Verizon Wireless’ New ‘Wallet-Biter’ Plans Cause Revolt on Customer Forum

If you don’t believe Verizon Wireless’ newest family-share plans work for you, you are not alone.

More than a few Verizon Wireless customers are in open revolt on the company’s interactive forum, and some are preparing to leave a wireless company they have stayed with for up to 15 years. In a word, the consensus from these vocal customers is: “enough.”

Customer ‘bgudgel‘ explains why:

I have been a loyal Verizon customer for seven years now. I have defended them and recommended them to friends and family, but I feel my time as a Verizon customer has come to an end. The simple reason is that Verizon no longer sees me as a valued customer. I am just a source of income to them. I was prepared to swallow the $30 upgrade fee, but the new shared data plans are the final straw.

You can argue pricing and details all you want, but the simple fact is this – Verizon is clearly not interested in providing great service at fair prices to their customers anymore. The want to provide great service at the highest possible price, and they are taking pages out of the Big Cable handbook to do it – requiring services you don’t want/need in order to get the service that you actually do. And on top of that, the price levels they have chosen for data thresholds and adding additional lines are completely indefensible.

Verizon, I have heard your message loud and clear. You no longer care about me as a customer, so I will gladly take my business somewhere else. I do not know if I can get a better deal anywhere else, but I will no longer give money to you based on the simple principle that you have no respect for your loyal customers. It feels like you are just using us, and that is when I say goodbye.

A California customer considers this the last straw for Big Red:

I too have been a Verizon customer for years. But this final slap in the face is it for me. First, the stupid $30 “upgrade” fee for the “privilege” of buying a new phone from Verizon, and now this absurdity.

I am researching other companies’ prepaid plans now, and I fully intend to be gone within a couple of weeks, at most. And I won’t encounter cancellation penalties as our 3-line plan is more than 2 years old.

I have grown weary of “data” and its rising costs and caps, and will purposely look for a voice/text plan only. Enough.

And Lyondellic tallies up Verizon’s nickle-and-diming customers over the past year:

During my year with Verizon, I have seen a failed attempt to impose a $2 ‘convenience’ fee for paying my bill online. I have also seen a $30 fee added for device upgrades. Then there was the February 2012 change in the customer agreement that does not limit so-called ‘Network Optimization’ to 3G devices, which also allows throttling (let’s call it what it is) during the current and NEXT billing cycles. Verizon seems to have no issues with someone getting full 4G LTE speed, as long as they pay for it by the GB, but apparently feel that those of us with unlimited data plans should be considered data hogs that can be slowed down into billing cycle that has not even started. So network optimization in Verizon-speak means freeing up bandwidth for their pay by the GB customers by throttling customers with grandfathered unlimited data plans that are using their devices in a manner that is consistent with their agreements! Finally, we are told about the cries for family shared-data plans. I figured Verizon might do something that would make it attractive for me to move into a tiered data plan, boy was I ever wrong.

Now Verizon wants to charge $40 per smartphone to actually use the shared-data plans! So, for someone who is paying ~$87 per month for a smartphone with unlimited data, the cost per month will now be somewhere around $120 for the 6GB plan! How are these plans a good thing for either new or existing customers?!? I was considering paying full price to upgrade to a Galaxy Nexus in order to keep my unlimited data plan, but I have changed my mind. I can order the Galaxy Nexus from Google for $399 and use a prepaid, no-contract plan from T-Mobile plan that provides me with 100 minutes, unlimited text messaging and 5GB of data at 4G speeds for $30 month. Since I do not make a lot of calls on my phone, why would I want to continue to pay Verizon $87 per month without subsidized device upgrades, which would move me into a $120 month plan?

So I look at this as a simple lesson in economics. I can pay the ETF, buy a GNex and still come out ahead by moving to T-Mobile. The beauty of this is that I will also be taking money away from Verizon, as they clearly want to treat me like a second-class customer that needs to fork over more of my money. So I will vote with my dollars and send a clear message to Verizon that their conduct is unacceptable. I encourage others here to consider doing the same. Your speed may not be blazing fast with T-Mobile, but neither will be the speed that money flies out of your wallet or purse. My .02 cents!

