As the fall elections near, the rhetoric and sheer nonsense from those opposed to important consumer broadband reforms has reached a fever pitch.  And as our reader Karen writes, too many Americans and the candidates they support just don’t get it.

Here in Delaware, Tea Party candidate Christine O’Donnell exemplifies what Net Neutrality supporters are up against — complete ignorance and big cash contributions.  Before she went into hiding, I attended one of Christine’s rare public events and asked her about where she stood on Net Neutrality and her response was she believed “all sides should be represented on the Internet.”  So she thinks Net Neutrality is about views expressed online, not stopping the telecom industry from slowing or blocking access to websites.

At least 35 of the Tea Party groups are opposed to Net Neutrality, mostly because their financial backers (big corporations and billionaire-funded front groups) have convinced members they should be.  Many others are stupid enough to believe Glenn Beck and his pal Phil Kerpen at Americans for Prosperity who say Net Neutrality will “censor” the Internet or turn control of it over to Barack Obama.

Conservative groups heavily funded by corporate interests they refuse to identify are backing various chapters of so-called “Tea Party” groups and feeding them talking points generated by companies like AT&T and Verizon in opposition to Net Neutrality.  The Center for Individual Freedom runs a website StopNetRegulation, edited by conservative activist Seton Motley, dedicated to derailing broadband reforms.  Motley was also quoted in The Hill in late September warning Republicans about antagonizing Tea Party types with their support for Net Neutrality in Congress.  Only then his comments came as leader of the group “Less Government.”  Judging from the organization’s website, Motley is also in favor of reduced size websites because his amounts to a single sentence.

Seton is convinced the end of the net world, as we know it, comes November 30th when the government could “seize control of the Internet.” That’s the date of the FCC’s November meeting, at which Seton suspects Julius Genachowski will finally move to reclassify broadband as a telecommunication service. 

Seton completely misrepresents reclassification as saddling the Internet with “the same rules as landline telephones.”  I read that claim somewhere before… oh yes, straight from AT&T and Verizon lobbyist talking points.

It doesn’t matter to Seton and other conservatives that Genachowski went out of his way to say he would not be applying any onerous telephone-era regulations on today’s broadband providers.  In fact, Genachowski’s actions to date have moved at such a glacial pace, friends have to occasionally check his pulse to make sure he’s still with us.

So what is so big, bad, and scary about Net Neutrality?  It simply guarantees your Internet Service Provider doesn’t start throttling your speeds when accessing websites and Internet applications they dislike, cannot block access to websites critical of their agenda, and are not allowed to extort payments from content providers just to allow traffic onto “their” networks.

While that may pose a Halloween freak-out for the profit-obsessed phone and cable companies, it’s hard to find actual consumers (not paid by said providers) who want their Internet service blocked or slowed down.

Seton goes way over the top turning this into a First Amendment free speech issue.  That argument only works for the likes of AT&T and Verizon who find their corporate right to overcharge people for broadband being infringed.

Seton then argues his view must be right because even minority groups support his position.  As readers here already know, most of the groups he names to bolster his argument are “dollar-a-holler” organizations willing to peddle the phone and cable company agenda on their letterhead in return for donation checks.

So have many additional normally Democrat paragons, including several large unions: AFL-CIO, Communications Workers of America (CWA), International Brotherhood of Electrical Workers (IBEW); several racial grievance groups: League of United Latin American Citizens (LULAC), Minority Media and Telecom Council (MMTC), National Association for the Advancement of Colored People (NAACP), Urban League; and an anti-free market environmentalist group: the Sierra Club.

If you ever wondered why AT&T and Verizon spend so much on contributions to these interest groups, Seton Motley just handed you the answer — so he and the companies he supports could name drop them in arguments against pro-consumer broadband reform.  And considering the CWA and IBEW represent phone company workers, it’s not a surprise to see them on their side of this issue either.  Wherever you look amongst those in opposition to Net Neutrality, a check from AT&T and/or Verizon is almost always waiting to be deposited.

