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52 Mayors Pledge Allegiance to Comcast’s Merger Deal; Is Yours on the List?

mayorsMore than 50 mayors of towns and cities large and small regurgitated Comcast-provided talking points in a joint letter submitted to the FCC in support of the Comcast-Time Warner Cable merger:

The combination of these two American companies will bring benefits to every affected city. Cities joining the Comcast service area will benefit from increased network investment, faster Internet speeds, improved video options and leading community development programs to help us tackle important community challenges like the digital divide. Existing Comcast markets will enjoy the benefits of a company with the scale and scope to invest in innovation and deliver products and services on a regional basis.

For us, the most significant aspect of the proposed transaction is its capacity to propel new investment in infrastructure in Time Warner markets that will enhance video and Internet service in our communities. Comcast has pledged to invest hundreds of millions of dollars a year speeding up and improving the combined company’s networks.

We also view positively the apparent response to this development from other companies that provide similar services. Since the Comcast Time Warner Cable transaction was proposed, Google has announced plans to expand its high-speed Fiber service to 34 new communities, AT&T has announced plans to expand its 1 gigabit U-Verse service to 100 new municipalities including 21 large cities, and Sprint’s corporate parent has proposed to build a 200 Mbps wireless network for the US.

In addition to being terribly misleading, parts of the letter are factually inaccurate. The letter’s text was taken almost entirely from Comcast’s own talking points released to the media and disclosed to the Securities and Exchange Commission.

Buffalo Mayor Byron Brown 2012: Time Warner Cable is naughty. 2014: Time Warner Cable is nice.

Buffalo Mayor Byron Brown
2012: Time Warner Cable is naughty.
2014: Time Warner Cable is nice.

Remarkably, Buffalo Mayor Byron Brown managed a complete flip-flop on his views of Time Warner Cable. In 2012, he co-signed a letter accusing Comcast and Time Warner Cable of anticompetitive behavior, runaway rate increases, and a growing digital divide. He was speaking about Comcast and Time Warner Cable’s  decision to partner with Verizon Wireless to jointly market products to their customers:

“We are deeply worried that the anti-competitive partnership between Verizon Wireless, the nation’s largest wireless provider, and four of the leading cable companies will have a negative impact on economic development and job creation in our cities, leading to higher prices, fewer service options, and a growing digital divide, “ the letter reads. “As you review the Verizon Wireless/cable transaction, we strongly urge you to examine the impact of this transaction on competition and consumer choice, and ensure that our communities are not left behind.”

This year, despite the fact both Comcast and Time Warner Cable still have their cross-marketing agreement with Verizon and both cable operators have raised prices, Brown joined the other mayors heaping praise on both cable companies:

Time Warner Cable has been a responsible corporate citizen whose efforts will only be enhanced by joining forces with Comcast’s community investment programs. Comcast has established itself as an industry leader and exemplary community partner who invests in its local communities and works hand in hand with local governments on critical social challenges like the digital divide.

Except when it is not.

Matthew Keys, who comments on journalism and social media, notes the Comcast merger has little to do with broadband expansion at other companies:

But the mayors failed to note that Sprint’s pledge of a faster wireless data network was predicated on a merger with rival T-Mobile, which fell through earlier this month. In addition, AT&T’s 1-Gigabit Internet service is likely being offered as an incentive for the FCC to approve its own proposed merger with Comcast competitor DirecTV; the Internet service is offered to residents in a handful of cities at a whopping $100 a month, nearly triple what the company sells it’s basic broadband Internet service for. And while the mayors assert that Google is expanding its Fiber service to more than 30 areas, they fail to note that Google is in preliminary talks with those communities and that the rollout may never happen.

If any providers inspired a broadband speed Renaissance, it was Google Fiber and a handful of gigabit community-owned fiber networks like EPB in Chattanooga, all demonstrating fast speeds and affordable pricing can go hand in hand when your primary interest is serving customers, not shoveling money at shareholders.

Customers who happen to live in the cities below might want to fill the email boxes and melt down the phone lines of these mayors who have demonstrated a willingness to throw their constituents under the bus (Matthew Keys did an exceptional job collecting their contact information).

Feel free to share our fact-based testimony with the mayors and let them know you don’t appreciate the fact they are spending taxpayer time and money advocating for a multi-billion dollar cable merger the majority of Americans oppose. Then remind them if this merger succeeds, you will think of them every time you have a problem with your cable service, when your bill increases, and when you discover Comcast has rationed your use of the Internet with a compulsory usage allowance. Because these problems always come fast and furious with Comcast, let them know you will have no trouble recalling their role in bringing Comcast to town when you go and vote.

Mayor Name
City
State
E-mail
Phone Number
William Bell Birmingham Alabama [email protected] (205) 254-2283
Tom Tait Anaheim California [email protected] (714) 765-5247
Kathleen DeRosa Cathedral City California [email protected] (760) 770-0340
Harry Price Fairfield California [email protected] (707) 428-7400
Acquanetta Warren Fontana California [email protected] (909) 350-7600
Jeffrey Gee Redwood City California [email protected] (650) 780-7597
Steve Hogan Aurora Colorado [email protected] (303) 739-7015
Marc Williams Arvada Colorado [email protected] (303) 424-4486
Richard McLean Brighton Colorado [email protected] (303) 655-2266
Michael Hancock Denver Colorado [email protected] (303) 331-3872
Pedro Segarra Hartford Colorado [email protected] (860) 757-9500
Cindy Lerner Pinecrest Florida [email protected] (305) 234-2121
Joy Cooper Hallandale Beach Florida [email protected] (954) 457-1318
Alvin Brown Jacksonville Florida [email protected] (904) 630-1776
George Vallejo N. Miami Beach Florida [email protected] (305) 948-2986
John Marks Tallahassee Florida [email protected] (850) 891-2000
Tomas Regalado Miami Florida [email protected] (305) 250-5300
Lori Moseley Miramar Florida [email protected] (954) 602-3142
Buddy Dyer Orlando Florida [email protected] (407) 246-2221
Frank Ortis Pembroke Pines Florida [email protected] (954) 435-6505
Michael Boehm Lenexa Kansas [email protected] (913) 477-7550
Michael Copeland Olathe Kansas [email protected] (913) 971-8500
Kevin Dumas Attleboro Massachusetts [email protected] (508) 223-2222
Gary Christenson Malden Massachusetts [email protected] (781) 397-7000
Michael McGlynn Medford Massachusetts [email protected] (781) 393-2409
Daniel Rizzo Revere Massachusetts [email protected] (781) 286-8111
Albert Kelly Bridgeton New Jersey [email protected] (856)-455-3230
Dana Redd Camden New Jersey [email protected] (856) 757-7200
Frank Nolan Highlands New Jersey [email protected] (732) 872-1224
David DelVecchio Lambert New Jersey [email protected] (609) 397-0110
Gary Passanante Somerdale New Jersey [email protected] (856) 783-6320
Thomas Kelaher Toms River New Jersey [email protected] (732) 341-1000
Eric Jackson Trenton New Jersey [email protected] (609) 989-3030
Richard Berry Albuquerque New Mexico [email protected] (505) 768-3000
Ken Miyagishima Las Cruces New Mexico [email protected] (575) 541-2067
Byron Brown Buffalo New York [email protected] (716) 851-4890
Ernest D. Davis Mount Vernon New York [email protected] (914) 665-2300
Lou Odgen Tualatin Oregon [email protected] (503) 691-3011
Joseph DiGirolamo Bensalem Pennsylvania [email protected] (215) 633-3603
Eric Papenfuse Harrisburg Pennsylvania [email protected] (717) 255-3040
Rick Gray Lancaster Pennsylvania [email protected] (717) 291-4701
Robert A. McMahon Media Pennsylvania [email protected] (610) 566-5210
Michael Nutter Philadelphia Pennsylvania [email protected] (215) 686-2181
C. Kim Bracey York Pennsylvania [email protected] (717) 849-2221
Joseph Riley Charleston South Carolina [email protected] (843) 577-6970
Stephen Benjamin Columbia South Carolina [email protected] (803) 545-3075
Lee Leffingwell Austin Texas [email protected] (512) 974-2250
Beth Van Duyne Irving Texas [email protected] (972) 721-2410
Allen Owen Missouri City Texas [email protected] (281) 403-8500
Leonard Scarcella Stafford Texas [email protected] (281) 261-3900
Matthew Doyle Texas City Texas [email protected] (409) 643-5902
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Comcast to 2,700+ NY’ers – Your Opposition to Our Merger: Unsubstantive, Should Be Ignored

