Frontier Communications customers in the mountainous western counties of North Carolina have run out of patience waiting for web pages to load and upgrades to arrive, despite repeated promises from the phone company that its aging copper-wire DSL service would improve over time.

Stop the Cap! readers in the region pointed us to a special investigative report by WLOS-TV, Asheville’s ABC affiliate, which reports Frontier service is so bad, speeds under 1 Mbps are common. The station saw examples of Frontier unable to supply even modest speeds of just 3 Mbps.

“I’d rather stab myself than rely on Frontier’s fake internet access,” says our reader Darrell, who lives near Brasstown. “The only thing high-speed at Frontier is how fast they hang up on you when you call to complain.”

Frontier sold him “up to 10 Mbps” speed and instead struggles to deliver 1 Mbps, despite repeated service calls and promises of improvements.

“They keep telling us the federal government has to come up with money to help upgrade the area, and I keep wondering why a private company needs our tax dollars to build a network they will profit from for years,” Dan said. “If they cannot do the job, maybe the town should because they at least answer to us.”

Aiden Davis, who lives near Asheville, said he’d rather have the government give money to the cable company to extend broadband to his home, which is located about 1/4th a mile away from the nearest cable connection.

“At least the cable company can give me speeds DSL never will,” he told us.

Reporters at WLOS visited Murphy, N.C., a community of 1,600 people in Cherokee — the westernmost county of the state.

Craig Marble escaped Washington, D.C. to live in the picturesque community nestled in the mountains. But his efforts to telecommute to his IT employer are frustrated by Frontier’s DSL service, which is supposed to provide up to 3 Mbps to Marble and his neighbors. But Frontier delivers far less than it advertises.

Western North Carolina

“It’s just a comedy of errors except that it’s not funny. It takes five minutes to load a single webpage,” Marble said. “This should be 3.0, not .3 [Mbps],” Marble said while showing reporters various speed tests for his service, resulting in .3 and .5, and .6 Mbps at various times throughout the morning and afternoon.

More than 50 similar complaints have been filed with the North Carolina Attorney General, some about internet speed, others about service, outages, and billing problems.

“If there are companies out there making representations to consumers that they can not back up and we hear from consumers, we will absolutely take action on their behalf,” Attorney General Josh Stein told the station. “If we determine that Frontier is not complying with the law, we’ll hold them accountable, but there’s a lot of work we still need to do.”

But residents contend Stein does not seem to be in a hurry to chase down Frontier, and may not have the resources to follow through even if he wanted. After the Democrat won the North Carolina Attorney General race and took office in 2017, the Republican-controlled legislature slashed $10 million from his budget, forcing layoffs of dozens of staff attorneys and limiting his office’s ability to act.

Stein told the TV station he wrote to Frontier about internet speed issues in North Carolina, but hasn’t received a response.

Frontier responded to WLOS with a statement, reading in part:

“Copper-based internet service is difficult to represent consistently as it is subject to distance limitations. That is why it is sold as offering ‘up to’ a specified speed. Not all customers will have the same DSL service.”

But some customers report speeds are consistently better at times when most people are unlikely to be online, suggesting Frontier may be overselling its DSL service — forcing too many customers to share a limited bandwidth connection.

“When it is 2:30 in the morning, we always have the best speeds,” Davis reported. “They always drop as soon as the kids get home from school and keep dropping into the evening. During recent winter storms, speeds dropped to the point where the internet was unusable.”

Attorney General Joel Stein

“It’s not a technical problem, it’s a ‘reluctance to spend money to fix it’ problem,” he added.

Frontier frequently responds to speed complaints with press releases touting recent internet service improvements made possible through the federal government’s Connect America Fund, without always disclosing many of these projects pay to extend internet access into areas where it did not exist before, not improve service for customers that already have it.

Frontier’s willingness to spend its own money on broadband improvements is often challenged by Wall Street’s demands for a dividend payout to shareholders, sending a significant portion of Frontier’s incoming revenue to investors. The company has reduced its dividend during difficult times to invest in limited upgrades. But critics claim Frontier’s devotion to a robust upgrade program comes second to shareholders and depends mostly on federal government handouts.

“The company struggles to spend $14.4 million on upgrades through 2020, but had no problem spending more than $10 billion to buyout Verizon in Florida, California, and Texas,” complained Darrell. “When you ask them specific questions, you learn that upgrade spending is window dressing that won’t address their speed problems across this part of the state.”

Marble tells WLOS that seems to be his impression as well, noting Frontier representatives didn’t give him much hope.

“They said — several of them said, ‘There are no plans for upgrades in your area, period’,” Marble said.