The Obama-Has-Concentration-Camps-crowd parked on Andrew Breitbart’s website ate it up and wrote comments like this:

The communist can’t control the people with a internet that is out of control, all dictatorships have the power over what the people can read, free thinkers in this day and age are considered terrorist, Republicans, conservatives, anti abortionist, Oath Keepers, Christians, ex military, people who think the Constitution is still the law of the land, my lord, the communist can’t have these sorts communicating with each other over the internet, why, they may all come together one day and put a stop to the one world government goal, you know, the goal of making the world one big slave camp.

This kind of wild opposition has even corporate Republicans on edge, according to The Hill.  A major talking point of Net Neutrality opposition is that such “sweeping changes” should not be enforced by the FCC, but from legislation enacted in Congress.  But because Tea Party elements are opposed to the concept altogether, and Republicans are loathe to hand Democrats their votes on much of anything, even a corporate-friendly Net Neutrality bill introduced by Rep. Henry Waxman (D-Calif.) went up in flames.  Waxman’s bill would have enacted some protections, but only until 2012, at which point it was open season on broadband consumers.

The Hill piece delivered a disappointing fact of life for much of today’s Congress, beholden first to corporate interests (underlining ours):

In a striking sign that people who normally align themselves with telecommunications companies may line up behind the bill if it is industry-backed, ardent net-neutrality critic Brett Glass, founder of a wireless company, is open to it. He tweeted on Monday, in a note to Americans for Prosperity executive Phil Kerpen, that the Waxman legislation seems “more reasonable than I expected.”

In a note earlier this month, analysts at Stifel Nicolaus wrote that although Republican House members “may not have incentive to solve a political problem for Democrats,” some may support the bill “if there’s a push by” phone and cable companies and at least some Internet companies.

But the shilling for Big Telecom has never been a one-party-problem.  While Republicans appear to be moving in lock step against Net Neutrality, a number of groups and politicians on the Democratic left have also been only too willing to take AT&T money and run to a microphone to oppose a free and open Internet.

The Los Angeles Times gave plenty of space on an issue we’ve written repeatedly about on Stop the Cap!:

Key minority groups are backing the carriers’ efforts to thwart the net neutrality proposals, which would, for instance, prohibit carriers from charging more to give some residential and corporate customers priority in delivering online content.

“When you give national civil rights groups millions of private dollars, there’s no firewall strong enough to keep that money out of their policy,” said Malkia Cyril, executive director of the Center for Media Justice.

Cyril and other consumer and public advocates have been buoyed by comments from Federal Communications Commission member Mignon L. Clyburn, a prominent African American and daughter of Rep. James E. Clyburn (D-S.C.).

She said in a speech in January that she was surprised that most statements and filings by “some of the leading groups representing people of color have been silent on this make-or-break issue” of net neutrality.

“There has been almost no discussion of how important — how essential — it is for traditionally underrepresented groups to maintain the low barriers to entry that our current open Internet provides,” Clyburn said.

At issue are the enormous contributions from big phone and cable companies like Comcast, AT&T and Verizon that routinely translate into what we’ve called “dollar-a-holler” advocacy.  After the checks get deposited, many of these groups generate innocent sounding letters of support for the latest merger, deregulation, or policy debate — always in favor of Big Telecom and too often directly against the interests of the people they claim to represent.

No group better exemplifies this than the League of United Latin American Citizens (LULAC), a particularly eager player in the cash for advocacy game.  And the group doesn’t care whether the money comes from Verizon or AT&T.  They’re on board with both.

Brent A. Wilkes, executive director, penned this guest editorial for the Houston Chronicle, for which he was called an “idiot” by at least one of the newspaper’s readers:

Net-neutrality rules should prevent broadband providers from engaging in anti-competitive behavior, but they should not be commandeered to insulate wealthy Internet applications companies from paying their fair share of the broadband bill. Any new rules must protect consumers both by ensuring their unfettered access and by shielding them from having to shoulder all the costs for faster broadband networks that our nation so badly needs. Such an approach will not please the special interests, but it will be a double win for consumers.

