Greenwood, Miss.

Although the days of frenzied buying and selling of cable systems is behind us, smaller cable operators are still in the market for system swaps and buyouts.

Some 8,200 Windjammer Cable customers in Greenwood, Miss. and surrounding areas are about to become Suddenlink customers.  For many residents in Greenwood, located north of Jackson, this will be their third cable provider in two years.

Originally owned by Adelphia, Greenwood’s cable system was acquired in 2008 by Time Warner Cable as part of a bankruptcy sale of Adelphia’s cable properties.  Time Warner Cable ponied up an estimated average $3,500 per subscriber to purchase Adelphia’s cable systems, even though many were badly in need of upgrades.

Time Warner merged many Adelphia systems in larger communities into its own operations, but sold most of the smaller, more rural systems deemed strategically unimportant to the company.  In total, more than 125 cable systems in 25 different states, many serving just a few hundred subscribers each, were dumped overboard at a loss of $45 million by Time Warner.  Greenwood, like 124 other communities, would now receive cable service from a company nobody ever heard of before — Windjammer Cable.

Windjammer was created in 2008 to handle the 80,000 Adelphia customers Time Warner cast-off.  Owned by private equity firm MAST Capital Management, Windjammer is run by Jupiter, Fla.-based small cable operator Communications Construction Services, which is mostly known for providing cable service to more than 200 military bases across the country.

For Greenwood customers, the welcome letter from Time Warner Cable ended their cable relationship with Adelphia.  But it was a relationship never destined to last.

Just one year later, another welcome letter arrived, this time from Windjammer Cable:

Welcome to the Windjammer Cable family!

We have recently acquired the former Time Warner Cable system in this area, and are proud to be your new cable services provider.

We’re more than just a cable company. Windjammer Cable brings a whole world of entertainment and communications to the place it matters most…your home.

As a way to make the transition easy from one cable company to another, you will see very little change in how you receive your cable and communications services.

We will be updating your High Speed Internet, Digital Phone, and E-mail services beginning in the early morning of January 12, 2009. This conversion may take up to 10 days. We will only be working on your service between 1:00 am – 6:00 am local time. During this time, you may experience slight service interruptions, so please be patient.

To those of you who currently use the Time Warner Road Runner email service, there will be changes to your email account. Please visit our new website where you will find information about setting up a new Windjammer email account. We encourage you to do this as soon as possible. Your existing Road Runner email account will continue to work the same for at least the next two months.

If you do not use the Time Warner Road Runner email service, but use another service, like Gmail, you will not need to make any changes.

If you are a Time Warner Digital Phone customer, you should not notice any significant changes to your phone services. If you use the voice mail service, you will have to re-record your message. Instructions for doing this can also be found on our website.

Our customer service representatives are available 24 hours a day to answer any questions you may have about the transition. Consider us your new friend and neighbor, and know that we are only a phone call away.

We look forward to serving all your cable and communication needs!

Windjammer Cable

Now, one year and some months later, customers can prepare for their next welcome letter from Suddenlink.

What Suddenlink paid to acquire the Windjammer system has not been disclosed.

Suddenlink has experience providing service in Mississippi — its nearest system is in Greenville, about 50 miles west of Greenwood.

Suddenlink is the nation’s seventh-largest cable operator, with customers primarily located in Arkansas, Louisiana, North Carolina, Oklahoma, Texas and West Virginia.

North Carolina Legislature

We collectively sighed last Wednesday when the Senate Finance Committee temporarily pulled S1209, but the victory is short-lived.  Sources tell us S1209 is scheduled to return this Tuesday, one day after the long Memorial Day weekend.

We are not happy with some of the rumors that have been circulating around the Legislative Building in Raleigh.  One suggests S1209 will be modified into a one year, renewable moratorium on municipal broadband while a joint task force ponders questions about financing of municipal broadband, broadband adoption and speed, and overall competition in North Carolina.  Without a clear sunset provision, the legislature can renew the moratorium indefinitely, assuring incumbent phone and cable companies of a continued easy ride into our wallets.

