“The World Company is complimented that a number of companies have expressed interest in its Sunflower division over the years. This continues today. There is no definitive agreement concerning Sunflower with any company at this time.” — Dolph C. Simons Jr., Chairman, The World Company

Those words were reported Wednesday in a brief story published by the Lawrence Journal-World is response to an article published by cable trade magazine Multichannel News that Sunflower Broadband was close to a sale to Knology.

The denial of a definitive agreement does not mean the company isn’t close to reaching one, which was the original claim in the article written by Mike Farrell.

The non-denial denial didn’t dampen excitement by several Sunflower Broadband customers who were delighted to learn of the potential ownership change for the usage-capping broadband provider.

Some have stayed with AT&T’s DSL service just to escape Sunflower’s pricing, which one reader called “insane.”

Another claims AT&T’s upgrades have helped improve broadband service: “AT&T service has improved greatly…not to mention the price blows Sunflower away. Though AT&T will not tell you that you don’t have to have their modems. Go to Best Buy and get a third party modem.”

However, the broader implications of a sale of the cable company are worrying some Lawrence residents pondering the future of the hometown newspaper, the aforementioned Journal-World.  Sunflower Broadband and the LJW share a common owner — The World Company.  While the cable industry remains very profitable, many newspapers are not.

Phil Cauthon added his views to the Lawrence Broadband Observer on the topic:

I can’t see how this is anything but ominous for the Journal-World. Sunflower has a been a boon to the otherwise sinking newspaper ship. Unless some of the money from this sale is set aside as a foundation to support the newspaper over the long term, I don’t see how the Journal-World survives post-Knology sale. That Dolph Simons is still alive during a sale bodes well for that kind of prospect. Otherwise, I hope the Kansas City Star sees fit to serve Lawrence as a primary market—maybe even purchasing the LJW—with more than just a page or two of “metro” coverage.

What a great way to introduce U-verse to Chattanooga — headline news that an AT&T technician pepper-sprayed three dogs owned by a Chattanooga woman with a repellent known to be stronger than police pepper spray.

The nightmare for Janelle Lawrence began last week when an AT&T technician came on her property unannounced and began working in her fenced-in yard.

Janelle greeted the technician and asked him if her dogs, who were sharing her yard with the AT&T employee bothered him.

“He said not anymore.  I pepper sprayed them,” Janelle told WRCB, a Chattanooga television station.

She also noticed her dogs reeling in pain.

“My pug had pepper spray all over her body and was having trouble breathing and it got all over my arms and I started burning,” Lawrence says.

Lawrence says the technician was rude to her and refused to show her I.D. or a work order.

She recorded his truck number off the back of his work truck and called the main office demanding to know why he was there when she doesn’t subscribe to any of the company’s services.

AT&T told WRCB they didn’t need Janelle’s permission to enter her property or spray her pets.

AT&T issued a statement to the station:

“An AT&T technician has been working on this street all week for this week’s U-verse launch in Chattanooga. This AT&T technician needed access to the easement area on this fenced-in property, which is in a public right of way.”

Janelle remains deeply upset at AT&T and the employee, who appears not to be suffering any ill-effects to his job from the incident.

“You can do something to me and I’ll take it all day, but if you touch my little angels,” Lawrence says that’s where she draws the line.

The pepper spray incident took a considerable amount of shine off AT&T’s U-verse launch event, particularly for potential customers who are also pet owners like Stop the Cap! reader Sam who pointed this incident out to us.

“The same quick-drawing AT&T technician that attacked this poor woman’s pets could be aiming for yours or mine next,” he writes. “As long as this guy is still employed by AT&T, I wouldn’t have U-verse in my house even if they gave it to me for free.”

As far as Sam as concerned, AT&T pepper sprays their customers with high bills and bad service on a daily basis anyway.

“These guys have no shame buying their way into Tennessee with another one of those statewide deregulation bills that brought lots of campaign cash for supporters and very little for consumers,” Sam writes. “I signed up for EPB Fiber service, which is owned by the city, costs me less than either the cable or phone company, and delivers real fiber optic service right to my house.”

Sam also notes the guy who installed it loved his two dogs and cat.

[flv]http://www.phillipdampier.com/video/WRCB Chattanooga Chatt woman ATT pepper sprayed my dogs 7-27-10.flv[/flv]

WRCB-TV was the only station in Chattanooga to spend more than a few seconds on U-verse’s introduction in the city this week, but it wasn’t the kind of PR AT&T was exactly hoping for.  [Warning-Content may upset sensitive viewers.]  (2 minutes)

All this during an underwhelming launch week for AT&T’s U-verse in the River City, which garnered almost no attention in the local broadcast media, except for the pepper spraying incident.  The local newspaper put the story in its Business section.