From AT&T’s talking points to Wilkes editorial.  “Wealthy Internet applications companies” already pay for their own bandwidth and for the Internet’s expansion.  Search engine companies like Google and Yahoo! construct data centers with their own money just to maintain their services to consumers, generating jobs and helping local economies.  Wilkes ignores the fact broadband providers already earn plenty from their subscribers — consumers and businesses who pay a monthly fee so they can access those “wealthy Internet applications companies.”

But that is not enough.  Now broadband providers want to be paid twice.  To facilitate their argument, they’ve invested more than a million dollars in LULAC alone to defend their position, which ultimately brings Latinos (and everyone else) the high broadband bills today that Wiles scaremongers will be forthcoming tomorrow.

Wilkes was shocked, shocked by the implication that phone company money would have anything to do with LULAC going out of its way to comment on arcane telecommunications policy issues, always in favor of its benefactors.

“It’s kind of like saying the minority organizations can’t think for themselves,” Wilkes said, adding that any suggestion that minority groups were mouthpieces for the industry was “offensive.”

Verizon played along:

“I can tell you we do not, and have not ever, given money to minority organizations so that they will support our positions on any topic,” said Peter Thonis, a spokesman for Verizon Communications Inc. “We talk to many groups about our positions, and some agree with us and some do not.”

So if Verizon talked to Stop the Cap! about their positions, do you think we’d receive a handsome check from the phone company?

The Times documented numerous other examples:

For instance, David Cohen, Comcast’s executive vice president, joined the board of the National Urban League three years ago as part of a three-year partnership to promote the league’s various educational programs. Comcast, now seeking FCC approval to buy a controlling interest in NBC Universal, was recognized that year for being one of several sponsors to donate $5 million or more to the organization.

On the local level, the Greater Sacramento Urban League has Barbara Winn, a Sacramento-area director of external affairs for AT&T, as its chairwoman and Linda Crayton, Comcast’s senior director for government affairs in California, as vice chairwoman.

That affiliate’s president, David B. DeLuz, wrote to the FCC in January that net neutrality rules “will strongly reduce broadband network investments and ultimately raise prices.” DeLuz said in an interview that the two telecom executives on the chapter’s board have not influenced its net neutrality stance.

“The Urban League does not engage in pay to play,” he said. “Just because [telecoms] write a check to us doesn’t mean they write the only check to us.”

The most remarkable part about the Urban League’s argument is that in a sea of corporate cash, competing checks can cancel each other out.

While the blizzard of bucks continues to descend on Washington, Time Warner Cable CEO Glenn Britt decided his cable company could cut out the middlemen and go right to the man with the plan to reclassify broadband.  Unlike ordinary consumers, Britt had no trouble getting FCC Chairman Julius Genachowski to take his call, allowing him to personally lobby against Net Neutrality and those nasty broadcasters trying to overcharge him for permission to carry local broadcast stations on the Time Warner Cable dial.

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/ATT Net Neutrality There’s a problem.mp4[/flv]

It seems like only yesterday AT&T’s Ed “Our Pipes” Whitacre was clamoring for the right to deliver the Internet to consumers his way, complete with pay walls and speed throttles.  Very little has changed since Big Ed left for Government Motors with his $158 million AT&T golden parachute.  The name at the top has changed, but AT&T still recognizes money buys friends and influence.  (2 minutes)

As AT&T and Verizon discover an increasing amount of their revenue and profits come from their respective wireless divisions, they’re testing the waters to determine just how much more consumers are willing to pay for cell phone and wireless broadband services.

