Ft. Wayne, Indiana

Outrage over enormous price increases for Frontier’s fiber optic television service in Indiana are being met with little more than a shrug of the shoulders by one company executive, who seemed to dismiss as an afterthought the state-of-the-art FiOS network it acquired from Verizon.

Frontier Communications’ president of its Midwest division, Don Banowetz, has been making the rounds with Fort Wayne-area reporters over news the phone company intends to boost prices for its FiOS TV service by $30 a month for most customers.

But Banowetz has done little to defend the price increases or the fiber network the company acquired with its purchase of landlines from Verizon.

“Look, we bought the whole company, right? All the assets. The FiOS part was part of that, so it was part of the deal,” said Banowetz.  “We couldn’t ride the previous arrangement. So in essence, it was what it was.”

WANE-TV reporter Aishah Hasnie seemed stunned with Banowetz’s response, finally asking what customers should do if they can’t afford the rate increases.

“Get DirecTV,” came the reply.

Starting February 18th, customers who subscribe to a FiOS TV basic package will see their rates go by up $12 per month. Customers who subscribe to other FiOS TV packages will see a $30 increase. The increase does not affect customers under a price protection plan.

That kind of price increase would normally provoke blanched faces in a corporate boardroom over fears of a mass exodus of customers.  But not Frontier.

“The FiOS TV part of our business is actually a very small part of our business. It’s about three percent of our revenues,” said Banowetz.

But Frontier’s satellite package, pitched as an alternative, brings plenty of tricks, traps and other hidden fees inside the box.  In addition to signing a two-year service commitment with DirecTV, customers also have to sign a three-year “price protection agreement” with the phone company, which is another way of saying “contract.”  The total price adds up:

• Customers opting for Frontier’s “free TV” promotion will face a three-year contract term with a $400 early cancellation fee;
• Frontier’s satellite TV promotion has a three-year contract term with a $300 early cancellation fee;
• “Care and handling” fees amounting to $69.99 apply to the “free TV” offer;
• A $34.99 Frontier “video setup fee” applies to customers getting satellite service from the phone company;
• DirecTV requires customers to pass a credit check and sign a contract with a 24 month commitment;
• If you change any aspect of your programming package, you may forfeit the “free service” offered as part of the promotion.

In northwest Washington state, Frontier’s rate increases are alienating the company with one member of the state’s congressional delegation.

U.S. Representative Rick Larsen (D-Wash.) sent a letter to Frontier complaining about the huge rate hikes, telling the company it needs to find better alternatives for many of his constituents who cannot install a satellite dish.

“Folks in Northwest Washington are concerned about the future of cable service offered through Frontier Communications, and rightly so,” said Rep. Larsen. “I am calling on Frontier to offer consumers better and more affordable options for cable service in the region.”

Rep. Larsen’s letter to Frontier Communications:

Dear Mr. Mason:

I am writing to express concerns that I share with many of my constituents in Northwest Washington about Frontier’s plans for cable service in our region. The Everett Herald recently published an article, “Switch to a Dish or pay more, Frontier tells FIOS customers,” that highlights some of the problems that people in Northwest Washington have with Frontier’s announcement that it will alter the existing framework of its fiber-optic television service. Specifically, Frontier’s decision to offer its customers a choice between continuing with their current FIOS television service—with a rate increase of 46 percent or switching their cable television service to the satellite provider DirecTV.

I am concerned with Frontier’s decision to substantially raise its cable television rates for its existing customers in the Pacific Northwest. Last September, Frontier Communications Chief Executive Maggie Wilderotter was quoted in The Oregonian newspaper stating that Frontier would distinguish itself from larger cable companies by holding down prices for its customers. I find it troubling that less than six months later Frontier is dramatically raising its cable television rates.

