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Frontier CEO Tells Customers To Stay Home This Summer (But Stay Offline)

Phillip Dampier August 4, 2008 Data Caps, Frontier Comments Off on Frontier CEO Tells Customers To Stay Home This Summer (But Stay Offline)
Gas prices are high so stay home, but with our all-new 5GB monthly usage cap, stay offline too!
Gas prices are high so stay home, but with our all-new 5GB monthly usage cap, stay offline too!

Too bad western New York seems to have one rainy day after another this summer.   Maggie Wilderotter, Chairman and CEO of Frontier Communications, wants to share your grief over high gas prices with some great summer fun alternatives in this newsletter enclosed with monthly telephone bills.

Of course, going online with Frontier DSL can only be one of them for the next few days, because after that, you will have hit your all-new 5GB monthly usage cap, so hope the remainder of August is rain-free so you can go and do something else.

Frontier: Now With Prices Up To $10.80 Per Gigabyte, Limit Five GB

Phillip Dampier August 4, 2008 Competition, Data Caps, Frontier 13 Comments
Your Money = Their Money

Your Money = Their Money

With the imposition of a 5GB monthly cap across their nationwide service area, consumers might find it useful to break down the cost of what different broadband services charge for service per gigabyte, and what kinds of profits companies can expect to receive from those charges.   The average cost of traffic for most national broadband providers amounts to pennies per gigabyte transferred.   But what will you pay?

Frontier offers different pricing across several promotions, ranging from $19.99-$49.99.   The lower priced tiers correspond with service contracts that require multi-year commitments, with a substantial penalty for early cancellation.   They also charge a monthly modem rental fee (MRF) of $3.99.   In some areas this fee is levied even if you wish to use your own DSL modem.   Since this fee is universally imposed in many areas, its cost has been included in the price breakdown.   Excluded from the review are additional taxes, surcharges, and fees which are imposed by various taxing authorities but are outside of Frontier’s control.

Frontier High Speed Internet Cost Review
(per  GB downloaded,  5GB per month)

Your Monthly Price      Per GB     Frontier Pays Per GB
$49.99 + $3.99 MRF      $10.80            less than 10c
$39.99 + $3.99 MRF      $ 8.80            less than 10c
$29.99 + $3.99 MRF      $ 6.00            less than 10c
$19.99 + $3.99 MRF      $ 4.00            less than 10c

The cost for watching an average 4GB high definition DVD quality movie over Frontier DSL is $43.20.   One DVD will be all you get, because any more than that puts you over the limit.  With a growing number of Americans using the Internet to access multimedia content online, exceeding 5GB of usage per month is easier than ever.

Stop the Cap! challenges Frontier to make public their own study which sources have told us show up to 40% of their existing customers already exceed 20GB of usage per month using Frontier DSL.   How does the company justify calling nearly half of their loyal customers bandwidth piggies and abusers?

Since low usage customers represent enormous profits for broadband providers, as the above chart illustrates, kneecapping the average user and beheading the high bandwidth customer with a draconian limit on monthly usage allows Frontier to vastly expand profits.   As their own financial reports to shareholders illustrate, Frontier’s investment in their network does not come close to corresponding with the massive profit taking a 5GB usage cap allows.

Cherry pick the weekend e-mailer and occasional web browser, throw everyone else under the nearest bus, and  high five one another all the way to the bank.   That’s the Frontier way.

NBC Olympics: On the Go… Somewhere Else

Phillip Dampier August 3, 2008 Broadband "Shortage", Data Caps, Online Video 1 Comment
Viewers may have to stick with TV to watch the Olympics for free.

Viewers may have to stick with TV to watch the Olympics for free.

While the rest of the wired world gets ready to sit back and enjoy Olympics coverage from China, Americans are being told you can have the Olympics online, but you better not have metered broadband access.

When NBC partnered with TVTonic to provide NBC Olympics On The Go,  it had to specifically warn viewers with metered broadband access not to bother.   Streaming high quality video feeds can consume a significant amount of bandwidth, and can easily allow unassuming viewers to win the the gold in the Biggest Bandwidth Overlimit Fee competition.

TVTonic's warning to broadband users to not use the service if they are using a broadband provider with usage caps.