Chattanooga residents now enjoy a fifth choice for several traditional services offered by cable or satellite:

• Comcast — incumbent cable operator
• EPB — municipally owned power utility and fiber-to-the-home provider
• AT&T — U-verse brings better speeds and service than traditional DSL from the phone company
• DirecTV — Satellite TV
• DISH — Satellite TV

The biggest savings residents will find from Comcast and AT&T comes when bouncing back and forth between new customer promotions.  Or you can just stick with EPB, which seems to offer the same prices for new and old customers.  For broadband customers, EPB delivers (by far) the fastest Internet speeds — up to 100Mbps upstream and downstream.  Comcast comes in at second place, and AT&T U-verse tops out at around 24Mbps if you are lucky.

Once promotional pricing from Comcast and AT&T expire, savings are highly elusive.  Price comparisons are extremely difficult because of channel line-ups, bundled equipment, and different Internet speed tiers and phone calling plans.  Making the best choice means sitting down and exploring channel lineups, HD channel tiers, how much broadband speed you require, and what kind of phone service you want, if any.

Most of the triple-play bundled promotions including standard cable, Internet and phone service will run between $119-139 a month before taxes, fees, and equipment costs.  If you sign a contract, Comcast will throw in a free iPod Touch.  Providers will keep your package price-increase-free for the length of any contract you sign.  That could be important, because AT&T and Comcast have been increasing their rates at least annually.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/ATT U-verse Launch Event Chattanooga.flv[/flv]

Raw video from the Chattanooga Times Free Press captured the launch party for AT&T U-verse in the city.  (34 seconds)

McCormick - An AT&T Friend for Life

While AT&T was patting itself on the back for its wonderfulness, AT&T took special care to extend personal credit to Rep. Gerald McCormick (R-Hamilton County) for shepherding the Competitive Cable and Video Services Act of 2008 through the Tennessee General Assembly.  It helped deregulate the telecommunications industry in Tennessee and de-fang oversight agencies tasked with protecting consumer interests.  The result has been a myriad of customer service nightmares for Tennessee residents, particularly for those who are with AT&T and have faced repeatedly inaccurate bills and terrible customer service.

McCormick was right there in the press release to help celebrate the achievement:

“As Tennessee policymakers, our goal was to increase investment throughout the state and give consumers more choices and innovative new services, and I’m honored to help AT&T celebrate this launch,” Rep. McCormick said.

AT&T invested $180,000 in Tennessee lawmakers like McCormick to do the right thing by AT&T and pass the bill.  The Chattanooga Times Free Press delivered a breakdown in April 2009 summing up the spending as AT&T pushed forward its bill:

State Election Registry records show AT&T’s PAC gave almost $180,000 to candidates, usually incumbents, as well as PACs operated by legislative leaders and caucuses and parties in the two-year 2008 campaign cycle.

The PAC, funded by top executives, gave $2,000 to Lt. Gov. Ron Ramsey, R-Blountville, the Senate speaker, records show. The PAC gave another $8,000 to Mr. Ramsey’s leadership PAC, known as RAAMPAC, according to records.

The AT&T PAC contributed $5,000 to then-House Speaker Jimmy Naifeh, D-Covington, and another $4,000 went to Mr. Naifeh’s leadership PAC, the Speaker’s Fund, records show.

Rep. Gerald McCormick, R-Chattanooga, who is sponsoring the AT&T-backed deregulation bill, reported receiving $1,250 from AT&T’s PAC in 2007, records show.

“I don’t know how much money I’ve gotten from them,” Rep. McCormick said Tuesday. It is “up to each individual legislator whether they let that kind of thing influence them. I would hope that nobody would. I certainly don’t. I don’t need the campaign money that bad, to be honest with you.”

Janelle Lawrence and her beloved pets enjoyed none of this AT&T largesse — just the literal sting of the results.

AT&T’s idea of “unlimited service” has its limits.  Five gigabytes to be exact, as some customers are now learning.

Weeks after promising AT&T customers enrolled in unlimited smartphone data plans that they could keep them, AT&T is now calling some subscribers of an earlier unlimited plan, telling them they need to limit their use of the “unlimited service.”

AT&T’s Data Connect Unlimited plan was discontinued by AT&T back in 2008, but the company promised current customers they could keep their unlimited plan.  But now, the company has started calling customers when they exceed 5GB of usage during a month.

The Washington Post reports AT&T has been sending mixed messages to customers, and is cracking down on those customers exceeding the company’s arbitrary limits.

“We’ve had a small group of customers on a DataConnect 5GB plan who were not being charged for overage when they went beyond that limit,” she wrote. “We’re now working to bring their accounts in line with the policy for the other DataConnect 5GB plan subscribers.”

Clark added that users who had signed up for AT&T’s earlier Data Connect Unlimited plans (which it stopped selling in 2008) could keep using them, but if they made “certain changes to their account” — for instance, transferring it to a new line — they would have to sign up for a new $60 plan with a 5-gigabyte usage cap.

