CenturyLink’s stock is being pummeled after the company announced a cut in divided payouts to shareholders earlier this year, preferring to keep the money in-house to reduce debt and increase spending on necessary broadband upgrades.

Last fall, CenturyLink stock was trading for over $23 a share. By January, rumors that CenturyLink was going to cut its dividend put the stock on a downward trajectory, falling to an all-time-low below $11 this month. Company officials argued that with tightening credit opportunities and increasing interest rates, the company needed to devote money normally paid back to shareholders towards paying down its $35.5 billion long-term debt and provide better service to its customers.

A half billion dollars of that money will also be spent on upgrading CenturyLink’s broadband service, particularly in rural areas where the company is receiving Connect America Fund (CAF) dollars from the federal government.

“Our plan for 2019 includes investing to improve the trajectory of the business increasing CapEx by roughly $500 million,” Jeff Storey, president and CEO of CenturyLink said on a January analyst conference call. “As I mentioned earlier those investments include expanding the fiber network, adding new buildings throughout our footprint, enhancing our enterprise product portfolio, continuing our investments in CAF-II, and transforming our customer and employee experience.”

Investors were not impressed with those plans, and CenturyLink’s share price cratered.

Independent phone companies have traditionally attracted investors with handsome dividend payouts, but the realities of their aging infrastructure and the inability to compete effectively with cable companies on lucrative broadband services have left companies like CenturyLink, Windstream, and Frontier Communications in a quandary. Shareholders do not perceive value investing in fiber optic network upgrades and punish companies that announce dramatic increases in network investments. Customers left on slow-speed ADSL networks are increasingly dissatisfied with their internet experience and seek alternative providers — usually the local cable company. As Frontier Communications has discovered, attempting to win back ex-customers has been exceedingly difficult, often only possible with lucrative promotional offers that undercut the cable company. But such offers attract customers with above-average price sensitivity, making it difficult to extract increased revenue from them going forward.

CenturyLink’s stock price has dropped to an all-time low over the last six months.

Investors are also increasingly concerned about the financial viability of investor-owned phone companies that are stuck between leveraging their old networks and facing down shareholders when upgrades become essential. AT&T and Verizon have wireless units responsible for much of the revenue earned by those two Baby Bells. Traditional phone companies have had less luck trying to sell ancillary support services like Frontier’s “Peace of Mind” technical support service, or bundling satellite TV service into packages.

CenturyLink’s Local Service Territory (Source: CenturyLink)

CenturyLink is increasingly depending on its enterprise and wholesale businesses to earn revenue. That fact has prompted some shareholders to ask why the company hasn’t spun off or sold off its traditional landline network and consumer businesses, which currently account for only 25% of its revenue. In May, CenturyLink seemed determined to placate those investors with an announcement it was exploring “strategic options” for its consumer business. Investors theorize that CenturyLink could “unlock value” from its legacy landline networks in such a sale or spinoff that would benefit shareholder value. It would also be much cheaper than investing in that network to upgrade it.

The chorus for a sale increased after Frontier Communications announced it was spinning off its landline territories in the Pacific Northwest to a company specializing in upgrading legacy networks to support better broadband. Frontier, mired in debt and facing a concerning due date for some of its bonds, made the sale to give a boost to its balance sheet. Frontier had also been facing increasing scrutiny about a potential Chapter 11 bankruptcy filing. Windstream declared bankruptcy earlier this year, reminding investors that a trip to bankruptcy court could quickly wipe out all shareholder value.

MoffettNathanson, a Wall Street analyst firm that specializes in telecommunications, finds little to like about CenturyLink shedding its own landline operations. Frontier’s sale benefited from the fact a significant part of its Pacific Northwest territory was built from an acquisition from Verizon, which had already installed its FiOS fiber to the home network in parts of Washington and Oregon. About 30% of the territory Frontier is selling is fiber-enabled. In comparison, CenturyLink has installed fiber to the home service in only about 10% of its territory, dramatically reducing any potential sale price. Much of CenturyLink’s core fiber network powers its enterprise and wholesale operations — businesses CenturyLink would likely keep for itself.

MoffettNathanson also sees little value from the proposition a buyer could leverage CenturyLink’s network to provide backhaul fiber capacity for future 5G services, because CenturyLink provides service mostly in smaller communities likely to be bypassed by 5G, at least for the near term.

Wall Street’s idea of a win-win strategy for CenturyLink is to keep its consumer business and expand its broadband service footprint and capability, if the federal government offers to cover much of the cost through more rounds of CAF subsidies. Taxpayers would subsidize broadband expansion while CenturyLink and shareholders share all the profits.

Canadians, living under a regime of three national wireless carriers (Bell, Rogers, and Telus) pay some of the highest wireless prices in the world. A new plan announced today from Rogers Communications is unlikely to change that.

