STATE OF NEW YORK

PUBLIC SERVICE COMMISSION

_______________________________________

Joint Petition of Charter Communications and Time

Warner Cable for Approval of a Transfer of Control

of Subsidiaries and Franchises, Pro Forma                                Case 15-M-0388

Reorganization, and Certain Financing Arrangements.                               

_______________________________________

Statement of Opposition to Joint Petition and

Response to Redacted Comments of DPS Staff

Phillip M. Dampier, Director and Founder: Stop the Cap!

Rochester, New York

September 25, 2015

Stop the Cap! is a Rochester-based consumer group founded in 2008 to fight against the introduction of artificial limits on broadband usage (usage caps, consumption billing, speed throttling) and to promote better broadband speeds and service for consumers. Our group does not solicit or accept funding from lobbyists, companies, or others affiliated with the telecommunications industry. We are entirely supported by individual donors who share our views.

Introduction

Our opposition to the Joint Petition is based on our belief it does not meet the “public interest”  test established in Section 222 of the New York Public Service law, and must therefore be denied.

For the sake of brevity, we wish to associate ourselves with most of the views of the DPS Staff contained in their redacted comments regarding this case, published on the DPS website on September 16, 2015. Most of our testimony will seek to expand on their findings or add additional information to the record for the Commission’s consideration.

As we stated in our remarks regarding the Comcast-Time Warner Cable merger, New York law obligates the applicant alone to demonstrate its proposal is in the public interest. If the Commission finds the application does not meet the public interest or provide sufficient public benefits, it should be rejected. The DPS staff has reported to you Charter Communications and Time Warner Cable have not met their burden. We agree.

The DPS staff then proposes a mitigation strategy in an effort to tip the balance in favor of the applicant. It remains our view it is not the Commission’s responsibility to help tip the balance in favor of an applicant that has failed to meet its burden.

Nevertheless, we offer the Commission our insight about Charter Communications, its proposals, and the DPS staff recommendations with the hope it will be useful to win commitments from Charter should the Commission choose to proceed with approval, enforcing modifications to deliver the public interest benefits consumers across New York tell us they actually want and need from their providers.

Discussion

New York State, particularly across the upstate region, is not well positioned to take advantage of next generation broadband networks. Just two providers deliver telecommunications services to the majority of New York: Verizon Communications and Time Warner Cable. Although Frontier Communications and Cablevision also deliver service, their service areas are much smaller than the two dominant incumbents. The decisions Verizon and Time Warner Cable make about their investments in broadband and telephone service affect millions of New Yorkers.

Many New York residents have only one choice for Internet service that meets the Federal Communications Commission’s definition of broadband: 25Mbps download speed and at least 3Mbps upload speed.[1] In areas where Verizon FiOS is not available, Time Warner Cable is the only significant provider consistently providing service options at or above 25Mbps. The most common alternative is DSL, which rarely meets the FCC’s minimum definition of broadband.

With this in mind, the FCC reported 53 percent of rural Americans lack access to broadband service achieving speeds of 25Mbps or better. As much as 20 percent still lack access to broadband at speeds achieving the FCC’s old benchmark of 4Mbps. Upstate New York, in particular, is a long way away from achieving the goals of 100Mbps broadband set by Gov. Cuomo, unless you have access to a cable broadband provider.

In Rochester, the majority of residents have only one choice for a provider that meets the FCC’s definition of broadband: Time Warner Cable. While Frontier Communications has made investments to improve their wireline network, only a small minority of customers qualify for DSL service that can meet the FCC’s benchmarks.

While Verizon Communications has done an admirable job delivering its fiber to the home service FiOS to portions of New York, the company has suspended expansion of the service and has not even met its service obligations in cities like New York.[2]

Even more concerning is the fact none of the significant incumbent providers serving New Yorkers have expressed any interest in providing residential gigabit speed service. Google Fiber has not announced any expansion into New York State and other significant gigabit speed providers, including AT&T, do not provide wireline service in New York.