Canada’s Usage Based Billing Raises Prices for Consumer Broadband to New Highs

Phillip Dampier June 13, 2012 Canada, Competition, Consumer News, Data Caps Comments Off on Canada’s Usage Based Billing Raises Prices for Consumer Broadband to New Highs

Despite repeated provider claims that usage-based billing will save customers money on their broadband bill, new evidence shows the exact opposite is true. Broadband prices for metered broadband across Canada are rising, not falling, and now outpace pricing in the United States.

The reason for more costly broadband? Internet Overcharging schemes like usage caps, overlimit fees, and so-called usage billing, which providers have uniformly implemented on both wired and wireless broadband in most parts of the country.

A new study from PricewaterhouseCoopers finds Canadian consumers now pay 3.9% more for broadband than American consumers do, and prices are expected to increase another 9% by 2016 — from the average $38.43 paid last year to $45 for usage-capped broadband.

Usage billing has been profitable to Canadian providers like Rogers and Bell, with broadband revenues up 17.5% last year as consumers adopted higher priced plans to accommodate their monthly usage.

Canadian providers have also systematically reduced or “re-tiered” usage allowances, engineering service upgrades for customers trying to avoid costly overlimit fees.

“Canada’s broadband fees were lower than those in the United States in 2007-09, but as a result of large increases during the past two years, the average Canadian broadband subscriber paid more in 2011 than the average U.S. subscriber did,” says the report.

Bandwidth caps have allowed Canadian providers to now charge premiums to high bandwidth users, according to the report. Rising use among all broadband customers “should continue to put upward pressure on pricing.”

In the United States, providers are having a more difficult time implementing similar usage caps and overlimit fees, primarily because of consumer-organized backlash.

Justice Department Launches Antitrust Investigation Into Data Caps

Holder

The Justice Department has been quietly conducting a wide reaching investigation into whether cable operators are using Internet Overcharging schemes like usage caps and metered billing to squash online video competition, according to a report in this morning’s Wall Street Journal.

The Antitrust Division has spoken to major online video providers like Netflix and Hulu as well as cable operators, including Time Warner Cable and Comcast.

At issue are data caps — limits on how much a subscriber can use their broadband account.  Justice officials are exploring whether major broadband providers like Comcast and AT&T are using usage limits to protect their video businesses from cord-cutting — canceling a cable subscription to watch shows online.

Providers of online video like Netflix are particularly concerned about operators showing favoritism to their own video platforms. Comcast, for example, exempts partnered content from its usage allowance while continuing to count Netflix viewing against its cap. Comcast’s Xbox “free pass” is attracting particular attention in the Justice probe, in part because it could violate the merger agreement with NBC-Universal which requires the company to not discriminate against third party video content.

Some cable operators claim usage caps protect their networks from heavy users overwhelming their facilities. Comcast claimed its decision not to count Xbox video traffic against the operator’s monthly usage cap was fair because the video content did not travel across the Internet. Now the company has temporarily suspended  usage caps altogether in preparation for testing a new usage limit that also carries overlimit penalty fees.

Federal Communications Chairman Julius Genachowski last month publicly announced his support for usage limits and metered billing, describing both as innovative and enabling customer choice. The Justice Department probe would indicate otherwise, because it suggests customers are finding their options increasingly limited, possibly in violation of federal antitrust laws.

The Justice Department is also investigating the industry’s TV Everywhere project, which provides access to cable network online video exclusively to those with an existing cable television package. Most cable networks specifically prohibit online streaming of their live content, which itself might run afoul of antitrust rules.

The Journal notes Attorney General Eric Holder on Tuesday suggested he would like to be a cord-cutter himself, picking and choosing only the channels he wants to watch. At a recent Senate hearing, Sen. Al Franken (D-Minn.) said cable bills were “out of control” and consumers want alternative options to watch shows online. Holder responded, “I would be one of those consumers.”

Sprint Allows Its Majority Stake in Clearwire to Slip Below 50 Percent

Phillip Dampier June 12, 2012 Broadband Speed, Sprint, Video, Wireless Broadband 1 Comment

Sprint Nextel has allowed its majority share in Clearwire Corporation to drop below 50 percent in a strategic move to rebalance its voting and economic interest in the wireless partnership.