“Introducing Rogers Infinite – Unlimited Data plans for Infinite Possibilities,” or so claims Rogers’ website.

Canadians’ initial enthusiasm and excitement for Rogers’ new “unlimited data plans” was quickly tempered by the accompanying fine print that makes it clear the plans may be free of overlimit fees, but very much limit their usability once the data allowance runs out. Customers can pool data with family and friends, but Rogers did not mention exactly how.

Rogers Infinite oddly offers three different price tiers, based on… usage, which is strange for an “unlimited” plan:

• Infinite +10 offers 10 GB of data at traditional 4G LTE speed, bundled with unlimited calling and texting for $75 a month.
• Infinite +20 offers 20 GB of data at traditional 4G LTE speed, bundled with unlimited calling and texting for $95 a month.
• Infinite +50 offers 50 GB of data at traditional 4G LTE speed, bundled with unlimited calling and texting for $125 a month.

Those prices are steep by American standards, but Rogers also incorporates fine print that few carriers south of the border would attempt. First, Mobile Syrup reports included calls and texts must be from a Canadian number to a Canadian number. Extra fees may apply if you contact your friends in America and beyond. The “infinite” runs out when your allowance does. After that, it may take an infinitely long time to use your device because Rogers will throttle upload and download speeds to a maximum of 256 kbps for the rest of the billing cycle. American carriers, in contrast, typically only throttle customers on busy cell towers after exceeding an average of 20-50 GB of usage, although some mandate a throttle based entirely on usage. If customers want more high-speed data, they can purchase a Rogers Speed Pass for $15 and receive an extra 3 GB of high-speed data. In contrast, T-Mobile offers U.S. customers an unlimited line for $60 with no speed throttle until usage exceeds 50 GB a month. That is less than half the cost of Rogers’ Infinite +50 plan for an equal amount of high-speed data.

More fine print:

Rogers Infinite data plans include 10 GB, 20 GB or 50 GB of data at max speed on the Rogers network, extended coverage areas within Canada, and Roam Like Home destinations (see rogers.com/roamlikehome). You will continue to have access to data services with no overage beyond the max speed allotment at a reduced speed of up to 256 kilobits per second (for both upload and download) until the end of your current billing cycle. Applications such as email, web browsing, apps, and audio/video streaming will continue to function at a reduced speed which will likely impact your experience. We will send you a text message notifying you when you have used 90% and 100% of the max speed allotment included in your plan with the option to purchase a Speed Pass to add more max speed data to your plan. In all cases, usage is subject to the Rogers Terms of Service and Acceptable Use Policy.

GIVE us more money and TAKE what we offer you.

Bloomberg News is reporting what many of you already know — it is getting tougher to get a better deal from your cable or phone company.

As Stop the Cap! has documented since the completion of the Time Warner Cable/Bright House/Charter Spectrum merger in 2016, companies are pulling back on promotions, taking advantage of a lack of competition and offering best pricing only to new customers.

Charter Spectrum and Cable One (soon to be Sparklight) are the most notorious for implementing “take it or leave it” pricing. In fact, one of Charter CEO Thomas Rutledge’s chief complaints about Time Warner Cable was its “Turkish Bazaar” mentality about pricing. Rutledge claimed Time Warner Cable had as many as 90,000 different promotions running at the same time, typically targeted on what other companies were theoretically providing service and how serious the representative felt you were about canceling service. Time Warner Cable had basic retention plans available for regular representatives to offer, better plans for retention specialists to pitch, and the best plans of all to customers complaining on the “executive customer service” line or after filing complaints with the Better Business Bureau. There were plans for complaining over the phone and different plans for complaining at the cable store. Rutledge was horrified, because customers were now well-trained on how to extract a better deal every year when promotions ran out.

Last month, Rutledge said he was indifferent about cash-strapped consumers that cannot afford a runaway cable TV bill on a retired/fixed income or the urban poor who can’t imagine paying $65 a month for basic broadband service. To those customers, pointing to the exit is now perfectly acceptable. In fact, companies make more profit than ever when you drop cable television service and upgrade your broadband connection to a faster speed. That is because there is up to a 90% margin on internet service — provisioned over a network paid off decades ago and designed for much less space efficient analog television. Charging you $20 more for faster internet service is nearly 100% profit and costs most companies next to nothing to offer, and Time Warner Cable executives once laughed off the financial impact of so-called “heavy users,” calling data transport costs mere “rounding errors.” 

Even with a much tougher attitude about discounting service, Charter and Comcast are still adding new broadband customers every month, usually at the expense of phone companies still peddling DSL. So if you cancel, there are probably two new customers ready to replace you, at least for now.

