AT&T has boosted the maximum available broadband speed for its U-verse Internet offering to 45/6Mbps service in 40 cities across 15 states.

The broadband speed boost is part of AT&T’s Project Velocity IP (VIP), a three-year plan to expand U-verse’s capabilities and coverage into more communities within AT&T’s local landline service areas.

Most of the funding for Project VIP is being directed into expanding AT&T’s profitable wireless 4G network, but about $6 billion will be spent upgrading AT&T’s aging copper wireline facilities.

A big priority for AT&T is to retire copper-based distribution networks and replacing that wiring with fiber optics. U-verse depends on a significant amount of fiber to provide enough bandwidth for its television, phone and broadband service. But unlike Verizon FiOS, which delivers a fiber connection straight to the home, AT&T still relies on traditional copper wiring into the home.

Until AT&T replaces that copper with fiber, top broadband speeds are unlikely to keep up with its biggest competitor — cable broadband.

AT&T’s says the 45Mbps speed boost represents an incremental upgrade and plans further speed increases to 75Mbps.

In more rural areas, U-verse will rely on IPDSLAM technology to increase speeds up to 45Mbps. AT&T eventually hopes to further bump download speeds to 100Mbps.

For the most rural communities within its service area, AT&T hopes to offer service exclusively over its wireless network, eventually scrapping rural landlines altogether.

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/KTAL Shreveport U-verse Coming to Louisiana 8-23-13.mp4[/flv]

KTAL-TV reports AT&T’s upgraded U-verse could soon be coming to Shreveport, La. as part of Project VIP, which may give Comcast some much-needed competition in the Ark-La-Tex region. (3 minutes)

The meter is lurking

AT&T may soon approach your electricity provider to encourage the introduction of prepaid electrical service, powered by AT&T’s wireless network.

AT&T is looking beyond traditional cell phone service to keep profits flowing into its lucrative wireless business. A growing segment of revenue is anticipated to come from so-called “machine to machine” communications. One application, Meter Data Management (MDM), provides connectivity to wireless-enabled smart utility meters, and is expected to grow 300 percent to $221 million by 2014.

Although now uncommon in the United States, prepaying for electric service is found in many parts of the world where cash-strapped consumers tend to renege on the bill. With late and non-paying customers remaining a consequence of the current American economy, AT&T is encouraging utilities to adopt pay-for-use technology that will cut the 10 percent of late-payers off the grid and save utilities money spent to collect past-due bills.

AT&T argues the next generation of “smart meters” can do a lot more than report meter readings over a wireless network. The technology can be leveraged to offer risk-free utility service, targeting credit compromised customers and those seeking to avoid billing surprises from excessive energy use.

Customers switched to prepaid electric service fill their meter with an allotment of energy usage from prepaid top-up cards sold by area convenience stores, supermarkets and even street vendors. Customers can also use credit cards or authorize checking accounts to be debited on a regular basis. Customers who exceed their allowance quickly find their service shut off automatically, depending on state laws. Making a payment switches the power back on within minutes.

“Nearly 30 percent of people are on a prepay mobile plan in 2013,” said Ed Davalos, lead product marketing manager at AT&T, during a recent Greentech Media webinar. “That cannot be overlooked. The consumer has already changed.”

Getting utilities to adopt the system may require AT&T, in partnership with other vendors, to front some of the costs to switch to smart meter and prepaid billing technology. A study commissioned by AT&T found the biggest hurdle to adopting prepaid electric service is understanding who pays to implement it. One-third of American utility companies would launch prepaid service if it could be done for no or low-cost. Another one-third say they would seriously consider it if someone else put up the money to introduce it.

Since customers can only use energy they already paid to use, there is no payment risk to the utility company. AT&T estimates nearly 10 percent of all utility customers receive disconnect notices every month. The utilities eventually cut service to 3-5 percent of those who still don’t pay, which usually requires a truck to be sent to the customer’s home.

Using prepaid electric service offers utilities the power to switch off service at the office without a costly truck roll and prevent customers from running up an enormous past due balance. If just 10 percent of customers switched to prepaid electric service, AT&T estimates an average utility with 250,000 customers would save $5-15 million per year in costs. Those using prepaid service are so wary of exceeding their power allowance, they use about 11 percent less electricity than non-prepaid customers, reducing demand on electricity generation.