Phillip Dampier August 26, 2014 Comcast/Xfinity, Time Warner Cable No Comments

psctestComcast told the New York Public Service Commission that the overwhelming majority of the substantive comments submitted to the regulator “express a strong desire and enthusiasm for the improved and expanded voice, data, video, and broadband services” that the merger of Comcast and Time Warner Cable will bring to the state.

new math“Given these many concrete benefits, and the lack of any harm to competition or consumers, it should come as no surprise that the overwhelming majority of the substantive comments (approximately 110 out of a total of about 140 substantive comments) filed in this proceeding support Commission approval of the transaction,” Comcast wrote in its latest submission.[1]

Comcast’s “new math” applies a subjective (and undisclosed) standard about what constitutes “substantive,” but in the end the cable company has urged the Commission to disregard the sentiments of more than 2,700 New York State residents who have filed comments in strong opposition to the merger because their remarks simply fell beneath Comcast’s standards.

“The minority of organizations and individuals who filed substantive comments opposing the transaction largely ignore the significant public interest benefits of the transaction,” writes Comcast. “Instead, these detractors raise issues that are not relevant to the transaction and are factually inaccurate and speculative – such as unfounded concerns about Comcast’s broadband management practices, misplaced criticisms of Internet Essentials, and general fears that ‘big is bad.’ None of these commenters identify any reasonable basis to reject or condition the Joint Petition.”

Comcast did not apply the same rigorous standards of ‘substantiveness’ to comments sent by its supporters, who often used what New York Assemblyman Joe Morelle admitted was a Comcast-supplied template ghost-written by the company itself.[2]

“Supporters of the transaction span a wide range of groups and individuals, including governmental officials (e.g., mayors, town supervisors, county commissioners, city councils, state legislators, and school superintendents); businesses and non-profits; state and local organizations focused on economic development; community service, youth and family, and diversity organizations; arts and education groups; and others,” writes Comcast.

chicago urban leagueBut the company never disclosed the many financial ties between Comcast and its political and civic supporters. In fact, a large percentage of the “template” letters of support originated from politicians like Assemblyman Morelle, who recently received a $1,000 check from Comcast[3] and Rochester city councilman Adam McFadden, whose group claims to receive $50,000 annually from Comcast.[4] [5]

In fact, it is hard not to find financial connections between Comcast’s supporters and the cable company itself. A random sampling uncovers multiple instances of Comcast contributions that were followed by letters of support for its merger:

The Urban League has received at least $12 million in in-kind contributions from Comcast since 2007, in addition to direct financial contributions to local chapters around Comcast’s service area.[6] In just one example Stephen Thomas, Comcast’s area vice president, who also serves on the Chicago chapter’s board of directors, presented the organization with a check for $40,000.[7] Just a few months later, Andrea L. Zopp, president of the Chicago Urban League, wrote to urge the FCC to approve Comcast’s merger deal.[8]

“Comcast is a strong supporter of the Urban League movement throughout the country. … I sincerely ask that you approve this transaction so that the Urban Leaguers and everyone else can benefit,” Zopp wrote.

Various chapters of the Boys and Girls Club also submitted glowing letters in favor of the merger. Comcast has partnered with local Boys & Girls Clubs since 2000, providing more than $68 million in cash and in-kind contributions. But no chapter was willing to openly admit Comcast asked them to share their views with New York regulators and only a few disclosed the financial ties the organization has with Comcast. The Boys and Girls Club has been a very loyal supporter of whatever Comcast has on its corporate agenda. Chapters submitted letters urging regulators to approve the Comcast-NBC merger in 2010 as well.[9]

Another strong supporter Comcast quotes from in its filing is the National Black Chamber of Commerce. But they don’t mention Comcast is a corporate sponsor of the group.[10]

Comcast (falsely) claims their Internet Essentials is the country's only discount Internet program for the disadvantaged. But Google Fiber gives it away for free.

Comcast (falsely) claims their $9.95 Internet Essentials is the country’s only discount Internet program for the disadvantaged. But Google Fiber gives it away for free to anyone who wants it.

Comcast also called criticism of its Internet Essentials discount Internet program “inaccurate and unavailing,” despite the fact the company’s own senior vice president David Cohen admitted the program was stalled to use as a political chip to win approval of its merger with NBCUniversal.[11]

Comcast also falsely claims it is the only Internet discount program for the poor of its kind.

“[Critics] simply advocate a different broadband adoption program – one that no company has ever implemented, that has never been attempted or even analyzed, and that may not be equally sustainable or popular or easy to publicize,” Comcast wrote. “Comcast is the only company to offer a program of this kind, and it has continually and voluntarily expanded the scope, breadth, and eligibility for and benefits of the program.”

In fact, it may have escaped Comcast’s attention that Google has provided residents in their fiber service areas with free Internet service with absolutely no income qualification or needs test, after paying a “construction fee” ranging from $30 in Provo, Utah [12] to $300 in Kansas City.[13] Residents in the latter community can break the somewhat steep construction fee into 12 payments of $25 each and have a guarantee of free service for up to seven years. Over the course of both programs, Google offers a more compelling and less expensive offer without onerous qualification requirements.

Yr    Google Fiber Cost  Comcast Internet Essentials Cost (@$9.95/mo)

1          $300                            $119.40
2          $0                                $119.40
3          $0                                $119.40
4          $0                                $119.40
5          $0                                $119.40
6          $0                                $119.40
7          $0                                $119.40

Over the course of seven years, a Google Fiber customer selecting discounted Internet would pay $300. A Comcast customer would pay $835.80 – a difference of $535.80.

While Google Fiber’s service area is very limited, it does offer an evidence-based challenge to Comcast’s inaccurate claim that its Internet Essentials program is unprecedented and represents the best solution for New York. A well-designed program designed to help New Yorkers will sell itself far better than the complicated, restrictive, and revenue-protection-oriented Internet Essentials, and its lack of penetration in long-standing Comcast service areas speaks for itself.

The California Emerging Technologies Fund also found serious problems with Internet Essentials from top to bottom.[14]

“Comcast makes the sign-up process long and cumbersome,” CETF claimed.[15] “The application process often takes 2-3 months, far too long for customers who are skeptical about the product in the first place, and have other pressing demands on their budgets. The waiting period between the initial call to Comcast and the CIE [Comcast Internet Essentials] application arriving in the mail can stretch 8-12 weeks, if it comes at all. After submitting the application, another 2-4 weeks elapse before the equipment arrives. Many low-income residents do not have Social Security Numbers (SSNs) and are required to travel long distances to verify their identities because Comcast has closed many of its regional offices. Recently, some potential subscribers with SSNs were rejected over the phone and told they had to visit a Comcast office. Comcast has a pilot effort in Florida that should be expanded to allow customers to fax or e-mail photocopied IDs as proof of identification.”

CETF also found widespread violations of Comcast’s own program rules when the cable company conducted credit checks on customers, which can reduce a customer’s already challenged FICO score with a credit inquiry on their file.

“Comcast conducts credit checks for some customers, contrary to CIE rules,” the CETF filing said. “Dozens of clients are receiving letters from Comcast saying that they have failed a credit check. Comcast specifically states and advertises no credit check is needed for CIE. This has repercussions beyond obtaining broadband service. The act of performing a credit check can negatively impact the consumer’s credit worthiness. Initially, some CIE service representatives told customers they could pay $150 deposit to avoid a credit check, also contrary to program rules.”

Customers have also been redirected to Comcast sales call centers, where they receive aggressive sales pitches for higher-cost products and services.

Comcast’s celebration of its commitment to minority television programming does not mention the expansion of minority programming was a condition of the FCC’s approval of the Comcast-NBCUniversal merger.