In contrast, in states including Texas, North Carolina, Georgia, Missouri, and Tennessee, many consumers have the option of choosing at least two gigabit service providers (Google or AT&T) as well as municipal or public broadband providers such as EPB, which serves the Chattanooga area. Time Warner Cable has focused much of its upgrade activity on these communities to remain competitive, delivering 300Mbps broadband service for the price it used to charge for 50Mbps speeds.

In western New York, the fastest broadband speed most residential customers can buy is just 50Mbps. Charter Communications proposes to increase that speed in some areas to a maximum of 100Mbps, along with their entry level 60Mbps plan. Although helpful, that offers little solace to residents and small businesses that would like the option to purchase considerably faster Internet speeds that are now becoming available in other parts of the country.

The Commission’s decision will have an enormous impact on what kinds of telecommunications services will be available to New Yorkers for years to come. Verizon has shown no interest in resuming fiber service upgrades, so most customers will continue to purchase Internet access from the incumbent cable operator to obtain the broadband speeds they require. Today that usually means Time Warner Cable. Sometime next year, that could be Charter Communications.

Time Warner Cable vs. Charter Communications

The most important question before the Commission is which cable operator is better positioned to deliver the services customers in this state want and/or need. We argue that operator is Time Warner Cable, not Charter Communications.

Since the termination of the Comcast-Time Warner Cable merger, Time Warner Cable has responsibly invested in their infrastructure without assuming an irresponsible amount of debt.

Time Warner Cable CEO Robert Marcus reported significant progress in their first quarter 2015 report to shareholders and customers, despite the distraction of the Comcast merger[3]:

Over the past 16 months, we’ve made significant investments to improve our customers’ experience:

• Investing more than $5.2 billion to, among other things, improve the reliability of our network and upgrade customer premise equipment – including set-top boxes and cable modems – with the latest technologies and expand its network to additional residences, commercial buildings and cell towers;
• Launching TWC Maxx, which features greater reliability, all-digital video, advanced TV services, standard tier of Internet speeds at 50 Mbps, and higher tiers of service up to 300 Mbps. New York, Los Angeles and Austin are complete; Dallas, San Antonio and Kansas City are underway; Charlotte, Raleigh and Hawaii are slated for later this year; and San Diego is expected to be done in early 2016;
• Introducing Enhanced DVR, a six-tuner set-top box that allows customers to record up to six shows simultaneously and store up to 150 hours of HD content;
• Increasing the number of Cable Wi-Fi hotspots available to our customers to 400,000;
• Rolling out our cloud-based video guide to 8 million set-top boxes to date. The guide also makes it easier to browse our On Demand library, which now sits at 30,000 free and paid titles and continues to grow;
• Expanding our industry-leading TWC TV app – which allows customers to watch live TV and On Demand content and control and program their DVR from inside and outside the home. TWC TV is now available on Xbox One, Xbox 360, Amazon Kindle Fire HD and HDX tablets, Android and IOS phones and tablets, Fan TV, PCs, Samsung TV and Roku;

Serving customers on their schedules rather than ours. We expanded one-hour appointment windows across the company and in Q1 met that window 97 percent of the time. We continue to add nighttime and weekend appointments.

Since that report, Time Warner Cable has announced new Maxx service upgrade areas – Greensboro and Wilmington, N.C. At least 45 percent of Time Warner Cable’s national footprint will be serviced with Maxx upgrades by the end of this year, and Marcus has indicated additional cities will receive upgrades in 2016.[4]

Marcus has indicated repeatedly he intends to see Maxx service upgrades extend even further. On the January 29, 2015 quarterly results conference call with investors, Marcus indicated Maxx upgrades delivered tangible benefits to the company, including increased customer satisfaction, higher network reliability, and a stronger product line. Based on those factors, it would be logical to assume Time Warner Cable would continue its upgrade project, and indeed Marcus confirmed this in his remarks:

“Our aim is to have 75% of our footprint enabled with Maxx […] by the end of [2016], and my guess is we’re continuing to roll it out beyond that,” said Marcus[5]. “So the only question is prioritization, and obviously as we think about where to go first, competitive dynamics are a factor. So that includes Google, although it’s not explosively dictated by where Google decides to go. In fact I think we announced the Carolinas before Google did their announcement this week. So competitors are certainly relevant obviously.

