Milwaukee’s Public, Educational, and Government (PEG) channels will soon be off Time Warner Cable’s analog basic cable lineup with little recourse for city officials upset about the channel losses.

Time Warner Cable is notifying analog cable subscribers in several Wisconsin cities about an upcoming digital conversion that will cut an average of a dozen channels from the analog lineup this fall. In Wisconsin, Time Warner is targeting several well-known cable networks like The Weather Channel and CNBC for the digital switch, as well as Ion TV over the air affiliates and several independent/religious broadcast stations.

The loss of PEG channels without any discussion with local officials has some Wisconsin community leaders upset, fearing significant viewing losses. Communities across Wisconsin lost their right to compel the carriage of the public interest channels after a 2007 deregulation bill essentially written by AT&T became law.

“It has been brought to our attention that a number of channels in the local Time Warner Cable ‘basic’ package will be shifted to the digital tier next month, meaning that most Milwaukeeans without a newer model television will need to obtain a digital to analog converter box in order to continue to view the entire basic cable package. We are both frustrated and perturbed by this news,” said Milwaukee Council members Jim Bohl, Robert Bauman, and Tony Zielinski. “Let’s not minimize who it is that will be most impacted by this move on Time Warner’s part either — people with older model televisions who only subscribe to a basic cable package. In short, this cut in service will have a disproportionate effect on residents within the city of Milwaukee.”

Time Warner Cable spokesman Michael Hogan made it clear the transition is something subscribers will have to get used to, because Time Warner is gradually moving all of its cable systems to digital only service.

“We are moving towards a higher-quality, digital-only experience by making channels that had been available in both analog and digital formats available in a digital format only,” said Hogan. “Delivering channels digitally frees up capacity in our network to deliver faster Internet speeds, more HD channels and On Demand choices, and other new services in the future. We began the process several years ago of moving towards a digital-only experience. All of our direct video competitors – including direct broadcast satellite providers and phone companies – already take advantage of the efficiencies of digital delivery and deliver all of their programming solely in digital format.”

The Sordid History of “Video Competition” in Wisconsin

The race to digital service to keep up with satellite providers and AT&T U-verse is not exactly the type of competition Wisconsin residents thought they would get from the passage of a 2007 statewide video franchise law advocated by AT&T.

According to the Center for Media and Democracy, the Wisconsin law is modeled on the American Legislative Exchange Council’s “Cable and Video Competition Act,” a model bill ghostwritten by AT&T for use in statehouses around the country. AT&T provided more funding for ALEC’s activities in Wisconsin from 2008-2012 ($55,735) than any other corporation. Supporters of the legislation promised it would lead to more competition, better customer service and lower cable rates.

Bohl

Instead, it leaves Wisconsin communities with no recourse when cable operators decide to digitize or encrypt cable channels that city officials believe should be widely available to the public. Provisions in the law no longer permit local communities to have any say in a provider’s channel lineup, placement, or technology used to deliver the service.

Milwaukee Alderman Jim Bohl called the channel conversion a Time Warner bait-and-switch maneuver that will cut off residents’ access to city government. As for those promises of lower cable rates, Bohl rolled his eyes.

“I can only tell you it’s gotten worse,” Bohl told the Milwaukee Express. “This change would not have been looked at real happily by the council. I don’t think they ever would have done that if they were still accountable for their franchise agreement with the city of Milwaukee.”

Time Warner Cable subscribers without converter boxes who directly attach coaxial cable to the back of older television sets will be affected by the switch and will need to pay extra for a standard set-top box on each affected television in the home (roughly $7 a month each), or take advantage of a temporary offer from the cable company to supply a small digital to analog converter box that will be available for free for one year. After that, the smaller converter boxes will cost $0.99 a month each with no purchase option.

Without the boxes, Time Warner Cable subscribers will find themselves increasingly out of luck as the company gradually eliminates analog channels from the lineup.

Being AT&T’s Best Friend Can Be Rewarding

Montgomery

Supporters of AT&T’s video competition bill have been luckier than most Wisconsin cable subscribers.