Verizon Wireless has spent the past year closing loopholes of various kinds and herding an increasing number of customers into mandatory data plans which can add up to $30 a month per phone to your monthly bill.  AT&T wants more if you plan on early upgrades for your cell phone.  A quick review:

Verizon Wireless Locks Down Prepaid Phone Models: Anyone who has shopped for a prepaid phone has probably noticed them dangling from hooks in Walmart and other stores at prices starting around $20.  Most of these prepaid phones are basic models or those deemed cutting edge a few years ago.  Take the LG 5600 — the Accolade.  It’s a phone your father would be comfortable with, covering the basics and designed primarily for making and receiving phone calls.  Verizon Wireless’ retail price for its “postpaid” customers (those who get and pay a bill every month) is $199.99 for the Accolade.  Of course, if you sign a new two-year contract, the phone is free.  But you can find the exact same phone, labeled for Verizon’s prepaid service at prices as low as $15.88.

Verizon claims the deep, deep discounts on prepaid phones are made back from the higher prices prepaid customers pay for airtime.  Some enterprising Verizon postpaid customers have sought these models out to replace or upgrade a worn out or broken phone without having to sign a new two-year contract.  Some other prepaid companies have also activated Verizon’s prepaid phones on their own network, including Page Plus.

Verizon has put the kibosh on both practices.  Customers seeking to activate a prepaid phone on a postpaid account must first use the phone in prepaid mode for a minimum of six months prior to its conversion to postpaid use.  Until very recently, some customers discovered a loophole around this requirement — registering a prepaid phone first on Verizon’s website and then activating it by dialing *228.  So long as a phone had never been activated, it often could be used on a postpaid account from the date of purchase.  But now Verizon tracks which phones are intended for postpaid and prepaid use, and that loophole has been closed.

Page Plus, which resells Verizon’s network, also had to stop activating Verizon prepaid phones almost a year ago.

As a result, those who want discounted cell phone service but keep Verizon’s robust network coverage have been forced to buy handsets at retail pricing, purchase one of several mostly refurbished phones direct from Page Plus, or activate an older phone no longer in use.

Avoiding the Data Plan: What drives an increasing number of Verizon off-contract customers towards “creative solutions” for upgrading their more than two year old phones is resistance to the expensive data plan required for most of their newest and best phones.  For these customers, renewing a contract means a plan change that includes $30 a month extra for data services or a phone downgrade to a basic model to avoid a data plan. Verizon’s remaining data-plan exempt handsets are:

• Verizon Wireless CDM8975
• LG Accolade™
• LG Cosmos™
• Pantech Jest™
• Samsung Gusto™
• Verizon Wireless Salute™
• Verizon Wireless Escapade®
• Samsung Haven™
• Samsung Intensity™
• Samsung Convoy™
• Motorola Barrage™

For large families accustomed to mid-level phones, the prospect of being stuck with a Jitterbug-like-downgrade or a $30 data plan has kept many from renewing their contracts, sticking with what they already own.

When AT&T announced the end of its flat rate smartphone plan, it said the lower pricing on smaller allowance data packages would represent “savings” for consumers reluctant to upgrade.  It’s hard to accept the same company that set prices so high for data usage in the first place has consumer interests at heart with usage-limited alternatives, especially when they no longer offer an unlimited option for customers who want one.

Verizon also plans to drop its unlimited plan in the near future.  Also on tap is a gradual shift away from so-called “mid-level” phones that consumers can purchase with a reduced rate, but still-mandatory $10 data plan.  Verizon increasingly will push customers between two stark choices — a high-powered, battery-eating smartphone that will give you a heart attack if you drop it or a very basic, stripped down phone with features commonly found on handsets five years ago.

This kind of pricing is driving some cash-strapped consumers to prepaid alternatives, such as Page Plus and Straight Talk on Verizon’s network and Wal-Mart’s new family prepaid plan on T-Mobile.  This is especially true if customers just want to talk and text.

