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Happy Rate Increase Tuesday: Time Warner Cable Back for More from North Carolinians

Phillip Dampier November 16, 2010 AT&T, Broadband Speed, Community Networks, Competition, Consumer News, Fibrant, Greenlight (NC), MI-Connection, Video Comments Off on Happy Rate Increase Tuesday: Time Warner Cable Back for More from North Carolinians

Time Warner Cable customers in North Carolina are getting rate hike letters from the cable company that foreshadows what other Time Warner Cable customers around the country can expect in the coming months.

For residents in Charlotte and the Triad region, Time Warner is boosting prices for unbundled customers an average of six percent, which will impact customers not on promotional plans or who are not locked into a “price protection agreement.”

The rate increases particularly target standalone service customers.  Those with the fewest services will pay the biggest increases.  Those who subscribe to cable, phone, and broadband service from the company will suffer the least.

A Time Warner Cable spokesman claimed the company is just passing on the cost of programming.

WXII-TV in Greensboro reported that for many customers already struggling with their bills, they don’t want to hear anything about a price hike.

“I think it’s ridiculous at this time with the economy — it’s hard to make it as it is,” one customer told the station.

“I wish there was a better option out there, but it’s about the only thing you can get,” said another viewer.

Time Warner has been developing pricing models that increasingly push customers towards bundled packages of services.  Standalone broadband service saw dramatic price increases in many areas in 2010, and the company’s most aggressive new customer promotions encourage customers to take all three of its services.

But broadband customers need not expose themselves to inflated broadband prices for standalone service.  Most Time Warner Cable franchises offer Earthlink broadband at comparable speeds at prices as low as $29.95 per month for the first six months.  When the promotion expires, customers can switch back to Road Runner at Time Warner’s promotional price.

Time Warner does face competition in some areas of North Carolina from AT&T U-verse, which offers attractive promotional pricing for new customers.  But the phone company’s broadband speeds come up short after Time Warner boosted speeds across much of the state.  The cable company now delivers Road Runner at speeds of up to 50/5Mbps.  AT&T tops out at 24Mbps, and not in every area.

When a competitor can’t deliver the fastest speeds, they inevitably claim consumers don’t want or care about super-fast broadband.

“We are focused on offering the broadband speeds that our customers need, at a price that they can afford,” said AT&T spokeswoman Gretchen Schultz.

Greenlight promotes its local connection to Wilson residents

Some North Carolina consumers are watching AT&T’s slower speeds and Time Warner’s price hikes from the sidelines, because they are signed up with municipal competitors.

Residents in Wilson with Greenlight service from the city don’t have to sign a contract to get the best prices and obtain service run and maintained by Wilson-area employees. The provider has embarked on a campaign to remind residents that money spent on the city-owned provider stays in the city.

In Salisbury, Fibrant is making headway against incumbent Time Warner as it works through a waiting list for customers anxious to cut Time Warner’s cable for good.  Fibrant customers are assured they’ll always get the fastest possible service in town on a network capable of delivering up to 1Gbps to businesses -and- residents.

MI-Connection, the rebuilt former Adelphia cable system now owned by a group of local municipalities is managing to keep up with Time Warner with its own top broadband speeds of 20/2Mbps.  The system is comparable to a traditional cable operator and does not provide fiber to the home service.  Its 15,000 customers in Mooresville, Cornelius and Davidson are likely to stay with the system, but it is vulnerable to Time Warner’s bragging rights made possible from DOCSIS 3 upgrades.  Since Time Warner does not provide service in most of MI-Connection’s service area, city officials don’t face an exodus of departing customers.

But that could eventually change.  Some MI-Connection customers have reported to Stop the Cap! they have begun to receive promotional literature from Time Warner Cable for the first time, and there are growing questions whether the cable company may plan to invade some of MI-Connection’s more affluent service areas.  Cable companies generally refuse to compete with each other, but all bets are off when that cable company is owned by a local municipality.