Former Republican state Rep. Phil Montgomery, lead sponsor and claimed author of the 2007 video competition bill, was well compensated with a sudden $2,250 campaign contribution from AT&T the year the bill was introduced. Another $1,500 arrived from AT&T executives and one of their spouses in Texas and $1,500 from a senior AT&T executive in Wisconsin.

Before AT&T’s bill was written, the company barely knew Montgomery existed, donating a total of only $300 to his campaigns from 1998-2005.

After the bill became law, Montgomery spent his remaining years in the Wisconsin Assembly building a solid record avidly supporting AT&T’s public policy maneuvers, including a measure to deregulate basic phone rates and end oversight of telephone service quality by the state’s Public Service Commission.

Despite revelations Montgomery served as an ALEC board member and received contributions amounting to $10,800 from telecom companies, in 2011 Gov. Scott Walker appointed him to chair the PSC — very same agency Montgomery worked for years to disempower.

“He was very friendly to industry when he was a legislator, and was seen as carrying water for the telecommunications industry and the utilities,” said Mike McCabe, executive director of the Democracy Campaign. “Consumer advocates would naturally have concerns about somebody who seemed so supportive of industry now being in a position of overseeing those industries.”

Sen. Jeff Plale Takes Marching Orders from AT&T, His Chief of Staff’s Rap Sheet, a Freezer Full of Steaks and a Country Club for Cronies

Plale

AT&T’s biggest ally in the Wisconsin Senate was Jeff Plale, one of only a handful of Democrats — all pro-business conservatives — belonging to ALEC.

The patience of his district was tested after Plale began openly advocating for his corporate donors and claimed he could not understand why questions about his integrity were being raised by his opponents. Plale, after introducing AT&T’s companion video franchising bill in the Senate expressed he was shocked, shocked to discover he received more campaign contributions from AT&T and the cable industry than any other legislative Democrat. He added he did not know why AT&T’s Political Action Committee had suddenly maxed out on its campaign contribution two years before the next election.

Plale’s close working relationship with AT&T evolved inside of his office.

In 2003, Plale hired Katy Venskus, a charged felon, to raise funds for his election campaign. Despite pleading no contest to siphoning off more than $12,000 from an abortion rights organization and being caught up in a scandal over illegal campaign work for another Democrat, Venskus was appointed Plale’s chief of staff and would quickly become the point person for AT&T’s video competition bill in Plale’s office, working closely with AT&T to adjust the bill’s language to the company’s liking and help coordinate its movement through the Senate.

The successful passage of the bill would prove personally lucrative to Venskus when she left Plale’s office to join lobbying firm Public Affairs Co., of Minneapolis just one month after AT&T’s bill was signed into law. One year later, she took on AT&T as a lobbying client.

Venskus

In 2009, Plale and AT&T closely collaborated to write another deregulation measure to be introduced in the Wisconsin legislature, this time deregulating phone rates, making provision of landline service optional, and gutting service oversight. By then, AT&T Wisconsin considered Venskus an on-contract lobbyist.

The irony of a felon serving as the chief of staff for a Wisconsin state senator or as a registered lobbyist was not lost on the Milwaukee Express’ Lisa Kaiser.

“Despite being a felon, Venskus can affect public policy at the highest levels as a registered lobbyist,” observed Kaiser. “Yet she couldn’t be licensed to become a day care provider.”

According to e-mails and draft copies of the telephone deregulation bill obtained from the Legislative Reference Bureau and interviews conducted by The Capital Times, a number of meetings —  “too numerous to count,” according to Plale’s chief of staff, Summer Shannon-Bradley — occurred with AT&T lawyers and executives and several other key industry stakeholders to work on the bill.

One important meeting in November 2009 included this attendance list: Andrew Petersen, director of external affairs and communications with telephone company TDS; William Esbeck, executive director of the Wisconsin State Telecommunications Association (WSTA) – a telecom industry lobbying group; that group’s attorney, Judd Genda; and AT&T attorney David Chorzempa.