This cellular module is designed to fit within many power meters.

Customers enrolled in prepaid service get to check their energy usage and some utilities offer different rates depending on the time of day. That means cost-conscious customers might hold off doing laundry until rates drop overnight. Others might avoid air conditioning use in the late afternoons, when fluctuating power rates are typically at their highest.

Campbell McCool, chief marketing officer of SmartSynch said the actual costs to the wireless network to manage prepaid was “well under” $0.50 per meter, per month — and SmartSynch executives have offered it can be as little as pennies per meter, per month depending on volume.

Verizon is also involved in the business, announcing a partnership with eMeter to offer cloud-based, scalable MDM for utilities.

Forty-two percent of U.S. electric customers now have digital meters, up from less than 5 percent in 2008. In 2015, more than 50 percent will have them, according to one consultant.

With the introduction of smart meters come risks, warns some consumer advocates.

Last month, the U.S. power market regulator moved towards charging JPMorgan with manipulating higher fluctuating electricity prices with fraudulent trading schemes, impacting customers in California and the Midwest.

Third party electricity marketers have also become a problem in many deregulated power states, with come-ons ranging from rebate checks to introductory rates that expire and leave the customer paying skyrocketing electricity rates well above the cost of buying service direct from the local utility. Many also impose lengthy contracts with steep early termination fees.

Smart meters allow utility providers to conjure up a number of marketing programs, such as a “free power day” offered once per week. Customers signing up for promotions like that typically avoid running the washing machine, dryer, and dishwasher except on days when they won’t pay to use the appliances. Others have to wait until after midnight for savings to kick in from overnight energy discounts.

But many of the programs have been designed to promise more savings than they deliver. Power providers have been criticized for aggressive door-to-door marketing, fraudulent utility switches reminiscent of days when phone customers found their long distance carrier switched without their permission, and tricky promotional checks that, once deposited, commit a customer to several years of service with a provider at whatever rates they choose to charge.

But lack of savings isn’t the only problem. In Texas, utilities can cut power service to customers within 24 hours of warning them they have exhausted their prepaid balance.

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/ABS-CBN Regulators promoting use of prepaid electricity 10-25-12.flv[/flv]

In the Philippines, prepaid electric service was introduced to cope with customer complaints about high electricity rates. ABS-CBN News reports the meters don’t cut the price of electricity, they just help customers better manage bills by suggesting ways to reduce usage. (Oct. 2012) (2 minutes)

Pay television providers forced Al Jazeera to remove or block its online video content from American viewers in return for launching its new news channel on cable systems this week.

The Qatar-based news network had maintained a loyal, but small online audience for its English language news programming, using video streaming to reach American audiences that could not watch on cable or telco-TV.

For Time Warner Cable and AT&T U-verse customers, neither of which carry the new Al Jazeera America network, the move effectively cuts off viewing of the news channel’s English language programming.

The removal of Al Jazeera video content began with the termination of its live global English language stream within the United States. That was followed by blocking the network’s video clips on YouTube. The only way for viewers to watch the network now is by paying a cable, telephone, or satellite operator, assuming they are willing to carry it.

AT&T U-verse suddenly dropped predecessor Current TV just hours before Al Jazeera America was scheduled to launch in its place. The loss of five million potential viewers came as a complete surprise, culminating in a lawsuit filed against AT&T for violating its contract.

“Unfortunately, AT&T’s decision to unilaterally delete Al Jazeera America presented us with circumstances that were untenable — an affiliate that has willfully and knowingly breached its contractual obligations,” Al Jazeera America wrote in a statement issued Tuesday night. “Al Jazeera America’s strong hope is to resolve this matter quickly.”

AT&T issued its own statement stating the company “could not reach an agreement with Al Jazeera that we believed provided value for our customers and our business.”

Riyaad Minty, Al Jazeera’s head of social media has fielded complaints from loyal viewers who never got to watch the channel through their pay television provider and now can’t access the network without one. Minty tweeted the network was considering a new online offering within weeks, but it would not include Al Jazeera America.