Among Comcast's "compelling" minority programming that customers are asked to pay for: Baby First Americas, a

Among Comcast’s “compelling” minority programming that customers are asked to pay for: Baby First Americas, a network for bilingual infants aged 0 to 3.

Subscribers got less than compelling programming and more rate increases to pay for it.

National Public Radio noted Comcast’s new minority channels are not exactly drawing significant audiences[16]:

Out of the gate, well, first was Baby First America — for bilingual infants aged 0 to 3.

ASPiRE, a channel focused on African-Americans, is mostly repurposed old series and gospel music videos.

ASPiRE, a channel focused on African-Americans, is mostly reruns and talk shows. Writer Anita Wilson Pringle called the network’s programming “crap.”

Next came Aspire, a family-oriented network from ex-basketball star and entertainment impresario Magic Johnson. Its lineup includes reruns of The Cosby Show plus even older fare: Julia, Soul Train and The Flip Wilson Show.

Writer Anita Wilson Pringle, for one, is no fan of that lineup of TV retreads.

“He promised innovative, new fresh ideas, new fresh programming, and it’s not,” she says.

Pringle is upset that Aspire’s managers were merely reshuffled from the old Gospel Music Channel. And she says the people Aspire is supposed to serve — African Americans — don’t exactly need more reruns or talk shows.

“It’s crap, if you really want to know the truth,” she says. “But my thing is, they did this to break that monopoly that Comcast was having on all these stations, and all that has happened is that Comcast has a stronger monopoly.”

Comcast’s commitment to improve energy efficiency is comparable to Time Warner Cable’s own commitments, providing no net gain for New York consumers.[17]

Comcast’s promised commitments to deliver better customer service have been made annually for several years with no significant improvement, as measured by independent customer satisfaction studies. Comcast relies on a quotation from a Wall Street analyst, Craig Moffett, who provides only anecdotal evidence of customer service improvements and has supported the merger’s potential benefits for shareholders.

Comcast's idea of effective competition is using your Verizon Wireless connection for home broadband use. A 16GB monthly plan will cost consumers as much as $170 a month before taxes and fees.

Comcast’s idea of effective competition is using your Verizon Wireless connection for home broadband use. A 16GB monthly plan will cost consumers as much as $170 a month before taxes and fees.

Comcast’s assertion that the Commission should ignore or downplay bad customer service experiences of customers outside New York is made despite their own admission they serve only a tiny number of New York customers today. Is Comcast suggesting it would be inappropriate to consider their customer service record in comparable-sized cities across the country, some likely served by the same national and offshore customer care centers New Yorkers will reach when they have future problems with Comcast?

Comcast’s claims of plentiful broadband competition also do not exist in the real world for many New Yorkers. The Commission has faced such a large number of complaints about Verizon landline service, which also supports DSL, it launched a Verizon Service Quality Improvement Plan. When a Verizon landline becomes inoperable for several months, as customers in Inwood experienced earlier this year[18], their DSL broadband is also inoperable. For customers served by cable, but not reached by DSL service from telephone companies like Verizon, Windstream, and Frontier Communications, their only realistic home broadband connection comes from the local cable company. Wireless broadband, advocated as a competitive alternative by Comcast, does not penetrate well indoors in large sections of rural upstate New York and is constrained by very expensive service plans and severe limits on data usage, compelling customers to pay excessive fees to obtain service.

A family consuming 16GB of data per month (less than today’s average use per person) would face Internet bills of $170 a month with Verizon Wireless ($40/mo Monthly Line Access – Internet Device + 16GB Data Plan ($130/mo Monthly Account Access)[19] Wired broadband accounts from Time Warner Cable in comparison cost as little as $14.99 a month for unlimited usage.

Where DSL service is available, it is typically offered at speeds lower than a cable operator can offer. As an example, at our residence in the Town of Brighton, N.Y., Frontier Communications can only offer a maximum speed of 3.1Mbps from their DSL service because of our distance from the central office.

Comcast will have a near-total monopoly on all broadband service in excess of 15Mbps in current Time Warner Cable territories not serviced by Verizon FiOS. Verizon’s maximum speed DSL offer is for speeds “up to 15Mbps.”[20] Verizon FiOS expansion outside of already-committed territories has ended, and the majority of upstate New York is not served by Verizon’s FiOS fiber upgrades.

Comcast claims there is a world of difference between highly regulated energy-generation utilities and the “competitive” marketplace for telecommunications.

“Proposals that the Commission approach this transaction with the same mindset, and apply the same types of burdensome conditions, are entirely unjustified,” argues Comcast.

“Electric and gas utilities remain the quintessential public service utilities,” says the cable company. “Their markets are characterized by a lack of competition, captive customer bases, and direct rate-setting and operational oversight by the Commission.”

In fact, many cable customers in New York do face a lack of competition for fast broadband speeds, are stuck with the single cable operator serving their community, and lack the consumer protections offered by the Commission that apply to other utilities.

The Commission can test Comcast’s claims of competitiveness for itself. Stop the Cap! offers a challenge to find more than one provider that can deliver consistent, widely obtainable broadband speeds of 15/3Mbps or greater in downtown Buffalo, Rochester, Albany or Syracuse.

The Commission will discover there is only one provider now capable of delivering that service across the entire urban centers of upstate New York: the local cable company.

In far western New York, Verizon FiOS is available only in small parts of South Buffalo and North Buffalo and select suburbs.

In Rochester, Frontier Communications does not offer consistent access to speeds greater than 10Mbps.

Albany and Syracuse are also bypassed by Verizon FiOS, left with Verizon DSL, which only offers speeds “up to 15/1Mbps.” Most customers get less.

Comcast would have the Commission believe any review of its broadband service is off-limits and outside of their jurisdiction anyway.

“The Commission has no authority to review broadband transactions and lacks statutory authority to regulate broadband services – and beyond this, cable broadband services are interstate information services that are not properly subject to state jurisdiction,” claimed Comcast.

It further argued the Commission must ignore “matters beyond the Commission’s jurisdiction,” quoting from a 2006 proceeding.

mergerComcast evidently forgets the law has changed in New York. In 2006, the Commission had to disprove a petition was in the public interest to reject it. In 2014, the applicant is solely responsible for carrying the burden of proof that their proposal is in the public interest.

Nothing in Section 222 of the Public Service Law places restrictions on what the Commission can consider when weighing public interest benefits.

Comcast’s claims of its wish to expand service into rural, unserved areas also must be questioned. Comcast automatically sets a high bar for expansion suggesting it will occur only “where economically feasible,” which is the same standard in place with the incumbent cable operator.

“Where economically feasible” is the reason cable companies in New York have rarely expanded their service territories, except in high growth areas where population density warrants expansion. All cable operators have an internal formula governing Return On Investment requirements that must be met before expansion begins. The Commission must review that information and compare the standards used by both applicants, because it will ultimately govern any future natural expansion of cable service in rural New York.

Conclusion

Comcast’s rosy picture of New York’s future with a merged Time Warner Cable-Comcast is belied by the real world experiences of New York consumers who have learned from long, hard experience that when a cable company starts promising a better deal, the result has too often been higher rates and fees, unwanted channels, poorer customer service, and new restrictions.

'An Extortion-for-distortion hose job.'

Don’t close your eyes to the facts.

Cable operators have enjoyed unfettered power to escape oversight with inflated claims of fierce competitiveness that they suggest will keep prices and abusive behavior in check, but in reality rates are rising and Comcast’s customer approval ratings live in the basement.

Comcast’s most recent filing continues to dismiss these very real concerns for New Yorkers who will not have a choice of a cable operator other than Time Warner Cable or Comcast. Calling the comments of more than 2,700 New Yorkers largely opposed to this merger “unsubstantive” is precisely the attitude of a cable company that has earned its bad reputation with customers.

Sending “templates” to politicians and non-profits that have received funding from Comcast and asking them to send letters to regulators urging approval of the company’s latest item on the agenda is the kind of “substantive” evidence Comcast wants the Commission to rely on in this proceeding.