For most North Carolina residents, AT&T will likely be the first wired competitor, with its U-verse system.  To date, U-verse has drawn mixed reviews from North Carolina consumers.  Many appreciate AT&T’s broadband network is currently less congested than Road Runner, and speeds promised are closer to reality on U-verse compared with Road Runner during the early evening.  But some AT&T customers are not thrilled being nickle-and-dimed for HD channels Time Warner bundles with its digital cable service at no additional charge.  And for households with a lot of users, AT&T can run short on bandwidth.

“We have five kids — three now teenagers, and between my husband’s Internet usage and me recording a whole bunch of shows to watch later, we have run into messages on U-verse telling us we are trying to do too much and certain TV sets won’t work until we reduce our usage,” writes Angela.  “AT&T doesn’t tell you that you all share a preset amount of bandwidth which gets divided up and if you use it up, services stop working.”

Angela says when she called AT&T, the company gave her a $15 credit for her inconvenience, and the company claims it is working on ways to eliminate these limits in particularly active households.  For now, the family is sticking with U-verse because the broadband works better in the evenings and she loves the DVR which records more shows at once than Time Warner offers.  Their U-verse new customer promotional offer saves them $35 a month over Time Warner, at least until it expires.

“From reading about Fibrant and Greenlight on your site, my husband still wishes we lived in Salisbury or Wilson because nothing beats fiber, but at least what we have is better than what we used to have,” she adds.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/WXII Greensboro TWC Raising Rates 11-16-10.flv[/flv]

WXII-TV in Greensboro reports of Time-Warner Cable’s rate hikes for the Piedmont Triad region of North Carolina.  (2 minutes)

AT&T Tries to Stomp Out Class Action Rights: Supreme Court Case Could Eliminate Consumer Protections

Not really

Back in 2002 Vincent and Liza Concepcion walked into a southern California AT&T Mobility store to purchase new cellphones for themselves.  AT&T advertised a buy one, get one “free” offer for cellphones.  What AT&T didn’t say was that the family would end up paying more than $30 in hidden sales taxes for both phones.

More than eight years later, that purchase — and the resulting class action lawsuit it launched — threatens to sweep away important consumer protections by letting corporations ban class action cases and curtail Attorneys General from enforcing state consumer protection laws.

Oral arguments in the case AT&T Mobility v. Concepcion were heard before the U.S. Supreme Court last Tuesday in one of the most important consumer protection cases in decades. At issue is this clause, inserted into the Concepcion’s service contract with AT&T that would disallow the family from participating in a class action lawsuit:

“You and AT&T agree that each may bring claims against the other only in your or its individual capacity, and not as a plaintiff or class member in any purported class or representative proceeding.”

That clause clashes with several state laws, California’s included, which basically say consumers cannot be compelled to sign away their basic consumer protection rights.  California law also says some contracts can be considered unenforceable ‘if they are built on deception, are too-one sided, or violate broader public policy.’

Hello, AT&T.

Vincent and Liza, through their attorney, argue that bringing an individual lawsuit against AT&T over $30 in sales taxes would be crazy — no lawyer would take the case and no plaintiff would front a retainer well beyond the amount in dispute.

As Justice Ruth Bader Ginsburg wrote in another class action case, “The realistic alternative to a class action is not 17 million individual suits, but zero individual suits, as only a lunatic or a fanatic sues for $30.”

The “class action” concept provides at outlet for aggrieved consumers who can attract legal representation if a company can be sued on behalf of every impacted customer.  For AT&T, that could mean facing not just the Concepcion family, but millions of Californians — each charged sales taxes for phones the company advertised as “free.”

How AT&T’s Case Has Broadened Into a Major Dispute Over Arbitration vs. Class Action Lawsuits

It's easy to navigate AT&T's terms and conditions to achieve a good outcome from arbitration, right?