The news channel is forced to tread carefully because of restrictive terms in its carriage agreements, designed to cut off cord cutters who refuse to pay for cable television. Most cable contracts forbid allowing cable networks to stream their programming online unless they offer it only to those who can prove they already pay an authorized provider.

Time Warner Cable is reportedly still negotiating with the news channel, which usually asks for less than five cents a month per subscriber. But no decision had been reached. Time Warner dropped predecessor network Current TV hours after news stories reported Al Gore, Jr. and other owners had sold the channel to the Qatar news organization.

Concern about programming costs only goes so far. While Time Warner Cable and Bright House customers continue to go without Showtime and access to CBS programming online (in addition to local station blackouts in New York, Texas and California), the two cable companies have found room in the budget to add two new expensive sports networks to their lineups.

Fox Sports 1 and 2 replaced the much-less-expensive Speed and Fuel Networks Aug. 17 on both cable systems. Fox had been getting 23¢ per subscriber each month for Speed and about 20¢ monthly for Fuel. Fox expects both cable operators to pay a monthly fee of 80¢ per subscriber for Fox Sports 1, rising quickly to $1.50 within a few years, according to Sports Business Daily. The cost of Fox Sports 2 is unknown.

Fox wants the two networks to gradually rival the most expensive network in your cable television package – ESPN. To manage that, Fox will need to engage in a bidding war with its Walt Disney-owned rival to grab the most-watched sporting events. Sports franchises love that, because they will profit handsomely from the proceeds. But both Fox and Walt Disney are bidding with cable subscribers’ money. The more sports programming costs, the higher cable bills will rise. ESPN already charges at least $5 a month per subscriber. To rival ESPN, Fox Sports may eventually have to charge as much, boosting cable bills an extra $4-5 a month for the competing sports networks.

“It’s going to be a popular channel,” said Joe Durkin, Bright House senior director of corporate communications. “It’ll be rich with sports, and we’re happy to bring it to our customers.”

Fox Sports negotiated access to more than 90 million U.S. homes through agreements with most large cable, telephone, and satellite TV distributors. Attracting them: at least 5,000 annual hours of live events and original programming including college basketball and football, joined by Major League Baseball next year. The network will also feature NASCAR, international soccer and Ultimate Fighting Championship (UFC) competitions.

Fox Sports 2 will feature mixed martial arts at the outset, with more programming coming as the network develops.

Besides the two national sports networks, Fox also owns almost two dozen regional sports channels including Prime Ticket and Fox Sports West. It also acquired a 49% stake in New York’s YES, the Yankees Entertainment and Sports Network, with an option to buy it outright later. It also recently acquired a sports channel in Cleveland.

Fox also plans to launch another entertainment cable network Sep. 2 with the debut of a companion to the FX network Fox is calling FXX.

FXX is being programmed for… you guessed it, young adults aged 18-34 — the most coveted demographic for advertisers. It will feature reruns and original programming, including Parks and Recreation, Arrested Development, How I Met Your Mother, Freaks and Geeks, Sports Night, It’s Always Sunny in Philadelphia, The League and Totally Biased with W. Kamau Bell.

You may not have asked for the new network, but chances are you are getting it anyway. Fox has signed carriage agreements with Comcast, Time Warner Cable, Charter, Verizon FiOS, AT&T U-verse, and both satellite services.

Waiting for Comcast and Verizon to offer cutting edge broadband to 620,000 Baltimore city residents and businesses appears to be going nowhere, so the city is hiring an Internet consultant to consider whether to sell access to its existing fiber network.

Baltimore officials spent at least a year trying to convince Google to launch its fiber network in the city only to be bypassed in favor of Kansas City, Austin, and Provo, Utah. Local unions and community groups have also attempted to embarrass the local phone company by publicly protesting Verizon’s lack of interest in expanding its fiber optic network FiOS in Baltimore. Comcast has proved a disappointment for many, with the latest technology going to other cities well before Baltimore gets improved service.

Baltimore’s Board of Estimates voted to spend $157,000 to hire Magellan Advisors to produce a cost-benefit analysis of expanding the city’s current fiber infrastructure to deliver better Internet access.