At the rate Time Warner Cable has been rolling out Maxx upgrades, which were first announced on January 30, 2014[6], with 45% of its service area upgraded within 23 months, it is likely the company would complete its Maxx upgrade to all of its service areas within the next 24-30 months. The DPS staff also notes, “there is no indication that Petitioner’s plan for converting to all-digital in New York is any different from Time Warner’s existing plan.”

Charter’s upgrade proposal is, in fact, generally inferior to what Time Warner Cable is accomplishing on its own. We strongly recommend the Commission carefully consider whether Charter’s proposal is as truly compelling as they claim.

Charter Communications’ upgrade proposal is not a good deal for New York.

We agree with the DPS staff’s conclusion Time Warner Cable, on its own, would likely complete its Maxx upgrade program across upstate New York at or around the same time Charter’s proposed upgrades would be complete. Therefore, when comparing Charter’s proposal with Time Warner Cable’s existing service, we urge you to use Time Warner Cable Maxx service as the benchmark, not the existing level of service provided in upstate New York today.

Time Warner Cable Maxx offers 50/5 Mbps speeds under its most popular Standard plan. In contrast, Charter proposes to offer 60/5Mbps service under its most-popular Spectrum plan. While Charter’s offer is superior at first glance, it comes at a cost to customers looking for more budget-priced service or those seeking faster speeds.

Charter has no plans to continue Time Warner Cable’s $14.99 Everyday Low Price Internet service – a very important offer for low income residents and senior citizens who are unable to afford the nearly $60 regular price both companies charge for their 50 or 60Mbps tiers. Time Warner Cable offers this tier without preconditions, restricted qualifiers, contracts, or limits on what types of services can be bundled with it. Any consumer qualifies for the service and can bundle it with Time Warner Cable telephone service for an additional $10 a month, which offers a nationwide local calling area, as well as free calls to the European Union, Mexico, Puerto Rico, and several Asian nations.

The loss of a $25 plan that includes basic Internet access and a bundled, 911-capable telephone line would be devastating to low-income New Yorkers and senior citizens. During the Comcast-Time Warner Cable hearings, no topic elicited as much interest as Internet affordability. Time Warner Cable clearly offers a superior product line for these customers, including two other Internet service tiers offering stepped up Internet speeds in $10 increments. These options would be unavailable from Charter.

Charter’s proposed solution to serve low-income New Yorkers is adoption of Bright House Networks’ Connect2Compete program, which offers restricted access to $9.95/month Internet service for those who qualify.

Stop the Cap! investigated Bright House Networks’ existing offer in a report to our readers[7] in June 2015, and we urge the Commission to look much more closely at the specific conditions Bright House customers have had to endure to qualify to subscribe:

1) You must have at least one child qualified for the National School Lunch Program. They need not be enrolled now.

2) You cannot have been a Bright House broadband customer during the last three months. If you are a current customer, you must first cancel and go without Internet service for 90 days (or call the phone company and hope to get a month-to-month DSL plan in the interim.)

3) If you have an overdue bill older than 12 months, you are not eligible until you pay that bill in full.

4) Bright House does not enroll customers in discounted Internet programs year-round. From a Bright House representative:

“We do participate in this particular program, however, it is only around September that we participate in it. This is a seasonal offer that we have which can only be requested from the middle of August to the middle of September, which is when most start up with school again for the year.”

5) Bright House does not take orders for the Low-Income Internet plan over the Internet. You have to enroll by phone: (205) 591-6880.

Families fall into poverty every day of the year, and poverty-stricken families move from one school district to another every day of the year. So it’s horribly unfair to tell them they’d qualify for this program if only they had fallen into poverty sometime between the middle of August and the middle of September.

