More drive-by reporting on Comcast’s usage caps.

When the media covers Internet Overcharging schemes like usage caps and consumption billing, it is often much easier to take the provider’s word for it instead of actually investigating whether subscribers actually need their Internet usage limited.

Comcast’s planned reintroduction of its usage caps on South Carolina customers begins Friday. Instead of the now-retired 250GB limit, Comcast is graciously throwing another 50GB of usage allowance to customers, five years after defining 250GB as more than generous.

The Post & Courier never bothered to investigate if Comcast’s new 300GB usage cap was warranted or if Charleston-area customers wanted it. It was so much easier to just print Comcast’s point of view and throw in a quote or two from an industry analyst.

In fact, the reporter even tried to suggest the Internet Overcharging scheme was an improvement for customers.

The newspaper reported Comcast was the first large Internet provider in the region to allow customers to pay even more for broadband service by extending their allowance in 50GB increments at $10 a pop. (Actually, AT&T beat Comcast to the bank on that idea, but has avoided dropping that hammer on customers who already have to be persuaded to switch to AT&T U-verse broadband that tops out at around 24Mbps for most customers.)

Since 2008, the company’s monthly limit has been capped at 250 GB per household. When customers exceeded that threshold, Comcast didn’t have a firm mechanism for bringing them back in line, other than to issue warnings or threaten to cut off service.

“People didn’t like that static cap. They felt that if they wanted to extend their usage, then they should be allowed to do that,” said Charlie Douglas, a senior director with Comcast.

Charleston is the latest in a series of trial markets the cable giant has used to test the new Internet usage policy in the past year. As with any test period, the company can modify or discontinue the plan at any time.

During the trial period in Charleston, customers will get an extra 50 GB of monthly data than they’re used to having. If they exceed 300 GB, they can pay for more.

“300 GB is well beyond what any typical household is ever going to consume in a month,” Douglas said. “In all of the other trial markets with this (limit), it really doesn’t impact the overwhelming super-majority of customers.”

The average Internet user with Comcast service uses about 16 to 18 GB of data per month, Douglas said.

Customers who use less than five GB per month will start seeing a $5 discount on their bills.

“We think this approach is fair because we’re giving consumers who want to use more data a way to do so, and for consumers who use less, they can pay less,” Douglas said.

Data caps are designed to stop content piracy?

The Charleston reporter asserts, without any evidence, “data-capping is a trend many Internet service providers are expected to follow in the next few years as the industry aims to reduce network congestion and to find safeguards against online piracy.”

Suggesting data caps are about piracy immediately rings alarm bells. Comcast and other Internet Service Providers fought long and hard against being held accountable for their customers’ actions. The industry wants nothing to do with monitoring online activities lest the government hold them accountable for not actively stopping criminal activity.

“It’s not about piracy, per se,” said Douglas. “We don’t look at what people are doing. The purpose is really a matter of fairness. If people are using a disproportionate amount of data, then they should pay more.”

Comcast’s concern for fairness and disproportionate behavior does not extend to the rapacious pricing and enormous profit it earns selling broadband, flat rate or not.

MIT Technology Review’s David Talbot found “Time Warner Cable and Comcast are already making a 97 percent margin on their ‘almost comically profitable’ Internet services.” That figure was repeated by Craig Moffett, one of the most enthusiastic, well-respected cable industry analysts. That percentage refers to “gross margin,” which is effectively gravy on largely paid off cable plant/infrastructure that last saw a major wholesale upgrade in the 1990s to accommodate the advent of digital cable television and the 500-channel universe. Broadband was introduced in the late 1990s as a cheap-to-deploy but highly profitable, unregulated ancillary service.

How things have changed.

Just follow the money….

Customers used to being gouged for cable television are now willing to say goodbye to Comcast’s television package in growing numbers. Today’s must-have service is broadband and Comcast has a high-priced plan for you! But earning up to 97 percent profit from $50+ broadband isn’t enough.

A 300GB limit isn’t designed to control congestion either. In fact, had she investigated that claim, she would have discovered the cable industry itself disavowed that notion earlier this year.

In fact, it’s all about the money.

Michael Powell, the head of the cable industry’s top lobbying group admitted the theory that data caps are designed to control network congestion was wrong.