But what began as a legal argument over a “free” phone has broadened into a much larger legal case before the Supreme Court: can consumers be compelled to participate in company dispute settlement schemes and give up their legal right to petition the court system for relief?  Further, what happens when those contract clauses conflict with state consumer protection laws?

Following in the footsteps of the credit card industry, AT&T inserted a clause mandating customers stay away from class action lawsuits.  By telling consumers they are forbidden to participate in such cases, AT&T pushes customers into the murky world of “arbitration” — a system where AT&T picks a private company, with whom it has a financial-business relationship, to “impartially” rule on customer complaints in secret proceedings.  Consumers have to pay their own way to attend arbitration hearings, often held in cities a thousand miles away or more.  They also must agree the decisions are binding and final.

AT&T argues, both directly and through its dollar-a-holler advocates, that class action cases are annoying, expensive, and do not typically deliver substantial benefits to class members.  The wireless carrier argues arbitration of individual cases is much faster and potentially more lucrative to would-be class action members.  Stephen J. Ware, a professor of law at the University of Kansas School of Law argues consumers have often done far better avoiding litigation and entering into arbitration programs.

But consumer advocates claim AT&T’s arbitration rules are stacked against consumers.  Arthur H. Byrant, executive director of Public Justice argues:

First, AT&T’s “agreement” bars its customers from court (except small claims court) and requires them to utilize the company’s mandatory arbitration program. Its rules say that, if a customer completes the process and recovers more than the last written settlement offer AT&T made before the arbitrator was chosen, a $7,500 premium will be paid. Second, the “agreement” bans AT&T’s customers from bringing or participating in class actions against it. Third, the “agreement” provides that, if AT&T’s class action ban is found to violate the law (as 20 states have held contractual class action bans do when they effectively immunize a company from liability), the arbitration clause “blows up” and the class action must proceed in court. Then, when the class action ban is struck down under state law (as AT&T knew it would be), the company springs its wacky trap: It argues that the Federal Arbitration Act of 1925 (FAA) pre-empts — and invalidates — that state law because (believe it or not) the state law is biased against arbitration.

AT&T’s call for pre-emption suffers from a bad connection. State law is not biased against arbitration. It allows AT&T to resolve disputes in either arbitration or court. Only AT&T’s “agreement” is biased against arbitration. Its “blowup clause” precludes class actions from proceeding in arbitration, but not in court.

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Using the scroll bar to the right of the player, move down and click on Attorney Paul Bland’s name and watch him argue forcefully that AT&T’s motives are plain and simple — to allow them to get away with anything they want and not face accountability from the legal system. — “Arbitration is not the Candy Bridge into Rainbow Land.”

Tapping Into Consumer Discontent With Class Action Cases for the Benefit of AT&T

What the lawyers get

Ask anyone about the merits of most class action settlements and one will often get a response that the lawyers win while consumers lose.  Just this week many owners of HP printers will get word a deal has been reached over a class action case involving printer ink.  The multiple law firms involved will split not more than $2.9 million under the terms of the proposed settlement.  Consumers will get “e-credit” worth $5, $2, or $6 redeemable at HP’s online store, which sells ink cartridges at inflated prices.  In effect, HP has little to grumble about delivering “awards” to consumers that ultimately benefit its own enterprise, the only place those awards can be redeemed.

With settlements like that all too common, it is easy for AT&T’s advocates to tap into consumer discontent with class action lawyers, proclaiming AT&T’s case is actually consumer-friendly because it would cut those money-grabbers out of disputes with the company.

But consumer advocates stress class action cases do more than deliver settlements — they deter bad behavior on the part of would-be wrongdoers, bring corporations to account fiscally when they are forced to settle, and open the door to legal discovery which can uncover patterns of extensive wrongdoing that would otherwise remain secret in arbitration.

But most important of all, class actions impact every customer, not just the handful who navigate arbitration to achieve a confidential settlement.  That can be critically important to stop unfair business practices.