Cable One redefines rapacious pricing. The company specializes in markets where the incumbent phone company is likely to offer low-speed DSL, if anything at all. As a result, they have a comfortable monopoly in many areas and price their service accordingly. Cable One’s basic 200 Mbps plan, with a 600 GB data cap, costs $65 a month, not including the $10.50/mo modem fee, and $2.75 monthly internet service surcharge. To ditch the cap, you will pay another $40 a month — $118.25 total for unlimited internet.

In fact, Cable One charges so much money for internet, they even have Wall Street concerned they are overcharging!

When Joshua May tried calling Spectrum to deal with the 29% more it wanted (around $40 a month) after his promotion expired, the customer service representative told him to go pound salt.

“I expected they’d at least offer free HBO or Showtime,” May, 34, of Springfield, Ohio, told Bloomberg News. “They did nothing.”

He did something. He cut the cord. The representative could have cared less.

The product mix cable and phone companies offer has not really changed, but the era of shoving a triple play bundle of internet, TV, and phone service sure has. Charter and Comcast now treat cable television as a nice extra, not the start of a bundle offer. Broadband is the key item, and the most profitable element, of today’s cable package. Beleaguered phone service gets no respect either. Time Warner Cable used to sell its triple play bundle including a phone line for less money than their double play bundle that omitted it. Today, it’s a simple $9.99/mo extra, given as much attention as a menu offering premium movie channels.

Comcast differs from Charter by offering a plethora of options to their customers. If you don’t want to spend a lot for high speed internet, spend a little less for low speed internet. Their television packages also vary in price and channel selection, often maddeningly including a “must-have” channel in a higher-priced package. Like Spectrum, their phone line is now an afterthought.

AT&T and Verizon have their own approaches to deal with reluctant customers. Verizon FiOS customers face steep price hikes when their promotions expire, but the opportunity to score a better deal is still there, if Verizon is in the mood that quarter. Verizon remains sensitive about their subscriber numbers and growth, so when a quarter looks like it will be difficult, the promotions turn up. AT&T prefers to play a shell game with their customers. Most recently, the company has given a cold shoulder to its U-verse product, treating it like yesterday’s news and best forgotten. AT&T literally markets its own customers to abandon U-verse in favor of AT&T Fiber. Verizon and AT&T treat their DSL customers like they are doing them a favor just by offering any service. All the best deals go to their fiber customers.

AT&T Randall Stephenson is a recent convert to the “who cares about video customers” movement. Services like DirecTV Now were originally channel-rich bargains, but now they are a place for rate hikes and channel deletions. Over a half-million streaming customers have already canceled after the most recent price hikes, but Stephenson claims he does not mind, because those bargain-chasers are low-quality customers worthy of purging. AT&T’s dream customer is one who appreciates whatever AT&T gives them and does not mind a parade of rate hikes.

Comcast’s chief financial officer Mike Cavanagh said it more succinctly: seeking subscribers that “really value video and our bundle despite the increases in prices,” and has “the wallet for a fuller video experience.”

Customers who decide to take their business to a streaming competitor are already learning the industry still has the last laugh. As package prices head north of $50/month, that is not too far off from the pricing offered by cable and phone companies for base video packages. In fact, Spectrum has begun undercutting most streaming providers, offering $15-25 packages of local and/or popular cable channels with a Cloud DVR option for around $5 more a month.

Frontier Communications will pay one smartphone addict $1,000 if they will give up their device for one week and rely on a 1990s-era obsolete flip phone instead. The cringe worthy challenge, soaked in irony, is brought to you by a phone company that delivers late 1990s-era DSL to a substantial number of its customers.

Frontier:

If you’re chosen, you’ll be responsible for using a flip phone in place of your smartphone for seven full days (that’s 168 hours!), and we want you to log your experience. We’ll have you track (don’t worry, your info stays safe with us!) how long it takes you to do basic tasks such as texting and checking email, how many times you wish you could Google something, how many hours you slept, how your productivity changed (or didn’t!), and even if you were late to appointments (after all, how does anyone get around without Google Maps?). Was your experience #TheWorstThingEver? Did you find new freedom? Either way, we want to hear about it.

Applicants can register until July 8, 2019. 

What’s in it for you

$1,000 in compensation

Boredom Buster Swag Bag (i.e. your survival kit) including:

• An actual, physical map (yes, those still exist!) to make up for your GPS.
• A pocket phonebook, because who memorizes numbers anymore?
• A notepad and pen to make grocery trips a little less painful.
• A couple ’90s CDs (think Britney and NSYNC) to soothe your Spotify withdrawals.
• Remote work environment as you earn your $1,000—no heading to an office at 8am for this job!
• No drug testing or background check required.
• A unique social experiment and a chance to go back in time . . . or, well, something like that.

The goal of the experiment is “to help us understand how much we rely on smartphones and how that affects day-to-day life. (Our hypothesis? A lot.)”

It is too bad Frontier didn’t embark on an experiment to determine how much customers rely on high quality, 21st century internet access. They could quickly learn that for many of those stuck with Frontier’s DSL service… they can’t, because Frontier does not provide it.