TVTonic's warning to broadband users to not use the service if they are using a broadband provider with usage caps.

Content providers are starting to wake up to the real threat of the imposition of usage caps across the United States, limiting cable and DSL broadband customers from accessing content that was developed specifically for the broadband platform.

TVTonic is just one of several online services that could effectively be shut out of doing business in the United States because of broadband usage caps.   The company provides access to over 100 broadband Internet TV feeds, many transmitted in “high definition” quality, all of which would bring viewers ever closer to hitting their monthly limit.

Other providers such as Hulu and Joost provide legal access to hundreds of TV series, movies and specials at no charge to viewers.   But with bandwidth usage caps, will you be willing to spend your limited bandwidth watching?

Suspiciously, the “bandwidth crisis” that the industry continues to blame for the imposition of unreasonable usage caps stops at the water’s edge.   Customers in Japan and Korea enjoy broadband connections often a hundred times faster than what is available in the United States, at much lower prices and no restrictive caps.   In fact, outside of North America, nobody has heard of a bandwidth crisis.

While many broadband providers continue to reap handsome profits from their broadband services, demands for higher shareholder returns and struggling quarterly results from their other product lines in a stagnant economy have led many to decide investing in a lobbying scare campaign is a better use of their money.   It’s easier to try and convince Americans they are the problem, and limit service accordingly.

FCC Commissioner Regurgitates Industry Talking Points On Demand

Phillip Dampier August 2, 2008 Broadband "Shortage", Data Caps, Online Video, Public Policy & Gov't Comments Off on FCC Commissioner Regurgitates Industry Talking Points On Demand

It’s good to know that I can order up video on demand from the comfort of my own living room (transmitted over the woefully over-congested cable system’s network if you believe them).   It’s not comforting to watch  FCC Commissioner Robert M. McDowell parrot the broadband industry’s propaganda talking points on demand, and in a voluntary guest column in Monday’s Washington Post yet:

Robert F. McDowell, FCC Commissioner

Robert M. McDowell, FCC Commissioner

Today, a new challenge is upon us. Pipes are filling rapidly with “peer-to-peer” (“P2P”) file-sharing applications that crowd out other content and slow speeds for millions. Just as Napster  produced an explosion of shared (largely pirated) music files in 1999, today’s P2P applications allow consumers to share movies. P2P providers store movies on users’ home and office computers to avoid building huge “server farms” of giant computers for this bandwidth-intensive data. When consumers download these videos, they call on thousands of computers across the Web to upload each of their small pieces. As a result, some consumers’ “last-mile” connections, especially connections over cable and wireless networks, get clogged. These electronic traffic jams slow the Internet for most consumers, a majority of whom do not use P2P software to watch videos or surf the Web.

At peak times, 5 percent of Internet consumers are using 90 percent of the available bandwidth because of the P2P explosion. This flood of data has created a tyranny by a minority. Slower speeds degrade the quality of the service that consumers have paid for and ultimately diminish America’s competitiveness globally.

While we at the Federal Communications Commission are trying to spur more competitive build-out of vital “last mile” facilities, especially fiber and wireless platforms, this congestion will not be resolved merely by building fatter and faster pipes.

Peer-to-peer traffic has been an issue for the Internet long before the industry decided to call it a “bandwidth crisis.”   And despite McDowell’s pleas for “cooperation,” putting engineers to work  solving these problems instead of  regulation,  the broadband industry that appears before him with regularity has decided that cooperation really means a coordinated public relations campaign, with  the delivery of identical talking points about a bandwidth crisis, a sky is falling plea to Washington to use taxpayer funds to improve the infrastructure formerly developed with private funds, and the imposition of egregious usage caps no matter what else happens to control the bandwidth piggies.

Judicial action by the entertainment industry trade associations have actually reduced a lot of the illegal file trading and peer-to-peer usage.   And just as the company behind BitTorrent launches a whole menu of new, completely legal services, the cable and DSL providers come by and lay waste to such services, as consumers become reluctant to waste their bandwidth allotment on perfectly legitimate content.