Much has also been said by Sen. Clodfelter regarding the legality of municipal broadband in North Carolina.  Some of his earlier comments suggest he’d be a proponent for a moratorium while the state legislature thrashes out the legal questions.

But the courts have already effectively dealt with this question and handed victory to municipalities.  Why bother with a moratorium when in 2005, Laurinburg, North Carolina won its court battle against big telecom companies.  The judge ruled:

“Laurinburg’s network is run over fiber optic “wires or cable,” providing a “system” for “transmit[ting]” and “receiv[ing]” electronic signals capable of being converted to “audio” and/or “video” streams of information. See N.C. Gen. Stat. § 160A-319(b). We believe this fits within a broad construction of the definition of a CTS. Therefore, we hold that Laurinburg is acting within its municipal authority to run its network, and was not acting ultra vires in contracting with School Link to provide the network’s ISP service.”

Doesn’t the legislature have better things to do than to spend all of this valuable time doing work for big phone and cable companies?

We need you to again write and call your legislators. We have been told by numerous sources that your input has been very effective in pushing back S1209.  The more North Carolina consumers speak out against this anti-consumer bill, the less likely it will ever become law.

Here are the points you need to raise in your next letter or phone call:

1. Why is the legislature still spending time on this unnecessary, anti-consumer legislation?  S1209 is wanted by large phone and cable companies.  You want your town or city to have every option open to deliver better service if a consensus is reached for it in your community.  The current system already provides effective checks and balances.  We don’t need S1209.
2. Studying broadband issues is fine, but placing a moratorium on municipal broadband projects in the meantime is completely unacceptable.
3. Corning’s plant in Hickory, North Carolina produces 40 percent of the world’s supply of fiber optic cable.  Passing S1209 impedes fiber projects in North Carolina, hurting our own workers and state economy.
4. North Carolina needs all the broadband expansion it can get.  We are ranked 41st out of 50 states.  Passing S1209 preserves mediocre broadband service in our state indefinitely.

For some of you, this will be your third or fourth call or e-mail.  Perhaps it’s time to remind legislators you are becoming increasingly concerned that measures like S1209 continue to be debated.  While Time Warner Cable and CenturyLink/Embarq’s legislative priorities continue to get plenty of time and attention in Raleigh, they don’t get a vote in the next election.  Remind them you do, and your continued support hinges on whether you can feel confident members represents your interests, not those of big cable and phone companies.

Remember the three rules when contacting your legislators:

• Be polite.
• Be persuasive.
• Be persistent.

Well-informed constituents who can defeat industry talking points represents the nuclear option against bad telecommunications legislation.

Now get on the phones and e-mail and get busy.  Remember — one e-mail message per address.  No carbon copies!

Here is the list:

Latvia is celebrating today with the news it has the world’s second fastest broadband service, now beaten only by South Korea.

According to Ookla, which released speed measurement test results this week, the Baltic state in northeastern Europe achieved second place with a speed index of 24.41 Mbps, ahead of Moldova (21.63 Mbps), Japan (20.43 Mbps) and Sweden (19.95 Mbps).

Latvia has come a long way from its former days as a Soviet Socialist Republic.  The country declared its independence March 3, 1991 and adopted a parliamentary democracy.  Latvia maintains close economic ties with the United States and Scandinavian countries, and has rapidly sought its future within the European Community, distancing itself from Russia.  Today Latvia is a member of both the European Union and NATO.

Like other Baltic republics Lithuania and Estonia, Latvia has undergone a complete telecommunications transformation.  Out went the old Soviet-era telephone exchanges with antiquated copper wire, and in came optical fiber, especially in the nine major cities within Latvia’s administrative divisions.  Latvia’s economic planning heartily endorsed broadband service as a major economic driver, and the country and its citizens depend heavily on its broadband networks for entertainment, banking, business, education, and facilitating health care.