Additionally, it is problematic that Frontier has not offered an adequate alternative to those customers who live in apartment complexes where the installation of satellite dishes is prohibited and therefore cannot take advantage of the option to switch their cable service to DirecTV. — Rick Larsen, United States Representative, Washington State, 2nd District

Stop the Cap! reader John says he has sent a letter to CEO Maggie Wilderotter protesting the rate hikes and imploring the company to find a programming co-op to join.  Smaller providers need not pay “rack prices” for cable programming.  Municipal providers, family owned companies, and small independent cable operators have enjoyed substantial programming discounts through group buying power.  Frontier apparently is trying to negotiate for video programming on its own, a fatal mistake that has brought on this month’s rate hike.

If you want to help educate Frontier about how to run their business properly, here is their contact information:

Frontier Communications Corporation
3 High Ridge Park
Stamford, CT 06905-1390
Phone: 203-614-5600
Fax: 203-614-4602
[email protected]

When writing or calling, don’t forget to tell them to abandon their Internet Overcharging schemes — no usage caps or limits on Frontier broadband, or you will take your business somewhere else.

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WANE-TV in Fort Wayne delves into Frontier Frustration as angry customers react to news of enormous rate increases.  (2 minutes)

A Montreal blogger experienced the wrath of some Videotron employees when he casually snapped a photo of their recently-remodeled store in the Carrefour Agrignon.

Elias Makos shares the crazy story of his experience last November:

Walking to the Best Buy, I noticed the Videotron store, which has recently been remodeled as the company focuses more and more on its new cell phone services. Not only was the store remodeled, but there was a ratio of about 6 employees per customer in the store.  This was hilarious to me, and even more so when I think about how Videotron’s parent company, Quebecor, has locked out 253 Journal de Montreal employees for almost two years now. Apparently the company can’t pay for journalism but can afford an army of numbskulls selling cell phone contracts.

So I took out my phone and snapped one picture of the store from about 20 feet away. Put my phone back in my pocket and walked to Best Buy. About a minute later, I feel a hand on my back.

The photo worth a thousand punches to the face. (Courtesy: Elias Makos)

“Why did you take a picture of me?”

I was floored. “What?” I said, realizing that it was a Videotron employee from the store. He asked the same question again. I looked at him, flabbergasted that he even cared. He looked very nervous, like he knew he and his store was incompetent. He told me not to take pictures of his store, or else. I stared at him, realized I didn’t have to tell him a thing, and walked away, although not before I must have gave him the most confused look in my life.

I get to Best Buy, walk to the games section (major cutie working there today!) and found several new copies of both games. I was happy. I picked both games up. Then, out of nowhere, this guy approaches me.

“If you take another photo of my store, I’m going to punch you.”

Minutes later, the mall’s security guards approached Makos demanding he delete the photos, claiming taking photographs inside the mall violates mall policies.

Makos’ story turned into a bigger story on CBC Radio, with company officials trading accusations with Makos over whether the public has a right to snap pictures of its stores.

Foolishly, Videotron didn’t learn the cardinal rules of good public relations — strong-arming a member of the public and reflexively taking the side of the goon-employees who subsequently stalked Makos inside the mall will never turn out well no matter how you defend it.

CBC Radio Montreal talks with area blogger Elias Makos, who related his ridiculous encounter with some bored (and boorish) Videotron employees at the local mall who were more than a little camera shy. (12 minutes)
You must remain on this page to hear the clip, or you can download the clip and listen later.

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Now that the FCC has given the green light to Comcast’s merger with NBC-Universal, the headquarters of Comcast is moving to 30 Rockefeller Plaza in New York City.

While Comcast is moving on up, customers’ bills may soon follow.

Critics warn Comcast’s standing as the leading Internet Service Provider combined with its unprecedented power over programming could change the face of broadband Internet, particularly where online video is involved.

Comcast’s efforts to protect its cable business could lead to additional fees for broadband customers who seek to use the Internet to watch programming they used to get on cable-TV.