The TV station sent Frontier a detailed questionnaire, to which the company responded, taking care to disclaim some of the upgrade benefits many of Frontier’s own press releases seem to imply:

Question: How many customers does Frontier service in the following counties: Buncombe, Cherokee, Clay, Graham, Haywood, Henderson, Jackson, Macon, Madison, Mitchell, McDowell, Polk, Rutherford, Swain, Transylvania, Yancey? Answer: I’m not familiar enough with cities in counties etc. We have customers in the following towns: Andrews, Bryson City, Buncombe, Cashiers, Cherokee, Cullowhee, Fontana, Franklin, Garden City, Glenwood, Hayesville, Highlands, Madison, McDowell, Mitchell, Murphy, Robbinsville, Suit, Sylva, Weaverville and Yancey. Of those we serve, some are only telephone customers, some internet only customers and still others both phone and internet customers. While we do not provide market specific customer counts in any of our operating areas for competitive reasons, it is fair to say that our customer count in the areas I referenced is in the tens of thousands.

Question: How is Frontier using the Connect America Funds in western North Carolina? What’s being done to upgrade or add service? How is the money being spent? Answer: Frontier is installing fiber into network support buildings or units in western North Carolina to enable more capacity over our existing copper network.

Question: How many new customers has Frontier been able to provide service to, as a result of Connect America funds? Are the funds being used more for acquiring new customers or is it more upgrading service for existing customers and in that case, what have the service improvements been like? Answer: It starts with upgrading the network to provide a minimum of 10 Mbps service identified as CAF households to meet the requirements of the CAF Fund as established by the FCC. Customers along the path of these improvements, both existing and those who are currently not customers, can take advantage of new broadband upgrades though not necessarily at the 10 Mbps threshold. However, it is not designed to extend the network to different operating areas.

Question: How much funding has Frontier received in Connect America funds for upgrades to broadband service in those western North Carolina counties? Answer: As of 2016, Frontier began receiving approximately $3.6 million a year from the CAF to expand and upgrade the company’s network to more than 11,000 locations in North Carolina by the end of 2020, to include areas in western NC. In total, Frontier has accepted the FCC’s CAF II offer of over $330 million annually across 29 states during the six-year program, and must meet annual benchmarks for each state beginning in 2017 for passing a specified percentage of designated households.

Question: In which counties has Frontier received funds and is using them to improve or add service? Answer: We have previously used CAF II funds in Macon, Clay, Jackson and Swain counties.

Question: What projects/upgrades have been completed to date, since Frontier started receiving Connect America funds? Answer: In addition to the counties referenced above, representative counties in this latest round in 2017 included households in Cashiers, Cherokee, Franklin and Hayesville. By the of this phase of CAF II funding the intention is to have touched all of the counties we serve in Western NC, barring anything unexpected.

Question: Has Frontier over-promised service in areas in any of the above mentioned counties? If service has been over-promised, what problems is that creating and what is the remedy for solving that problem? Answer: I’m not sure what this question is asking. I would say that copper-based internet service is difficult to represent consistently as it is subject to distance limitations. That is why it is sold as offering “up to” a specified speed. However, CAF funding should have a positive impact on the end user experience.

Question: What is the best way customers who feel they’re being underserved or not getting the service that they’ve paid for can reach out to report a problem? Answer: They should call 1-800-921-8101.

Question: Has the state of North Carolina, through the state’s Attorney General office or Consumer Protection Division reached out to Frontier over service issues, failing to deliver on service promises made by the company and if so, what’s been the response back to the state? Answer: We receive individual customer complaints from these agencies, usually revolving around availability of service or insufficient internet speeds. Our marketing for internet service and our terms of service recognize that some customers may not have the same experience as others, largely because of the distance limitations of DSL service or congestion in the network. We are attempting to address both of these issues through a combination of normal capital budgets and the additional CAF II funding.

Question: What are some of the issues Frontier runs into in expanding or improving broadband service or internet access and speed issues in western North Carolina? Answer: Mostly there are geographic challenges. However, customer density is also a challenge, or lack thereof. Balancing the significant cost of expanding broadband availability in rural areas versus the potential return on that investment is always a challenge. However, we are grateful for the Connect America Fund to help spur some of that investment and know that those customers who have been impacted by the expanded capacity appreciate the service.

Question: Anything you would like to add about the Connect America funds? Answer: We are fortunate to be a participant in the CAF funding process and grateful to the FCC for making it possible. Our hope is that customers in Western NC will have better internet connectivity experiences as we move along toward the culmination of this funding in 2020.