As a result, broadband is plentiful, fast, and remarkably inexpensive, especially in cities.  In rural communities, parts of Latvia still rely on older DSL technology delivered over traditional phone lines, but the country has plans for universal optical fiber as finances allow.  Meanwhile, widespread wireless mobile networks provide Europe’s least expensive cell service, with a charge averaging just four cents per minute to make and receive calls.

Latvia’s dominant broadband provider is Lattelecom, co-owned by the Latvian government and Sweden’s TeliaSonera AB.  Its broadband packages stun the rest of Europe and North America.

For customers in Riga, Jurmala, Jelgava, Daugavpils, Valmiera, and Ventspils districts, fiber optic broadband delivers service up to 200 Mbps upstream/downstream for just under $26.02 per month.  At that price, they also include a guarantee that speeds will always be above 30/20 Mbps.

Lattelecom's broadband tiers. In order, in U.S. dollars -- $13.80, $17.29, $20.78, and $26.02, all without a service contract.

Lattelecom is also introducing a 500Mbps service shortly.  There are additional substantial discounts for expectant mothers, educators, and the disabled.  For those too distant to access the fiber network, a DSL package up to 10Mbps with unlimited telephone calling (including international long distance) costs $37.45 per month.

The Baltic press has run with the success story of the region’s broadband providers, especially in light of the continued decline in scores for broadband in the United States, which has now fallen to 26th place (10.15 Mbps), and the United Kingdom, 33rd (7.71 Mbps).  Canada came in at 32nd (7.92 Mbps).

The most dramatic improvements in broadband continue in eastern Europe, particularly in the Republic of Moldova, its next door neighbor Romania and Bulgaria.  South Korea maintains its world-leader status.

Among the worst performers: Haiti, Lebanon, El Salvador, Afghanistan, Guatemala, Zimbabwe, Yemen, Mali, and Sudan.

The Denver Post this morning did a major disservice to its readers in a heavily slanted editorial objecting to the reclassification of broadband service to restore the FCC’s traditional oversight authority over Internet providers.

In their piece For Web and Broadband Regulation, Less is More, the editors at the Post delivered less facts and more industry talking points.  It even mislead readers by quoting from two Republican FCC commissioners, completely ignoring the Democratic majority that would likely prevail in a vote on the matter.

The editorial forgets to mention why this debate is taking place.  Readers should have been made aware the broadband industry the Post celebrates as successful under a light touch regulatory philosophy effectively-won total deregulation in a game changing court decision that stripped the FCC’s authority to provide checks and balances over today’s duopoly broadband market.

Ed Whitacre, AT&T

Comcast sued after the FCC punished the company for deliberately interfering with customers’ broadband speeds for certain Internet applications (despite Comcast’s initial denials).  The Post characterizes such behavior on the part of the nation’s largest cable company as “only a couple documented issues, which were quickly resolved.”  How does the Post think these were resolved?  The FCC used the authority it now no longer has to pressure Comcast to stop.  What stops the next “documented issue?”

AT&T’s former chairman and CEO Ed Whitacre gave Americans plenty to worry about in 2005 when the nation’s largest phone company infamously declared that popular web sites should not be expected to use AT&T’s “pipes for free.”  That attitude is still being defended today by millions of dollars in lobbying, fake grassroots astroturf campaigns, and industry bought-and-paid-for “research studies.”  Why spend all that money on a “resolved” issue?

But the most offensive part of the Post‘s piece was a completely dishonest attempt by the editors to imply there is widespread bipartisan opposition to common sense broadband regulation like Net Neutrality.

We had the opportunity Wednesday to talk with two FCC commissioners about the dual proposals for reform. They voiced concerns about an FCC move to redefine broadband networks as highly regulated telecommunications services.

Meredith Attwell Baker, who was nominated to the commission by President Obama, called the reclassification dangerous, adding it was a “brand new model.” FCC Commissioner Robert M. McDowell, nominated by President George W. Bush, worried about the unintended consequences that might come out of an additional layer of regulation.