E-mails and other correspondence between those at the meeting and Plale’s staff show slashes or check marks next to sections of the proposal that attorneys for AT&T and the WSTA suggested should be changed.

“It’s like lawmakers looked around and said, ‘These are the companies affected. So sit down with the drafters and make a bill,’ ” Barry Orton, a UW-Madison telecommunications professor told the Times. “The public interest isn’t represented. How could it be? Nobody was there to represent them.”

Life got tougher for Ms. Venskus a few months later when she was charged with felony theft and felony identity theft on suspicion of making $11,451 in improper purchases with her Public Affairs credit card, including a freezer full of steaks, according to the criminal complaint filed in Dane County court. She repaid the charges, but her contract to work for AT&T’s interests was suspended.

That September, Plale wore out his welcome in the 7th District serving southern Milwaukee and lost to primary challenger Chris Larson, who contended Plale was far too conservative and cozy with AT&T for his district.

Gov. Scott Walker is also a close friend of ALEC, supporting a number of corporate-sponsored initiatives to deregulate the telecommunications industry. (Source: ALEC Exposed)

Plale would land on his feet when, after siding with Republicans on a lame duck session vote to stick it to the state’s unions, he joined the administration of Republican Gov. Scott Walker as the administrator of the Division of State Facilities — a $90,000 a year job.

“Instead of seeking out the best and brightest, this governor is busy creating a country club for cronies,” Marty Beil, executive director of the Wisconsin State Employees Union, told the Wisconsin State Journal. “When he says ‘open for business’ and then appoints people like Plale, he’s obviously saying that he doesn’t draw the line at the world’s oldest profession.”

As the cable industry seeks new revenue from the adoption of growing cable modem rental fees, one vendor has received approval for an inexpensive DOCSIS 3 cable modem so small it can fit in your pocket.

Hitron Technologies’ data-only CDA CCC (4.3 inches tall, 2.75 inches wide, and 0.98 inches thick) is no bigger than a stack of two modern smartphones, but is well-equipped with an Intel Puma 5 chip, MaxLinear tuners, and a built-in spectrum analyzer. DOCSIS 3 modems must support a minimum of four bonded upstream and downstream channels, providing support for up to 100Mbps or more broadband speeds.

(Image: Multichannel News/Hitron)

Hitron says its new modem was designed for the developing prepaid Internet service market, currently championed by Comcast. Although the selling price has not been disclosed, Hitron will likely have to match or beat the cost of Comcast’s current $69.95 prepaid Internet Starter Kit that includes an Arris DOCSIS 3 modem, cables, and an instruction manual.

Todd Babic, Hitron’s chief sales and marketing officer said the company expects the tiny modem to be sold at retail, but also offered the lightweight modem could be used as a mailed replacement for the millions of aging DOCSIS 2 cable modems still in use by broadband customers.

The modem was certified for DOCSIS 3 use by CableLabs, the non-profit research and development consortium pursuing new cable telecommunications technologies for the benefit of its cable operator members.

Various DOCSIS standards covering cable broadband modem technology have been in use since November 1997.

Taiwan’s Hitron Technologies delivers over 3 million DOCSIS products annually to cable operators worldwide which support both residential and business class applications.

Comcast rates are going up again this fall in the Pacific Northwest, now exceeding $70 a month.

At least 600,000 cable customers in Oregon and southwestern Washington will pay 4.4 percent more for 100-channel television service beginning this October, raising the cost of Standard basic cable to $70.49 a month.

Despite threats of cord cutting, customers in the Pacific Northwest have remained loyal to the idea of paying for television, according to Fred Christ, policy director for the Metropolitan Area Cable Commission in Washington County.

“Subscriber numbers remain steady,” Christ told The Oregonian. “People still don’t see an easy alternative to Comcast, Frontier (FiOS TV), or the satellite providers, all of which cause more or less the same amount of pain.”

The newspaper notes sports programming may not be the cause of this year’s rate increase.

The cost of Comcast’s discounted “Digital Economy” cable package, which excludes most expensive sports networks, is rising at nearly double the rate of Standard Cable, up 8.6 percent this fall to $37.95 a month.