But worst of all, Comcast suggests that any review of the company’s broadband service, its pricing and performance, and the potential for usage allowances and usage fees above and beyond the current high cost of Internet service is off-limits to New York regulators. The Commission already recognizes the growing importance of broadband in New York State and that it is, in reality, nearly a necessity.

Time Warner Cable recognizes that and is moving ahead on an upgrade program that delivers broadband benefits above those offered by Comcast and at a lower price, with no usage allowances or overlimit fees likely in the foreseeable future. It remains clear to us that Time Warner Cable is the better choice for New York. We have a well-documented history of not being great fans of Time Warner Cable, but we know worse when we see it, and we see it in Comcast.

[1] http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId={60D7F65E-3AAB-4507-B58D-7F14E31E130A}

[2] http://www.rochesterhomepage.net/story/d/story/lawmakers-write-letters-supporting-comcast-deal/38184/WjHF311jeEqZdF9IOMX7mg

[3] http://www.rochesterhomepage.net/story/d/story/lawmakers-write-letters-supporting-comcast-deal/38184/WjHF311jeEqZdF9IOMX7mg

[4] http://stopthecap.com/2014/08/11/rochester-city-councilman-adam-mcfaddens-love-for-comcast-and-the-50k/

[5] http://www.nlc.org/corporate-engagement/corporate-partners-program

[6] http://corporate.comcast.com/news-information/news-feed/national-urban-league-resource

[7] http://www.thechicagourbanleague.org/cms/lib07/IL07000264/Centricity/Domain/14/impact-jan-2014.pdf

[8] http://www.thewrap.com/consumer-groups-urge-fcc-to-reject-comcast/time-warner-cable-deal/

[9] http://apps.fcc.gov/ecfs/document/view?id=7020462210

[10] http://www.nationalbcc.org/news/progress-reports/2107-recap-of-22nd-annual-conference

[11] http://stopthecap.com/2013/07/10/comcasts-internet-essentials-facade-padding-the-bottom-line-without-cannibalizing-your-base/

[12] https://fiber.google.com/legal/subscriber/provo/

[13] https://fiber.google.com/legal/subscriber/kansascity/

[14] http://arstechnica.com/business/2014/07/comcasts-internet-for-the-poor-too-hard-to-sign-up-for-advocates-say/

[15] http://www.cetfund.org/files/140711_CETF_Partners_Comcast-TWC_FCC_PR_and_Filing.pdf

[16] http://www.npr.org/2013/11/12/244558834/comcast-deal-puts-new-minority-run-channels-in-play

[17] http://www.timewarnercable.com/en/about-us/corporate-responsibility/environment.html

[18] http://manhattan.ny1.com/content/shows/ny1_for_you/203064/ny1foryou–inwood-verizon-customers-want-phone-service-outages-to-stop

[19] http://www.verizonwireless.com/wcms/consumer/shop/shop-data-plans/more-everything.html

[20] http://www.verizon.com/home/shop/shopping.htm

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Verizon Wireless Closing Unlimited Data Plan Upgrade Loopholes; The Latest Party Ends 8/24

610px-Verizon-Wireless-Logo_svgVerizon Wireless is closing several loopholes that customers have used to acquire new subsidized, on-contract smartphones and keep their unlimited data plans intact for an extra two years.

Since Verizon Wireless stopped enrolling customers in unlimited use data plans in 2012, current customers have been able to hang on to their unlimited use plans with the understanding they will not be entitled to subsidized upgrades or new lines with unlimited data. Despite that, Verizon still aggressively pursues unlimited data customers at almost every contact encouraging them to ditch their unlimited plan in favor of much more profitable Family Share plans, which feature usage-based billing tiers that customers will need to regularly upgrade to stay ahead of increasing data usage trends.

A study from Consumer Intelligence Research Partners showing Verizon has successfully convinced all but 22% of their customers to dump their unlimited plans. Those still hanging on guard their unmetered plans zealously. Some have even managed to find loopholes that let them keep unlimited data while getting subsidized device upgrades. But Verizon has caught on and is slowly closing the loopholes, increasing restrictions on unlimited data plan customers.

The Loopholes

One of the newer loopholes is a type of subsidized upgrade through Best Buy. A number of careful steps are required to win the upgrade without changing your data plan, and there are several side effects explained exhaustively on the Slickdeals website. If you try, read the instructions very carefully or you could lose your unlimited plan. The upgrade has been successful for many who have kept their unlimited packages, signed a new two-year contract exempting them from Verizon Wireless’ 4G speed throttle, and getting a new device at a subsidized discount. it won’t be easy to tell when this loophole is closed, and you might have to fight to win back your unlimited data package if it is removed from your account.

Another loophole involves shifting upgrades around on your current family plan. As different family members become eligible for device upgrades, it is possible to an upgrade to an existing number with an unlimited data plan without losing that feature. This is the most popular loophole at the moment and the one Verizon Wireless wants to kill the most.

"Tina, bring me the axe!"

“Tina, bring me the axe!”

Verizon Takes the Axe to Loopholes, Discounts, and Finance Plans for Unlimited Data Customers

Verizon has declared a virtual war on their grandfathered unlimited data plan customers, and has gradually tightened the noose:

  1. Verizon Wireless will begin throttling 4G/LTE speeds of off-contract, unlimited data plan customers deemed heavy users who consume more than 4.7GB of data per month beginning this fall;
  2. On July 13, Verizon Wireless quietly terminated its Device Payment Plan for unlimited data customers seeking to finance the cost of an unsubsidized device upgrade over 12-20 months. Instead, customers must enroll in Verizon Edge to get a phone with little cash upfront and monthly payments. One of the conditions of the Edge program is forfeiting your unlimited data plan;
  3. Verizon will no longer allow customers with unlimited data plans to transfer an available device upgrade from another line on the account to get a subsidized device upgrade while keeping their unlimited data plan.

In the past, some customers who love upgrading devices a lot either grabbed other family members’ device upgrade offers or opened up extra lines on the account. For each additional $9.99 a month basic line, a customer could qualify for a new subsidized device with a two-year contract, initially attaching a basic 2GB $30/month data plan they can immediately drop when the phone is switched to a line with unlimited data. Some customers have even maintained two or three unused phantom lines just so they can upgrade their phone every 10 months or so.

Beginning Aug. 24, Verizon will close that loophole by forcing customers to keep a data package associated with every subsidized device on their account for the length of the contract. This means customers must pay at least $30 for a 2GB data package, plus the usual $9.99 a month fee for service over the next two years for each line with a smartphone attached, regardless of what number it gets associated with.

According to information received by Droid Life, Verizon believes that when it “gives customers a discount on the retail price of a smartphone, we expect them to pay for data services and keep the smartphone activated for two years. This change closes the loopholes which allowed customers to activate/upgrade a smartphone and immediately revert back to a basic phone, resulting in a discontinued smartphone with no associated data plan.”

This may explain why Verizon Wireless is so gung-ho about getting me to switch to their "money-saving" Family Share Plan. In fact, it's a Family Theft plan -- nearly three times more expensive with a data cap that will force even more upgrades at a higher cost in the future.

Here’s an offer I’d like to refuse: This may explain why Verizon Wireless is so gung-ho about getting customers to switch to their “money-saving” Family Share Plan. In fact, it’s a Family Theft plan — nearly three times more expensive with a data cap that will force even more upgrades at a higher cost in the future.

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Syracuse Wants More Choices Than Comcast and Verizon: Considers Building Publicly-Owned FTTH Alternative

Downtown Syracuse (Image: Post-Standard)

Downtown Syracuse (Image: Post-Standard)

The city of Syracuse is facing an unpleasant broadband reality: the current cable company is about to be bought out by Comcast (which has usage caps in store for broadband customers) and the phone company has thrown in the towel on further expanding FiOS — fiber to the home broadband.

Mayor Stephanie Miner isn’t willing to let the city get trapped by a lack of broadband options from Comcast and Verizon, so she’s developing a plan to build a publicly owned alternative.

