Phillip "No Data Tsunami Over Here" Dampier

As the Canadian Radio-television and Telecommunications Commission enters into the second week of hearings on Internet Overcharging, there have really only been a few minor surprises.

First, and most importantly, when voting consumers pay attention, regulators start asking questions and get aggressive.  This is the same commission that only a year ago gave the green light to wholesale usage-based billing (UBB) — a practice that would guarantee every ISP in Canada dropped flat rate Internet service.  After a half-million Canadians signed Openmedia.ca’s petition opposing UBB, the Harper government (and the opposition parties) got interested, and the Commission got an earful from Industry Minister Tony Clement, who was simply appalled at this kind of Internet pricing.

Second, this round of CRTC hearings has found Bell — UBB’s biggest proponent — largely unrepentant.  It still supports charging people for their usage, even as the company’s foundation for that premise — bandwidth congestion — erodes away.  Providers can claim anything they like, but they cannot invent facts.  By Friday, most of the commissioners realized what consumer advocates had been saying all along — there is no great bandwidth crisis in Canada.  No data tsunami. No exaflood in the zettabyte era.  Growth is exponential to be sure, and Canadians have a passionate affair with their Internet connectivity, but one that remains easily managed when providers make regular, affordable investments in upgrading their networks.

Bell’s week-long contention that congestion pricing was paramount to managing Canada’s bandwidth finally fell apart when CRTC Chair Konrad von Finckenstein noted Bell’s trinity of regional entities managed Internet usage completely differently, even though the traffic passed through the exact same network:

• 1) Bell Aliant, which provides service in the Atlantic provinces, has no usage caps at all.
• 2) Bell Quebec provides service with a considerably more generous usage allowance than given to those customers in Ontario, even those just on the other side of the border.
• 3) Bell Ontario’s usage cap is downright stingy compared with Quebec, most likely because it competes in Ontario with an equally stingy provider — Rogers Cable.

With these facts in evidence, Bell was finally forced to concede it was “competition” not “congestion” that brought three different treatments of Internet usage.  So much for “network congestion.”

Bell’s competitors also hung the telecom giant out to dry when it was their turn to testify.  Each in turn would claim that congestion presented no problems for their respective networks.  Telus, Rogers and Shaw all denied they shared Bell’s usage problems.  That is not to say any of them were in favor of restoring flat-rate Internet access.

Instead, they argued, UBB represented a combination of “stimulating investment” in broadband networks (already insanely profitable for all-comers) and “peak usage pricing,” a hybridized argument about congestion during peak usage periods.  Since some wholesale broadband services are priced at peak capacity requirements, some argue UBB helps keep that peak usage manageable during prime time.

Unfortunately, the peak usage pricing argument undermines itself because Canadian providers enforce usage limits 24/7, not only during peak usage periods.  This means there is no incentive for users to offload their heaviest usage to times when the network experiences low demand.  Independent providers continue to argue “peak usage pricing” may be defensible in certain circumstances, but it’s not even a possibility under Bell’s proposed wholesale UBB scheme.

The record being constructed from Canada’s hearings have direct implications for Americans, as the basic business models for cable and phone providers are similar in both countries.  The death rattle of the “congestion” myth is good news for North American broadband users who have long rolled their eyes at hysterical arguments about data floods and capacity crises.

The CRTC still needs to hear from some additional speakers, and we are under no illusion they will completely reverse themselves on Internet Overcharging schemes, but this represents a clear-cut case that consumers need not simply sit back and take abusive pricing.  Consumer activism can make a real difference in the broadband policies of both the United States and Canada.  It takes a concerted effort, but once a critical mass of consumers is achieved, the ability for providers to simply do as they please becomes a virtual impossibility.

That’s good news for all of us.

[flv width=”640″ height=”368″]http://www.phillipdampier.com/video/CBC UBB 7-11-11.flv[/flv]

CBC News covers the start of the CRTC hearings and what UBB pricing is doing to Canada’s Internet experience.  (2 minutes)

Martin

While thousands of West Virginians continue to struggle without any broadband service, the state government is having trouble finding a way to spend up to $40 million in broadband stimulus money on institutional broadband projects that often already have cutting edge fiber networks.