If you live in North Carolina and want to file a complaint about your internet service with the Attorney General’s Office click here.

WLOS-TV in Asheville, N.C. aired this special investigative report about Frontier Communications’ performance problems in western North Carolina. (5:03)

Verizon Communications has selected Samsung Electronics as a major supplier of the wireless company’s forthcoming 5G wireless service, launching first in Sacramento, Calif., in the second half of this year.

Samsung will be a major vendor supplying Verizon and its customers in Sacramento with 5G equipment, including wireless modems and routers. In 11 other cities where Verizon is testing 5G service, Ericsson AB, another 5G network vendor, has supplied much of the equipment. Samsung is currently a small player in the 5G networking business, but hopes to ramp up its business and cross-promote its smartphones and tablets with future 5G users.

Verizon’s wireless customers in Sacramento will be the first to receive invitations to switch their home broadband accounts away from AT&T, Frontier, Wave Broadband and Comcast — the four largest incumbent providers in the greater Sacramento area. Verizon claims its 5G service can support speeds up to 1Gbps. Verizon has been testing 5G service in 11 U.S. cities, but has kept pricing details to itself. The issue of data caps has been repeatedly raised and most industry analysts predict Verizon will usage cap its 5G service at around 200GB a month. Whether the company plans to offer an unlimited use plan is unknown.

Kim Young-ky, president of Samsung’s networks business, told the Wall Street Journal that 5G is a reality and it will be much more than just an upgrade from 4G service.

“The average U.S. consumer uses about five gigabytes of mobile data a month,” said Kim. But after 5G becomes more ubiquitous in the next few years, he believes consumers will eventually use closer to 100GB monthly on new services such as virtual or augmented reality programs—or even from driverless cars, the newspaper added.

Kim expects the first 5G capable smartphones won’t appear until sometime in 2019, leaving 5G primarily as a wireless home broadband replacement during its initial rollout.

Altice customers woke up on New Year’s Day to discover as many as 17 Starz and Encore premium movie channels missing from their lineup, replaced with little-watched alternative networks like The Cowboy Channel and Hallmark Drama.

It is the first retransmission consent dispute of 2018, and it began as 2017 ended. Altice issued a terse statement:

As of midnight December 31, 2017, Altice USA will no longer carry Starz or StarzEncore programming directly. Despite numerous attempts by Altice USA to reach a deal with Starz for continued carriage in video packages and a la carte carriage, Starz refused all offers, including an offer to extend our current arrangement.

Customers will not get a discount on their cable bill because of the loss of the premium movie networks. Instead, Altice quickly signed carriage agreements with several replacement basic cable networks including Hallmark Drama, Sony Movies, MGM HD, HD Net Movies, Flix, and Cowboy Channel. The last network on the list seemed an odd choice for the New York City market, featuring rodeos and rural living-oriented programming. Some customers were also placated with a replacement subscription to The Movie Channel.

Customers don’t consider the six replacements adequate for the loss of more than a dozen premium-priced movie channels, including STARZ, STARZ Edge, STARZ In Black, STARZ Comedy, STARZ Cinema, STARZ Kids & Family, STARZENCORE, STARZENCORE Action, STARZENCORE Classic, STARZENCORE Black, STARZENCORE Family, STARZENCORE Suspense, STARZENCORE Westerns, STARZENCORE Español and Movie Plex channels, and some plan to downgrade or cancel service.

Removing 17 channels and replacing them with 4, one of which is the cowboy channel is the stupidest thing I have ever heard. My bill is more than 200.00 per month, and the value for the money is definitely not worth it. Optimum is just plain greedy.

— Mary Anne Suttles (@Stormcloud2000) January 2, 2018

Altice has played hardball with programmers in the past, especially those that direct-sell their programming to consumers through online streaming. In follow-up remarks, Altice essentially told customers to go and buy Starz directly from Starz itself, and took a shot at the network claiming most of their customers don’t watch their movie channels anyway.

“We are focused on providing the best content experience for our customers and continually evaluate which channels meet their needs and preferences relative to the cost of the programming imposed by content owners,” Altice officials said in a statement. “Given that Starz is available to all consumers directly through Starz’ own over-the-top streaming service, we don’t believe it makes sense to charge all of our customers for Starz programming, particularly when their viewership is declining and the majority of our customers don’t watch Starz. We believe it is in the best interest of all our customers to replace Starz and StarzEncore programming with alternative entertainment channels that will provide a robust content experience at a great value.”

