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The Weather Channel Is Off DirecTV Over a $0.01 Rate Dispute

Phillip Dampier January 14, 2014 Competition, Consumer News, DirecTV, Video 4 Comments

weather channelThe Weather Channel has been removed from DirecTV’s lineup and replaced with WeatherNation, a much-smaller channel based in St. Paul, Minn., because the popular weather network reportedly sought a $0.01 monthly rate increase.

DirecTV subscribers told Stop the Cap! the channel change happened just after midnight, although WeatherNation was already a part of DirecTV’s lineup.

“This is unprecedented for the Weather Channel,” said David Kenny, CEO of the Weather Channel’s parent company. “In our 32 years, we have never had a significant disruption due to a failure to reach a carriage agreement.”

directvThe Weather Channel has launched a campaign to restore the network that carries the impression DirecTV does not care about the safety of their customers. The Weather Channel executives have stated their severe weather coverage is unparalleled and would leave satellite dish customers in rural areas without important information about dangerous weather.

But Dan York, responsible for DirecTV content, said weather information is available from a variety of sources, especially smartphones, and The Weather Channel has drifted away from its core weather mission, devoting up to 40 percent of its programming to reality TV shows.

bring back weather

The two sides are far apart, even arguing over the amount of the increase The Weather Channel wants for its programming. Executives at The Weather Channel claim their requested increase amounts to $0.01 per month, per subscriber, on top of the $0.13 average cost distributors pay for the weather network. DirecTV says it is substantially more than that and it seeking a 20% rate cut due to declining ratings.

The Weather Channel lacks the clout major corporate conglomerates like NBC Universal, Time Warner Entertainment, or Viacom have when negotiating contract renewals. Instead, it is counting on its loyal audience to bring the fight to the satellite provider.

So far, viewers seem to be responding. An anti-DirecTV website run by The Weather Channel has received more than 700,000 page views and reportedly brought 150,000 complaint calls to DirecTV customer service.

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The Wall Street Journal reports the advent of smartphones has taken a significant toll on The Weather Channel’s viewership, leading DirecTV to ask for a 20% rate cut. (4:17)

Charter Communications Publicly Offers to Buy Time Warner Cable in $61 Billion Deal

twc charterAs expected for months, Charter Communications, Inc. today formally offered Time Warner Cable shareholders $132.50 per share to assume ownership of the nation’s second largest cable operator in a deal worth more than $61 billion, including debt.

Bloomberg News this afternoon reported Charter Cable has offered $83 in cash for each outstanding share of TWC stock, as well as about $49.50 in Charter stock. That makes the attempted takeover the third largest merger deal worldwide since 2009.

Rutledge

Rutledge

Charter CEO Thomas Rutledge, a former executive at TWC and Cablevision would lead the combined enterprise under the Charter Cable name, likely pushing out TWC’s new CEO Robert Marcus. Rutledge argues that combining Charter and TWC would bring about considerable cost savings, particularly for spiraling programming costs. Analysts say the deal would also mean a reduction in Time Warner Cable’s workforce, especially in middle management, as operations are consolidated around Charter’s leadership.

Rutledge today said he privately approached Time Warner Cable executives with an offer in late December.

“We haven’t received a serious response,” Rutledge said today in a Bloomberg News telephone interview. “Our objective was to talk to management and try to get them engaged. They have not, so we’re going to make our case to shareholders about why this deal is good for them and hope they ask management and the board to watch out for the interests of shareholders.”

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Chris Marangi from Gamco tells CNBC Charter Communications’ proposal to buy Time Warner Cable for $61.3 billion is probably too low, but the cable industry is “ripe for consolidation” and further mergers are likely. (1:39)

Time Warner Cable’s chief financial officer Artie Minson reportedly requested Charter make a higher bid that included more cash, but Charter refused.

Malone

Malone

The man pulling the levers behind Charter’s curtain is Dr. John Malone, former CEO of Tele-Communications, Inc., which was America’s largest cable operator in the late 1980s and 1990s. Malone’s Liberty Media is Charter Communications’ largest single investor. Malone has long argued for consolidation and cooperation in the cable industry to boost profits and control programming costs that drive up cable television bills.

Malone specializes in structured mergers and acquisitions that result in tax-free buyouts. Charter’s offer relies heavily on debt financing and would allow Charter to shield its ongoing net operating losses from taxes.

Malone indicated he is willing to play hardball to force a merger.

Malone told investors he expected Time Warner Cable to resist a takeover by Charter — America’s fourth largest cable company — so he is prepared to nominate Charter-friendly directors for Time Warner Cable’s board before nominations close Feb. 15. Time Warner Cable shareholders could force the merger by voting for Malone’s handpicked directors, who would promptly approve Charter’s takeover offer. But Time Warner executives will likely argue Charter’s offer is disadvantageous for TWC shareholders.

takeover“Since we made our first proposal, Time Warner Cable has lost another half million video customers,” Rutledge said. “Their customer service continues to decline in every measure. We can improve it. We have a demonstrated track record of improving customer service. It’s a question of credibility.”