State officials won $126 million in federal stimulus grant money last year, from which the state announced it would lay more than 2,400 miles of fiber optic cable to wire government offices, schools, and libraries.  Now, a vocal critic says a combination of government waste, preferential treatment for the state’s largest phone company — Frontier Communications, and bad planning could leave up to $40 million of the grant money on the table, unspent for better broadband.

Jim Martin, president of business broadband provider Citynet, says the state overestimated the number of public facilities that need broadband improvements.  Many of the facilities involved already have high speed service, and do not require additional infrastructure.  As the grant expires, Martin says he would not be surprised if the state only managed to fund the installation of 300 miles of fiber.

Martin believes funds should be redirected to bolstering the state’s “middle mile” network — fiber infrastructure that would serve as an open network backbone to ensure capacity exists to support growing broadband demands in the state.  Instead, Martin told the Charleston Gazette, the state has been spending money providing fiber broadband to small libraries with fewer than a dozen computers that are unlikely to have the resources to pay the monthly fees Frontier Communications will charge for the service.

“There’s no value to any of this to anyone but Frontier,” Martin said.

In fact, Martin believes many of the current projects funded by taxpayer dollars deliver enormous benefits to Frontier’s bottom line, but only incremental improvement to some institutional users.

Martin claims Frontier has, in some cases, only spent enough money to install fiber from the pole to the building. That assures Frontier of being the only provider that can deliver ongoing service to institutional users.  Martin has a dog in this fight — his company competes with Frontier for business service contracts.

West Virginia's current broadband map shows large areas of the state have access to no broadband at all. (Olive color = No broadband.) (Click to enlarge)

Before the grant expires in February 2013, the state is hurrying to bolster its list of would-be recipients.

Jimmy Gianato, the state’s homeland security chief, said his office recently identified 330 additional “replacement locations” — higher education facilities, schools, health departments and state-owned hospitals — that could be eligible for the project, according to the newspaper.

Not on the list are individual consumers and small businesses who currently do not have access to any broadband service.  One of the ongoing problems of broadband stimulus funding is that public funds are often available to bolster broadband for state and locally-owned institutions, such as government offices, health care facilities, schools and libraries, but no funding to improve infrastructure for individual broadband service for “last mile” users.  This can result in Cadillac-style installations for small schools and libraries who win superb quality networks they ultimately cannot afford to operate on an ongoing basis.  For most, that service would come from Frontier Communications.

Martin already accused the state of investing in more than 1,000 routers without being certain if they were needed or where they would be installed.  At $20,000 each, Martin called the routers “Lamborghinis” and suggested they were largely unnecessary.

Wayne King: Living high off Time Warner Cable's Hog

The vice-chairman of North Carolina’s Republican Party, Wayne King, Tuesday penned a guest editorial in the Fayetteville Observer telling readers recent legislation passed in the state legislature provides a level playing field for telecommunications companies and protects “scarce public dollars” from being spent to compete against private providers like Time Warner Cable.

This legislation will also greatly benefit North Carolina taxpayers. At a time when local governments are cutting education and law-enforcement funding, taxpayers simply do not need to be spending scarce public dollars on communications systems that directly compete with the private sector. It makes no fiscal sense to build public infrastructure right alongside lines that have already been built by private firms.

Let’s imagine the government wanted to get into some other generally private industry. Would taxpayers be willing to foot the bill for a publicly subsidized cafeteria right next to a favorite local restaurant? Keeping in mind that you’d have to pay for services at both facilities (public communications networks still charge subscribers), I think the answer would be no.