Altice did expand on what it felt were unfair terms being offered to it while consumers could get the same movies and original series for less money elsewhere:

“Since our last contract renewal, Starz began offering a direct to consumer streaming service for $8.99 per month. Given that Starz is available direct to consumer through their subscription service, we have been actively negotiating to reach a deal that makes sense for all our customers, and made numerous offers of increasing value and partnership structures.

Starz wanted an all or nothing-type deal and their insistence on terms would force us to charge customers more than what the Starz OTT product costs — that would not make sense for our customers. Given the limited viewership of Starz amongst our customer base and that consumers can get Starz directly, we believe this approach is in the best interest of all of our customers who otherwise would have seen an impact on prices due to Starz’ demands.

We have simply been seeking to do what Starz itself is doing: support a Starz a la carte product, whether through our sales channels or through their OTT service.

We have reached more than two dozen agreements over the last few months that reflect the company’s commitment to both negotiate fairly and keep costs down for customers. In addition to offers to maintain packaged distribution, we proposed extending our a la carte deal in Suddenlink to include Optimum and Starz refused – this despite the fact that Starz has a la carte only deals with other distributors. We also offered to help sell the Starz OTT service to our broadband customers and they refused. We also offered to extend our current agreements.”

Analysts say it is very uncommon for a cable company to encourage its customers to directly subscribe to a service traditionally sold by the cable operator itself. Altice sought to drive home their view that selling cable programming direct-to-consumers devalues the product for cable operators, especially if the programmer sells it directly to consumers at a lower retail price than a cable operator can can buy at the wholesale rate.

“Despite all of Altice’s assertions to the contrary, the facts in this dispute are simple. Altice wanted a drastic reduction in price that was totally inconsistent with the market and flew in the face of the record popularity of our programming,” Starz said in a statement that did not refute Altice’s cost claims.

Starz offers a 7-day free trial of its streaming app, which offers on-demand access to most titles found on Starz or Encore networks. After the free trial, the service is available for $8.99 a month or $89.99 a year, which offers a 17% discount off the monthly price. The website offers more information about supported devices and streaming policies.

While giant cable company mergers unexpectedly took a breather in 2017, Fierce Cable predicts this year isn’t likely to be a repeat of last year.

“With polls showing Democrats poised to begin sweeping back into power with the 2018 midterm elections, look for cable operators to make hay on the current regulatory climate and start turning their rivals into that most precious of resources: scale,” writes Daniel Frankel.

With time for large cable operators to get easy approval of merger deals from deregulation-minded Republicans potentially running out, 2018 could bring dramatic consolidation in the cable industry, with Comcast a likely buyer and Charter Communications a potential seller… if the offer is good enough.

Many industry observers expected the first year of the Trump Administration to be a banner year for cable mergers, especially with the entry of Altice, a European cable conglomerate known for its willingness to overpay to acquire cable operators. Altice has since run into significant financial challenges and investor blowback, forcing the company to shelve acquisition plans for now and focus on debt reduction and developing a stronger business plan to operate its ailing cable and wireless properties in Europe. Altice USA, which owns Suddenlink and Cablevision, has not shelved its plans to upgrade many of its customers to fiber to the home service, but is also no longer seen as an immediate bidder for Charter, Cable One, or WideOpenWest.

Fierce Cable expects Comcast to respond to AT&T’s merger with Time Warner, Inc., assuming the deal successfully overcomes Department of Justice objections in court, and 21st Century Fox’s asset sales to Disney. Both transactions threaten to consolidate programming production and distribution around an even smaller group of media giants, which could challenge Comcast’s NBCUniversal unit as well as the cost of cable programming networks. Comcast has shied away from acquisitions after an embarrassing failure of its attempt to buy Time Warner Cable a few years ago.

If Comcast wants to build scale, it would naturally target an acquisition of Charter Communications, the second largest cable company in the country. The deal would give Comcast dominance over the New York and Los Angeles media markets and broadband service provision across most major American cities. Comcast could also seek a less controversial acquisition of Cox Communications, one of the few major independent cable companies left. But Comcast could also seek acquisitions in Hollywood to bolster its production capabilities.

Most other cable acquisition options would be considered scraps by the largest operators. Altice could be persuaded to prematurely exit the American market and sell Cablevision and Suddenlink if convinced it has no chance of building adequate scale to stand with Comcast and Charter. Beyond that are smaller rural and regional operators including Mediacom, Midco, WOW!, GTT, RCN, and many others that serve fewer than one million customers.

Company executives may be hoping the objections to the AT&T/Time Warner deal are an anomaly for the Trump Administration. But it’s clear that whatever smooth waters exist for upcoming mergers will get choppy as the midterm elections approach. Should Democrats win back the House and/or Senate, life will get considerably more difficult for future media consolidation deals.