AT&T’s Increases ‘Early Upgrade Price’ for Data-Friendly Smartphones by $125

Boy Genius Report obtained a copy of an AT&T memo to its sales force notifying them the price for “Early Upgrade Pricing,” traditionally charged customers who must have the latest and greatest, or accidentally lose or destroy their existing phone, is going up — way up, from $75 to $200:

Beginning Oct. 3rd, Early (Exception) Upgrade pricing for Smartphones will increase from the two-year price plus $75 to the two-year price plus $200.  This change does not apply to iPhone or Basic and Quick Messaging Phones.

Example: BlackBerry Torch $199.99 two-year price + $200 Early Upgrade fee = total price $399.99, a savings of $100 off the No-Commitment price of $499.99.

In return for just a $100 discount, customers sign a new two-year contract that begins with the phone’s replacement.  That contract includes the usual early termination fee of $325, which decreases by $10 per month.  AT&T watchers speculate the price change was designed to stop resale of relatively new phones on sites like eBay or Craigslist, where sellers charge near-retail prices and eat the formerly low penalty for an early upgrade.  It also makes the price of getting the very newest phones that much higher.

Cell Phone Lobby Resists Requirement for Early Warnings Alerting Customers Their Data Allowance Is Almost Gone: “It Will Cause Customer Confusion and Frustration”

Liz Szalay had to dip into her 401(k) retirement account to pay the family’s $2000 Verizon Wireless bill, gone wild with data fees her 14-year old son ran up searching for and downloading songs.

“I would never have allowed my son to accrue such charges, if I had known,” Szalay, a secretary in Niles, Michigan, told Bloomberg News. “What I did to prevent this from happening in the future was have his Internet access completely blocked by Verizon, but not before they made off with a boatload of money.”

Had Szalay received a text and/or e-mail message warning her one of the phones on her account was approaching 80 percent of its monthly data allowance, or was already at risk of racking up huge fees, it would have been possible to stop the damage before it began.

Senator Tom Udall, a New Mexico Democrat, wants to make sure she gets that warning.  Udall drafted legislation that would require companies to warn customers when they have used 80 percent of their allotment.

“It’s difficult for the carriers to get up and argue against greater transparency on bills and notifications,” Christopher King, an analyst at Stifel Nicolaus & Co. in Baltimore told Bloomberg. “It’s becoming an issue on the front burner of regulators’ minds.”

The industry’s lobbyists are trying to block the legislation anyway.

The CTIA, the wireless industry lobbying group, is fiercely trying to kill Udall’s bill, claiming warnings will cause “customer confusion and frustration” and that carriers already offer customers the opportunity to check their usage by visiting carrier websites or via a text message.

The lobbyist solution requires consumers to be vigilant and check daily to make sure they don’t exceed any limits.  Udall’s idea puts the onus on phone companies to warn customers, who often have family members that have no idea what kind of cash bonanza they can provide a wireless provider just by using data features built into their phones.

Szalay’s son has a phone that doesn’t require a data plan, but incurs an enormous $1.99 in charges for every megabyte accessed online.  Verizon’s own website notes customers can consume 183 megabytes of data streaming music just five minutes a day for a month.  That’s $364 in data charges.  Five minutes downloading games — 440 megabytes or $875 in data fees.  One need not use their phone for hours a day to incur enormous fees for data usage.  Szalay’s son could have managed the $2,000 bill he caused using his phone for less than 15 minutes each day.

Verizon does not allow customers hit with these bills to retroactively sign up for a data plan to cover the costs, which are the same to Verizon whether a consumer incurs them on an unlimited $30 monthly data plan, or on a pay per use plan with a stinging penalty rate.

And the company objects to any government official telling them to warn customers before the overlimit fees kick in.

“We have several measures in place that allow our customers to monitor their usage and protect against overages — this is a proactive approach on Verizon’s part,” Verizon’s Smith told Bloomberg in an e-mailed statement.

How to Protect Yourself

Both Verizon and AT&T are masters of extracting a maximum amount of money from customers’ pockets.  Verizon is increasingly risking its high rating for customer service and quality by finding new ways to nickel and dime even long time customers to death.  AT&T already has earned a bad reputation and can’t drop much further unless it adopts Sprint’s old strategy of driving its own customers away.  Only through education and careful consideration of your family’s actual usage can you safely navigate around these shark-like wallet biters.