On the right side of the Commission, the two Republican members Meredith Attwell Baker, a former telecom industry lobbyist and Robert M. McDowell.

How clever of the Denver Post to dangle the implication that Baker, being appointed by Obama, is somehow an ally.  She is not.  The Post only spoke with the two Republican minority commissioners for its editorial.  Atwell was appointed by Obama under long-standing FCC rules which require that only three Commissioners may be members of the same political party.  There is no practical difference between Atwell and McDowell.  Why didn’t the newspaper speak to at least one of the majority Democrats on the Commission, all of which are expected to support Chairman Genachowski?  Because that would have dramatically weakened the provider’s editor’s arguments and talking points.

Of course, there is nothing “brand new” about Title II authority.  It has been used successfully to oversee today’s increasingly deregulated landline marketplace to protect rural Americans who don’t have competitive choices should their phone company provide abysmal service.  What was new was the defective mechanism used by former FCC Chairman Michael Powell, under the Bush Administration, to oversee broadband using what the courts determined was phantom authority.

There is nothing about those regulations “ill-suited” to restoring the FCC’s lost authority, which is the ultimate game plan here.  Providers have fed talking points, which editors at the Denver Post apparently devoured, suggesting everything from unintended consequences to the sky falling down should the FCC be able to implement its National Broadband Plan on its terms.  Providers want the power to control and implement broadband deployment on their terms — the same ones that have left millions without any real broadband options at all, and the rest of us with slow service at high prices.

We hope that process ends with succinct and limited rules that apply to broadband providers, but leave them relatively unfettered so the Internet continues to be a place for entrepreneurs, thinkers and dreamers to pursue their ideas.

These are all noble goals, but they cannot be achieved if a handful of giant broadband providers start extorting fees from content producers and engaging in other abusive behaviors.  The Post seems to think America is a world-leader in broadband, yet we are not.  This country is now handily beaten by several Asian nations and even cities within the former Soviet Union and its east European bloc.  Just this week Ookla released a speed index report that tells the truth about America’s broadband experience:

Here are the top 10 U.S. cities and their corresponding 30-day average speeds:

1. San Jose, Calif. 15.02 Mbps
2. Saint Paul, Minn. 14.53 Mbps
3. Pittsburgh, Pa. 14.18 Mbps
4. Oklahoma City, Okla. 12.12 Mbps
5. Brooklyn, N.Y. 12.10 Mbps
6. Tampa, Fla. 12.05 Mbps
7. Bronx, N.Y. 12.01 Mbps
8. New York, N.Y. 11.85 Mbps
9. Denver, Colo. 11.68 Mbps
10. Sacramento, Calif. 11.34 Mbps

The global top 10:

1. Seoul, South Korea 34.49 Mbps
2. Riga, Latvia 27.88 Mbps
3. Hamburg, Germany 26.85 Mbps
4. Chisinau, Republic of Moldova 24.31 Mbps
5. Helsinki, Finland 20.58 Mbps Mbps
6. Stockholm, Sweden 19.97 Mbps
7. Bucharest, Romania 19.68 Mbps
8. Sofia, Bulgaria 18.99 Mbps
9. Kharkov, Ukraine 18.15 Mbps
10. Kaunas, Lithuania 17.46 Mbps

With evidence like this, the editors at the Post need to get out from behind those telecom talking points and visit today’s real broadband world.

Take the money and run

The Federal Communications Commission’s approval of Frontier’s takeover of 4.8 million Verizon landline customers in 14 states comes a year after the company announced the deal.  Frontier joins three other independent phone companies — FairPoint Communications, Windstream Communications, and CenturyLink zealously trying to grow their companies with additional mergers and acquisitions to avoid being swallowed up themselves.

What is common among all four companies is they rely heavily on dividend payouts to keep their stock price as high as possible.  That was a formula for disaster for FairPoint, the first of the four to end up in bankruptcy after a similar deal with Verizon in northern New England caused the company to falter.  Service and billing deteriorated, customers fled, and promises for better broadband were broken.  Now Frontier is following in FairPoint’s footsteps with more than 4.8 million new customers Frontier hopes they can swallow.