“Our principal purpose is how to fairly monetize a high fixed cost,” said Powell.

Powell mentioned costs like digging up streets, laying cable and operational expenses. Except the cable industry long ago stopped aggressive buildouts and now maintains a tight Return On Investment formula that keeps cable broadband out of rural areas indefinitely. Operational expenses for broadband have also declined, despite increases in traffic and the number of customers subscribing.

[flv]http://www.phillipdampier.com/video/CNBC Internet v. Cable 8-20-10.flv[/flv]

Don’t take our word for it. Consider the views of Suddenlink Cable CEO Jerry Kent, interviewed in 2010 on CNBC. (8 minutes)

“I think one of the things people don’t realize [relates to] the question of capital intensity and having to keep spending to keep up with capacity,” said Suddenlink CEO Jerry Kent. “Those days are basically over, and you are seeing significant free cash flow generated from the cable operators as our capital expenditures continue to come down.”

Unfortunately, Charleston residents don’t have the benefit of reporting that takes a skeptical view of a company press release and the spokesperson readily willing to underline it.

If Comcast seeks to be the arbiter of ‘fairness,’ then one must ask what concept of fairness allows for a usage cap almost no customers want for a service already grossly overpriced.

Phone companies looking for a cheap way to increase broadband speeds are turning away from fiber optics and towards advanced forms of DSL that don’t bring cost objections from shareholders.

Whether your provider is AT&T or an ISP in Europe or Australia, financial pressure to improve broadband on the cheap is fueling research to wring the last kilobit out of decades-old copper phone wiring.

Alcatel-Lucent suggests VDSL2 Vectoring is one such technology that can enable download speeds up to 100Mbps using noise-cancelling technology to suppress interference.

But the advice doesn’t impress fiber optic fans who suggest any reliance on deteriorating copper phone lines simply postpones an inevitable fiber upgrade that could come at a higher cost down the road.

VDSL2 Vectoring and G.Fast are only as good as the copper wiring that extends to each customer. Up to 45 percent of North American wire pairs are in some state of disrepair.

Vectoring has been described as “pixie dust” by Australia’s former Communications Minister Stephen Conroy. Conroy was overseeing Australia’s switch to fiber service as part of the National Broadband Network. But a change in government has scrapped those plans in favor of a cheaper fiber to the neighborhood broadband upgrade advocated by the new Communications Minister Malcolm Turnbull that resembles AT&T’s U-verse.

“Malcolm can sprinkle pixie dust around and call it vectoring and he can do all that sort of stuff but he cannot guarantee upload speeds,” Conroy told Turnbull.

As with all forms of DSL, speed guarantees are extremely difficult to provide because the technology only performs as well as the copper wiring that connects a neighborhood fiber node to a customer’s home or office. Upload speeds are, in practical terms, significantly slower than download speeds with VDSL2. Turnbull expected download and upload speeds on Australia’s VDSL2 network to be around a ratio of 4:1, which means a customer who has a download speed of 25Mbps per second would receive an upload speed of around 6Mbps.

In the lab, VDSL2 Vectoring delivers promising results, with speeds as high as 100Mbps on the download side. DSL advocates are excited about plans to boost those speeds much higher, as much as 1,000Mbps, using G.Fast technology now under development and expected in 2015. VDSL2 Vectoring and G.Fast both require operators to minimize copper line lengths for best results. Unfortunately, dilapidated copper networks won’t work well regardless of the line length, and with many telephone companies cutting back upkeep budgets for the dwindling number of customers still using landlines, an estimated 15-45 percent of all line pairs are now in some state of disrepair.

Assuming lab-like conditions, G.Fast can deliver 500Mbps over copper lines less than 100 meters long and 200Mbps over lines between 100 and 200 meters in length.

G.Fast also allows for closer symmetrical speeds, so upload rates can come close or match download speeds.

This cabinet houses the connection between a fiber optic cable and copper phone wiring.

Providers prefer the copper-fiber approach primarily for cost reasons. There are estimates deploying a G.Fast-capable VDSL service to a home would cost around 70 percent less than fiber to the home service. Workers would not need to enter customer homes either, offering less-costly self-install options.