What you get

Of course, reform is also desperately needed in the class action system.  Too often, judges approve class action cases that deliver maximum benefits to the law firms that bring them, leaving consumers with peanuts.  Strict limits on legal fees recouped in such cases, perhaps tied to a percentage of total recovery would be a start, as are bans on settlements that don’t provide cash refunds to consumers who choose not to conduct further business with companies that abuse them.  Coupons, low value trinkets, and donations to third party groups (non-profit or otherwise) are insufficient.  Attorneys that selfishly claim most of the proceeds for themselves have only themselves to blame when corporations use that fact against them under so-called “tort reform” proposals.

Some advocates of AT&T’s position also argue that government oversight can provide a more effective system of checks and balances against corporate overreach.  While a noble sentiment, anyone who has watched the revolving door of lobbyists going to work for such agencies, later returning to lucrative jobs with the companies they formerly regulated, knows that is a classic case of the fox overseeing the hen house.  In an era of government “oversight” that missed everything from BP’s safety lapses, salmonella-infected eggs, produce, and meat, tainted pet food ingredients from China, and indecisiveness about telecommunications reform like Net Neutrality — such proposals are not to be treated seriously.

The Supreme Court Decision

While it will be months before the Court rules, most observers suspect consumers will ultimately win the case.  Liberals on the court are skeptical AT&T’s efforts to preempt state consumer protection laws are actually for the benefit of consumers, and some of the most conservative members of the court like Justice Clarence Thomas, big believers in “states’ rights” are likely to find for the Concepcion family.

“Based on what was said during the argument, I predict a 8-1 or 7-2 vote for the consumers and California, with Samuel Alito dissenting and John Roberts a toss up. Thomas, who never speaks at oral argument, will vote for the consumers and state on federalism grounds, as he always does in [arbitration] cases,” writes Lawrence Cunningham, Argument in Class Waiver Case Favors Consumers, States, Concurring Opinions.

“[I]t doesn’t look as though there are too many votes at the high court to do away with the right of consumers to band together to sue the great American manufacturers of fine print,” said Dahlia Lithwick, Can You Hear Them Now? The Supreme Court reads the fine print on your cell phone contract, Slate.

If these two observers are wrong, it will be open season on consumers who will be forced into arbitration agreements that deliver all of the benefits to companies like AT&T.  Under such a scenario, there would be little to dissuade companies from developing new fine print to trick and overcharge consumers.  Few will be willing to buy a ticket to fly halfway across the country to sit for arbitration proceedings over a $20 dispute, especially when the arbitration firm’s income depends on fees paid by the very companies that are accused of wrongdoing.

Another Weekend Spat: AT&T U-verse vs. Food Network: “It’s Not About the Money,” Scripps Claims

Phillip Dampier November 8, 2010 AT&T, Consumer News, Editorial & Site News, HissyFitWatch, Online Video, Video Comments Off on Another Weekend Spat: AT&T U-verse vs. Food Network: “It’s Not About the Money,” Scripps Claims

AT&T's "Fair Deal" website claims the company is fighting for lower programming costs.

Programmers trying to play hardball over fees paid by cable, satellite, and phone company providers occasionally get the ball thrown back at them, which is precisely what happened Friday when Scripps-Howard found their popular networks thrown off of AT&T’s U-verse, even though the companies had agreed on financial terms.

At issue — AT&T wants to distribute programming it pays for over new mediums, ranging from video on demand, online viewing, and even wireless watching through smartphone applications.  If programmers want more money, AT&T argues, they’d better also be willing to deal on how that programming gets watched.

When Scripps’ officials demurred Friday morning, AT&T simply pulled the plug on Food TV, HGTV, the Cooking Channel, as well as lesser-watched Great American Country and DIY Networks.

Scripps’ officials hurried out a statement:

“Let me start by saying this impasse is not about money,” said John Lansing, president of Scripps Networks. “We reached an agreement in principle with AT&T U-verse on the distribution fees we would receive for these networks well in advance of last month’s contract deadline.”