“I’m putting together a plan that we can do it ourselves, as a community,” Miner told the Post-Standard

If approved, Syracuse would join Chattanooga, Lafayette, La.,  Wilson and Salisbury, N.C., and several other cities providing local citizens with broadband speeds up to 1,000/1,000Mbps.

“Would we have to do that in phases? What would that look like? How would we pay for it? What would the model be? Those are all things that we are currently looking at, ” Miner noted.

Many of those questions have already been worked out by the best clearinghouse Stop the Cap! knows for excellent community broadband project development: the team at the Institute for Local Self Reliance.

The Community Broadband Networks Initiative of the Institute for Local Self-Reliance, works with communities across the United States to create the policies needed to make sure telecommunications networks serve the community rather than a community serving the network. The Institute for Local Self-Reliance is a non-profit organization that started in Washington D.C. in 1974.

ILSR’s Mission:

The Institute’s mission is to provide innovative strategies, working models and timely information to support environmentally sound and equitable community development. To this end, ILSR works with citizens, activists, policymakers and entrepreneurs to design systems, policies and enterprises that meet local or regional needs; to maximize human, material, natural and financial resources; and to ensure that the benefits of these systems and resources accrue to all local citizens.

No community should attempt to build a community broadband network without first consulting with ILSR. They are particularly effective at helping combat the misinformation campaigns that often arise when an incumbent duopoly discovers they are about to get serious competition for the first time.

If your community wants something better than the local cable and phone company, have your local official(s) E-mail or call Christopher Mitchell at ILSR: 612-276-3456 x209

With entrenched providers unwilling to meet the needs of communities for affordable fast Internet, more American communities are providing the service themselves, much as they take care of local roads, bridges, and other public infrastructure. Comcast’s toll information superhighway may work wonders for shareholders, but it leaves most customers cold. Syracuse, like most upstate New York cities, has also watched Verizon flee from investments in FiOS expansion beyond a handful of wealthy suburbs. Verizon has diverted much of its investment away from wired networks in favor of wireless, a much more profitable business.

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Windstream Teaches AT&T, Comcast, Verizon, Others How to Avoid Federal Income Taxes

A gift from the American taxpayer, willing to make up the difference.

Another corporate tax cut

Wall Street rallied around big telecommunications company stocks this week as news spread that Windstream has found a way to avoid paying federal income tax by converting its copper and fiber networks and other property assets into a tax-exempt trust.

Windstream says it has already won Internal Revenue Service approval to convert all of its network assets into a publicly traded “real estate investment trust.” REIT’s pay no federal income taxes, and if other large telecom companies follow Windstream’s lead, taxpayers will have to make up the estimated $12 billion in lost tax revenue annually.

Investors are excited by the prospect of a major reduction in tax exposure for some of America’s richest telecommunications companies. Windstream was rewarded the most with a 12 percent boost in its share price – a two-year high for the largely rural phone company. But AT&T, Verizon, Comcast, Time Warner Cable, and Cablevision also saw stock prices rising over the possibility of major increases in dividend payouts to shareholders from the proceeds of the tax savings.

REIT conversions are just the latest trick in the book corporations have used to cut, if not eliminate most of their tax liabilities. REITs are exempt from federal taxes as long as they distribute 90 percent of taxable earnings back to shareholders. Democrats in Congress have been busy fighting their Republican colleagues offer efforts to drop the practice of inversion — allowing companies to cut taxes by relocating offshore. Robert Williams, an independent corporate tax consultant, told Bloomberg News the Democrats have their hands full with that this year and are unlikely to be able to also devote resources to closing the REIT tax loophole.

“Management teams will surely look closely at emulating Windstream because the tax savings are potentially so significant,” said Craig Moffett, an analyst at MoffettNathanson LLC, in a note. “For a company like AT&T, where free cash flow has been under pressure and management has been willing to push hard to save on taxes, the appeal must surely be great.”

staxIf a high-profile phone or cable company moves to enact an REIT, that might be enough to provoke Congress to act, warned Moffett.

“The biggest hurdle in this process is getting the private letter ruling from the IRS, and we’ve got that,” David Avery, a spokesman for Windstream, told Bloomberg. The deal doesn’t need the consent of the Federal Communications Commission, Avery added.

Windstream’s tax savings will cut company debt by around $3.2 billion and produce about $115 million annually in free cash flow. Although Windstream chief financial officer Tony Thomas vaguely promised to use some of the money to invest in broadband upgrades, he was more specific about the benefits Windstream’s REIT will have on the company’s growth agenda. It can use the savings to “acquire other network assets to grow,” — business jargon meaning more merger and acquisition deals, this time fueled by Windstream’s slashed tax bill.

Wall Street investment banks paid to advise on Windstream’s REIT conversion are promoting the concept to other telecom companies as easy to replicate and profoundly profitable. But who should share in the new found wealth?

“People are asking the question if these tax benefits should be passed on to the end user — you and I when we pay our phone or cable bill — versus going to the corporation,” said Phil Owens, vice president at Green Street Advisors, a real estate research firm in Newport Beach, California, that has counseled companies like Equinix on REIT conversions.

Don’t count on it.

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Your Unlimited, Off-Contract Verizon Wireless Web Experience Will Be “Optimized” (Throttled) Oct. 1

throttleVerizon Wireless’ ongoing campaign to get rid of its grandfathered unlimited data customers continues this week with news the carrier will begin throttling speeds of off-contract customers still hanging on to their uncapped data plans starting Oct 1.

Verizon doesn’t call the enforcement of speed reductions a “throttle,” but rather “Network Optimization”:

Verizon Wireless strives to provide its customers with the best wireless experience when using our network. In 2011, Verizon Wireless launched Network Optimization, which slows the data speeds of its unlimited data subscribers with 3G devices who are in the top 5% of data users when they connect to a cell site experiencing high demand.

Effective October 1, Verizon Wireless will expand its existing Network Optimization policy to include its unlimited data subscribers using 4G LTE devices who have fulfilled their minimum contract term. Based on your plan and recent data usage, one or more lines on your account may experience a reduction in data speeds when connected to a cell site experiencing high demand. Customers on MORE Everything or other usage-based data plans are not subject to Network Optimization. For more information about our Network Optimization, please refer to www.verizonwireless.com/networkoptimization.

Verizon Wireless customers on the company’s 3G network have been subject to speed throttling for several years if Verizon deems them a “heavy user,” but the company’s 4G LTE network avoided the speed noose until now. Customers who find themselves subjected to Verizon’s speed limiter report it is a very unpleasant experience.

610px-Verizon-Wireless-Logo_svg“My phone has been throttled and is now essentially unusable for the very things it is marketed for,” reports one customer sentenced by Verizon’s “Network Optimization.”  “I can send texts, emails, and view basic websites but any sort of streaming is now out of the question for the remainder of the billing cycle and possibly the next cycle as well.”

The throttle effectively limits speeds to well under 300kbps, and in most urban areas where cell tower usage is higher, punished customers have to live with speeds of around 50kbps — the same as dial-up.

Verizon’s logic and consistency about its “Network Optimization” faced customer scrutiny as well.

“This is not about equal opportunity bandwidth, it’s about Verizon realizing they can increase their revenue stream, otherwise, wouldn’t those tiered folks be getting throttled as well if they ‘abused’ and used ‘inordinate’ amounts of data?  Oh no, of course not, Verizon just bills them more.  This scenario is as ridiculous as charging $20/month for text messaging, which, by the way, is also data.”

What makes you speed-throttling-worthy? According to Droid Life, which broke the story, anyone using more than 4.7GB of data per month on a busy cell tower is likely to end up on a speed diet.

Verizon claims its “Network Optimization” is designed to protect the usage experience among all of its customers, and suggests the speed reductions will only occur when a heavy user is connected to a “high demand” cell site.

“Once you leave that site and attach to a new cell site without high demand, your speeds return to normal,” claims Verizon. “Other carriers often throttle you no matter what throughout the end of a billing cycle.”

But Verizon’s gesture isn’t as generous as it first suggests.

Once a customer is suspected of being a data hog and forced to endure Verizon’s speed throttle, they can stay in Verizon’s speed prison for up to 60 days after being sentenced. The result is dramatically reduced data speeds when a customer happens to travel through a busy cell site area, regardless of whether they are using a lot of data at the time or not.