It has been our experience covering service providers across all 50 states that most design these low-cost Internet access programs with revenue protection first in mind. Charter Communications is no different. As with Comcast, Connect2Compete is only available to families with school age children. Applicants face an intrusive, complicated, and time-restricted enrollment process designed to dampen and discourage enrollment.

The interest in meeting the needs of low-income customers would be laudable if not for the insistence otherwise-qualified existing customers cannot downgrade their regular price broadband plan to Connect2Compete unless they voluntarily go without Internet service for three months.

We strongly recommend Charter Communications be compelled to continue Time Warner’s $14.99 Internet plan, but at speeds no less than 25Mbps, the minimum definition of entry-level “broadband” by the FCC. We also recommend Charter be required to further discount this plan to $9.95 a month for qualified customers who meet a simple income test the Commission can define and establish. These discount programs should not just be available to families with school-age children. Everyone needs affordable Internet access, whether you are single and looking for your first job or a fixed income senior citizen.

All restrictions for existing customers or those with an outstanding balance must be prohibited and sign-ups must be accepted 365 days a year with re-qualification occurring not more than once annually.

Charter’s broadband offers for lower-income New Yorkers are not adequate, and neither are their plans for customers who need enhanced service.

Time Warner Cable Maxx delivers a more compelling offer for consumers and small businesses that need much faster Internet access. Charter’s upgrade will offer customers two choices: 60 or 100Mbps service. Time Warner Cable Maxx offers considerably more[8]:

Charter Communications has only committed to provide customers with unlimited Internet access for three years. Time Warner Cable CEO Robert Marcus has repeatedly made it clear compulsory usage caps are off the table at Time Warner Cable – a lesson they learned after customers pushed back and forced them to shelve a usage cap experiment planned for Rochester and other cities in April 2009[9]. The company has never raised the possibility of compulsory usage limits or usage-based billing again.

“We have no intention of abandoning an unlimited product we think that something that customers value and are willing to pay for,” said Time Warner Cable CEO Robert Marcus. “The way we’ve approached usage-based pricing is to offer it as an option for customers who prefer to pay less because they tend to use less. And we’ve made those available at 5 gigabytes per month and 30 gigabytes per month levels.[10]”

Time Warner Cable again offers a better choice for New Yorkers. With many New Yorkers having no practical alternatives, imposing usage limits or forcing customers into even higher-priced usage billing plans would only make New York even less attractive for those who need high quality Internet access for education, telecommuting, or to assist in running a small business. Google Fiber, in contrast, offers 1,000Mbps service with no usage caps at all. Many other providers also have no plans to introduce usage caps.

Charter Communications has a history of capping their customers’ usage. Less than three months before announcing it would acquire Time Warner Cable, Charter Communications quietly dropped usage caps in place on its broadband plans since 2009, without explanation and the FCC now wants to know why, as they also contemplate the impact of the merger[11] [12]. In addition to the anti-consumer practice of placing customers on an unnecessary usage allowance, such usage limits may also be established for anti-competitive reasons to limit exposure to online video streaming, which competes directly with cable television. Customers who watch a lot of online video are those most likely to face service suspension or find overlimit usage fees applied to their bill.

Almost all of Charter’s so-called customer-friendly commitments and policies have a very unfriendly expiration date of three years, which should be unacceptable to the Commission. There is no reason Charter cannot extend its commitments to not charge modem fees, adhere to the basic principles of Net Neutrality, and not impose usage caps or other forms of usage billing permanently. Without such a commitment, consumers could soon pay much higher prices for broadband service, and without robust competition unlikely to develop in most of New York over the next three years, there will be every incentive for Charter to further boost earnings by imposing modem fees and usage pricing on its customers.