Consumer Reports reports otherwise. Charter Communications has perennially been ranked America’s second worst Internet Service Provider cable operator in annual reader surveys. Only Mediacom is ranked lower among cable operators.

Now that Charter’s offer has gone public, investors suspect other cable operators may soon consider bidding for Time Warner Cable as well. Comcast is a likely bidder with an interest is taking control of Time Warner Cable’s systems in New York City and certain midwestern markets. Comcast would also like TWC’s regional sports channels serving southern California.

Customers will have no say in the matter, except through appeals to federal regulators which must approve any sale.

Unlike TWC, Charter Cable has usage limits on their broadband service.

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CNBC’s David Faber reports today’s offer from Charter Communications is not technically a “bid” for Time Warner Cable. Instead, it’s a public offer to hopefully force TWC executives to take Charter’s offer more seriously. (3:25)

80% of Qatar Has Fiber Optic Broadband; Fastest Nationwide Rollout of Fiber in the World

Phillip Dampier January 13, 2014 Broadband Speed, Consumer News, Public Policy & Gov't Comments Off on 80% of Qatar Has Fiber Optic Broadband; Fastest Nationwide Rollout of Fiber in the World
Ooredoo in Arabic means "I Want."

Ooredoo in Arabic means “I Want.”

More than 80 percent of homes in Qatar now receive fiber optic broadband at speeds up to 100Mbps and the country is on track to becoming one of the best-connected nations in the world.

According to the Fiber to the Home Council, Qatar is the world leader for fastest deployment of fiber-based Internet access, as the country moves away from copper-based ADSL broadband at record speed.

Ooredoo, formerly known as Qatar Telecom (Qtel), has been constructing the fiber network to help the country develop its knowledge-based economy and offer an infrastructure platform for high-tech business to launch new online products and services. The Emirate has the world’s fastest-growing economy, forecast to have grown by 6.5% in 2013. It also has the world’s highest GDP per capita at $106,000.

With that economic success, the government is accelerating its ambitious reform program designed to move Qatar away from dependence on its gas and oil economy into the digital age. In 2008, the government launched Qatar National Vision 2030, which includes major infrastructure projects including fiber broadband, new roads, railways, airports, bridges, hospitals, libraries and museums.

Fiber broadband is not cheap in Qatar, but neither is the cost of living there, something compensated for in the average Qatari salary. A 100Mbps account costs $178.50 a month, although adding television and telephone service only adds $13.75 a month to the bill.

NorthwesTel’s Usage Meter Runs Amuck; Company Says “Turn Off Your Computer At Night”

1638.OpenMedia-Internet-meterMore than two dozen NorthwesTel customers in Canada’s north are contemplating a class-action lawsuit against their Internet provider after being charged hundreds, if not thousands of dollars in overlimit charges for phantom traffic nobody can seem to identify.

Kyle Jennex of Whitehorse has always checked his usage, particularly because NorthwesTel charges very high prices for access and has a low usage cap. Running over a plan limit can prove costly at $5 per gigabyte. In November, Jennex discovered NorthwesTel’s usage meter was registering between 5-7GB of mysterious upload traffic every night even after the computer was physically disconnected from his Internet connection.

Despite complaining to NorthwesTel, the company billed him for nearly $1000 in overlimit fees, claiming he exceeded his allowance by nearly 200GB.

“I depend on the Internet for our lifestyle,” Jennex told Yukon News. “We like our music and our movies and our TV, so I download a lot of stuff. I also believe that if I’m paying for 150 gigabytes, I’m going to use that up. So because of that I monitor our usage carefully so I can spread it out throughout the month and to make sure we don’t go over.”

NorthwesTel has never suspected their meter of being responsible for the phantom usage measurements. To Curtis Shaw, NorthwesTel’s vice president of marketing, excess usage is entirely the customer’s responsibility. The company told Jennex his high usage was likely caused by torrent/peer-to-peer network traffic or a neighbor who had hacked into his password-protected Wi-Fi network. But neither explanation can account for usage that continued to rack up with nothing connected to his Internet modem.

Shaw recommends NorthwesTel customers shut down their computers when not in use, particularly overnight, to avoid excess charges. He also advises customers to change their passwords, regularly check usage, and install and update anti-virus software on their computers.

badbill

Bill Shock

Shaw also says users can sign up for e-mail that notifies customers when they approach their limit, “really to protect people from receiving a surprise bill.” He adds the company does monitor customer usage and has called customers in the past when their accounts show an unusual amount of activity.