Network congestion problems may be a result of too many customers connected to a single cell site at any one time, several customers concurrently engaged in high bandwidth traffic exchanges through a cell site, or Verizon’s inadequate capacity to meet even the reasonable needs of its wireless customers.

But regardless of the cause, only one group will be punished for their usage-excess: unlimited data plan customers who are now mostly off-contract (Verizon requires most customers signing a contract renewal that includes equipment discounts to migrate off their unlimited plan, which stopped being sold to new customers in June, 2012.)

Customers can get out of speed jail permanently simply by agreeing to give up their unlimited data plan. Then they can use (and abuse) Verizon’s limited wireless bandwidth, whether it slows every other customer down or not.

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New York City Comptroller Unimpressed With Comcast/Time Warner Cable Merger

one mbps

“Hey look, is that the Verizon FiOS truck?”

New York City comptroller Scott Stringer is lukewarm at best about the idea of Comcast taking over for Time Warner Cable. In a letter to the New York Public Service Commission released today, Stringer says the deal needs major changes before it comes close to serving the public interest.

“As New York City residents know all too well, our city is stuck in an Internet stone age, at least when compared to other municipalities across the country and around the world,” Stringer wrote. “According to a study by the Open Technology Institute at the New America Foundation, New Yorkers not only endure slower Internet service than similar cities in other parts of the world, but they also pay higher prices for that substandard service. Tokyo residents enjoy speeds that are eight times faster than New York City’s, for a lower price. And Hong Kong residents enjoy speeds that are 20 times faster, for the equivalent price.”

Stringer should visit upstate New York some time. While the Big Apple is moving to a Verizon FiOS and Time Warner Cable Maxx or Cablevision/Optimum future, upstate New York is, in comparison, Raquel Welch-prehistoric, especially if your only choice is Verizon “No, We Won’t Expand DSL to Your House,” or Frontier “3.1Mbps is Plenty” Communications. If New York City’s speeds are slow, upstate New York speeds are glacial.

“The latest data from the FCC shows that, as of June 30, 2013, over 40 percent of connections in New York State are below 3Mbps,” Springer added.

Come for the Finger Lakes, but don’t stay for the broadband.

Should the merger be approved, Comcast would be obligated to comply with the existing franchise agreement between Time Warner Cable and the City of New York. However, in order for the proposed merger to truly be in the public interest, Comcast must have a more detailed plan to address these ongoing challenges and to further close the digital divide that leaves so many low-income New Yorkers cut off from the information superhighway. To date, Comcast’s efforts to close the digital divide have focused on its “Internet Essentials” program, which was launched in 2012.iii The program offers a 5 megabit/second connection for $9.95/month (plus tax) to families matching all of the following criteria:

• Located within an area where Comcast offers Internet service
• Have at least one child eligible to participate in the National School Lunch Program
• Have not subscribed to Comcast Internet service within the last 90 days
• Does not have an overdue Comcast bill or unreturned equipment

While the aim of the program is laudatory, its slow speed, limited eligibility, and inadequate outreach have kept high-quality connectivity beyond the reach of millions of low-income Americans. Not only are the eligibility rules for Internet Essentials far too narrow, but the company has done a poor job of signing up those who do meet the criteria. In fact, only 300,000 (12 percent) of eligible households nationwide have actually signed up since the program was launched in 2011.

It is critical that the PSC not only press Comcast to significantly expand the reach of Internet Essentials, but also that it engage in appropriate oversight to ensure that the company is meeting its commitments to low-income residents of the Empire State.

Phillip "Comcast isn't the answer to the problem, it's the problem itself" Dampier

Phillip “Comcast isn’t the answer, it’s the problem” Dampier

In fact, the best way New York can protect its low-income residents is to keep Comcast out of the state. Time Warner Cable offers everyday $14.99 Internet access to anyone who wants it as long as they want it. No complicated pre-qualification conditions, annoying forms, or gotcha terms and conditions.

When a representative from the PSC asked a Comcast representative if the company would keep Time Warner’s discount Internet offer, a non-answer answer was the response. That usually means the answer is no.

“We have seen how telecommunications companies will promise to expand access as a condition of a merger, only to shirk their commitments once the merger has been approved,” Springer complained. “For instance, as part of its 2006 purchase of BellSouth, AT&T told Congress that it would work to provide customers ‘greater access and more choices for broadband, no matter where they live or work.’ However, later reports found that the FCC relied on the companies themselves to report their own merger compliance and did not conduct independent audits to verify their claims.”

Big Telecom promises are like getting commitments from a cheating spouse. Never trust… do verify or throw them out. Comcast still has not met all the conditions it promised to meet after its recent merger with NBCUniversal, according to Sen. Al Franken (D-Minn.).

Stringer also blasted Comcast for its Net Neutrality roughhousing:

While the FCC has not declared internet providers to be “common carriers”, state law has effectively done so within the Empire State. Under 16 NYCRR Part 605, a common carrier is defined as “a corporation that holds itself out to provide service to the public for hire to provide conduit services including voice, data, or video by electrical, electronic, electromagnetic or photonic means.”

Importantly, the law requires these carriers to “provide publicly offered conduit services on demand to any similarly situated user on substantially similar terms, subject to the availability of facilities and capacity.”

In recent months, Comcast has shown that it is willing to sacrifice net neutrality in order to squeeze additional payment out of content providers, such as Netflix. As shown in the chart below, Netflix download speeds on the Comcast network deteriorated rapidly prior to an agreement whereby Netflix now pays Comcast for preferential access.

speed changes

concast careConsumers have a legitimate fear that if access to fiber-optic networks is eventually for sale to the highest bidder, then not only will it stifle the entrepreneurial energy unleashed by the democratizing forces of the Internet, but will also potentially lead to higher prices for consumers in accessing content. Under that scenario, consumers are hit twice—first by paying for Internet access to their home and second by paying for certain content providers’ preferred access.

Internet neutrality has been a core principle of the web since its founding and the PSC must examine whether Comcast’s recent deal with Netflix is a sign that the company is eroding this principle in a manner that conflicts with the public interest.

Stringer may not realize Comcast also has an end run around Net Neutrality in the form of usage caps that will deter customers from accessing competitors’ content if it could put them over their monthly usage allowance and subject to penalty rates. Comcast could voluntarily agree to Net Neutrality and still win by slapping usage limits on all of their broadband customers. Either causes great harm for competitors like Netflix.

“I urge the Commission to hold Comcast to that burden and to ensure that the merger is in the best interest of the approximately 2.6 million Time Warner Cable subscribers in New York State and many more for whom quality, affordable Internet access remains unavailable,” Stringer writes. “And I urge Comcast to view this as an opportunity to do the right thing by introducing itself to the New York market as a company that values equitable access and understands that its product—the fourth utility of the modern age—must be available to all New Yorkers.”

If Comcast’s existing enormous customer base has already voted them the Worst Company in America, it is unlikely Comcast will turn on a dime for the benefit of New York.

The best way to ensure quality, affordable Internet access in New York is to keep Comcast out of New York.

No cable company has ever resolved the rural broadband problem. Their for-profit business model depends on a Return on Investment formula that prohibits expanding service into unprofitable service areas.

These rural service problems remain pervasive in Comcast areas as well, and always have since the company took over for AT&T Cable in the early 2000s. Little has changed over the last dozen years and little will change in the next dozen if we depend entirely on companies like Comcast to handle the rural broadband problem.

A more thoughtful solution is encouraging the development of community co-ops and similar broadband enterprises that need not answer to shareholders and strict ROI formulas.

In the meantime, for the good of all New York, let’s keep Comcast south (and north) of the border, thank you very much.

 

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Major Verizon FiOS Speed Upgrade: Upstream Speed Now Equals Downstream

Phillip Dampier July 21, 2014 Broadband Speed, Competition, Consumer News, Verizon No Comments

faster fiosVerizon Communications today announced its FiOS Internet customers will be getting free speed upgrades that match upload and download speeds — the only provider in FiOS markets to offer speed equality.

