Pai

In an effort to “streamline” procedural rules and paperwork at the Federal Communications Commission, FCC Chairman Ajit Pai is proposing to theoretically weaken the existing informal complaints process, leaving consumers with unresolved complaints only one firm option — paying a $225 filing fee to pursue a formal complaint at the Commission regarding their internet service provider.

“This Order streamlines and consolidates the procedural rules governing formal complaints against common carriers, formal complaints regarding pole attachments, and formal complaints concerning advanced communications services and equipment,” the FCC proposal reads. “We base these rule refinements on 20 years of experience adjudicating formal complaints and conducting mediations. We find that these rule revisions will eliminate inconsistencies among various complaint proceedings, promote a fully developed record in each case, foster disposition of formal complaints in a timely manner, and conserve resources of the parties and the Commission.”

With thousands of informal complaints about the nation’s cable, phone, wireless, and satellite companies arriving at the FCC every week, and millions of comments to process on hot-button topics like net neutrality, the federal agency is trying to distance itself from being a government’s version of the Better Business Bureau. Under the Obama Administration, FCC Chairman Tom Wheeler invited consumers to bring their complaints about internet service providers to the FCC’s attention. In 2015, the FCC launched a Consumer Help Center that, like Pai’s latest proposal, also claimed to “streamline the complaint system.”

FCC’s online Complaint Center

“The first responsibility of the FCC is to represent consumers,” the agency noted in a 2015 blog post. “Facilitating consumer interface with the Commission is a major component of that responsibility.”

Three years ago, the FCC stepped up involvement in the consumer complaints process to keep an eye on the marketplace and its providers — to see whether consumers were being well-served and ferret out companies that were not responsive or “bad actors” in the industry. The best way the FCC determined that was to track and measure consumer complaints.

“The information collected will be smoothly integrated with our policymaking and enforcement processes,” the FCC wrote in 2015. “The result will be better results for consumers and better information for the agency. The insights we gain will help identify trends in consumer issues and enable us to focus Commission time, money, and resources on the issues that matter most.”

The proposed changes supported by Chairman Pai are subtle, but in the regulatory world, a few words can mean a lot — something the New York State Public Service Commission and Charter/Spectrum are debating right now. A single appendix in the 2016 Merger Order approving Charter’s acquisition of Time Warner Cable and the cable company’s interpretation of it led to threats by the PSC to de-certify the multi-billion dollar merger.

Matthew Berry, the FCC’s chief of staff, promptly attacked as “fake news” a partly specious article on the subject published by The Verge (which was substantially modified from the original this afternoon).

This is fake news. No change is being proposed to the FCC’s process for handling informal complaints. I’ve rarely seen an article about an FCC item that has been this far off base. https://t.co/L59YxbggSY

— Matthew Berry (@matthewberryfcc) July 10, 2018

But Berry ignores the fact the proposal states up front it amends or changes current rules. Whether the FCC intends to make changes in its day-to-day operations as a result is a separate matter from the rules that govern the FCC’s work. The former can be changed almost at will, the latter cannot.

The section that has sparked controversy this week is: § 1.717 Procedure. It details what happens when the FCC receives an informal complaint from a consumer, either from a web-based complaint form or written complaint:

Current Language:

The Commission will forward informal complaints to the appropriate carrier for investigation. The carrier will, within such time as may be prescribed, advise the Commission in writing, with a copy to the complainant, of its satisfaction of the complaint or of its refusal or inability to do so. Where there are clear indications from the carrier’s report or from other communications with the parties that the complaint has been satisfied, the Commission may, in its discretion, consider a complaint proceeding to be closed, without response to the complainant. In all other cases, the Commission will contact the complainant regarding its review and disposition of the matters raised. If the complainant is not satisfied by the carrier’s response and the Commission’s disposition, it may file a formal complaint in accordance with § 1.721 of this part.