1.  Avoid cell phone company insurance plans unless you are concerned about theft.  With “early upgrade” plans, even at AT&T’s $200 price, it may not be worth paying an expensive monthly fee for insurance.  Also consider Squaretrade, a third party warranty/replacement provider.  They charge considerably lower prices than most (Google around for coupon codes offering up to 30 percent off).  If your phone breaks or is damaged, and you are not on a contract, you might find a suitable refurbished replacement through websites like eBay.  Just make sure the phone wasn’t designated for prepaid service to avoid activation hassles.

2.  If you want Verizon network quality, but don’t want to pay Verizon’s diamond-platinum pricing, consider doing business with one of the new prepaid providers offering month-to-month service that uses the same network as Verizon itself.  Walmart sells Straight Talk, but also consider Page Plus, which offers 1,200 minutes of call time, 1,200 texts, and 50MB of data use for $29.95 per month.  The only downside is that most prepaid providers don’t sell family plans, meaning each user pays the same price.  Walmart’s new prepaid plan changes that with the introduction of a shared family plan, with additional lines given discounted pricing.  But the discounts are not as good as postpaid plans offer, and the service relies on T-Mobile, which is not well-regarded for coverage outside of metropolitan areas.

3.  Smartphones, in addition to being expensive, often deliver horrible battery life.  Some won’t even make it through an entire business day.  Before seeking out one of these premium phones, consider whether you will actually use their features.  Is it worth the price of a $30 a month data plan if you only occasionally use the phone for wireless Internet?  Bragging rights come with a $200 up front price tag and a two year contract that will run up to $720 just for the data plan over two years.  If you drop it, lose it, or it gets stolen, the retail price for most of these phones is north of $500.

4.  Carriers design “gotcha” data pricing into their assumed revenue models.  They know even with online tools, nobody wants the hassle of checking their allowance for data every day, especially when most stopped checking their voice minutes allowance years ago.  While carriers occasionally waive gigantic bills, especially when the media gets involved, you can restrict data access on some or all of your phones if you do not have a data plan and don’t care about this feature.  You should support Senator Udall’s bill as well.  Carrier excuses that a warning message will cause confusion and frustration are laughable.  Getting a $2,000 wireless bill in the mail will cause far more of both.  That the industry objects to even this common sense approach illustrates just how rapacious wireless companies are for additional profits.

5. Educate everyone on your plan about the implications of using the phone to download music and games or watch video.  Unless you are on a flat rate plan, you may want to simply tell your family not to use their phones for these kinds of services without asking permission first.  This gives you an opportunity to check your allowance before Verizon gets a chance to reduce your bank balance.

[flv width=”640″ height=”500″]http://www.phillipdampier.com/video/Cell Phone Savings 10-12-10.flv[/flv]

We have four reports covering consumer news on cell phones that can save you money:  KSHB-TV in Kansas City takes a look at Walmart’s new prepaid family plan using T-Mobile’s network, WIVB-TV in Buffalo reports Sen. Kirsten Gillibrand (D-N.Y.) wants carriers to stop international roaming charges when customers end up making and receiving calls on a Canadian provider’s network from the American side of the border, WFTS-TV in Tampa provides tips on getting lower rates from your cell phone company and WTEV-TV in Jacksonville helps customers analyze cell phone bills for savings.  (6 minutes)

Charter Cable customers are upset over new surcharges of a dollar or more on their monthly cable bills to pay for broadcast/over-the-air stations they can receive for free.  Even worse, Charter already charges its basic customers in areas like upstate South Carolina up to $25 a month for basic cable, which includes local channels and a handful of cable networks.

Now customers like Cathy Bader want to know why Charter needs a dollar surcharge on a $25 cable package when it only costs Charter a dollar for the local channels she wants to watch.