A war between RT, Russia’s external English language news channel and the New York Times over the health impact of 5G technology has given the telecom industry a new talking point: Claims that 5G signals are dangerous are nothing more than Russian fake news.

Generous news coverage about 5G deployment has brought out fringe critics claiming wireless mobile technology causes brain cancer, infertility, autism, heart tumors and Alzheimer’s disease. In some cities in the western U.S., mysterious “Public Health Warning” signs have been placed on utility poles, showing the alleged locations of future 5G cell sites as health is really important for many people, people want to feel healthy and relax, and that’s why so many try cbd products, or vape pens to relax as well, as you can even go online and visit this for different vape pens if you want to get one of your own. You may also want to experience tranquility with the 3chi purple urkle thca flower, as the calming attributes of the Purple Urkle strain combined with THCA offer a pathway to relaxation.

The Times instead blamed the Kremlin’s state-sponsored news outlet RT for stirring up opposition to 5G. Reporter William Broad claimed RT had largely ignored 5G until this year, when it suspiciously aired seven stories about its health risks:

RT’s assaults on 5G technology are rising in number and stridency as the American wireless industry begins to erect 5G systems. In March, Verizon said its service will soon reach 30 cities.

RT America aired its first program assailing 5G’s health impacts last May, its only one in 2018. Already this year, it has run seven. The most recent, on April 14, reported that children exposed to signals from 5G cellphone towers would suffer cancer, nosebleeds and learning disabilities.

[…] The network is now applying its playbook against 5G by selectively reporting the most sensational claims, and by giving a few marginal opponents of wireless technology a conspicuous new forum.

RT’s Rick Sanchez devoted a substantial amount of time on a recent show attempting to refute a New York Times article that claimed Russia was trying to interfere with America’s 5G expansion using fear-mongering. (19:32)

The “Balaclava EMF Shield” is designed to protect you from ambient radiofrequency energy.

One RT host, Rick Sanchez, devoted 20 minutes of a recent show critiquing the Times story and expressing disappointment over the caliber of its reporting. Sanchez suggested the New York Times report was virtually an advertisement for Verizon and narrowed in on an admission near the bottom of the piece that the phone company and the newspaper are now business partners:

Wireless high-speed communication could transform the news industry, sports, shopping, entertainment, transportation, health care, city management and many levels of government. In January, The Times announced a joint venture with Verizon to build a 5G journalism lab.

Sanchez also sought to tie the push for 5G as another example of corporate influence over Washington, noting FCC Chairman Ajit Pai was a former lawyer for Verizon. He also tied 5G into the assault on net neutrality, without explaining why. For its part, the Times suggests, with little evidence, that RT is running a propaganda campaign against 5G to slow down its deployment in the United States, allowing Russia to leap ahead:

Even as RT America has worked hard to damage 5G, the scientific establishment in Russia has embraced a contrary and questionable position: that the high frequencies of 5G communications are actually good for human health. It recommends their use for healing wounds, boosting the immune system and treating cancer. Millions of Russian patients are said to have undergone such high-frequency therapies.

Beauty clinics in Moscow use these high frequencies for skin regeneration, according to a scientific study. One company says the waves can remove wrinkles and fight hair loss.

The back-and-forth arguments have now attracted Washington’s attention, and some in Congress want to hold hearings about a reputed “disinformation campaign” run by Russia against 5G technology. Wireless carriers will welcome such hearings, allowing them to further argue for deregulation of cell placement rules and other zoning matters and claim the U.S. is falling behind in the global 5G race. It is also much easier to dismiss objections to 5G as Russian fake news than to finance a team of experts to counter those claims.

Lost in all of this is the original question about the risks of 5G technology. Much of the health an d safety opposition to wireless technology began long before the concept of 5G was unveiled. Some parents have opposed in-school Wi-Fi as medically harmful. Others fear traditional 3G or 4G radiofrequency energy, which some claim (without substantial evidence) causes cancer.

The health impacts of 5G have not been definitively proven, and it will be important to distinguish between different flavors of 5G to even consider the question. Millimeter wave 5G networks that depend on small cells those signs affixed to utility poles warn about operate at very high frequencies with very low power. No person will likely be within 10-15′ of a small cell because they will be erected on top of utility poles. They also emit a very short range signal unlikely to penetrate walls of buildings, much less your brain or vital organs. The other version of 5G will be placed on existing cell towers and will be no more harmful than 3G or 4G. If one fears radiofrequency energy, they are much more likely to get a large dose of it driving past (or living by) an AM, FM, or TV transmitter that operates at much higher power.

KOIN-TV in Portland, Ore. reported the sudden appearance of ‘Public Health Hazard’ signs warning of the risks of 5G. But are the signs for real? (2:31)