Proposed Language:

The Commission will forward informal complaints to the appropriate carrier for investigation and may set a due date for the carrier to provide a written response to the informal complaint to the Commission, with a copy to the complainant. The response will advise the Commission of the carrier’s satisfaction of the complaint or of its refusal or inability to do so. Where there are clear indications from the carrier’s response or from other communications with the parties that the complaint has been satisfied, the Commission may, in its discretion, consider a complaint proceeding to be closed. In all other cases, the Commission will notify the complainant that if the complainant is not satisfied by the carrier’s response, or if the carrier has failed to submit a response by the due date, the complainant may file a formal complaint in accordance with § 1.721 of this part.

At first glance, these two sections appear nearly identical. The subtle changes relate to defining, in writing, the exact responsibilities of the FCC. Weasel words like “may,” “advise,” “in its discretion,” and “consider” are red flags. When these kinds of words replace black letter words like “will,” the rules are weakened by making them discretionary. In such cases, a decision to pursue a matter is no longer a requirement, it’s an option.

In this case, Mr. Pai is proposing to reduce the FCC’s obligations to oversee an informal consumer complaint from the moment it is received to its ultimate disposition.

Under the current complaint rules, the FCC has collected a lot of information about the nature and resolution of consumer complaints. Let’s say Nancy Smith files a informal complaint against Comcast using the FCC’s online complaint center. Right now, the FCC requires Comcast to respond to Nancy’s complaint within 30 days. Comcast knows that the FCC will be monitoring the complaint and Comcast’s response. If Comcast were to ignore the letter or dismiss it, the FCC will be watching.

Consumers getting squeezed by reduced oversight.

The high complaint rates earned by telecom companies have been fodder for regulators and politicians for years, so most companies refer complaints filed with the FCC to their highest level “executive customer service” personnel empowered to resolve complaints almost anyway they can. If Mrs. Smith is pleased with the response from Comcast, the cable operator knows the FCC sees that as well. Comcast is also sensitive to the fact the FCC might one day act on unresolved issues that generate the most complaints. Over time, statistics gathered by the FCC will reveal the companies least willing to cooperate with their customers and those most motivated to resolve issues. That could count if a company like Comcast sought a merger with another cable company with a lower complaint rate, for example.

Under the proposed informal complaint rules, the FCC’s role is effectively reduced to a complaint letter-forwarder. Nancy Smith’s letter sent to the FCC under the new rules will still be forwarded to Comcast and probably arrive with a 30 day deadline to respond, should the FCC choose to maintain that requirement. In a theoretical response to Mrs. Smith, the FCC can immediately notify her it has forwarded her complain to Comcast and regardless of the provider’s response (assuming Comcast sends one), her only recourse if she remains dissatisfied is to pursue a formal complaint — the one that involves a previously established $225 filing fee and comes with a mass of terms, conditions, and requirements comfortable only for lawyers and lobbyists.

The FCC attempts to explain away the changes in a footnote (emphasis ours):

We also clarify rule 1.717, which addresses informal Section 208 complaints. See 47 CFR § 1.717. In addition to wording revisions that do not alter the substance of the rule, we delete the phrase “and the Commission’s disposition” from the last sentence of that rule because the Commission’s practice is not to dispose of informal complaints on substantive grounds. We also add a rule memorializing MDRD’s staff-assisted mediation process, which enables parties to attempt to resolve their disputes before or after the filing of a formal complaint.”

A “practice” is not a “rule” or “requirement,” however. “Substantive grounds” is also undefined in the footnote and could be subject to interpretation. After all, Mr. Pai has also claimed that repealing net neutrality would have no substantive impact on the internet.

D.C.’s lobbyists routinely make regulatory language change suggestions on behalf of their clients.

Lobbyists are paid handsomely to urge adoption of similar, subtle modifications in regulatory rules and laws because they can establish loopholes large enough to drive a truck through. In virtually every proceeding, comments routinely focus on proposed language changes. This will be the core part of the discussion at the FCC before voting on the rule change proposal as early as tomorrow – July 12, 2018.