WFMZ-TV in Allentown, not too far from Comcast’s old headquarters in Philadelphia, reports.  (2 minutes)

Gary McCallum, a Shaw customer in Edmonton, Alberta, has received word his broadband service is about to get more expensive — a lot more expensive.

“Holy crap, it’s like text messaging [bill shock] all over again when your broadband bill arrives and you are now looking at hundreds of dollars instead of the $40 or $50 you used to pay,” McCallum told CTV News.

McCallum, and other designated “heavy users,” are receiving letters in the mail from Shaw notifying them they have been exceeding the company’s declining usage limits imposed on its broadband service.  If they exceed the limits again, they may be subject to penalty fees of as much as $2 per gigabyte.

“I’m upset about the backdoor tactics,” McCallum complains.  “They keep it secret and then lambaste you later.”

Most Shaw customers will be forced to confine their usage to 60GB per month, the limit on the company’s most popular broadband plan.  If they don’t, after some warning, they’ll pay a stiff fine.  Just 20GB of overlimit usage will more than double the average customer’s broadband bill, currently around $37 a month.

A house full of teenagers watching Netflix or downloading files could cost far more than that.

Company officials deny the potential revenue bonanza is unjustified.

Customers who use more will pay more, admits Terry Medd, vice-president of operations for Shaw Communications in Calgary.

“It’s video over the Internet that’s driving a lot of this cost,” he said. However, most Shaw Internet customers won’t hit their caps, Medd claims, suggesting it should affect fewer than 10 per cent of customers.

“The average user consumed about one-third of what the cap is. In other words, we’ve set the caps at three times the average usage. For the average user, there’s no concern here,” Medd said.

However, Shaw recently reduced their usage caps on virtually all of their Internet plans, making it more likely customers will be snagged by overlimit fees.

Some customers want to know what they will get if they use far less than their plan allowance.

Don McGregor believes Shaw’s plan to charge Internet users for the data they use is fair and equitable, so long as those who use less than the allowance get a break on their bills.

“Shaw should plan on refunding fees for any use of data below the contracted amount,” the Edmonton resident wrote in a letter to the editor published in the Edmonton Journal.  “Since 90 per cent of Shaw’s subscribers use less than the full GB capacity they pay for, I am sure these subscribers’ refund cheques are in the mail.”

Don, like other Canadians, is about to learn Internet Overcharging is never about fairness or saving customers money.  It’s about charging customers more for the same service they used to receive for less, without any improvements.  ISPs will not provide true “usage pricing” for consumers because it would slash revenue from their broadband service.

But western Canadians need not be victims of Shaw’s overcharging.  Telus, which sells landline-based DSL service in British Columbia and Alberta says it has upgraded its facilities to accommodate usage demands and won’t expose customers to overlimit fee bill shock.

Telus offers a way out of Shaw's Money Party hangover

Although Telus’ website does show usage limits, company officials claim they are rarely enforced, and not at the subscriber’s expense.

Telus could make a significant dent in Shaw’s customer base by dropping them altogether, which will save the phone company from these kinds of  silly legal gymnastics in their FAQ:

Why do you call your service unlimited, when my monthly usage is limited?
We refer to TELUS High Speed as being unlimited because you get unlimited hours of monthly access.

If you do not want to play Shaw’s Internet Overcharging game, perhaps spending time with a new Xbox 360 would be better?  Telus is giving them away to qualified new customers signing up for service.

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CTV News in Edmonton informs Alberta’s Shaw customers their broadband service could get a lot more expensive.  (2 minutes)

Knology's Shakedown in Lawrence

Pesky facts have a way of getting in the middle of silly marketing campaigns.  Knology of Kansas (actually Georgia) has run into this problem in a big way with its glitzy, carefully-crafted welcome website KnologyKnows.

Some of the company’s facts are uncoordinated.

Lawrence blogger Joe Davis sure noticed:

Knology put up a new website to help build their brand in Lawrence, Kansas. In big capital letters, they write:

Allow us to introduce ourselves. We’re Knology, the new (115-year-old) kid on the block.