Too bad Mr. King prefers to dine at Time Warner Cable Café.  He’s evidently having trouble seeing over the cable company’s talking points-menu to recognize that while he rails against public broadband expansion and community-owned competition to providers like AT&T, CenturyLink, and Time Warner Cable, he completely forgot the state of North Carolina and the city of Charlotte are handing Time Warner $5 million in combined, “scare public dollars” to create just over 200 new jobs and promise not to lay anyone off in the city of Charlotte.  That’s $5 million this year, and doesn’t count the sums the cable company has won from taxpayers over the past several years.

Mr. King has absolutely nothing to say about that kind of corporate welfare — the kind that takes $5 million away from education and law enforcement and hands it to a provider that will be raising its prices on North Carolina consumers once again by the end of this year.  And why not?  Where will those consumers go for a better deal?  FCC commissioner Mignon Clyburn called out the legislation for what it is: “a broadband barrier.”

While Mr. King remains firmly seated at Time Warner Cable’s table as it funnels money to his party’s legislators, it’s easy to stare out of their window and complain about a new café being built across the street.  If that happens, diners just might end up paying a lot less for their meal, and get a much better dining experience to boot.

The only folks with indigestion will be executives at the cable and phone companies, and people like Mr. King, who will probably have less campaign money to show for it.

Andre Vrignaud of Seattle has been benched for a year by Comcast for using too much of its Internet service.

From time to time, we get reports from Comcast customers victimized by the company’s 250GB usage cap.  The nation’s largest cable broadband provider implemented that arbitrary limit back in 2008 after the Federal Communications Commission told the company they could not throttle the speeds of customers using applications like peer-to-peer file sharing software — then pegged as the usual suspect for turning “ordinary” broadband users into “data hogs.”

For at least 18 months, Comcast’s usage cap came with no measurement tools or real explanation most customers could find about what a “gigabyte” was, much less how many of them they “used” that month.  Only last year, Comcast finally rolled out usage measurement tools for customers who bother to find them on their website.  New customers signing up for service never even realize there is a usage cap until a thick brochure of legalize comes with the installer outlining the company’s Acceptable Use Policy.

Still, compared to some of the usage cap battles Stop the Cap! was fighting three years ago, Comcast was the least of our problems.  Frontier’s infamous 5GB usage allowance was the worst we’d ever seen, Cable One’s IRS-like usage policies required an academic to explain them, and Time Warner Cable’s ‘lil experiment in broadband rationing with a 40GB usage cap experiment crashed and burned soon after being announced in the lucky test cities scheduled to endure it.  That doesn’t make Comcast’s cap fair or right, but protecting consumers from these schemes requires triage.

But we remember well Comcast’s promise that it would regularly revisit and adjust its usage cap to reflect the dynamic usage of its customers.  That’s just one more broken promise from a broadband provider with an Internet Overcharging scheme.  In fact, Comcast has not moved its cap one inch since the day it was announced, although they have increased their rates.  The only thing going for the cable giant is that it doesn’t treat “250GB” as a guillotine.  In fact, the cable company only sends the usage police after the top few percent of users that exceed it, issuing a warning not to exceed the cap again during the next six months, or face a year without having the service.

This punitive policy is what Time Warner Cable CEO Glenn Britt loves to rail against.  For him, broadband usage should never be penalized — it should be exploited for all the money the provider can possibly get from customers.  That’s why Britt favors a consumption billing system that starts off with a high monthly price for everyone, than goes much higher the more you use.  Would the neighborhood crack dealer cut you off for using too much?  Of course not.  Feeding your broadband usage habits can mean fat profits, and investors love it.

Andre Vrignaud, a 39-year-old gaming consultant in Seattle, wrote us (and many others) about his own experience with Comcast’s usage ban.  He’s a victim of it, having been warned once about usage and then ultimately told his cable modem was disabled for a year.  For Vrignaud, it was a case of using a cloud storage file backup provider, moving very high resolution images around, and having roommates.  Since Comcast counts upload and download traffic towards its usage limit, it’s not hard to see what can happen to anyone trying to back up today’s supersized hard drives.  What’s especially ironic is that Comcast itself sells online file backup services — which also counts towards your cap.