In practical terms, the changes are designed to subtly distance the FCC from involvement in consumer disputes with their providers. Oversight is weakened in this proposal, but more importantly, the focus of the FCC’s mandate changes from “the first responsibility of the FCC is to represent consumers” in 2015 to “if the complainant is not satisfied by the carrier’s response, or if the carrier has failed to submit a response by the due date, the complainant may file a formal complaint.” Only then, assuming a consumer successfully navigates a very complicated procedure to file a formal complaint and correctly follow notification requirements, will the FCC be compelled by the rules to stay involved with a complaint from start to finish.

Keep in mind companies that frequently have regulatory business before the FCC have staff attorneys and employees familiar with the FCC’s bureaucracy and rules. A $225 filing fee is an afterthought. For the average consumer, neither is probably true.

The likely result of the change will act as a deterrent for consumers relying on the FCC to help them resolve problems. Providers will also quickly recognize the FCC is no longer as willing to scrutinize customer complaints.

Ranking Member Rep. Frank Pallone, Jr. (D-N.J.) and Ranking Member of the Subcommittee of Communications and Technology Mike Doyle (D-Penn.), who both serve on the House Energy & Commerce Committee, quickly realized the implications of the FCC’s proposed rule changes and fired off a letter to Mr. Pai this week:

We are deeply concerned that the Federal Communications Commission (FCC) is poised to adopt a rule that would eliminate the agency’s traditional and important role of helping consumers in the informal complaint process. Too often, consumers wronged by communications companies face unending corporate bureaucracy instead of quick, meaningful resolutions. Historically, FCC staff has reviewed responses to informal complaints and, where merited, urged companies to address any service problems. Creating a rule that directs FCC staff to simply pass consumers’ informal complaints on to the company and then to advise consumers that they file a $225 formal complaint if not satisfied ignores the core mission of the FCC — working in the public interest.

At a time when consumers are highly dissatisfied with their communications companies, this abrupt change in policy troubles us.

After reviewing a lot of regulatory proceedings and comments over the last ten years of Stop the Cap!, it troubles us too.

Cox Communications sales representatives are accused of creating fake accounts and adding extra services to existing customers’ bills without authorization in hopes of scoring monthly bonuses of $10,000 or more.

WJLA-TV’s I-Team reports two whistleblowers have come forward to tell the Washington, D.C. station Cox employees are still defrauding customers to line their own pockets, despite repeated attempts to alert senior management and company claims the fraud was limited to a few now ex-employees.

“How far they’re going for a commission payout, to affect thousands of people, it’s a heinous, greedy act,” former Cox Communications employee Anna Wilkinson told WJLA. Fraud is allegedly rampant in the Mid-Atlantic region where Wilkinson worked, and it involves hundreds, if not thousands of bogus charges and accounts. Wilkinson reports some customers have had five to seven different accounts opened in their name using multiple addresses. Other customers are discovering services they did not request suddenly added to their bills.

Wilkinson blew the whistle on Cox’s fraud problem.

What motivates sales representatives to get “creative” with customer accounts is Cox’s lucrative bonus system that rewards agents that sign up the most new customers or add services to an existing account. The worst offenders are earning more than $12,000 a month from the fraud, and some have assembled large “black books” filled with valid customer Social Security numbers and other information gleaned from Cox’s customer database.

“Hundreds and hundreds of Social Security numbers, along with people’s first and last names, their address, birthdays” are involved, said Wilkinson. Sources told WJLA a favorite target for the scheme are ex-renters leaving an apartment building. When the disconnect request arrives, the reps use that person’s information to open multiple new accounts around that apartment complex.

“You have sales reps knowing who moves in and out of apartments,” the source said. “So they set up multiple accounts starting with one apartment like ‘Apartment 241.’ Then, another fake account in 540 and Apartment 352. All the fake accounts are then placed under one person’s name that use to live in Apartment 449.”

The representative can return to unsuspecting ex-renter time and time again to make their sales quota and earn bonus commissions.

“Let’s say he sold them cable and internet and added the phone to the service,” the source said. “That’s three sales. Move that person four times that’s 12 sales. If you do that 10 times that’s 120 sales [and] you have over 90 percent of your quota already done.”