For those who cannot afford traditional Standard cable television, Comcast’s limited basic service, which primarily consists of local TV channels, runs $12-22 a month depending on the customer’s location. It also increased in price by about $1.30 a month in August.

Comcast may not mind cord cutters too much, because it reaps significant profits from the broadband service that powers online viewing. Comcast raised speeds from 15 to 20Mbps last spring along with the price. The popular “Performance” tier now costs $53.95 a month.

Comcast is testing the reintroduction of usage caps in a handful of service areas, typically providing up to 300GB of usage per month before overlimit fees kick in. But those Internet usage limits do not yet apply in the Pacific Northwest.

Comcast blamed the rate increases on network enhancement investments including faster Internet speeds, more multi platform video and better customer service. Comcast is currently introducing its new X1 cable box that makes finding programming easier.

Customers can avoid the worst of the price increases by choosing a bundled service package, which will see a lower rate increase. Current customers can also call Comcast to negotiate a better deal by threatening to cancel service.

Mediacom, the worst-rated cable operator in the United States, claims it needs usage caps and consumption billing to force heavy users to pay for needed upgrades. But that isn’t what Mediacom’s executives are telling investors and the Securities and Exchange Commission (SEC).

Thomas Larsen, group vice president of legal and public affairs for Mediacom told The Gazette the consumption-based billing program was intended to pay for the cost of network upgrades incurred by “individuals who are the highest users.”

But Mediacom’s August 10-Q filings (Mediacom LLC and Mediacom Broadband LLC) with the SEC indicate Mediacom’s revenues are increasing faster than the cable operator’s costs to provide service, as customers upgrade to more costly, faster speed Internet tiers.

“Revenues from residential services are expected to grow as a result of [broadband] and phone customer growth, with additional contributions from customers taking higher speed tiers and more customers taking our advanced video services,” Mediacom reports. “Based upon the speeds we offer, we believe our High Speed Data (HSD) product is generally superior to DSL offerings in our service areas. As consumers’ bandwidth requirements have dramatically increased in the past few years, a trend we expect to continue, we believe our ability to offer a HSD product today with speeds of up to 105Mbps gives us a competitive advantage compared to the DSL service offered by the local telephone companies. We expect to continue to grow HSD revenues through residential customer growth and more customers taking higher HSD speed tiers. “

Mediacom’s consumption billing program, already in effect for new customers, will be imposed on all Mediacom broadband customers starting in September. Larsen claims only about three percent of customers will be impacted by the usage allowance, which will include 250GB of usage for customers selecting the company’s most popular speed tier. Larsen also claimed the average Mediacom customer uses only 14GB per month.

That usage profile is below the national average, and leads to questions about why Mediacom needs a usage allowance system when 97 percent of its customers do not present a burden to the cable company.

“Once a customer reaches their monthly allowance,  for $10 they can purchase an additional 50GB a month of capacity,” Larsen explained. “Each time that they reach that next level, they’ll be able to purchase another allotment. We’re never going to stop you from using data, we’re just going to charge you more if you exceed your monthly allowance. Before, we could cap you, there was no mechanism for them to purchase more.”

Mediacom did not frequently enforce its usage caps in the past except in instances where usage levels created problems for other customers. Despite Larsen’s assertion Mediacom would spent the overages collected from heavy users on broadband upgrades, Mediacom’s report to the SEC indicates broadband usage has never been a significant burden for the cable operator:

Our HSD and phone service costs fluctuate depending on the level of investments we make in our cable systems and the resulting operational efficiencies. Our other service costs generally rise as a result of customer growth and inflationary cost increases for personnel, outside vendors and other expenses. Personnel and related support costs may increase as the percentage of expenses that we capitalize declines due to lower levels of new service installations. We anticipate that service costs, with the exception of programming expenses, will remain fairly consistent as a percentage of our revenues.