Comcast’s attitude about its decision to ban Vrignaud from its broadband service for a year was simple enough: it’s a clear cut case of violating their usage caps.  In their view, heavy users slow down broadband service for everyone else in the neighborhood.  So they set a policy that cuts them off when they use too much.

To add insult to injury, broadband-disabled Comcast customers have to call Comcast’s Retentions & Cancellations Department to get the billing stopped on his disabled service.  Vrignaud had to negotiate with a representative whose instinct is to keep you a Comcast customer at all costs, even when the company won’t allow you to be one!

But is Comcast really facing a congestion issue?  Not if you happen to be a business customer at the same address, using the exact same infrastructure that residential customers in the neighborhood use.  Business Class service has no usage limits at all — “congested neighborhood” or not.  And that is where Comcast’s argument simply starts to fall apart.

We’ve been in touch with Vrignaud privately in an effort to help him find a way back to his broadband service.  The alternative is DSL from Qwest/CenturyLink, and unless you live in an area where the phone company has upgraded their networks to support ADSL 2+ or other advanced flavors of DSL, that represents quite a speed downgrade.

Our readers have told us Comcast representatives have several unofficial ways of dealing with heavy users who have gotten their first warning from the company.  Some have told customers to sign up for a second residential account under the name of someone else in the home to allot themselves an additional 250GB of usage.  Others recommend signing up for a business account, which means no usage cap at all.  For those who have been cut off, signing up as a new customer under the name of someone else in the household usually gets you back in the door, albeit facing the same usage cap issue all over again.

The problem Vrignaud encountered is Comcast’s clumsy way of dealing with customers, like himself, who have been sentenced to a year without broadband service (from them).

Vrignaud explored the route we recommended — Business Class service — and found he couldn’t sign up.  Evidently Comcast’s ban is tied to his personal Social Security number, and when he tried to enroll in Business Class service using it, he was stopped dead in his tracks.

Turns out that once Comcast has cut your broadband account for violating their data cap policy you are verboten from being a Comcast customer for 1 year. That’s right:

After being cut off from Comcast’s consumer internet plan due to using too much data, I’m told I’m ineligible to use Comcast’s recommended solution, their business internet plan that allows the unlimited use of data — solely because I made the mistake of actually using “too much” data in the first place.

As the sales rep said in my Google Voicemail message, “what’s interesting is that if you would have started off on the business side of the house, since we don’t have a cap limitations [sic] you would’ve been fine.”

Vrignaud also mentioned he was unsure if Comcast required a business Taxpayer Identification Number (TIN) in order to sign up for Business Class service.  In fact, for our readers who have gone this route, it turned out not to be necessary.  They just put their Social Security number in the space reserved for a TIN and had no problems.  Vrignaud would have a problem, however, because his Social Security number is effectively “poisoned” for the year.  He would need to obtain a specific kind of TIN — an Employer Identification Number (EIN) to proceed.  Luckily, it takes less than five minutes to apply for one online and is free.  The number displayed at the end of the process would be the one to use with Comcast.  An alternative suggestion would be to sign up for service under the name of someone else in the household.

For those on Comcast’s bad side, there is more hoop-jumping to get your service back than at the Ringling Bros. circus.

Should all this even be necessary?

Broadband service carries up to a 90% profit margin.

Stop the Cap! thinks not.  While Comcast may have endured last-mile congestion on its shared cable broadband network in days past, the company’s aggressive upgrades to DOCSIS 3 technology makes congestion-based usage limits more of an excuse than a reality.  Comcast is pitching faster broadband speeds than ever, all hampered by the same 250GB usage limit.  While residential and business class customers share the same physical cable lines strung across neighborhoods, one faces a usage cap and the other does not.  It’s simply not credible.  Comcast’s punitive usage cap scheme throws away their own customers and the revenue they bring.