Wilkinson said she filed complaints with the Federal Trade Commission (FTC) and the Virginia State Attorney General’s Office.

A representative from Cox Communications issued this statement in response to the report:

“We have stringent ethical and privacy standards that all employees are required to abide by. In instances where those standards are not adhered to, we take immediate action that can result in employee terminations. If there is a situation where a customer’s personally identifiable information is believed to have been compromised, we notify the customer and work with them to rectify. Cox has fraud alert measures in place and have taken other steps to help prevent this from happening. Nonetheless, like many companies, we have had isolated instances of employees not living up to our standards of behavior. Recently we learned of a small number of employees in Virginia who violated our policies. A thorough investigation occurred and those employees have since been terminated. An internal audit was also conducted ensuring that no customers’ personally identifiable information was compromised. We take these matters very seriously, and remain committed to protecting the safety of our customers’ information through our business policies and practices.

WJLA in Washington reports Cox’s sales agents are lining their own pockets opening fraudulent accounts. (3:09)

A typical flat/mud flap style antenna.

Proliferating in online ads, newspapers, and sometimes on television, “revolutionary” new antennas are being advertised claiming to replace cable television while getting most (if not all) of the same channels over the air for free.

These misleading scams have been around for several years. We covered one well-funded ad campaign for “Clear Cast” back in 2011. That particular over-the-air antenna was sold through newspaper ads designed to mimic a newspaper story, with bold headlines like “New Invention … Gets Rid of Cable and Satellite TV Bills.” Those who spent upwards of $50 received a slightly dressed-up bow-tie antenna barely suitable to receive UHF TV stations and worked about as well as a similar antenna selling for $1.49.

With the first wave of misleading ads well behind us, marketers have had to work overtime to reinvent the wheel and convince people to spend $40-50 for what usually cost the company under $5 to manufacture.

Now, instead of the “Clear Cast” antenna, there is the “ClearView HDTV Antenna,” marketed by a company named True Signal. It’s hardly alone. The Octa Air, The Fox, and many others are nearly-identical “mud flap”-style antennas, with a tiny “antenna” embedded inside. The concept marginally works when the owner attaches it to a window, which gives it more signal to work with than an antenna placed in the corner of a room.

The ad copy on the manufacturer’s website is usually over the top but is nothing compared to some of the advertiser-sponsored editorials — “advertorials” published by bloggers, third party advertisers, and fly-by-night websites that exist primarily to cash in on sales commissions. More than a few of those stretch marketing claims into the stratosphere.

Goodsavingstips.com is designed to look like an online combination of a high-tech website and Consumer Reports. In fact, it is a website that reviews products, but has a financial incentive to write glowing reviews to encourage you to buy whatever they write about.

Goodsavingstips stretches the truth about the ClearView antenna more than a salt water taffy machine on the Atlantic City Boardwalk:

If you could stop paying for cable or satellite TV and still get all of your favorite TV channels in HD for FREE, would you do it? Millions of Americans are doing just that, thanks to a brand new rule in 2018 that allows certain regions access to free TV.

Thankfully, if you live in an area where this new rule went into effect, you no longer need to give your hard earned money away to the big cable companies. As a result, Americans are now cutting the cord on their cable companies in record numbers, saving them thousands of dollars.

Up until 2018, cable companies were allowed to “scramble” their channels so that the general public could not access them without paying for their service. However, that all changed starting in 2018, with the government ruling that TV signals are public property and “belong to the people”. Ever since this rule went into effect, the big cable companies are panicing [sic] because many Americans will no longer need to pay for cable or satellite tv to get their favorite channels in HD. As long as you live in a publicly broadcasted [sic] area, it is now possible to watch all of your favorite channels for free with a TV antenna.

Boastful claims about the TrueSignal antenna.

Several antenna companies market their antennas using similar language. There is, in fact, no 2018 “new rule” suddenly mandating your access to free TV. You have been able to watch free TV for decades. Notice the ad copy does not directly state you can receive cable and satellite channels over the air. It only states you can watch “all your favorite channels,” which in this case better be local TV stations and not networks like USA, TNT, CNN, etc. Consumers did not need a new rule to cut the cable TV cord. They just needed competition.