Sounds eerily familiar to the beginning of “Sympathy for the Devil” by the Rolling Stones.  Trust me… I have no sympathy for the Devil (in this case, a non-local company), also known as Knology. Their website is called KnologyKnows.com. But considering how many “facts” they’ve put out this past week that have been wrong, they really don’t know.

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Knology’s opening welcome video to residents of Lawrence, Kansas has some fact-checking problems. (1 minute)

Davis caught a fact-checking lapse in the company’s introductory video, which claims the world record for handshakes was 13,372.  Oops.  In 2002, while campaigning for office, soon-to-be Gov. Bill Richardson set a world record for the most number of handshakes in an eight-hour period: 13,392.

The only thing Knology has been good at so far in Lawrence is shaking down their customers with Internet Overcharging schemes.  The company has plenty of money to invest in promoting itself, but has so far retained Sunflower Broadband’s costly usage limits and overlimit fees.

Knology hasn’t been around for 115 years either — a company it bought out was.  The Interstate and Valley Telephone Company was one of many independent phone companies created to serve areas AT&T dismissed as rural backwaters not worthy of their service.  Knology itself has only been around since 1994, owned by ITC Holding Company — the people who also brought you Mindspring, a defunct Internet Service Provider sold to Earthlink one month before the dot.com crash.

Did you know Lawrence omits several states?

Davis is also unimpressed with the company’s sell-out of its customer support staff, many of whom will lose their jobs as part of the company’s “rightsizing” initiative.

For Davis, first impressions mean a lot, and Knology is doing themselves no favors.  Some of their other trivia isn’t always accurate, either:

This “fact” is told to anyone who first comes to Lawrence. However, it is wrong. Truth is, 14 states are missing from the Lawrence street grid. The first thing I did when I was told this in 2006 was to find where Connecticut street was located. The funny thing is… Of the 36 state streets in Lawrence, Georgia is not included. Knology is based out of Georgia. Whoops.

Davis says Knology has turned Sunflower’s well-regarded Twitter customer support account into an automated marketing spambot, spewing out continuous tweets telling customers to enter its giveaway and visit its newly branded website.

Stop the Cap! reader Brian, also from Lawrence, agrees with Davis.

“Knology has no concept of the truth in their marketing campaign. This is a scary test of things to come. Fortunately, we just switched to AT&T’s U-verse.”

Perhaps Knology should learn from the ghost of Mindspring, which used to have legendary customer service and a list of:

By filling out Knology's survey, you can give the company a piece of your mind over its Internet Overcharging schemes and possibly win this 32" Samsung flat panel TV.

The 14 Deadly Sins of Mindspring (a/k/a “the ways that we can be just like everybody else”)

1. Give lousy service- busy signals, disconnects, downtime, and ring no answers.
2. Rely on outside vendors who let us down.
3. Make internal procedures easy on us, even if it means negatively affecting or inconveniencing the customer.
4. Joke about how dumb the customers are.
5. Finger point at how other departments are not doing their job.
6. Customers can’t get immediate “live” help from sales or support.
7. Poor coordination across departments.
8. Show up at a demo, sales call, trade show, or meeting unprepared.
9. Ignore the competition, they are far inferior to us.
10. Miss deadlines that we commit to internally and externally.
11. Make recruiting, hiring, and training a lower priority because we are too busy doing other tasks.
12. Look for the next job assignment, instead of focusing on the current one.
13. Office gossip, rumors, and politics.
14. Rely on dissatisfied customers to be your service monitors.

Readers can share their views about Knology’s unjustified Internet Overcharging schemes and enter to win a 32″ Samsung flat panel TV in the process.  You need not be a customer to participate.  Just complete their survey, and be sure to let them know in the box labeled “other” that you will never do business with an Internet provider that doesn’t provide truly unlimited, full speed, flat rate broadband service.