One of those incentives is the level of debt Charter Communications will assume in this transaction. DPS staff is correct when they noted New Charter’s debt and lowered credit rating “represents the single most substantial risk of the proposed transaction.”[13]

Debt servicing costs and more expensive credit are both deterrents to investment and are likely to limit the scope of Charter’s ongoing system upgrades and maintenance. Charter is a much smaller cable operator than Time Warner Cable, and is itself still in the process of repairing and upgrading its own cable systems and those it acquired in earlier acquisition deals. Time Warner Cable, in contrast, is in a much stronger financial position to carry out its commitments associated with the Maxx upgrade program.

Specifics about Charter’s commitments to expand service into unserved areas of New York were either vague and non-specific or redacted. The past history of winning expansion commitments from cable operators who rely on Return On Investment (ROI) formulas to determine which homes and businesses they will serve have met with limited success.

The pervasive problem of rural broadband availability is unlikely to be resolved substantially by this transaction without the strongest buildout requirements. But even that is unlikely to be of much help for large sections of New York outside of existing video franchise areas. Compelling Charter Communications to adopt universal service obligations within all existing Time Warner Cable franchise areas may be a good start. Under such a requirement, any consumer or business that wants cable service and lives within the geographic boundaries of an existing franchise area would receive it upon request without construction fees, surcharges, or other passed-along fees to reach that customer, regardless of their distance from the existing cable plant or ROI formula. The largest impact of this would be to extend cable service into business parks and commercial buildings, which often lack cable service, but many suburban and exurban residential customers would also benefit.

But the Commission must look carefully at Charter’s financial capacity to meet these obligations after assuming control of a company much larger than itself. No commitment is worth much if a company ultimately fails to deliver on it.

An overburdened cable operator is also unlikely to make substantial investments in improving customer service, and that makes the risk of depending on Charter Communications to improve Time Warner Cable’s already poor customer service rating doubtful. Competition is the biggest incentive to improve customer service and responsiveness, and that is unlikely to prove much of a factor for large sections of New York over the next few years. In fact, we argue customer service is likely to deteriorate for New Yorkers in the short term because of the disruptiveness of any ownership change and eventual billing system integration. Again, Charter’s proposal offers no compelling public interest benefit to New Yorkers. The fact DPS staff is proposing a performance incentive mechanism to compel service improvements illustrates absent punitive measures, Charter Communications is unlikely to offer any improvement over Time Warner Cable, and may in fact perform worse.

Consumer Reports rates both companies’ Internet Service poorly[14]:

• Charter: 63 (Reader Score), Poor Value, Fair Reliability, Good Speed, Mediocre Phone/Online Support, Fair In-Home Support
• Time Warner Cable: 57 (Reader Score), Poor Value, Fair Reliability, Fair Speed, Mediocre Phone/Online Support, Fair In-Home Support

Virtually nothing Charter Communications has offered as a public interest benefit meets that criteria. Its commitment to improve cable television does not offer any significant benefit to New York cable TV subscribers. Both Time Warner Cable and Charter propose to move to all-digital cable television to free up bandwidth to offer improved broadband.

While consumers clamor for smaller, less-costly cable television packages, Charter Communications’ CEO Thomas Rutledge is credited for inventing the “triple play” concept of convincing customers to package more services – broadband, television and telephone — together in return for a discount. Reuters cited his penchant for “simplified pricing,”[15] which is why Charter offers most customers only two options for broadband service and one giant television package dubbed Spectrum TV containing more than 200 channels.[16]

Unfortunately, any benefits from an all-digital television package are likely to be dismissed when customers get the bill. Currently, many Time Warner Cable customers watch analog television channels on television sets around the home without the need to rent a costly set top box. Any transition to digital television will require the rental of a set top box or purchase of a third-party device to view cable television programming. These can represent costly add-ons for an already high cable bill.

With approximately 99 percent of customers renting their set-top box directly from their pay-tv provider, the set-top box rental market may be worth more than $19.5 billion per year, with the average American household spending more than $231 per year on set-top box rental fees. These are some of the findings from Senators Edward J. Markey (D-Mass.) and Richard Blumenthal’s (D-Conn.) query of the top-ten pay-tv multichannel video programming distributors (MVPDs).[17]

Passed by Congress in December, the STELA Reauthorization Act of 2014 repealed the set-top box integration ban, which enabled consumers to access technology that allowed use of a set-top box other than one leased from their cable company. Without the integration ban, by the end of this year, cable companies will no longer be required to make their services compatible with outside set-top boxes, like TiVo for example, bought directly by consumers in the retail marketplace.