A map invites consumers to see if “free TV” is available in their state. Unsurprisingly, it is in all 50 states.

The rules regarding scrambling have only toughened against consumers over the last few years, not improved. Cable operators are now permitted to encrypt their entire TV lineup, even those channels customers used to watch using a built-in QAM tuner. The encryption allows cable companies to disconnect service from the office instead of dispatching a truck to physically disconnect the line going to your home or apartment.

However, not all TV antenna’s will work. In an attempt to block the public from picking up their TV signals, the cable companies are broadcasting their signals at very low frequencies since most antenna’s will not be able to pick them up. The trick is to get an antenna that can reliably pick up these low frequency signals, and up until now, there hasn’t been an antenna advanced enough to pick these signals up reliably. (There are other antenna’s out on the market, but they fail miserably in comparison to this one).

This is plainly false. Cable companies do not “broadcast” signals over the air. They send them through cables, hence the name “cable” television. Most cable systems also encrypt their digital lineups and no television antenna alone will decrypt them. If we were charitable, we could hazard a guess the reviewer is trying to suggest there are low-power television stations out there which need a better antenna to receive clearly, but these stations are independent of cable operators, don’t transmit on “very low frequencies,” and have been around for years.

Developed by a NASA engineer using military technology, the ClearView HDTV Antenna was just released this year so that it could specifically pick up these signals reliably and has been hailed as the only “super” HDTV antenna. It uses a discrete mud flap modern design which makes it the most reliable and technologically advanced antenna to hit the market today. It can pick up signals out to 60 miles with no problem (as well as the low frequency signals) to enable you to receive free crystal-clear HD channels.

Phillip Dampier: Debunking mode.

Misleading. In fact, the original design for the so-called “mud flap” antenna came from a Raleigh, N.C. based company Mohu. The company began as a small military contractor and the original intent of the antenna was not to receive free cable television. Mohu’s founder, David Buff, was working under a military contract to research new ways to counteract improvised explosive devices (IEDs) that were used against our armed forces in Iraq and parts of Afghanistan. He devised a low/no-profile antenna that closely resembled a mud flap attached to armored military vehicles that would jam the remote wireless signals used by insurgents to detonate roadside bombs. The military chose a different approach. So if the people selling these antennas were honest, they would have to say, “Developed by a military contractor but rejected by the military itself….”

Buff would later expand Mohu as a consumer antenna company, but suggests his proprietary design isn’t the result of the ‘space age’ antenna, but rather the signal amplifier attached to it. But that is hardly groundbreaking if an antenna cannot receive enough signal to amplify.

The “reviewer” promoting the ClearView antenna (who will earn a percentage from every sale that results from a click on his website) was amazed with the results:

What happened next was astonishing…

We turned the TV on and found ourselves staring back at an incredibly clear channel in HD. We kept flipping through channels and to our amazement, every channel was crystal clear. Best of all, we received almost all of the most popular channels you would get with cable.

All in all, we were able to access 68 channels in 1080 HD. It was as if we were getting free cable or satellite TV.

Now, before you cancel your cable or satellite subscription, it is important to note that there were a few channels that we could not get with the antenna. But in the end, we were able to receive about 85% of the same channels and more importantly, they were the most popular channels that people actually watch.

The verdict:If you want to save thousands of dollars and stop paying for cable or satellite tv, and don’t mind losing out on a few random channels you probably won’t even watch….

Up and coming technology: A wireless over the air antenna that receives signals from the best place in the house and then sends channels over an in-home Wi-Fi network.

We were not surprised it was deemed astonishing, considering the companies selling these antennas routinely buy sponsored space to promote their products on independent websites or compensate reviewers with a substantial commission if their reviews result in product sales. (Stop the Cap! does not accept sponsored posts or commissions to peddle products.)

The ClearView antenna did not do well for Amazon customers.