“AT&T U-verse demanded unreasonably broad video rights for emerging media where business models have not even been established,” Lansing said. “Accepting their demands would have restrained our ability to deliver our content to our viewers in new and innovative ways.”

Food Network President Brooke Johnson threw a HissyFit, claiming AT&T yanked the channels while the two sides were still at the negotiating table.

As Friday wore on, both sides defended their respective positions.  Scripps’ saw AT&T’s actions as nothing short of a Pearl Harbor sneak attack.  AT&T claimed Scripps was pulling a flim-flam — trying to stick the phone company with an inferior deal that restricted how they can use the basic cable networks, all at prices higher than their cable competitors were paying.

But when Lansing claimed the dispute was not about money, reality was also yanked from the lineup.  When a cable company or programmer tells you it is not about the money, it is all about the money.

Scripps reactivated their "Keepmynetworks.com" website to fight another programming fee battle

Johnson told the Chicago Tribune AT&T was trying to negotiate for broad usage rights of their programming for services that don’t even exist yet.

“They are asking for broad, unlimited distribution on non-linear platforms that go well beyond emerging media technologies. It’s anticipatory and it’s without a business model,” Johnson said.

Such agreements could end up haunting Scripps if a new money-making distribution scheme evolves that AT&T can use -and- get to keep all of the profits.

Cable companies might also be unhappy if AT&T won concessions they themselves don’t have.

Re-purposing video content into on-demand or portable viewing could evolve into a multi-million dollar business, especially if consumers begin deserting cable TV packages that include dozens of unwatched channels.  Cable cord-cutters could end up watching Food TV shows online, and who benefits financially from that is ultimately the issue here.

A weekend without the networks on U-verse was apparently enough for both sides, who pounded out an agreement announced yesterday evening, restoring the networks.

It was all-smiles for both sides:

Brian Shay, senior vice president of AT&T U-verse, said, “It was important to us on behalf of our customers to come to a positive resolution as quickly as possible. We appreciate everyone’s willingness to make that happen, working diligently over the weekend, so the situation wasn’t prolonged, and we thank our customers for their support and patience while we reached a fair deal.”

From Scripps:

“AT&T U-verse customers, we have been overwhelmed by your loyalty and support of HGTV and our other networks – DIY, Food Network, Cooking Channel and GAC. Your voice has been heard and we are very close to getting our networks back on AT&T U-verse.  We hope to have more good news for you soon.”

Terms of the new agreement were not disclosed, but you can be certain it includes a higher price tag for the bouquet of Scripps’ networks that will eventually appear on future AT&T U-verse bills.  But at least the cable networks avoided the fate of the Hallmark Channel, kicked off U-verse Sept. 1st and is still off as of today.

[flv width=”512″ height=”308″]http://www.phillipdampier.com/video/WDAF Kansas City Cable Customers Lose Channels 11-8-10.flv[/flv]

WDAF-TV in Kansas City covers the weekend loss of Food TV and other cable networks on AT&T U-verse over another programming fee dispute.  (2 minutes)

Pick Me Up Off the Floor: AT&T-Sponsored Conservative “Small Business Group” Opposes Net Neutrality

Yet another telecom industry-backed front group claiming to represent the interests of small businesses managed to get its very-predictable opposition to Net Neutrality published in this morning’s Washington Post.  That is a small achievement considering the newspaper’s editorial page that increasingly promotes Big Telecom’s agenda.

This time it was the AT&T-sponsored “Small Business & Entrepreneurship Council,” which the Post claims is a “nonpartisan advocacy and research organization dedicated to protecting small business and promoting entrepreneurship.”  Hardly.  More on that later.

Karen Kerrigan is president, chief executive — and head regurgitator of the same false talking points AT&T and others have used to oppose Net Neutrality from the start:

The Federal Communications Commission is poised to impose new rules on the Internet using an outdated regulatory regime originally designed for the monopoly telephone system of the 1930s.