But NorthwesTel didn’t bother to call a customer in Whitehorse who reports he was billed an extra $990 for the extra 198GB of usage he claims he never used. Nor did the company call the woman in the Northwest Territories bill shocked with $3,000 in overlimit fees in a single month.

The company says there have been repeated cases of neighbors “sharing” Wi-Fi connections which can quickly run up usage. But Jennex, who says he well understands the danger of unprotected Wi-Fi, believes he has taken the necessary precautions and has been overbilled anyway.

“The way they’re talking, it’s like every second neighbor is hacking into your wireless,” Jennex said. “I have passwords that are completely random that would take some pretty sophisticated equipment to hack into. We even tried disconnecting all our devices from the router and it still kept happening. The only way I could get them to stop was to physically unplug my modem.”

The company cannot or will not trace Jennex’s mysterious web traffic to identify the source, confident their meter is accurate. Besides, the company says, customers often underestimate the amount of traffic they consume using file sharing programs or watching video online. The company claims it worked hard on its usage meter and it received industry approval for its high degree of accuracy. But providers need not submit their meters for independent verification or subject them to periodic audits to verify meter accuracy.

NorthwesTel does not have a good record on meter accuracy. In 2010 the company was forced to admit it had overbilled hundreds of customers over a “meter glitch” when usage monitors were not reset. As a result, customers found enormous overlimit fees attached to their bills. In one example, a customer was charged a $2,500 overlimit fee on top of his usual bill of $88.

cctsA glitch may indeed be part of the problem as one Yukon customer successfully confronted NorthwesTel for erroneous overlimit fees for consumption of data that was impossible to accrue at the speed of his Internet connection.

Angry customers complain that with so little competition, NorthwesTel has every incentive to play fast and loose with its meter, either because customers will cut their usage, upgrade to a higher cost tier with a bigger allowance, or pay the overlimit fees.

Customers who believe they were unjustly billed overlimit fees should take their case first to the Office of the President. Failing that, they should appeal to the Commissioner for Complaints for Telecommunications Services, an independent agency that has a good track record of winning relief.

Some customers fear the expensive overlimit fees so much, they are following NorthwesTel’s advice and keeping their computers switched off when not being used, but that isn’t a good enough answer for Jennex, who plans to continue the fight.

“There’s no need to rip us off because we live so far North,” he told CBC North.

Maine: Your Broadband Speeds and Availability Suck – 49th Out of 50 States

Maine's broadband speeds are among the worst in the country. (Graphic: Portland Press Herald)

Maine’s broadband speeds are among the worst in the country. (Graphic: Portland Press Herald)

If talking about broadband was the same as getting broadband, Maine would be saturated with High Speed Internet service. Despite years of blue ribbon task forces, studies, grants, and lawsuits, the state of broadband in Maine has never been worse, ranked 49th among 50 states for quality of service and availability. The only state below Maine is Montana.

Maine’s woeful broadband is the result of passive providers including Time Warner Cable and FairPoint Communications that find little incentive to expand service into Maine’s considerable rural back country. Even if they did offer service, Maine’s aging population hasn’t shown much enthusiasm for spending hours online, assuming they understood how to navigate the Internet in the first place.

So how do you convince Maine’s broadband providers to deliver more and better service? Throw money at them in the form of tax breaks and subsidies, suggests David Maxwell, program director of the ConnectME Authority. He believes that if providers are incentivized to wire the unwired by agreeing to cover some of the costs, they will do it.

But as the Portland Press Herald reports, eight rounds of ConnectME grant funding to providers that averaged $1 million each has not made much of an improvement in the state’s broadband standing.

Maine residents in cities and large towns can usually find broadband service from either Time Warner Cable or FairPoint Communications, which purchased the deteriorating copper wire network abandoned by Verizon Communications as it exited the landline business in northern New England. Cable broadband customers can buy speeds up to 50Mbps, but Time Warner’s presence in Maine is not widespread. The majority of customers still buy access from FairPoint, and DSL speeds in Maine are slow.

Gizmodo reports the majority of Maine counties serviced by FairPoint currently receive a maximum speed of 7.3-10.9Mbps, primarily over DSL. That is 40-60 percent slower than the national average. In nearby Boston, speeds average 21.8-25.5Mbps.

FairPoint has been reticent about upgrading its landline infrastructure, particularly in rural counties. Maxwell told the newspaper FairPoint and other providers can’t justify an investment in broadband with no possibility of a quick return. But the phone company has also been accused of reneging on commitments already made to improve Internet access.

The Maine Public Advocate’s Office sued FairPoint to speed up and broaden its efforts to expand broadband to at least 87 percent of customers no later than April.

Wayne Jortner, senior counsel, told the Portland newspaper FairPoint vigorously defended against the lawsuit, but ultimately lost.

“In fact, the litigation did cause us to go all the way to the Maine Supreme Court, and we won there again,” Jortner said. “Now they’re on track to pretty much do what they said they would do.”

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