What the reviewer experienced was… over the air television, received through an antenna. Because most television stations now broadcast a digital signal, it is not surprising every channel would appear “crystal clear” because the alternative is typically no signal at all. The article continues to mislead readers, however, when it suggests buyers would “receive almost all of the most popular channels you would get with cable.” In fact, antenna users will only receive free, over the air local stations. Getting 68 over the air digital TV channels (and subchannels) is common only in the largest cities with multitudes of over the air stations. Many of those channels target ethnic minorities with foreign language programming, religious programming or home shopping. In most medium and smaller cities, expect 20-25 channels.

Right until the end, the reviewer was prepared to mislead his readers. The disclaimer itself fails to be completely forthcoming as well, telling prospective buyers there were only “a few” channels not receivable with the antenna. That could refer to over the air stations too weak to receive, but the surrounding context invites readers to believe those few channels are cable television networks. Telling people they will receive about 85% of the “same channels” (whatever that means) and “most channels that people actually watch” is true only if you exclude all cable television networks from that list.

The worst part of this is after spending $40 on the ClearView HDTV antenna, a whopping 52% of reviewers on Amazon.com gave it just one star. One reviewer compared it with a bent coat hanger serving as an improvised antenna and the coat hanger won. Most claimed it completely failed their expectations.

These antennas are made and marketed to a gullible public that has either forgotten about the basic principles of television antenna design or were too young to have ever used one. Many of the “high-tech” antennas we see sold these days are designed to work with UHF channels only, an important issue if one or more local stations still occupies VHF channels 2-13.

A more traditional RCA set-top antenna style common from the early 1970s – today. They work reasonably well and are inexpensive. The two vertical telescoping antennas are for VHF reception and the loop is tuned to receive UHF channels. You need an antenna capable of receiving both bands if you have stations on channels 2-13.

Indoor antennas are only suitable in you live relatively close to the transmitter. In most cases, residents of a city or inner ring suburb can usually get by with two telescoping rod antennas (“rabbit ears”) and a UHF antenna shaped into a small loop or bow tie design. Traditional set-top antennas often incorporate both. The telescoping antennas can be raised or lowered and rotate in various directions until you find the best reception. A UHF antenna usually can be turned to the right or left until best reception is achieved. These antennas are perfectly suitable and cost $20 or less. There are more modern antenna designs, some flat plastic or rubber sheets, others look like miniature replicas of an outdoor antenna mounted on the roof. In most cases, the design itself is what is “revolutionary.” None of these antennas perform miracles, but many are adequate. The key is finding the right direction to point them in or keeping them as close to a window as possible. You may need to find a different window, or change the height or positioning of the antenna to get the best reception.

If your reception remains poor, you need a roof or attic-mounted antenna, (remotely rotatable preferred over fixed-mounted). These antennas are mounted higher in a home, giving a less obstructed view to the transmitter tower, and capable of collecting weak signals that would be non-existent indoors. The biggest cost involved with these is often not the antenna but the installation. A high quality roof-mounted antenna will outperform any indoor antenna and will likely receive some stations from adjacent cities.

A relatively recent development is the “wireless antenna” which receives signals from an antenna placed in an area of the home which gets the best reception and transmits received TV channels over an in-home Wi-Fi network, making long antenna cable runs unnecessary. Unfortunately, reviews of many of these products are mixed and hint the technology has to undergo further development to make it less frustrating.

For now, cord-cutters with reception challenges may find the best solution is to subscribe to one of the streaming providers like DirecTV Now, YouTube TV, Hulu, etc. Be sure to verify which stations are available to you from each service before subscribing as they vary widely in each market.

If investing in a TV antenna, start small and inexpensive and consider trying out antennas available in local stores like Walmart, which can be more easily returned if they are unsuitable. If buying online, stick with a retailer like Amazon.com where independent reviews can help give you some insight into each antenna. Just be careful about overly glowing reviews. Fake/compensated reviews are a significant problem on online retailer websites, especially for unknown or unusual products or brands trying to break through in the market.

This isn’t going to be your parent’s HBO much longer.

In a recent town hall attended by 150 employees, AT&T laid out its new vision for the premium network it recently acquired. one almost similar at times to the business plan of a drug pusher.