Telekom Austria and Swisscom are among providers committed to launching the technology. Both countries are mountainous and have many rural areas to serve. Fiber rich providers are also looking at the technology for rural customers too costly or too remote to service with fiber.

Critics question the real world performance of both VDSL2 Vectoring and G.Fast on compromised copper landline networks. Decades of repairs, deteriorating insulation, corroded wires, water ingress, and RF interference can all conspire to deliver a fraction of promised speeds.

Many critics also point to the required aggressive deployment of fiber/VDSL cabinets — unsightly and occasionally loud “lawn refrigerators” that sit either in the right of way in front of homes or hang from nearby utility poles. To get the fastest possible speeds, one cabinet may be needed for every four or five homes, depending on lot size. Australia’s VDSL network, without Vectoring or G.Fast requires at least 70,000 cabinets, each powered by the electric grid and temporary backup batteries that keep services running for 1-2 hours in the event of a power failure. The batteries need to be decommissioned periodically and, in some instances, have caused explosions.

The costs of electric consumption, backup batteries, infrastructure, and maintenance of copper lines must be a part of the cost equation before dismissing fiber to the home as too expensive.

An unlimited wireless broadband plan popular with rural Americans and traveling RV owners has been revived after customers were informed unlimited access was going to be unavailable after Oct. 31.

Millenicom resells wireless broadband service on the Sprint and Verizon wireless networks. Millenicom’s $79.99 Unlimited Plan had no contract requirement and customers were allowed to bring their own wireless device.

Millenicom bucked the trend by continuing to find ways to offer unlimited access plans even as wireless companies began imposing usage caps. Sprint’s decision to cut service to a third-party reseller forced Millenicom to send an e-mail notice on Oct. 18 to unlimited use customers:

Sprint has discontinued service to our gateway provider, unfortunately that means we can no longer provide the Unlimited or BYOD Plan to you.

We anticipate your plan to be discontinued by Sprint by the end of this month. We can offer a couple of options for you available through October 31, 2013.

1. Continue your service through the BMI.net Unlimited/BYOD Plan. They have agreed to honor your service through the end of this month at no charge with an ongoing monthly service fee of $79.99;
2. Switch your service to the Millenicom 20GB Hotspot Plan. We will provide a Novatel MiFi 4620LE with activation and shipping free of charge.

Given this is out of our control, we recommend that you act on this at your earliest convenience.

We deeply regret this circumstance.

Millenicom

The decision would have had an immediate impact on rural customers who cannot get cable broadband or DSL. Many Millenicom customers receive wireless broadband over 3G, 4G, and/or LTE networks, depending on reception quality, the carrier, and what services are available on the nearest cell tower.

Just a few days later, the company reversed course, at least for current customers:

The upstream carrier is reconsidering their decision with our gateway. At this time it appears the accounts will be allowed to continue.

We apologize for any confusion or frustration and thank you for your patience; we will immediately provide updates as information is provided.

At the moment, Millenicom’s website still advertises three plans, although the Unlimited Plan details are now missing and might no longer be an option for new customers:

(Verizon Wireless Network) Hotspot Plan – No contract – Nationwide coverage (Check coverage)

• 3G/4G Novatel MiFi Hotspot
• 20 gigabytes of data
• Connect up to 10 WiFi-enabled devices

The 3G/4G Hotspot Plan is a no-contract service that allows for 20 gigabytes of data transfer for $69.99/month. The service automatically allows for up to 10 wireless devices to connect simultaneously and is backwards compatible to 3G in the event the device is outside the coverage area.  The service supports 802.11 b, g and n and is also VPN compatible. Initial charges require $99.99 device purchase fee, $49.99 activation fee and $15.00 shipping fee as well as the prorated balance of the first month service fee.

