between your Internet provider and some of the net’s biggest traffic generators.

President Obama’s statement goes beyond Wheeler’s tolerance for “individualized, differentiated arrangements” that could let cable and phone companies offer compensated “preferred partnership” deals with websites and applications, granting them special treatment or exemptions from speed throttles or usage caps not available to others.

The president’s four principles for a free and open Internet represent “common-sense steps that reflect the Internet you and I use every day, and that some ISPs already observe:”

  • netneutralityNo blocking. If a consumer requests access to a website or service, and the content is legal, your ISP should not be permitted to block it. That way, every player — not just those commercially affiliated with an ISP — gets a fair shot at your business;
  • No throttling. Nor should ISPs be able to intentionally slow down some content or speed up others — through a process often called “throttling” — based on the type of service or your ISP’s preferences;
  • Increased transparency. The connection between consumers and ISPs — the so-called “last mile” — is not the only place some sites might get special treatment. So, I am also asking the FCC to make full use of the transparency authorities the court recently upheld, and if necessary to apply net neutrality rules to points of interconnection between the ISP and the rest of the Internet;
  • No paid prioritization. Simply put: No service should be stuck in a “slow lane” because it does not pay a fee. That kind of gatekeeping would undermine the level playing field essential to the Internet’s growth. So, as I have before, I am asking for an explicit ban on paid prioritization and any other restriction that has a similar effect.

The president also expressed a desire to see the same rules applied to mobile networks. That is a significant departure from the policies of the FCC under Wheeler’s predecessor Julius Genachowski, who served as chairman during the Obama Administration’s first term in office. His Net Neutrality policies exempted wireless carriers.

“The rules also have to reflect the way people use the Internet today, which increasingly means on a mobile device,” said the president. “I believe the FCC should make these rules fully applicable to mobile broadband as well, while recognizing the special challenges that come with managing wireless networks.”

http://www.phillipdampier.com/video/111014_NetNeutrality_Final.mp4

President Barack Obama recorded this message supporting strong Net Neutrality protections for the Internet. (1:56)

Republicans in Congress and large telecommunications companies both immediately pounced on the president’s Net Neutrality plans.

Cruz Control

Cruz

“Net Neutrality is Obamacare for the Internet,” tweeted Sen. Ted Cruz (R-Tex.) “The Internet should not operate at the speed of government.”

Cruz’s spokeswoman,  Amanda Carpenter, added that Net Neutrality would place the government “in charge of determining pricing, terms of service, and what products can be delivered. Sound like Obamacare much?”

The National Cable and Telecommunications Association expressed surprise over the president’s strong public support for Net Neutrality action.

“We are stunned the President would abandon the longstanding, bipartisan policy of lightly regulating the Internet and call for extreme Title II regulation,” the NCTA wrote. “The cable industry strongly supports an open Internet, is building an open internet, and strongly believes that over-regulating the fastest growing technology in our history will not advance the cause of Internet freedom. There is no dispute about the propriety of transparency rules and bans on discrimination and blocking. But this tectonic shift in national policy, should it be adopted, would create devastating results.”

“Heavily regulating the Internet will lead to slower Internet growth, higher prices for consumers, and the threat of excessive intervention by the government in the working of the Internet,” stated the NCTA release. “This will also have severe and profound implications internationally, as the United States loses the high ground in arguing against greater control of the Internet by foreign governments. There is no substantive justification for this overreach, and no acknowledgment that it is unlawful to prohibit paid prioritization under Title II. We will fight vigorously against efforts to impose this backwards policy.”

Comcast Boosting Speeds in Pacific Northwest to Fend Off CenturyLink, Frontier, and Google

Phillip Dampier November 5, 2014 Broadband Speed, Comcast/Xfinity, Competition No Comments

Comcast-LogoAfter raising prices for Internet service and imposing the nation’s highest modem rental fee, Comcast customers in Oregon and southwest Washington are finally getting some good news: speed boosts.

Comcast will double Internet speeds for “the vast majority” in the Pacific Northwest between now and the end of the year, bringing 100Mbps service to Comcast’s “Blast” Internet plan and 50Mbps to “Performance” tier customers. Comcast says it is the 13th speed increase in the last dozen years in the region, but that isn’t all that has increased.