Although Mediacom reported field operating costs rose 7.6%, much of that increase was a result of greater fiber lease and cable location expenses on its wireless backhaul business for cell towers and greater use of outside contractors. In the company’s latest 10-Q filing, Mediacom reports its revenues increased 2.9 percent in the past year while its costs rose only 1.5 percent. Mediacom’s revenues from its broadband division are even more rosy, rising 9% in the past year alone. In fact, broadband is the company’s highest growth residential business.

Many of Mediacom’s long-standing customers were initially promised they would be exempt from usage caps, with only new customers subject to usage limits. But Mediacom has unilaterally changed their minds, much to the consternation of some customers.

As of this afternoon, Mediacom is still promising customers usage caps only apply to new customers and those making plan changes.

“It is my belief a man’s word is gold and when Mediacom customers have been told for ages they were grandfathered in with no usage data charges unless they changed plans, that is how it is supposed to be,” said D. Gronceski. “I have explicitly turned down service increases in the past to stay on the unlimited usage plan originally offered by Mediacom […] so I get screwed twice, once for bandwidth caps and again because I’m not getting the services I would be getting if I had not refused the automatic increases.”

Other customers incensed about the new usage limits have called to cancel service only to be threatened with steep early termination fees.

“Why do I have to pay an early termination fee?” asked AustinPowersISU. “The way of billing for the service is changing and I do not agree to this method of billing. I should be allowed to terminate my service without paying a fee.”

A Mediacom social media team representative offered one suggestion for customers finding themselves quickly over their usage limits: upgrade to faster speed tiers at a higher price. As for complaints about the unilateral introduction of usage caps with overlimit fees, it’s tough luck for customers, on contract or off:

All Internet users will be held to the new terms of service and usage based billing as of Sept. 7, 2013.  There is no agreement to sign, no acknowledgement needed.  Continuing to utilize Internet services is acceptance of these changes. If for any reason you do not feel that your current service level meets your needs, let us know and we can have a representative contact you with further options.

[…] Per the posted terms of service and acceptable use policy, there has always been an established data consumption threshold (data allowance) to be enforced at Mediacom’s discretion.  With this change, we have clarified these methods of enforcement and have expanded the allowance to offer different levels of users different options.  We have notified the proper departments of possible additions, but these statements are and have been posted.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/KCRG Cedar Rapids Mediacom Going Usage Billing 8-21-13.mp4[/flv].

KCRG in Cedar Rapids reports Mediacom is switching to consumption billing for broadband service in September.  (2 minutes)

AT&T has boosted the maximum available broadband speed for its U-verse Internet offering to 45/6Mbps service in 40 cities across 15 states.

The broadband speed boost is part of AT&T’s Project Velocity IP (VIP), a three-year plan to expand U-verse’s capabilities and coverage into more communities within AT&T’s local landline service areas.

Most of the funding for Project VIP is being directed into expanding AT&T’s profitable wireless 4G network, but about $6 billion will be spent upgrading AT&T’s aging copper wireline facilities.

A big priority for AT&T is to retire copper-based distribution networks and replacing that wiring with fiber optics. U-verse depends on a significant amount of fiber to provide enough bandwidth for its television, phone and broadband service. But unlike Verizon FiOS, which delivers a fiber connection straight to the home, AT&T still relies on traditional copper wiring into the home.

Until AT&T replaces that copper with fiber, top broadband speeds are unlikely to keep up with its biggest competitor — cable broadband.

AT&T’s says the 45Mbps speed boost represents an incremental upgrade and plans further speed increases to 75Mbps.

In more rural areas, U-verse will rely on IPDSLAM technology to increase speeds up to 45Mbps. AT&T eventually hopes to further bump download speeds to 100Mbps.

For the most rural communities within its service area, AT&T hopes to offer service exclusively over its wireless network, eventually scrapping rural landlines altogether.

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/KTAL Shreveport U-verse Coming to Louisiana 8-23-13.mp4[/flv]

KTAL-TV reports AT&T’s upgraded U-verse could soon be coming to Shreveport, La. as part of Project VIP, which may give Comcast some much-needed competition in the Ark-La-Tex region. (3 minutes)