[…]Essentially, government regulations and bureaucrats would now direct how traffic over the broadband Internet flows rather than privately managed networks — they would also dictate what type of speeds, services and prices consumers should have (one size fits all) rather than let the market and innovators determine those things.

[…]Net neutrality rules would give the FCC new powers to micromanage the operations and pricing and service levels of the privately owned and financed broadband networks that are the physical heart of the Internet. This is a strategy for chasing away the billions of dollars that broadband network operators (principally the telecom and cable companies) plan to invest in broadband infrastructure and new technology.

Kerrigan

Of course, the “outdated regulatory regime” we’ve heard about from AT&T repeatedly is not coming along for the ride in broadband reform… only the authority to provide an effective checks-and-balances system for the marketplace duopoly most Americans find when shopping for Internet access.  Nothing about Net Neutrality dictates speeds and prices consumers pay for broadband.  Considering the United States continues to lose ground in broadband rankings, all of the innovation the SBE claims would be lost was never here to lose.  It has been in South Korea, Japan, and increasingly eastern Europe.

Net Neutrality does not micromanage operations, pricing, or service levels.  In fact, it is the most simple, easy to understand government proposal around.  It states simply that broadband providers will treat all websites equally, will not run toll booths to extract extortion payments from content producers to guarantee their material won’t be artificially slowed down or blocked, and guarantees no provider censorship.  The industry’s claims that Net Neutrality will harm investment is phoney-baloney from the phone and cable companies.  They’ve earned fat profits in a Net Neutral-world for a decade.  But now decreasing interest in landlines and cable TV service means they’re trolling for more revenue, and they think they’ve found an untapped goldmine setting up toll booths on the Internet.

In Kerrigan’s world view, not allowing AT&T and Verizon to install paywalls, speed throttles, and establish paid special relationships with big businesses harms small businesses.  To prove her case, Kerrigan quotes Evelyn Nicely, president of Springfield-based Nicely Done Kitchens:

“Small businesses such as ours depend on every tool we can use to succeed. Undoubtedly, our strongest ally in terms of client communication, marketing, and product specifications comes from the use of broadband and the Internet. It has given us the ability to compete with anyone, even the larger and better-funded players in our industry, through our Web site and its innovative tools, which enable us to effectively market our services to the public.”

Of course, nothing in Nicely’s comments opposes Net Neutrality.  In fact, such important broadband reform preserves the strongest ally her business has — a free and open Internet that lets her compete with far larger players on an equal, level playing field.  The biggest threat to that level playing field is not passing Net Neutrality.  It would allow companies like Lowes or Home Depot to become paid, preferred content partners with broadband providers who could direct Ms. Nicely’s potential customers not to her website, but to them.  Large companies who can afford the price will find their ads splashed on broadband provider-home page portals that deliver customized web searches, preferred partner online ads and error redirection pages that can send customers who may mistype Nicely’s business name to her direct competitors.

How Nicely could ultimately manage to keep her business open in a broadband world where special favors can be bought and delivered should be a major concern for her and every other small business.

Kerrigan's Small Business Survival Committee was dedicated to serving the interests of Big Tobacco companies like Philip Morris.

It’s no concern of the SBE, whose corporate backers keep this front group up and running.  But then it’s not the friend of small business it claims to be, and it’s hardly a “council.”

Before discovering the money that can be made parroting talking points for big cable and phone companies, Kerrigan was shilling for Big Tobacco, getting substantial contributions for her Small Business Survival Committee (a/k/a Small Business Survival Foundation) which received more than $100k from Philip Morris, hardly a small business at the time.