Verizon will start transitioning qualifying current residential customers to higher upload speeds for free throughout the coming months, but we can help get you higher on the upgrade list if you keep reading. Later this year, existing and new FiOS small-business customers also will receive this upgrade.

“Faster upload speeds means better sharing experiences,” said Mike Ritter, Verizon’s chief marketing officer for consumer and mass business. “All Internet sharing – whether videos, large photo files or gaming – starts with uploading. FiOS all-fiber-optic technology offers a unique opportunity to enhance our customers’ Internet experience on a mass scale by increasing our upload speeds to equal to our industry-leading download speeds. As the Internet of Things becomes a reality, equal download and upload speeds will become essential.”

Verizon’s upgrade also lets the company point out a shortcoming of most of its cable competitors, upstream speeds lag far behind downstream speeds. Many cable operators still only offer no better than 5Mbps upload speeds, even while offering 50, 100, or 150Mbps for downloads.

Verizon says it noticed upload activity has been on the increase for some time, and with the upstream speed upgrades, it expects double the upload activity it sees today by 2016.

“Verizon’s decision to give every FiOS Internet customer upload speeds that mirror its industry-leading download speeds is a step forward for U.S. digital consumers – and unique among the major U.S. broadband Internet providers,” said Matt Davis, program director of consumer multiplay and broadband services research for IDC. “Because the upgrade is free, it delivers tremendous value to FiOS subscribers and strongly positions Verizon to meet the growing demand for upstream Internet speed.”

Verizon FiOS also lacks usage caps or consumption billing, giving customers a worry-free Internet experience that does not carry the risk of surprise charges on a future bill.

Here are Verizon’s new speed tiers:

140720_BenefitsofFast_432x315

  • 15/5Mbps is now 15/15Mbps
  • 25/5Mbps is now 25/25Mbps
  • 50/25Mbps is now 50/50Mbps
  • 75/35Mbps is now 75/75Mbps
  • 150/65Mbps is now 150/150Mbps
  • 300/65Mbps is now 300/300Mbps
  • 500/100Mbps is now 500/500Mbps

The free speed upgrades will begin with customers enrolled in Verizon’s My Rewards+ program. You can get on the upgrade list today by enrolling in the rewards program on the My Rewards+ websiteMy Rewards+ is Verizon’s free loyalty program that rewards customers for paying a bill online, renting or buying videos on demand, or in recognition of a birthday, service anniversary or other event. My Rewards+ members can use earned points for Visa Prepaid Cards or other gift cards good at participating merchants such as Starbucks Coffee, L.L. Bean, Panera Bread, Target, Amazon, Dunkin’ Donuts, Staples and others. Customers can also choose to donate their rewards to a charity of their choice.

Verizon is running several promotions (until 9/20/2014) for new customers who want in on the new FiOS speeds. The most popular Triple Play promotion is their 25/25Mbps Internet service, which also includes Preferred HD TV and nationwide home phone service (equipment rental required). This includes a two-year price guarantee for $89.99 per month when ordered online and $99.99 per month otherwise (not including equipment charges, taxes and fees). In addition, new customers can receive a free LG G Pad 8.3 LTE or up to $200 off any other tablet available from Verizon Wireless if they are willing to take out a new, two-year service agreement. This part of the promotion is less attractive to us because the offer requires the tablet be activated on the Verizon Wireless network, which means ongoing charges.

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I Love You Comcast! An Amazing 180 for Former Antitrust Attorney David Balto

Phillip "I got whiplash just watching" Dampier

Phillip “I got whiplash just watching” Dampier

A former policy director at the Federal Trade Commission and antitrust attorney at the U.S. Justice Department has managed an impressive 180 in just a few short months regarding the merger of Time Warner Cable and Comcast.

In February, David Balto told TheDeal the proposed takeover of Time Warner Cable “is a bad deal for consumers.” Today, Mr. Balto’s panoply of guest editorials, media appearances and columns — suddenly in favor of the merger — are turning up in the New York Times, the Orlando Sentinel, Marketplace, WNYC Radio, and elsewhere.

Balto’s arguments are based on “research” which, in toto, appears to have been limited to thumbing through Comcast’s press releases and merger presentation. That was enough:

First, this deal should create benefits for Time Warner customers, who will gain a significantly faster Internet and more advanced television service.

Second, competition is increasing in both the pay-TV and broadband businesses. Ninety-eight percent of viewers have a choice of three or more multichannel services, plus growing options online. Yahoo just announced a new video service, joining Netflix, Amazon and YouTube. In the last five years, cable has lost about seven million customers, satellite has gained nearly two million, and the telecommunications companies have gained six million.

Third, Comcast’s post-merger share of broadband falls closer to 20 percent when including LTE wireless and satellite providers. Over all, 97 percent of households have at least two competing fixed broadband providers — three or more if mobile wireless is included.

We used to wonder why government officials and regulators were so easily fooled by the corporate government relations people sent into their offices armed with press releases, talking points, cupcakes, and empty promises. We understand everyone isn’t a Big Telecom expert, but too often regulators’ reflexive acceptance of whatever companies bring to their table threatens to win them rube-status. We’d like to think Mr. Balto isn’t Comcast’s sucker, and we certainly hope there are no unspoken incentives on the table in return for his recent, very sudden conversion to celebrate all-things Comcast. Maybe he’s simply uninformed.

Balto

Balto

Although our regular readers — nearly all consumers and customers — are well-equipped to debunk Mr. Balto’s arguments, for the benefit of visitors, here is our own research.

First, Comcast’s Internet service is not faster than Time Warner Cable. Mr. Balto needs to spend some time away from Comcast’s merger info-pack and do some real research. He’ll find Time Warner Cable embarked on a massive upgrade program called TWC Maxx that is more than tripling broadband speeds for customers at no extra charge. Those speeds are faster than what Comcast offers the average residential customer, and come much cheaper as well. Oh, and TWC has no compulsory usage limits and overlimit penalties. Comcast’s David Cohen predicts every Comcast customer will face both within five years.

Second, that “advanced TV platform” Balto raves about requires a $99 installation fee… for an X1 set-top box. It also means equipment must be attached to every television in the house, because Comcast encrypts everything. At a time when customers want to pay for fewer channels, Comcast wants to shovel even more unwanted programming and boxes at customers. Older Americans who want their Turner Classic Movies have another nasty surprise. They will need to buy Comcast’s super deluxe cable TV package to get that network, at a cost exceeding $80 a month just for television. Ask Time Warner customers what they want, and they’ll tell you they’d prefer old and decrepit over an even higher cable TV bill Comcast has already committed to deliver.

Has competition truly increased? Not in the eyes of most Americans who at best face a duopoly and annual rate hikes well in excess of inflation. Even worse, for most consumers there is only one choice for 21st century High Speed Internet service – the cable company. Mr. Balto conveniently ignores the fact cable’s primary competitor is still DSL which is simply not available at speeds of 30+Mbps for most consumers. In some areas, like suburban Rochester, N.Y., the best the local phone company can deliver some neighborhoods like ours is 3.1Mbps. That isn’t competition. Verizon and AT&T have both stopped expanding DSL. Verizon has ended FiOS expansion and AT&T’s U-verse still maxes out at around 24Mbps for most customers. AT&T’s promised fiber upgrades have proven to be more illusory than reality, available primarily in a handful of multi-dwelling units and new housing developments. In rural areas, both major phone companies are petitioning to do away with landline service and DSL altogether.

Raise your hands if you want Comcast’s “benefits.” In New York, out of 2,300 comments before the PSC, we can’t find a single one clamoring for Comcast’s takeover. The public has spoken.

Cable "competition" in Minneapolis

Cable “competition” in Minneapolis. Charter and Comcast have also teamed up to trade cable territories as part of the Time Warner Cable merger package deal.

Satellite television’s days of providing the cable industry with robust competition have long since peaked. AT&T is seeking to further reduce that competition by purchasing DirecTV, not because it believes in satellite television, but because it wants the benefits of DirecTV’s lucrative volume discounts.