Bandwidth saturation is not a problem only seen by the bandwidth providers.   Software developers, professional and otherwise, are constantly refining their applications and protocols to reduce the effects of bandwidth saturation, when your Internet connection effectively freezes up.   More importantly, the boneheads in the entertainment industry have finally realized that the best way to stop illegal distribution of your content is to offer that content yourself, legally with advertiser support.   New services like Hulu and Joost give people exactly what they want – TV shows with limited and tolerable commercial interruptions without the need to fire up Pirate Bay and their favorite torrent application.   It’s also cheaper than suing the very people consuming your content!   That McDowell misses the forest for the trees is not a surprise – he was an early advocate and supporter of Digital Rights Management (DRM), a concept so despised by consumers, its days are numbered on most of the services that embraced it.

McDowell repeats the commonly heard “5%” refrain usually seen near  the top of the industry press releases on the impending “bandwidth crisis.”   But the rest of us are still waiting for independent verification of this claim, and an explanation as to whether or not this traffic is legitimate access to the “unlimited” service every provider has advertised to consumers, or some form of “abuse” already dealt with in existing acceptable use policies, which can be quietly enforced without hiring bandwidth management consultant Count Dracula to suck the life force out of the Internet for everyone else with usage caps.

I’m also hard-pressed to understand exactly how that 5% of traffic poses a major threat to  America’s competitiveness globally, while a 5GB usage cap applied to 100% of one’s customers is shrugged off, if even acknowledged.   One need only ask the  CEO of Netflix: Is the erection of a Berlin Wall of usage caps a positive development for your business plan to deliver legal, high quality video content to subscriber televisions over broadband?

In McDowell’s world view, those consuming large amounts of bandwidth on perfectly legal products will shamefully achieve membership in the “Tyranny of the 5% Club,” abusing the rights of Bob down the street who has a computer to check his Yahoo! e-mail and little else, but now he has to wait because you insisted on watching Harry Potter.   Shame on you.   It’s all your fault.

Is McDowell unaware his doctrine of “cooperation” and “putting engineers on it” already has a solution to the “last mile congestion” problem, itself a logical lapse in the argument arsenal this industry uses to hoodwink us into believing the Internet is on the verge of crashing and burning.

DOCSIS 3.0, an improvement over existing data delivery technology still in place at most cable companies, can  go a long way towards  resolving any neighborhood congestion issues  with  channel bonding, which allows multiple channels to be devoted to upstream and downstream data.   If Time Warner or Comcast doesn’t want to implement the new standard, that’s hardly the fault of the Harry Potter fan down the street.

At the same time they decry the collapse of online modern civilization, somehow these same companies   find plenty of bandwidth to roll out more  video channels you never asked for (but will be used as an excuse for next year’s rate hike),  dozens of video on demand options, Voice Over IP telephone service,  and the increasing number of digital HD channels and switched digital video, which transmits a TV channel to your neighborhood only when someone  chooses to watch.   Data is data.   If there is a bandwidth crisis for cable modems, where is the plea to stop  using too much television,  stop ordering too much pay per view, and get off the phone because we’re out of bandwidth.   I haven’t heard those panic buttons pushed, have you?

If the FCC wants to help spur America’s leadership role in the new Internet economy, it can begin by recognizing America is falling further and further behind other nations, because corporate greed is devolving Internet access domestically into a highly expensive, relatively slow, and usage capped nightmare.   While American website operators will be redeveloping content to get rid of graphics or anything else that might eat too much data, the rest of the world moves forward with innovative broadband applications and content, all made available only to the wealthiest Americans who can afford the price.    For the rest of us, time to get reacquainted with Gopher.

Read Your E-Mail At Blazing Speed; Because We’re No Good For Anything Else!

Phillip Dampier August 1, 2008 Broadband Speed, Data Caps, Frontier 2 Comments

Robb from Hillsboro, Oregon graciously gave permission to share his own research on what a 5GB cap means in the real world.   Some upset about the usage cap announced by Frontier have suggested that’s almost as bad as going back to dial-up.   But as Robb discovered, you would be better off with 56k dialup! That’s because an unlimited Frontier dial-up account can deliver more to you in a month than a crippled DSL account with a 5GB usage cap on it.

See the numbers for yourself:

Courtesy: Robb (a/k/a 'funchords'), Hillsboro, Oregon

Courtesy: Robb (a/k/a 'funchords'), Hillsboro, Oregon

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