(Sprint Network) Unlimited Plan – No contract – Nationwide Coverage – Plan Details Missing – May only be available for current customers ($79.99)

• Netgear 341U USB Device
• Unlimited data
• 3G/4G/LTE

Bring Your Own Device Plan – No contract – Nationwide Coverage

• Bring Your Own Device
• Soft capped unlimited data*
• 3G, 4G, LTE

The Millenicom BYOD mobile broadband account is a no contract service that allows for nationwide coverage using the clients own mobile broadband device. There is a one-time set up fee of $49.99 to activate the account. The BYOD service is for personal and family use and is not to be used for commercial purposes or as a public WiFi or broadcast to multi-dwelling units or any other extraordinary circumstance. Usage over 50 gigabytes in one month will alert our investigative team. Devices usable with this plan: Customer must own a non-active mobile broadband device of the appropriate upstream carrier (email [email protected] for clarification). We highly recommend you contact us before signing up for this type of account to ensure your device is compatible. (*-Soft cap of 50GB)

Customers report Millenicom has been a reliable reseller for years and is tech-savvy about finding ways to deliver rural wireless broadband to customers without onerous usage caps. However, their services are only as good as your cell reception. Sprint’s 3G network is notoriously oversold and slow in urban areas but might still be useful in rural communities. Sprint’s older Clear WiMAX 4G network rarely offers coverage in rural areas. But rural residents are in luck: Sprint’s rollout of 4G LTE service seems to run against the grain of most wireless providers. Sprint is upgrading rural and small city towers for LTE service before many larger urban areas get the next generation 4G service.

“Anything is better than satellite,” writes Stop the Cap! reader Dan Gallo. He has been a loyal Millenicom customer in rural Virginia for several years, where Verizon DSL is still not available and cable companies are nowhere to be found. “That Sprint tower next to the highway three minutes from my house delivers a solid signal, so there is civilization here.”

Thanks also to Stop the Cap! reader Daniel alerted us to the story.

[flv width=”204″ height=”380″]http://www.phillipdampier.com/video/Jeff Schefke Rural internet setup 6-21-13.mp4[/flv]

Jeff Schefke shows off his involved Millenicom setup and illustrates the complexities of getting rural wireless broadband from Sprint or Verizon Wireless through Millenicom. Schefke reports normal speeds are up to 2.5/1Mbps, which is far better than the 120kbps he used to get on his phone. (4 minutes)

More than 5,000 residents and businesses living on the island Bailiwick of Jersey now have a choice of two Internet Service Providers – both supplying gigabit fiber optic broadband.

Jersey Telecom, a government-owned provider, has been removing obsolete copper wiring and replacing it with fiber to the home service that should reach the entire island by 2015. The fiber network is open to all competitors. JT charges £59.99 ($97.25) per month for gigabit speeds, but now caps usage at just 100GB a month. Overlimit fees are around 50c per GB between the hours of 8am-midnight. Usage is unlimited during off-peak hours.

In addition to JT, Jersey customers who live on the remote Channel Island, a British Crown Dependency off the coast of France, can now also choose Sure Jersey, a privately owned ISP that offers unlimited use plans.

The fiber optic network is spreading to other Channel Islands, with significantly populated parts of Guernsey set to receive a fiber upgrade next.

Using traditional Return On Investment standards, Jersey would barely qualify for basic DSL service. The island has a population of just 100,000 residents, some spread far and wide in remote locations. Basic DSL service was supplied to customers in more densely populated communities, but speeds were often slow and congestion became a major problem, especially at night.

The local government determined Jersey’s broadband needs could best be met by upgrading to government-owned infrastructure that private businesses could lease to sell service. Much like public roads benefit private companies that use them to transport goods, JT’s fiber network is designed to help bolster the island’s digital economy.

Since the introduction of gigabit fiber, new digital startups have launched on the island and others have moved their digital businesses to the fiber-enabled island. FeelUnique, launched from Jersey, has now become Europe’s largest online beauty retailer, employing over 150. Other businesses on the island have launched software ventures for the health care and education markets, banking/investment products and services, and 3D printing ventures. Having a wide broadband pipe has helped anchor digital businesses to the island because moving elsewhere leaves many with little better than substandard DSL or an enormous price tag for a customized new fiber build.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/JT Fiber Has Arrived 2013.mp4[/flv]

Residents of Jersey talk about how fiber broadband has changed their online experience. (2 minutes)

 [flv width=”640″ height=”380″]http://www.phillipdampier.com/video/Digital Jersey Limited – Vision 2014 from Digital Jersey.mp4[/flv]

Digital Jersey released this video showing the group’s vision on how to leverage gigabit fiber broadband to boost the island’s digital economy in 2014. (3 minutes)