The FCC’s statement approving the merger reads like a press release for all involved, and delighted FCC Chairman Genachowski, who called these meager requirements “robust”:

Coming one week after the final state approval for the transaction, the FCC’s Order holds the applicants, Verizon and Frontier, to enforceable voluntary commitments, including:

• Extend faster broadband to more Americans: Frontier will significantly increase broadband deployment for the lines involved in this transaction, only 62 percent of which are broadband-capable today. Specifically, Frontier will deploy broadband with actual speeds of at least 3 Mbps downstream to at least 85 percent of transferred lines by the end of 2013, and actual speeds of at least 4 Mbps downstream to at least 85 percent of the transferred lines by the end of 2015, with all new broadband deployment offering actual speeds of at least 1 Mbps upstream.

Frontier's Fast One: 3 Mbps DSL Service with a 5GB Monthly Usage Allowance

Frontier’s broadband commitment gives the company a full five years to meet the bare minimum speed considered to constitute broadband in the National Broadband Plan.  One hopes Frontier doesn’t break into a sweat offering a piddly 3 Mbps service to homes using yesterday’s DSL service until then.  While Verizon’s rural castoffs get stuck eventually with 4 Mbps DSL, many of the company’s remaining customers are enjoying 50Mbps service over an all fiber network.  The FCC is accepting an urban-rural divide for broadband which will benefit the phone companies while leaving rural customers in the dirt.

Deploy fiber to libraries, hospitals, and other anchor institutions: Frontier will launch an anchor institution initiative to deploy fiber to libraries, hospitals, and government buildings, particularly in unserved and underserved communities.

Fiber for these locations sure, but no fiber for you or I.  Frontier, like most other telecom companies, loves to promote the benefits of fiber without actually deploying it to homes.

Promote competition: Frontier and Verizon have made a series of commitments to protect wholesale customers, including honoring all obligations under Verizon’s current wholesale arrangements that are in effect at closing.

Since wholesale customers often depend on the same network other customers do, if a company doesn’t deliver robust broadband into a state like West Virginia, there isn’t a robust service to sell to those wholesalers.

Improve data quality and collection: Frontier will make available to the Commission data on its broadband deployment progress at an unprecedented level of detail to enable effective monitoring of Frontier’s compliance with its commitments.

The Commission concluded that the commitments that applicants have offered, coupled with monitoring and enforcement by the Commission, will minimize the risks of harm and ensure that this transaction is in the public interest.

Phillip "Living on the Frontier" Dampier

Considering how weakly the FCC is committing itself to protecting rural customers from being dumped into the broadband backwater Frontier has on offer (complete with the 5GB monthly usage allowance), does collecting statistics help when things go sour?  Regulators collected statistics in New England when FairPoint failed, but that didn’t get service levels back until Maine, New Hampshire, and Vermont threatened to toss FairPoint out.  Now the company is in bankruptcy and regulators are negotiating which of the promises FairPoint made can be let go ‘for the sake of the company.’

That’s why it’s so ironic to read editorials that proclaim the FCC is on some sort of power grab when they seek to restore what meager authority they exercised over broadband before a DC Court effectively excluded broadband oversight from their portfolio.

It will be a good day when federal agencies like the FCC start worrying first and foremost about consumers instead of how to make a parade of overpriced mergers and acquisitions succeed for the companies involved.

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/WANE Ft Wayne Verizon hanging up on local landlines 5-24-10.flv[/flv]

WANE-TV in Fort Wayne warns viewers their landline company is about to change asVerizon vacates the area by July 1st.  (1 minute)

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/CWA Verizon Dont Take the Money and Run in WV.flv[/flv]

Too late.  The Communications Workers of America ran this ad spot asking the West Virginia governor to intervene and stop the sale.  (1 minute)