Those in other parts of the state pay as low as one-third that price for the same local channels.

“If you’re only paying $1.12 to rebroadcast the same channels that you can get with an antenna or on basic elsewhere [in the state] for $14 dollars, well, why don’t [they] take it down to $14 for basic cable,” Bader asked Diane Lee, a consumer reporter for WSPA-TV in Spartanburg.  “Why gouge the customers when you are the only game in town for most of us.”

Now that Bader has learned the exorbitant markup rate on basic, she wants to know how much Charter pays to re-transmit other channels, too.  She’s certain it is much less than the $111 she pays every month for cable service.

Time Warner Cable, in comparison, charges between $8-13 per month for the same broadcast networks in other parts of the state.  A good antenna will cut that bill to zero.

Charter Cable handed the TV station a written response:

“The pricing for our basic level of service incorporates the overall operating costs of providing video services to our customers.  Charter’s price for basic service in the upstate area is comparable to prices charged by certain other video providers, including basic cable service in the Atlanta area, which is approximately $23 a month.”

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/WSPA Spartanburg Charter Surcharge 10-5-10.flv[/flv]

WSPA-TV in Spartanburg ran this report about Charter’s high basic cable rates.  (2 minutes)

Residents of McBee, S.C., have been without cable and Internet service since last November, when rural cable provider Pine Tree Cablevision closed its doors and turned the services off in scores of small communities in New Hampshire and South Carolina.  For residents of Lamar, another South Carolina community served by Pine Tree, it wasn’t much of a service to lose.  Pine Tree’s “broadband” in Lamar was limited to 50kbps, with the entire community’s Internet delivered on a single AT&T-provided T-1 line.

But even the loss of a company like Pine Tree was immediately felt by area residents and businesses, now without cable TV and Internet service.  In Lamar, December 10, 2009 will remain a day of infamy:

“I was in the middle of submitting reports to SLED (the State Law Enforcement Division) when [Pine Tree pulled the plug and the cable and broadband system] went down,” Police Chief Charles Woodle told SC Now. Woodle now goes home twice a day to check his work e-mails.

The town’s water office closed December 21st because the town clerk could not upgrade the software needed to process water bills.

In Elloree, residents and local officials found out about Pine Tree’s financial problems when channels started dropping off the cable system, followed by the complete loss of service.  In December, customers mailing payments to Pine Tree had them returned by the post office undelivered.

Elloree Town Clerk Chasity Canaday told The Times and Democrat Pine Tree’s ultimate demise was a travesty.

“It shows a remarkable lack of professionalism to cut services from customers without any prior notice,” Canaday said. “For the majority of our residents, their notice that the cable service was terminated came when their televisions quit working.”

Despite claims from Pine Tree officials that new owners would take over the business they left behind, Canaday says that just isn’t true.

“It has been very, very difficult to get somebody else,” she said. “There is not a large enough customer base to entice a new company to come in. Most people have already switched to satellite.”

The newspaper noted after contacting 20 other municipalities, Canaday said most rural towns have no local cable provider and instead rely on satellite service.

Throughout rural South Carolina, tiny cable companies serving just a few hundred subscribers have come and many more have gone.

The town of Cameron lost Almega Cable about three years ago.  Other communities have said goodbye to operators like Brookridge Cable, SRW Inc., South Carolina Cable Television, Pine State Management Co., and Mid Carolina Cable.

In most cases, satellite television’s ability to deliver hundreds of digital signals it an easy choice over cable systems delivering only 2-3 dozen channels.  Because of a lack of investment to expand rural cable lineups, customer erosion has left many systems financially untenable.  One Texas cable system had just a dozen paying customers left when they called it quits.

That’s why the community of McBee is creating a lot of buzz in rural South Carolina.  They reportedly have Time Warner Cable, the nation’s second largest cable operator, in discussions to take over where Pine Tree left off, restoring cable and broadband service for a community of just 700 people.

But that service may come with a significant price — an indefinite franchise agreement that could eventually threaten the area’s local, customer-owned telephone cooperative.