Any antitrust attorney worth his salt should be well aware of what kind of impact volume discounting can have on restraining and discouraging competition. Comcast’s deal for Time Warner will let it acquire programming at a substantial discount (one they have already said won’t be passed on to customers) so significant that any would-be competitors would be in immediate financial peril trying to compete on price.

Frontier Communications learned that lesson when it acquired a handful of Verizon FiOS franchises in Indiana and the Pacific Northwest. After losing Verizon’s volume discounts, Frontier was so alarmed by the wholesale renewal rates it received, it let loose its telemarketing force to convince customers fiber was no good for television and they should instead switch to a satellite provider they partnered with. It’s telling when a company is willing to forfeit revenue in favor of a third party marketing agreement with an outside company.

So what does this mean for a potential start-up looking to get into the business? Since programming is now a commodity, most customers buy on price. The best triple-play deals will go to the biggest national players with volume discounts – all cable operators that have long agreed never to compete directly with each other.

In the Orlando Sentinel, Mr. Balto seemed almost relieved when he concluded Comcast and Time Warner don’t compete head-to-head, somehow easing any antitrust concerns. It is precisely that fact why this deal must never be approved. Comcast has been free to compete anywhere Time Warner provides service, but has never done so. Letting Comcast, which has even worse approval ratings than Time Warner, become the only choice for cable broadband is hardly in the public interest and does nothing for competition. Instead, it only further consolidates the marketplace into a handful of giant companies that can raise prices and cap usage without restraint.

If Mr. Balto truly believes AT&T and Verizon will ride to the rescue with robust wireless broadband competition, his credibility is in peril. Those two companies, among others, are completely incapable of meeting the growing broadband demands (20-50GB) of the home user. With punishing high prices and staggeringly low usage caps, providers are both controlling demand and profiting handsomely from rationing service at the same time. Why change that?

No 3G/4G network under current ordinary traffic loads can honestly deliver a better online experience than DSL, and customers who attempt to replace their home broadband connection in favor of wireless will likely receive a punishing bill for the attempt at the end of the month. The only players who want to count mobile broadband as a serious competitor in the home broadband market are the cable and phone companies desperately looking for a defense against charges they have a broadband monopoly or are part of a comfortable duopoly.

One last point, while Mr. Balto seems impressed that Comcast would continue to voluntarily abide by the Net Neutrality policies he personally opposes, he conveniently omits the fact Comcast was the country’s biggest violator of Net Neutrality when it speed limited peer-to-peer traffic, successfully sued the government over Net Neutrality after it was fined by the FCC for the aforementioned violation, and only agreed to temporarily observe Net Neutrality as part of its colossal merger deal with NBCUniversal. It’s akin to a mugger promising to never commit another crime after being caught red-handed stealing. A commitment like that might be good enough for Mr. Balto, but it isn’t for us.

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Here’s How to Tell the N.Y. Public Service Commission to Reject the Comcast/TWC Merger

ny pscThe New York Public Service Commission needs to hear from you about the Comcast-Time Warner Cable merger. Unlike some of the southern and midwestern states that have utility commissions that basically rubber stamp the agenda of Big Telecom companies, New York’s PSC has a reputation for being tougher and more customer-oriented. But the PSC cannot act in your interest if you don’t share your views.

It is incredibly easy to file your own comments with the PSC. Nearly 2,300 New Yorkers have done so thus far, but we need to make sure they understand our serious objections to Comcast’s usage caps, its expensive service, and customer abuse.

We have provided a sample letter below. We hope you will write your own, but offer ours as a guide that includes some of our biggest concerns. We may prepare another one soon outlining other concerns.

How to file your comment:

  • E-Mail: [email protected]
  • Mail: Hon. Kathleen H. Burgess, Secretary, Public Service Commission, Three Empire State Plaza, Albany, New York 12223-1350.
  • Phone: 1-800-335-2120 (press “1″ to leave a recorded comment)

All comments should refer to “Case 14-M-0183, Petition of Comcast Corporation and Time Warner Cable Inc.”

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

Re: Case 14-M-0183, Petition of Comcast Corporation and Time Warner Cable Inc.

Dear Ms. Burgess,

I am writing to ask the Public Service Commission to reject the merger proposal of Comcast and Time Warner Cable on the ground the companies have failed to show such a merger would be in the best interests of New York and its residents.

Although Time Warner Cable has never been a prize, Comcast’s reputation for bad service, high prices, rationed Internet access, and customer abuse is well documented in just about every community the company serves. Comcast has repeatedly been voted the “Worst Company in America” by Consumer Union’s Consumerist.com. The American Consumer Satisfaction Index has documented so many complaints about Comcast, it declared it the worst company it has ever scored, performing even worse than the Internal Revenue Service. For more than three years running, Harris Interactive has called Comcast one of the least reputable companies in America.

That alone should be enough to reject this merger out of hand. Permitting it would reward this company’s appalling behavior towards its own customers and expose New Yorkers to an even bigger monopoly problem than we deal with now. Unless you live in a Verizon FiOS service area, cable is your only real choice for true broadband speeds. DSL is rapidly losing favor and market share and Verizon has shown no interest in expanding it.

Comcast already uses its market power to its advantage by raising prices… a lot. Time Warner Cable charges less for its services than Comcast does.

For example, Time Warner Cable offers a standard television service package that provides all the popular cable networks for one price. Comcast offers a similar package but stripped out cable networks including Cloo, CNBC World, Al Jazeera America, Discovery Fit & Health, Disney XD, DIY, a range of ESPN’s extra networks, EWTN, Fine Living, Fox Business News, Great American Country, IFC, Investigation Discovery, Lifetime Real Women, Military Channel, MLB, most of MTV’s extra networks, NBA, National Geographic Channel, NFL Network, NHL Network, most of Nickelodeon’s extra networks, OWN, Oxygen, Sundance, Turner Classic Movies, The Science Channel, and VH1′s extra networks.

Customers who want these networks, like Turner Classic Movies, National Geographic, and IFC will have to pay a stunning price of up to $86 a month — just for television. Many of these networks are especially popular with fixed income older residents, who will now face an even larger cable TV bill.

Comcast promotes the fact its Internet speeds are faster than Time Warner Cable, but that is not true as Time Warner Maxx upgrades arrive. Comcast Internet service costs more, is slower, and increasingly usage-capped. Time Warner Cable has made clear it will not limit customers’ Internet usage. Comcast has made clear it will, predicting usage limits/usage-based pricing will be imposed on customers across its entire footprint within five years. That is no improvement for New York. That is literally a downgrade. We can do better in New York with Time Warner Cable.

In fact, the company has promised extremely little to New York after winning your approval to merge. Comcast is so arrogant, it already announced it will not share any cost savings with customers, promising even higher cable bills for New York with the merger. Even its touted X1 set top system will cost New Yorkers — it comes with a steep installation price of almost $100. Again, how does this serve the public interest?

Comcast’s public service programs are also woefully inadequate. Its Internet Essentials is a bureaucratic nightmare that only provides temporary discounts to a small percentage of customers (with school age children) who need an affordable Internet option. I guess childless couples and the elderly poor don’t matter. Time Warner Cable offers a $14.99 discount program available to anyone who wants it, no paperwork or waiting periods required.

It is my understanding Comcast must prove this merger is in the public interest to win your approval. It has utterly failed to do so, and I expect my state’s Public Service Commission to reject this merger. This is one deal that can never be modified sufficiently to make it acceptable for people like myself. You are doing us no favors trying to negotiate for an Internet discount program or expanding Comcast’s service area by a small amount in rural upstate New York. The end result is that millions of New Yorkers will get worse service than we get today, at a higher price, with little/no competition on the horizon.

This is a rare opportunity for our state, which lost most of its oversight powers over the cable industry years ago. Cable operators have abused their deregulated status and have raised prices, provided dreadful customer service, and have kept competition away. Letting Comcast into New York from Buffalo to the Bronx will only encourage more abuse, wreaking havoc on New York’s growing digital economy. Let’s send a clear message to Comcast New York isn’t willing to put our broadband future in the hands of “the worst company in America.” Let’s make it clear enough is enough.

Sincerely,

 

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