“We need hours a day,” said John Stankey, a recent transplant from AT&T’s executive suites now tapped to run WarnerMedia — AT&T’s new name for what used to be Time Warner (Entertainment) and owner of HBO. Stankey was complaining that HBO was out of touch with the times, attracting too few viewers to its multiplex of premium channels only a handful of times a week, if that. In a world shared by Netflix, that was not nearly good enough.

HBO, which began life as Home Box Office in November, 1972 is by far America’s oldest cable television channel. Originally a venue for high profile, unedited, commercial-free movies, along with sports and specials, HBO grew into a well-respected producer of high budget (often millions of dollars per episode), cutting-edge original movies and series, showcased to loyal audiences on Sunday nights for years. Series like The Wire, The Sopranos, Sex in the City, Oz and Game of Thrones are well-known across the country, but fewer than half of Americans subscribe to HBO to watch them. HBO has also been the critics’ choice for original content, showering awards on the network in unprecedented numbers for almost 20 years.

Now that AT&T is in charge, that is all about to change, as executives prepare to shift HBO away from “quality over quantity” towards “quality and quantity.” Stankey also made it clear the changes are first and foremost about making money — a lot of it earned by keeping subscribers on HBO property so their viewing habits can be studied and sold.

Stankey

“It’s going to be a tough year,” Stankey warned. “It’s going to be a lot of work to alter and change direction a little bit.”

“It’s not hours a week, and it’s not hours a month,” Stankey said of how long he expects HBO subscribers to spend time watching the service. “It’s hours a day. You are competing with devices that sit in people’s hands that capture their attention every 15 minutes. I want more hours of engagement. Why are more hours of engagement important? Because you get more data and information about a customer that then allows you to do things like monetize through alternate models of advertising as well as subscriptions, which I think is very important to play in tomorrow’s world.”

That will be a major shift for a network overseen top to bottom since 1992 by Richard Plepler, HBO’s chief executive. Plepler expanded on HBO original movies by launching expensive scripted series in the late 1990s that stood out by escaping broadcast television network censorship. But Plepler was very selective about the number of shows on HBO’s schedule, with some series taking years to develop. Under Stankey’s leadership, HBO will now be expected to dramatically expand original content, much like Netflix has done to keep viewers coming back for more.

“As I step back and think about what’s unique about the brand and where it needs to go, there’s got to be a little more depth to it, there’s got to be more frequent engagement,” Stankey said, adding HBO’s brand has to broaden its appeal to new audiences.

That will require a big boost to HBO’s budget. The pay movie channel is already extremely profitable, making almost $6 billion in profits over the last three years. It invested $2 billion in programming development, much less than the $8 billion Netflix is investing in less costly, but more prolific programming. HBO’s business plan depends heavily on American cable subscribers paying $10-15 a month for the network. It also earns money selling its original shows to television outlets in other countries. Its high monthly cost has always limited subscriber numbers, especially these days with cord-cutting and bill shaving. Premium movie channels are often the first networks to be dropped in return for a lower bill.

Plepler

To monetize its subscriber base, HBO either has to cut the cost of the network, transform it into must-have television, or a combination of both. Stankey is unhappy HBO has wavered around 40 million subscribers (out of 142 million American potential households) for years. He told audiences the network has to find ways to move the network beyond its perpetual 35-40% penetration “to have this become a much more common product.”

There was a clear sense of tension between Plepler, who is part of the New York City entertainment scene, and Stankey, a business-focused Texan with decades of experience in the Bell System — later AT&T. Plepler’s deference to Stankey’s new vision seemed uncomfortable at times, as Stankey made it clear who was now in charge:

Stankey: “We’ve got to make money at the end of the day, right?”
Plepler: “We do that.”
Stankey: “Yes, you do, just not enough.”

Plepler’s clearly defined tenure and vision at HBO had not wavered much since taking over in the early 1990s. But that vision was nervously discarded almost immediately as Stankey looked on.