That comes as news to several AT&T customers who have been in touch with the Post, who were switched, without permission, to limited service plans when they made minor changes to their account or were told AT&T was going to end unlimited service for all AT&T customers.

Rob Pegoraro, who writes the Fast Forward column for the Post, notes AT&T’s customer-care staff seems a little confused about these matters. He advises users with old, unlimited-data plans should be prepared for lengthy calls to customer service — and keep careful records of their interactions with the company.

Craig E. Moffett joined Sanford C. Bernstein & Co. as the Senior Analyst for U.S. Cable and Satellite Broadcasting in 2002.

Craig Moffett, a Wall Street analyst with Sanford Bernstein, is sounding the warning bells that if AT&T and Verizon assign usage caps to their forthcoming LTE wireless broadband services, they will never provide suitable competition for American consumers.

The implications of Internet Overcharging schemes in wireless broadband go well beyond the two companies’ broadband offerings.  Investors expect either AT&T or Verizon to attempt a buyout of DirecTV in the coming months, hoping to pair the satellite service with broadband packages delivered by DSL, fiber, or wireless broadband.  Because many DirecTV subscribers are located in rural areas where even DSL service is often not available, wireless broadband networks would be the most likely means of reaching customers, but not with onerous usage caps.

“If LTE networks are going to be usage-capped, then the last pretense that LTE networks can be positioned as a substitute for terrestrial broadband would seem to be gone,” Bernstein told his clients. “And if LTE can’t be offered as a replacement for wired broadband, then the notion of an out-of-region bundle of DirecTV and LTE is no more.”

Unlike earlier broadband technologies, WiMax, LTE, and other 4G broadband platforms can deliver far more data to subscribers at reduced costs.  With the increased efficiencies offered by the faster networks, carriers can provide customers with considerably more wireless broadband service, unlike heavily capped 3G networks, most of which are limited to 2-5GB of monthly usage before the penalty rates or speed throttles kick in.  While completely unlimited service is unlikely until capacity increases, there is plenty of room to allow customers to access 4G networks without thinking twice about everything they do on them.

Sprint is betting its comeback on its virtually-unlimited Clear WiMax 4G service, now becoming available in an increasing number of cities across the country.  Marketed as a replacement for wired broadband, Sprint is hoping customers will flock back to the carrier, especially if AT&T and Verizon’s 4G LTE offerings are capped.

But AT&T and Verizon have both made noises about usage capping their LTE offerings, if only to increase revenue.  These profit raising Internet Overcharging schemes come despite efforts by the Obama Administration to dramatically increase wireless spectrum available for wireless broadband services.  Dave Burstein from DSL Prime says Federal Communications Commission chairman Julius Genachowski is betting the farm on wireless broadband being the best chance for increased broadband competition.

“The heart of the U.S. broadband plan is to release more spectrum – enough for 10-20 networks like Verizon’s LTE now building – and pray that will be enough competition in five to seven years to check price increases,” Burstein writes.

Making wireless an important substitute for DSL requires raising bandwidth caps from today’s typical 5-10 gigabytes to several times as high as LTE makes the cost reasonable. If Verizon follows AT&T with an abusively low cap of 2-5 gigabytes and Sprint etc. don’t clobber them, the whole broadband plan falls apart because that’s not enough for competition in the future.

I doubt Julius understands this, because he would be doing everything in his power to avoid low caps. It’s just one more strike against “affordable” broadband, like the recent Comcast and Verizon price increases. People need to laugh out loud when Genachowski says “affordable” while tolerating continuous price increases.

Dave Burstein, DSL Prime

While wireless broadband can deliver access to many Americans who have never had broadband service before, it’s not well-positioned to compete for customers seeking to use the next generation of high bandwidth Internet applications.

None of the current wireless services are suitable for high quality video streaming of HD TV shows and movies, a crucial application for many broadband users. Burstein also notes large uploads are painfully slow on Clear’s WiMax network because of limited upstream speeds, but he expects improvements in time, assuming carriers expand with demand.  If not, as more users pile on the next generation wireless networks, their suitability for high bandwidth services becomes even more questionable.

“How much wireless could compete with landlines, especially as all cable connections are moving to 50 meg, was a crucial question for the broadband plan,” Burstein writes. “The consensus of several good engineers is that 4G competes fine with DSL if not many people expect video or other high-bandwidth apps. Wireless certainly can’t keep up if many people want to watch their TV over the net, so it’s only a partial substitute.”

As for AT&T and Verizon, Moffett suspects both may have to take a pass on DirecTV, consumed with fighting against broadband reclassification and Net Neutrality policies in Washington.  Taking on a second battle to run another dog and pony circus to gain regulatory approval for a buyout of DirecTV may be more than they’re willing to deal with at the moment.