Town Attorney Tony Floyd says Time Warner Cable in eager to expand into rural areas.  But the question is, will McBee concede too much just to attract a cable company?

“This is a long term contract,” he told SC Now. “If you grant a franchise, Time Warner will be able to keep competition out.”

Newly re-elected councilman Shilon Green is the biggest proponent for the deal.  He will propose an ordinance granting a franchise to the cable company at a town hall meeting to be held tomorrow.  He says Time Warner will bring better cable and broadband service to the area and introduce competition for phone service with their “digital phone” product.

But some other council members are concerned about Time Warner Cable’s impact on the area’s local, customer-owned phone company, Sandhill Telephone Cooperative.

Councilmen A.C. “Kemp” McLeod said he’s afraid the cable company could bully the co-op out of business.

“I know Sandhill is expanding their service into the TV business, and they’ve been very good serving rural communities,” McLeod told the newspaper. “I’d like to check with them first.”

“If [Time Warner] wants to come in [and] lowball this area, they can do it, then run our small business out of business,” McLeod said. “A big company can make it look good, make it look appealing, then once they have the market and run the small guy out, then they can raise the rates. At Sandhill, we have representation.”

Rural communities are often bypassed by cable providers because they lack enough closely spaced customers to make the infrastructure costs worthwhile.  Where smaller communities do cluster most of their population inside the town limits, cable systems have been built.  Many are independently owned and operated by small providers because larger companies have shown no interest in serving areas with just a few hundred potential customers.

That has left town leaders with the prospect of offering generous incentives to attract cable operators.  In addition to franchise agreements that never expire, some communities offer significant tax breaks and other concessions to encourage cable operators to bring service to area residents.  Despite complaints from big city residents that Time Warner is hardly benevolent, its brand and reputation do mean a lot in rural areas burned by Pine Tree’s sudden demise last year.

Green hopes the cable giant will bring a level of cable service not seen before in towns like McBee.

“A little competition is good,” Green said.

Telstra, Australia’s dominant telecommunications company, is openly concerned about the prospect of Australians finally shedding themselves from Internet Overcharging schemes like low usage caps and throttled speed.  But instead of doing away with these profit-boosting schemes themselves, they’ve decided to argue that consumers don’t need the country’s newest 1TB usage allowance plans, calling them publicity gimmicks.

Of course, Telstra doesn’t offer a 1TB plan.

Heath Gibson tries to explain away Telstra’s Internet Overcharging in a company blog post:

A terabyte is a lot of data. One provider claimed it’s enough to download about 200 DVD quality movies and still have quota left over.  Whilst my inner geek is salivating at the possibilities, the analyst in me is questioning just how many people currently need, or could even use, a terabyte of data each and every month.

Gibson believes the average Australian is better off plans like Telstra’s 50GB DSL service, running $49.30US per month on a two-year contract.  When all the charges and fees are totaled, Australians will pay Mr. Gibson’s company $2,364.50US for two years of service that slows to 64kbps once your monthly 50GB allotment is used up.

“Terabyte plans will have appeal to a special niche and demand for these plans will no doubt grow over time,” Gibson wrote. “But for now my advice to most people would be to look past the attention grabbing headline, check how big a plan you really need and keep in mind all the other things that go in to making a great ISP.”

Australians have already made that decision and they have been voting with their feet to other providers.  On the same day Gibson was dismissing the competition, Telstra CEO David Thodey was responding to it, recognizing the company has lost significant market share because of high prices and poor customer service.

He told The Advertiser improvements were underway.

“The focus on customer service is something that is innate within Telstra, but our delivery leaves a lot to be desired,” he said.

So is their pricing.  Gibson’s views defending rationed Internet service are similar to the arguments broadband providers in the States use to defend their failure to keep up in the global broadband speed race.  Only instead of dismissing the need for unlimited service, American providers try and convince customers they don’t need the faster speeds they don’t deliver.