American cable subscribers spend, on average, $89.16 a year renting a single set-top box. The average set-top box rental fee for each company was used to calculate an overall set-top box rental cost average across companies: $7.43 a month, or $89.16 per year. Considering many homes rent a DVR box to make and view recordings and maintain less-capable boxes on other televisions, the total cost adds up quickly. The average household spends $231.82 a year on set-top box rental fees, according to Sens. Markey and Blumenthal.

Charter proposes to introduce a new generation of set top boxes but as far as we know, has not disclosed the monthly cost of these IP-capable boxes to subscribers. We anticipate they will cost more than the current equipment provided by Time Warner Cable, which has also been increasing the cost of its set top box rentals.

Time Warner Cable’s entry level Digital Transport Adapters, which convert digital/HD signals for older analog-only television sets, almost tripled in price over just one year. Originally introduced for $0.99 a month, the rental fee increased this year to $2.75 a month for customers in Rochester.[18]

Other points the Commission should consider in reviewing this transaction:

1. DPA staffers claim the transaction is unlikely to alter the competitive landscape because Charter Communications and Time Warner Cable do not have overlapping service areas. While it is true Charter and Time Warner don’t compete for the same customers, it is inaccurate to suggest the transaction will not alter competition. Cable industry consolidation is underway, in part, to help larger combined operators secure better volume discounts for increasingly expensive video programming.

   AT&T’s primary motivation to acquire satellite provider DirecTV was to secure better prices for video programming, both for DirecTV customers but more importantly for its own, much smaller, U-verse TV operation.[19]

   The cost barrier for new, directly competing entrants into the cable television business is well-recognized, even by smaller independent cable television providers that are having difficulty staying profitable and maintaining investments in broadband as they lack the ability to secure similar volume discounts for themselves. The American Cable Association, representing small operators, warned the FCC “existing providers of both broadband and MVPD services and new entrants will be deterred from expanding their broadband networks or otherwise undertaking new builds” as a result of increasing programming costs.[20]

   As a result, it is unlikely a new provider will be able to develop a sustainable business model that includes cable television while paying wholesale programming costs that are dramatically higher than what combined companies like New Charter will pay.

2. The Commission must insist that upstate New York is treated equally to the New York City market. If the deal is approved, Charter must be compelled to commit to continue Time Warner Cable’s Maxx upgrade initiative across all of its service areas in New York State, to be completed within 30 months. Nothing less than that should be acceptable to the Commission. We agree with the DPS staff’s recommendation that Charter also be compelled to upgrade facilities to support gigabit broadband, but this should be extended to include all of its service areas in New York, not just the largest cities.

   This does not pose a significant challenge to any cable operator. With the upcoming introduction of DOCSIS 3.1 technology, cable operators even smaller than Charter will support 1Gbps broadband speeds as they drop analog television signals. Suddenlink[21], MidContinent[22], Cox[23], and Mediacom[24] already have gigabit deployment plans in the works. If Fargo, N.D. is getting gigabit broadband from MidContinent Communications in the near future, Charter should have no problem offering similar service to customers in Jamestown, Penn Yan, Watertown, Binghamton, and beyond.

3. The Commission must establish and enforce meaningful enforcement mechanisms should Charter fail to achieve its commitments as part of this transaction. Cable consolidation has never significantly benefited consumers. Charter is not guaranteeing Time Warner Cable customers will receive a lower bill as a result of this merger. Nor is it committing to pass along the lower prices it will achieve through negotiations for video programming volume discounts. Cable rates, especially for broadband, will continue to increase. Without meaningful competition, there is no incentive to give consumers a better deal or better service.