Comcast raised prices for its broadband plans last month: $66.95 for standalone Performance service ($53.95 if you bundle), $78.95 for Blast ($65.95 for those also taking cable TV or phone service). The modem rental fee remains a steep $10 a month.

Customers will receive e-mail when the faster speeds become available in their area, and a modem reset (unplug it briefly) will be required to get the new speeds.

Comcast is facing competition from CenturyLink, which is installing fiber optics in the area and Frontier, which inherited Verizon’s FiOS network when it acquired landlines in the region. Google Fiber is also expected to eventually make an appearance in the Portland area. Comcast prices are on the high side in comparison to the competition. CenturyLink’s introductory rate is as low as $50 a month for fiber service and Frontier charges $35 a month for 30Mbps service on its FiOS network.

For now, Comcast broadband service remains uncapped in the region, but Comcast is continuing market trials elsewhere that include a 300GB usage cap and an overlimit fee for those exceeding it.

Wall Street Investors Suckered By Broadband, Wireless Myths on Usage Pricing, Network Investment

verizon-protestBig Telecom companies like Verizon and AT&T use phony numbers and perpetuate myths about broadband traffic and network investments that have conned investors out of at least $1 trillion in unnecessary investments and consolidation.

Alexander Goldman, former chief analyst for CTI’s American Recovery and Reinvestment Act grants, is warning Wall Street and investors they are at risk of losing millions more because some of the largest telecom companies in the country are engaged in disseminating bad math and conventional wisdom that relies more on repetition of their talking points than actual facts.

Goldman’s editorial, published by Broadband Breakfast, believes the campaign of misinformation is perpetuated by a media that accepts industry claims without examining the underlying facts and a pervasive echo chamber that delivers credibility only by the number of voices saying then same thing.

Goldman takes Verizon Communications CEO Lowell McAdam to task for an editorial published in 2013 in Verizon’s effort to beat back calls on regulators to oversee the broadband industry and correct some of its anti-competitive behavior.

McAdam claimed the U.S. built a global lead in broadband on investments of $1.2 trillion over 17 years to deploy “next generation broadband networks” because networks were deregulated.

Setting aside the fact the United States is not a broadband leader and continues to be outpaced by Europe and Asia, Goldman called McAdam’s impressive-sounding dollar figures meaningless, considering over the span of that 17 years, the United States progressed from dial-up to fiber broadband. Wired networks have been through a generational change that required infrastructure to be replaced and wireless networks have been through at least two significant generations of change over that time — mandatory investments that would have occurred with or without deregulation.

Over the past 17 years, the industry has gotten more of its numbers wrong than right. An explosion of fiber construction in the late 1990s based on predictions of data tsunamis turned out to be catastrophically wrong. University of Minnesota professor Andrew Odlyzko, the worst enemy of the telecom industry talking point, has been debunking claims of broadband traffic jams and the need to implement usage-based pricing and speed throttling for years. In 1998, when Wall Street was listening intently to forecasts produced by self-interested telecom companies like Worldcom that declared broadband traffic was going to double every 100 days, Odlyzko was telling his then-employer AT&T is was all a lot of nonsense. The broadband traffic emperor had no clothes, and statistics from rival telecom companies suggested Worldcom was telling tall tales. But AT&T executives didn’t listen.

fat cat att“We just have to try harder to match those growth rates and catch up with WorldCom,” AT&T executives told Odlyzko and his colleagues, believing the problem was simply ineffective sales, not real broadband demand. When sales couldn’t generate those traffic numbers and Wall Street analysts began asking why, companies like Global Crossing and Qwest resorted to “hollow swaps” and other dubious tricks to fool analysts, prop up the stock price and executive bonuses, and invent sales.

Nobody bothered to ask for an independent analysis of the traffic boom that wasn’t. Wall Street and investors saw dollars waiting to be made, if only providers had the networks to handle the traffic. This began the fiber boom of the late 1990s, “an orgy of construction” as The Economist called it, all to prepare for a tidal wave of Internet traffic that never arrived.