Vrignaud wants the option of getting his service back, perhaps by buying additional usage.  That’s Time Warner Cable’s dream-come-true, and one we are concerned about.  Once broadband usage is limited and monetized, it becomes a commodity that can be priced to earn enormous additional revenue for cable operators, regardless of the actual cost of providing the service.  That’s a dangerous precedent in today’s duopolistic broadband marketplace, because the cost per gigabyte will likely be on the order of a thousand times or more the actual cost, with no competitive pressure to keep that cost down.  That’s how Canada ended up in its Internet Overcharging pickle, where providers call $1.50-$5 per gigabyte “reasonable,” even though it costs them only pennies (and dropping) to deliver.  Some providers are even raising those prices, even as their costs plummet.  That’s not a road we want the cable or telephone industry walking down, or else we’ll find today’s enormous cable TV bills pale in comparison to the outrageous broadband service bills of the future.  Time Warner Cable provided a helpful preview in 2009 when they proposed unlimited 15/1Mbps residential service at the low, low price of $150 a month.

Vrignaud is just one more example of why Internet Overcharging risks America’s broadband future.  It’s an end run around Net Neutrality, its arbitrary, and unjustified.  The rest of the world is racing to discard what they called congestion pricing almost as fast as America’s providers (and their Wall Street cheerleaders) are racing towards Internet Overcharging.  The United States should be following Canada’s lead and hold providers to account for this kind of Internet pricing and force them to prove its warranted, or be rid of it.  With virtually every provider earning enormous profits off Internet service at today’s speed-based pricing, there remains no justification to overcharge customers for their broadband usage.

In the wake of a scandal that forced the resignation of the president and a board member of one of America’s largest gay civil rights organizations, The Gay and Lesbian Alliance Against Defamation (GLAAD) has withdrawn its prior support for the merger of AT&T and T-Mobile and reaffirmed its support of strong Net Neutrality policies.

In a letter filed with the Federal Communications Commission earlier today, GLAAD did an about-face on its earlier support for the merger, telling the federal agency it now has a “neutral position” with respect to the deal.

Mike Thompson, GLAAD acting president, used the communication to also express the group’s strong support of Net Neutrality, which guarantees a free and open Internet.

“A rigorous review process considered GLAAD’s unique mission and concluded that while AT&T has a strong record of support for the LGBT community, the explanation used to support this particular merger was not sufficiently consistent with GLAAD’s work to advocate for positive and culture-changing LGBT stories and images in the media,” Thompson said in a statement.

Thompson’s belief that AT&T has a strong record of support for gay and lesbian issues remains controversial in many segments of the gay community. John Aravosis of Americablog would take issue with Thompson, accusing AT&T of “screwing” the gay community in the state of Tennessee:

AT&T was one of the companies whose local representatives sits on the board of directors of the Tennessee chamber of commerce.  You remember them, the group that endorsed and actively lobbied for the measure repealing gay and trans rights ordinances in the state, mandating it so that no trans person can ever change their birth certificate gender in the future, and banning any future civil rights ordinances for anyone in the future.  That AT&T.  The AT&T that weighed in early with a statement, when we asked the 13 companies to disavow the legislation and call on the governor to veto, but then whose statement pretty much didn’t say anything.  The AT&T then that emailed me multiple additional statements AFTER the governor signed the hateful bill into law.

Aravosis

GLAAD has taken its first steps to move as far away from dollar-a-holler advocacy as possible as a result of the hostile reception GLAAD’s original position got from rank and file members of the civil rights group.  After AT&T’s financial contributions to the group were exposed, along with the interests of one of their board members with direct ties to the telecommunications company, GLAAD accepted the resignation of group president Jarrett Barrios and board member Troup Coronado.

Remaining board members want the controversy to be over and done with.

“I am confident that Mike made the right decision both in withdrawing GLAAD’s endorsement of the AT&T merger application and in affirming our support of general net neutrality principles,” said GLAAD board member Tony Varona.

Politico obtained a statement in response to these events from AT&T:

“As we’ve previously said, we recognize, and fully respect that these organizations, which do important work, will make up their own minds about whether to support the merger or remain neutral. And, though it should go without saying, the decisions made by these organizations will not in any way impact our desire to work with, partner with or support those organizations in the future.”