The SBE knows how to attract media attention through catnip-like “scorecards” that rank elected officials based on just how friendly they are to SBE’s benefactors.  The group and its leaders are darlings of conservative political media.  Their views see Communism anywhere individuals collaborate on their own in a way that costs big business profits.  Its chief economist even saw Borg-socialism in the concept of “open source” software:

“In the software universe, something similar to the Borg from ‘Star Trek’ seems to be at work,” declared SBE’s Raymond J. Keating. “It’s called open source software distributed under an agreement known as General Public License (GPL). If you recall, the Borg are ‘Star Trek’ bad guys. They’re basically evil bureaucrats with skin problems, who assimilate every species they come in contact with throughout the universe. Societies are wiped out. Individual thought and creativity are extinguished as individuals are absorbed into a collective. Something similar could be said of GPL-based open source software.”

An impartial, fair observer of telecommunications policy for small business the SBE is not.

Unfortunately, the Washington Post, whose parent company owns cable operator Cable One, has little incentive to see through the SBE’s haze of telecom industry-inspired talking points.

World Wide Wait: DSL = (D)ead, (S)low and (L)ousy — the Dial-Up of the 2010s, Says Analyst

Telephone companies will lose up to half of their broadband market share if they insist on sticking with DSL technology to deliver Internet access, according to a new report from Credit Suisse analyst Stefan Anninger.

Anninger predicts DSL will increasingly be seen as the “dial-up” service of the 2010s, as demand for more broadband speed moves beyond what most phone companies are willing or able to provide.  Credit Suisse’s analysis says DSL accounts sold in the United States top out at an average speed of just 4Mbps, while consumers are increasingly seeking out service at speeds of at least 7Mbps.  The higher speeds are necessary to support high quality online video and the ability for multiple users in a household to share a connection without encountering speed slowdowns.

A lack of investment by landline providers to keep up with cable broadband speeds will prove costly to phone companies, according to Anninger. He believes a growing number of Americans understand cable and fiber-based broadband deliver the highest speeds, and consumers are increasingly dropping DSL for cable and fiber competitors.  Any investments now may be a case of “too little, too late,” especially if they only incrementally improve DSL speeds.

Anninger says providers may be able to offer up to 18Mbps in five years by deploying ADSL 2+ or VDSL technology, but by that time cable operators will be providing speeds up to 200Mbps, and many municipal providers will have gigabit speeds available.

The impact on phone company broadband market share will prove bleak for phone companies in all but the most rural areas, Anninger predicts.  He says by 2015, cable companies will have secured 56 percent of the market (up by 2 percent from today), phone companies will drop from 30 percent to just 15 percent, Verizon FiOS, AT&T U-verse, and wireless broadband will each control around 7 percent of the market, with the remainder split among municipal fiber, satellite, and other technologies.

Anninger is also pessimistic about wireless broadband being a wired broadband replacement in the next five years.

A Credit Suisse online survey of 1,000 consumers in August found that less than half would consider going wireless only.  The reasons?  It’s too slow, too expensive and most plans have Internet Overcharging schemes like usage caps and speed throttles.

Although cable companies are on track to be the big winners in broadband market share, still have one giant hurdle to overcome — a lousy image.  Just 36 percent of cable customers say they are “very satisfied” with their local provider.  More than 60% of FiOS and U-verse’s broadband customers said they are “very satisfied” with the services these advanced telephone company networks provide.  Consumer Reports has regularly awarded top honors to Verizon FiOS for the last several years.

Independent phone companies and smaller cable operators routinely score at the bottom, typically because they are relying on outdated technology to supply service.

This makes the marketplace ripe for disaffected consumers to jump to an alternative provider.  Unfortunately, as most Americans face a duopoly of the cable company they hate and the phone company that doesn’t deliver the services they want, there is no place for them to go.

Anninger also predicts the risk of broadband reform by reclassifying broadband under Title II at the Federal Communications Commission is now “minimal.”  That suggests Net Neutrality enforcement at the FCC is not a priority.  The Credit Suisse analyst says if action hasn’t been taken by winter or spring of next year, it’s a safe bet the Commission will never re-assert its authority.

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