After companies like Global Crossing and Worldcom failed in the biggest bankruptcies the country had ever seen at the time, Odlyzko believes important lessons were never learned. He blames Worldcom executives for inflating the Internet bubble more than anyone.

A bubble of another kind is forming today in America’s wireless industry, fueled by pernicious predictions of a growing spectrum crisis to anyone in DC willing to listen and hurry up spectrum auctions. Both AT&T and Verizon try to stun investors and politicians with enormous dollar numbers they claim are being spent to hurry upgraded wireless networks ready to handle an onslaught of high bandwidth wireless video. Both Verizon’s McAdam and AT&T’s Randall Stephenson intimidate Washington politicians with subtle threats that any enactment of industry reforms by the FCC or Congress will threaten the next $1.2 trillion in network investments, jobs, and America’s vital telecom infrastructure.

Odlyzko has seen this parade before, and he is not impressed. Streaming video on wireless networks is effectively constrained by miserly usage caps, not network capacity, and to Odlyzko, the more interesting story is Americans are abandoning voice calling for instant messages and texting.

8-4WorldcomCartoonThat isn’t a problem for wireless carriers because texting is where the real money is made. Odlyzko notes that wireless carriers profit an average of $1,000 per megabyte for text messages, usually charged per-message or through subscription plan add ons or as part of a bundle. Cellular voice calling is much less profitable, earning about $1 per megabyte of digitized traffic.

Wireless carriers in the United States, particularly Verizon and AT&T, are immensely profitable and the industry as a whole haven’t invested more than 27% of their yearly revenue on network upgrades in over a decade. In fact, in 2011 carriers invested just 14.9% of their revenue, rising slightly to 16.3 percent in 2012 when companies collectively invested $30 billion on network improvements, but earned $185 billion along the way.

While Verizon preached “spectrum crisis” to the FCC and Congress and claimed it was urgently prioritizing network upgrades, company executives won approval of a plan to pay Vodafone, then a part owner of Verizon Wireless, $130 billion to buy them out. That represents the collective investment of every wireless provider in the country in network upgrades from 2005-2012. Verizon Wireless cannot find the money to upgrade their wireless networks to deliver customers a more generous data allowance (or an unlimited plan), but it had no trouble approving $130 billion to buy out its partner so it could keep future profits to itself.

Odlyzko concludes the obvious: “modern telecom is less about high capital investments and far more a game of territorial control, strategic alliances, services, and marketing, than of building a fixed infrastructure.”

That is why there is no money for Verizon FiOS expansion but there was plenty to pay Vodafone, and its executives who walked away with executive bonuses totaling $89.6 million.

As long as American wireless service remains largely in the hands of AT&T and Verizon Wireless, competition isn’t likely to seriously dent prices or profits. At least investors who are buying Verizon’s debt hope so.

Goldman again called attention to Odlyzko’s latest warning that the industry has its numbers (and priorities) wrong, and the last time Odlyzko had the numbers right and the telecommunications industry got its numbers wrong, telecommunications investors lost $1 trillion in the telecommunications dot.com bust.

As the drumbeat continues for further wireless consolidation and spectrum acquisition, investors have been told high network costs necessitate combining operations to improve efficiency and control expenses. Except the biggest costs faced by wireless carriers like Verizon are to implement strategic consolidation opportunities like the Vodafone deal, not maintain and grow their wireless network. AT&T is putting much of its spending in a proposed acquisition of DirecTV this year as well — at a cost of $48.5 billion. That could buy a lot of new cell towers and a much more consumer-friendly data plan.