“I’ve said, ‘More is not better, only better is better,’ because that was the hand we had,” Plepler explained. “I’ve switched that, now that you’re here, to: ‘More isn’t better, only better is better — but we need a lot more to be even better.’”

As a result, HBO, which used to be the darling of critics and well-to-do viewers in big cities on the east and west coast is getting a radical makeover. Onlookers can expect a much more aggressive marketing effort and free samples of the service to attract and hold new customers. It will have to keep its pricing closer to the competition, particularly as many consumers already subscribe to 1-2 different streaming services. Then it will have to give people a reason to subscribe to just one more service.

Fierce competition by eastern Canada’s largest internet service providers are driving down prices across the Greater Toronto Area by as much as 45%.

Bell’s fiber to the home service, making its way across parts of the GTA, is now offering unlimited gigabit (1,000/940 Mbps) internet for $79.95 a month, a major drop from its original price of $149.95, if customers sign up before the end of July. Those signing up by July 7 can also get a $50 gift card.

Rogers, the country’s biggest cable company, has been pushing its own limited time promotional offer for its gigabit (1,000/30 Mbps) package, which is more widely available than Bell’s Fibe but also suffers from anemic upload speed. Rogers was selling the package for $152.99/month, but it’s now $79.99 for the first year. The offer is good throughout Ontario, New Brunswick, and Newfoundland.

The two telecom companies are trying to boost subscriber numbers during the slow summer months when quarterly financial reports can show a decrease in customers.

Canadians have generally had less access to gigabit speed plans than their American neighbors. Experts believe these companies are cutting prices to hook people on super-fast internet plans that will change consumer attitudes about gigabit speed from an unaffordable luxury into a necessity. Like Americans, Canadians are gravitating towards faster speed plans at an accelerating rate. They also continue to choose unlimited plans wherever available.

There are the usual terms and conditions in the fine print to consider:

Rogers: Offer available for a limited time to new Rogers internet subscribers within Rogers cable service area in Ontario (where technology permits). Subject to change without notice. Data usage subject to Rogers Terms of Service and Acceptable Use Policy. See rogers.com/terms for full details. Taxes extra. One-time activation fee of $14.95 and one-time installation fee (waived for Self-Install; Basic $49.99 or Professional $99.99) apply. Savings as compared to regular price for 12 months. Advertised regular price applies in month 13, subject to any applicable rate increases.

Speeds may vary with internet traffic, server gateway/router, computer (quality, location in the home, software and applications installed), home wiring, home network or other factors. See Acceptable Use Policy at rogers.com/terms. An Ethernet/wired connection and at least one additional wired or wireless connection are required to reach maximum download speeds of up to 1 Gbps for Rogers Ignite Gigabit Internet. Offer available until July 31, 2018 within Rogers cable service area (where technology permits) to new customers subscribing to Ignite Internet 60u or above.

Bell: Offer ends on July 31, 2018. Available to new residential customers in Ontario, where access and technology permit. For certain offers, the customer must select e-billing and create a MyBell profile. Modem rental required; one-time modem rental fee waived for new customers. Subject to change without notice and cannot be combined with any other offer. Taxes extra. Other conditions apply, including minimum system requirements. Subject to compliance with the Bell Terms of service; bell.ca/agreements.. Speeds on the internet may vary with your configuration, internet traffic, server, environmental conditions, simultaneous use of Fibe TV (if applicable) or other factors; bell.ca/speedguide.

$50 gift card promotion: Offer ends on July 7, 2018. The selected internet tier must include unlimited usage. An unloaded gift card will be mailed after the customer maintains a continuous subscription to the same eligible Bell services and has an account in good standing for 60 days following the installation of all services. All services need to be activated by July 31, 2018. Not combinable with any other offers or promotions. Subject to change without notice. One gift card per account. When received, customer must register the gift card online at bellgiftcard.com to request loading of the amount. Allow 30 days for gift card to be loaded and ready to use. If you cancel your services before you activate your gift card, you will not be able to use your gift card. Gift card and use are subject to the card program. Other conditions apply; see bell.ca/fullinstall.