“I’m paying more here for lesser service, so I think one of the things we want to try to do is look at that, look at what [current companies] offer and try to incentivize people to offer more,” Baltimore’s chief information officer Chris Tonjes told the Baltimore Business Journal. “In the short term, we’re going to do a study. In the medium run, we’re going to try to renegotiate the cable franchise agreement. In the longer run we want to make it more profitable for providers to come in here and offer the expanded service.”

Like many cities, Baltimore already owns and operates its own fiber ring, built with public funds to support the city’s public safety radio system. Like many municipal institutional fiber networks, Baltimore’s fiber ring is underutilized. Public safety and other institutional users often use just a fraction of available capacity. Despite the fact such networks are often oversized, they are rarely controversial because they do not typically compete with commercial providers and are usually off-limits to the public.

As Baltimore prepares to update their existing fiber infrastructure, Magellan will study the implications of leasing excess capacity to third-party providers that can sell broadband access to private businesses and individuals. Even Comcast and Verizon would be welcome to lease capacity.

Neither company has shown much interest, and the proposal received a strong rebuke from Maryland Sen. Catherine Pugh (D-Baltimore City):

Pugh

For the most part, municipally-built broadband networks have the economic chips stacked against them and, where tried, have saddled local taxpayers with a mountain of debt and half-built networks that are then sold at fire-sale prices to vulture investors. Taxpayers in Provo, Utah, for instance, spent $40 million to build a relatively small and modest network only to sell it for $1 a few years later because they underestimated the massive costs of operating, upgrading and maintaining it.

But Provo is just the latest exhibit in a long pantheon of such failed initiatives that include Groton, Conn., ($38 million taxpayer loss) and Marietta, Ga., ($35 million taxpayer loss). Cities as large as Philadelphia, New York and Chicago and as small as Lompoc, Calif., and Acworth, Ga., have also tried and failed to launch their own broadband networks — or simply gave up.

Pugh’s editorial, published in both the Wall Street Journal and The Baltimore Sun, failed to disclose Pugh has received political campaign contributions from both Comcast and Verizon. More importantly, Pugh did not bother to mention she is the president-elect of the National Black Caucus of State Legislators, a group with close ties to both Comcast and Verizon Communications.

Among the “member corporations” of the NBCSL — companies who “weigh in” on the policies promoted by the group: AT&T, Comcast, CTIA – The Wireless Association, the National Cable & Telecommunications Association, Time Warner Cable, and Verizon.

Among the NBCSL’s roundtable members: AT&T, Comcast, Time Warner Cable, and Verizon

For the fourth consecutive year, Verizon hosted its Black History Month open house at the Reginald F. Lewis Museum in downtown Baltimore. This year, among Verizon’s special guests: Maryland Senator and president-elect of the National Black Caucus of State Legislators Catherine Pugh. Comcast has also opened its checkbook to the NBCSL. Among the contributions — $50,000 to form the “NBCSL/Comcast Broadband Legislative Fellowship” to “increase efforts to conduct research and develop solutions regarding broadband adoption among African Americans.”

Opening up a competitive, lower-priced broadband alternative owned by the citizens of Baltimore is not one of Pugh’s favored solutions to be sure.

The NBCSL has been more than a little preoccupied with the business agendas of its corporate members. The group’s glowing endorsement of the Comcast-NBCUniversal merger was so positive, Comcast continues to present the group’s submission urging approval of the merger on its website. In 2011, the NBCSL signed on to the campaign to get government approval of the now-dead merger of AT&T and T-Mobile USA, claiming it was in the best interests of African-Americans. Just this month, Time Warner Cable quoted the group’s comments on the dispute between the cable company and CBS on its website.

Stop the Cap! has refuted claims that public broadband is a financial failure in the past. Read our fact check here.

Although Comcast has been the dominant cable provider in Baltimore for years, its monopoly status is “de facto” only, because federal law prohibits exclusive cable franchise agreements. That being said, no other well-known cable provider will agree to offer service in competition with another. Overbuilders — small private entities that have business plans that depend on competing with incumbent operators, are few and far between. For most Americans, the only cable competition comes from satellite providers or the phone company. Satellite television lacks a broadband option and Verizon’s local broadband infrastructure is limited to providing DSL service.

Tonjes

Tonjes hopes the possibility of a public broadband alternative might shake up the city’s broadband landscape, but not every neighborhood is now passed by the city’s fiber ring.