Voice to text substitution (US)

year voice minutes billions texts billions
2005 1,495 81
2006 1,798 159
2007 2,119 363
2008 2,203 1,005
2009 2,275 1,563
2010 2,241 2,052
2011 2,296 2,304
2012 2,300 2,190

Cell phone network companies (if you can believe their SEC filings) are incredibly profitable, and are spending relatively little on infrastructure:

year revenues in $ billions capex in $ billions capex/revenues
2004 102.1 27.9 27.3%
2005 113.5 25.2 22.2
2006 125.5 24.4 19.4
2007 138.9 21.1 15.2
2008 148.1 20.2 13.6
2009 152.6 20.4 13.3
2010 159.9 24.9 15.6
2011 169.8 25.3 14.9
2012 185.0 30.1 16.3

FCC Chairman Tom Wheeler Ignores Millions of Americans, Plans Fake Net Neutrality Frankenplan

frankenplanThe majority of 3.7 million comments received by the FCC advocate strong and unambiguous Net Neutrality protections for the Internet, but that seems to have had little impact on FCC chairman Thomas Wheeler, who is laying the groundwork for a hybrid Net Neutrality Frankenplan that would marginally protect deep pocketed content producers while leaving few, if any, protections for consumers.

The Wall Street Journal reported late last week that Wheeler is considering a “hybrid” approach, separating broadband into two distinct services:

  • Retail Broadband, sold to consumers, would continue as a broadly deregulated service, allowing ISPs to set prices and policies with little, if any, oversight. Wheeler’s plan would allow providers to freely implement usage-based pricing, establish paid fast lanes at the request of customers, and permit ISPs to continue exempting preferred content from usage pricing while charging customers extra to access content from “non-preferred partners;”
  • Wholesale Broadband, the connection between your ISP and content producers, would be reclassified under Title II and subject to common carrier regulations, which would allow the FCC to police deals between your provider and services like Netflix.

Wheeler’s proposal would offer significant protection to wealthy content producers like Netflix, Amazon.com, broadcasters and Hollywood studios, but would leave consumers completely exposed to providers’ pricing tricks, usage caps/consumption billing, and paid fast lanes that could leave unpaid content vulnerable to network deterioration, especially during peak usage times.

Comcast_pumpkinLarge telecommunications companies argue that deregulation promotes broadband investment and expansion to create world-class service. But years of statistics and comparisons with other countries suggest deregulation has not inspired sufficient competition to keep prices in check and force regular network upgrades. In fact, competition is much more robust at the wholesale level, while the majority of retail consumers have a choice of just one or two providers that receive almost no oversight. Those providers are now exercising their market power to further monetize broadband usage to boost profits and raise prices.

Wheeler’s proposal would ignore the wishes of more than three million Americans that want comprehensive Net Neutrality protections, as well as those of President Barack Obama, who has called for a ban on paid fast lanes. A senior White House official signaled Thursday the administration has concerns about Wheeler’s proposal, noting “the president has made it abundantly clear that any outcome must protect net neutrality and ban paid prioritization—and has called for all necessary steps to safeguard an open Internet.”

“This Frankenstein proposal is no treat for Internet users, and they shouldn’t be tricked,” consumer group Free Press CEO Craig Aaron said in a statement. “No matter how you dress it up, any rules that don’t clearly restore the agency’s authority and prevent specialized fast lanes and paid prioritization aren’t real Net Neutrality.”

Broadband providers don’t like Wheeler’s plan either. Verizon last week sent comments to the FCC warning any attempt to reclassify broadband under Title II “could not withstand judicial review.” Others, including the industry-backed U.S. Telecom Association, promised swift legal action against Wheeler’s proposal.

Aaron believes the last thing broadband needs is another “hybrid” plan.

“The FCC has already tried twice before to invent new classifications on the fly instead of clear rules grounded in the law,” Aaron said. “And twice their efforts have been rejected. This flimsy fabrication will be no different. And this approach will only serve to squander the political support of millions and millions of Americans who have weighed in at the agency asking for strong rules that will stand up in court.”

Time Warner Cable Recommits: No Mandatory Usage Caps As Long As Company Remains Independent

timewarner twcTime Warner Cable today recommitted itself to providing unlimited broadband service to any customer that wants it, promising customers they won’t be forced into a tiered usage plan as long as Time Warner Cable remains an independent company.

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

Marcus told Wall Street analysts on an afternoon conference call that the average Time Warner Cable customer now generates 35GB of traffic per month, and that a significant percentage of light users might realize some savings choosing a 30GB optional usage plan. But Marcus also admitted that few do.

marcus

Marcus

“I think that’s a testament to the value they place on unlimited,” said Marcus.