Clearwire runs the WiMAX 4G network Sprint sells to its customers, but America’s third largest cell phone carrier shares that 4G network with several other companies that resell access under various brands, including Time Warner Cable Mobile, Best Buy Mobile, and a range of smaller “MVNOs,” which mostly offer prepaid access.

Clearwire’s troubled existence forced Sprint to reduce its involvement and ownership in the company last year, when some analysts predicted the company faced imminent default on its debt. Had that happened, Sprint would have found itself inextricably tied to Clearwire’s fate as a majority owner, and could have been forced to help bailout the enterprise.

Clearwire has been trying to reinvent itself after Sprint declared it planned to construct its own 4G LTE network that would gradually replace the older WiMAX technology Clearwire uses.  That news challenged Clearwire because Sprint in the largest user of the network, providing 9.7 million customers with access. Clearwire’s own retail service, under the Clear brand, has just 1.3 million customers. More than one-third of Clearwire’s income comes from Sprint.

As Sprint customers gradually depart from WiMAX, Clearwire is trying to find new markets reselling access to the older technology to prepaid startups and discount resellers including FreedomPop, NetZero, Simplexity, and most recently Jolt Mobile.

But even Clearwire understands the days of its WiMAX network are limited. The company plans to build its own TD-LTE 4G network to remain competitive, and will resell wholesale access to prepaid services and to larger concerns like Leap Wireless’ Cricket and Sprint as those companies work to gradually expand their own LTE networks.

Clearwire believes their enormous spectrum assets could help smaller wireless companies fulfill demand for 4G service, particularly if those companies lack sufficient spectrum to fully provide the service themselves.

“We believe that, as the demand for mobile broadband services continues its rapid growth, Sprint and other service providers will find it difficult, if not impossible, to satisfy their customers’ demands with their existing spectrum holdings,” Clearwire indicated in its last quarterly report. “By deploying LTE, we believe that we will be able to take advantage of our leading spectrum position to offer offload data capacity to Sprint and other existing and future mobile broadband service providers for resale to their customers on a cost effective basis.” .

Clearwire plans to have 5,000 TD-LTE cell sites functioning by mid-2013 and quickly grow the network to 8,000 cell sites nationwide. Among the first cities expected to get the new LTE 4G service first are New York, Los Angeles, Chicago, and San Francisco.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/Clearwire 4G LTE Trials Results 1-2011.flv[/flv]

Clearwire holds more wireless spectrum than any other American wireless company, with 150 MHz in the 2.5 GHz band in the nation’s top 100 metro areas. Unfortunately for them, their high frequency spectrum does not penetrate buildings  as well as lower frequencies, such as 700MHz (Verizon & AT&T), making reception problematic indoors, especially in areas where signal strength is lower. Despite that, Clearwire believes its huge swath of spectrum gives it the ability to deploy extremely wideband 4G LTE service, which this video shows can support faster speeds. But the tests were conducted outdoors, where Clearwire’s network typically performs better. (2 minutes)

Comcast Told to Pull False Ad Claims It Has “Fastest” Broadband in the Nation

Phillip Dampier June 12, 2012 Broadband Speed, Comcast/Xfinity, Competition, Consumer News Comments Off on Comcast Told to Pull False Ad Claims It Has “Fastest” Broadband in the Nation

Comcast’s claim that its Xfinity Internet is the “fastest in the nation” is demonstrably false and has led to a request by the National Advertising Division, a self-regulating industry group, that Comcast pull the ads.

The NAD found Comcast was basing its claim on this 2011 PC Magazine article that gave high ranks to Comcast, along with Cox and Charter, for fast download speeds. But PC Magazine‘s study failed to account for Verizon FiOS and other fiber broadband providers, who routinely deliver upload and download speeds far in excess of what Comcast can offer.

The report (Case #5463 — available only to subscribers), recommends that Comcast stop making the claims in markets where fiber networks like FiOS are available. Where the company does choose to run the ads, they should disclose the PC Magazine report as its source.

Comcast’s cable broadband can deliver faster speeds than traditional telephone company DSL, but fiber broadband can deliver much faster service with equal upstream and downstream speeds of up to 1Gbps.

Comcast said it would consider the NAD’s recommendations.

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