Marcus’ decision to stay away from compulsory usage-capped Internet was questioned by Marci Ryvicker from Wells Fargo Securities, LLC., a Wall Street investment firm. Ryvicker tied the growth of online video consumption to the implementation of usage caps as way of protecting video revenue and regaining money lost from lost cable television subscriptions.

“I guess the underlying question is do you think you can monetize the pipe enough through high-speed data pricing to offset video decline,” asked Ryvicker.

“We haven’t really viewed usage-based pricing quite the way you’re postulating,” responded Marcus. “I think there’s a separate question as to whether or not we have the ability to offset video declines with [broadband]. I think it’s fair to say we’re very bullish on the high-speed data business and think we can continue to grow it based on both subscriber volume and incremental ARPU per [broadband] customer.”

Marcus added that Time Warner can continue to boost revenue by raising broadband prices and encouraging customers to upgrade to faster speed tiers at a higher price.

Comcast has a very different philosophy about usage caps — it embraces them. Comcast continues to test mandatory usage caps in several markets, leading to howls of complaints from customers and bill shock. One customer complained their cable bill frightens them every time they receive it, not knowing how much Comcast would charge them for that month of service. The family’s last cable bill, including Internet, exceeded $560, primarily due to Comcast’s overlimit usage fees. Comcast has also received complaints about its usage meter’s accuracy, but the company adamantly bills customers according to the readings of their meter.

“I’ll tell you what really isn’t fair,” wrote one customer. “That is that in ‘test markets’ like mine, Atlanta, we have the 300GB [cap] enforced with the penalty overage charge and we pay the SAME rates as people in other markets that aren’t yet one of the ‘test markets.’

Most analysts expect Comcast will eventually roll out usage caps to all of its customers, including any it acquires from Time Warner Cable. Customers cannot choose an unlimited use option in Comcast’s usage cap test markets.

New Zealand Getting 200/200Mbps Uncapped Fiber Broadband

Snap-Logo-2-300x300New Zealanders want faster broadband and they want it without a usage cap, and Snap is ready to offer both.

Snap’s nationwide 200/200Mbps Ultra-Fast Broadband commenced this week providing the fastest broadband on offer throughout New Zealand, priced at $111.50 a month with an unlimited use add-on available for an extra $8 a month. To date, the service had only been available in Auckland.

Kiwis can sign up for Snap on the Chorus network for the fastest 200/200Mbps speeds. Those served by Enable or UltraFast Fibre will see upload speeds reduced to 20Mbps for now, but will also be compensated with a lower monthly price: $87.71.

A wireless gateway to support the faster speeds will be provided at no extra cost to customers signing up for 200Mbps service.

no limitsSnap’s new service comes as a result of New Zealand’s deployment of fiber networks and an end to usage caps, consumption billing, and/or bandwidth throttling. Snap has been well received in New Zealand because it guarantees no traffic shaping, traffic management schemes, or mandatory usage caps. This comes at a time when North American providers are trying to force customers into usage-capped broadband plans and wireless carriers insist on using traffic shaping and caps.

“There is no faster commercially available service across the whole country today,” said James Koers, general manager, Snap Retail. “We’ve built our own network to ensure customers receive the fastest, most reliable service possible. We don’t cache or proxy or shape traffic in any way, giving customers peace of mind that they’re getting the service they expected and paid for.”

Koers adds there is a clear demand for fiber optic broadband across the country.

“Today, two out of every three of our sign-ups are for a fibre service which shows New Zealanders’ appetite is increasing for UltraFast Broadband as it becomes available,” said Koers. “200Mbps is just the beginning though as we’re now trialling Chorus’ new 1Gbps residential service.”

PC Magazine has rated Snap the fastest broadband provider in the country.

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  • arby: Such a pain to get a better deal. But better than when Cable was a Monopoly and there were no other choices. I am in the middle of a 2 year deal...
  • doug: not for Fort Collins, is this just a short delay or no increase at all? I am in Fort Collins and have been waiting for this upgrade. arggg....
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  • fjfdybvfgj: The Data Usage represented is usually the norm for most people by themselves. In a family of 5 and our usage is usually around 6TBs normally and is ~9...
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