   That is why if the Commission feels it must approve this transaction, the conditions that accompany it to achieve a true public interest benefit must be meaningful and ongoing. Any failure to deliver on those commitments must include a direct benefit to customers, not just to the state government. If fines are imposed, customers should receive a cash rebate or equivalent service credit for services not provided as part of any agreement.

Cable operators know once they secure a franchise or become the incumbent provider, no other cable company will negotiate with city officials to take over that franchise if the current provider’s application is denied during renewal. Once Charter (or any other cable company) establishes a presence, there is little or no chance a community will be able to get rid of that provider if it fails to perform. That is why any franchise transfer that comes from an acquisition or merger must be treated with the upmost seriousness. Customers will likely live with the decision the Commission makes for the next 10-20 years or more.

As Time Warner Cable customers loudly reminded the Commission in the Comcast merger proceeding, there is such a thing as a cable operator even worse than Time Warner Cable, already one of the lowest rated companies in the country. Comcast’s reputation preceded its intended entry into New York on a massive scale and the application was eventually withdrawn.

As the Commission must realize, this transaction does not just involve entertainment. Last week the Obama Administration declared broadband Internet access a “core utility.”[25]

“Broadband has steadily shifted from an optional amenity to a core utility for households, businesses and community institutions,” according to a report from the administration’s Broadband Opportunity Council. “Today, broadband is taking its place alongside water, sewer and electricity as essential infrastructure for communities.”

Unfortunately, the federal government has seen to it that this core utility is provided without the ability of local and state governments to properly deliver needed oversight. While the Public Service Commission lacks the authority to enforce consumer protections and quality of service standards for Internet access, it retains the very powerful ability to determine whether a company seeking to make a fortune selling consumers broadband service in a monopoly/duopoly market for many New Yorkers is a good or bad thing for consumers.

Our group strongly believes New York should not take a risk on Charter’s less-then-compelling offer when Time Warner Cable has demonstrated it is in a better financial position and has a proven track record of delivering on its commitments to improve service with its Maxx upgrade project. Time Warner Cable has superior options for low-income New Yorkers, has a large number of New York-based call centers providing valuable employment for our residents, offers more broadband options and faster speeds for entrepreneurs remaking themselves in the digital/information economy, and has committed to providing unlimited Internet access – a critical prerequisite for consumers choosing to drop cable television’s one-size-fits-all bloated video package and watch only the shows they want to see and pay for online.

We urge the Public Service Commission to deny Charter’s application. If it sees fit to make a different choice, we strongly recommend you demand the best possible deal for New York consumers and businesses that, as the DPS staff wrote, deserve best-in-class communications services.

• [1] http://stopthecap.com/2015/02/03/fcc-now-defines-minimum-broadband-speed-25mbps-everything-less-now-slowband/
• [2] http://www1.nyc.gov/office-of-the-mayor/news/415-15/de-blasio-administration-releases-audit-report-verizon-s-citywide-fios-implementation
• [3] http://www.twcableuntangled.com/2015/04/twc-gains-momentum-with-best-ever-subscriber-growth-customer-enhancements/
• [4] https://newsroom.charter.com/
• [5] https://seekingalpha.com/article/2864536-time-warner-cables-twc-ceo-rob-marcus-on-q4-2014-results-earnings-call-transcript
• [6] http://www.twcableuntangled.com/2014/01/get-the-details-on-twcs-plan-to-transform-ctv-internet-experience/
• [7] http://stopthecap.com/2015/06/25/bright-houses-mysterious-internet-discount-program-charter-wants-to-adopt-nationwide/
• [8] http://www.timewarnercable.com/en/enjoy/better-twc/internet.html
• [9] http://abcnews.go.com/Technology/story?id=7368388
• [10] http://stopthecap.com/2014/10/30/time-warner-cable-recommits-mandatory-usage-caps-long-company-remains-independent/
• [11] http://stopthecap.com/2015/09/23/fcc-demands-details-about-charters-suddenly-retired-usage-caps/
• [12] http://www.multichannel.com/news/fcc/fcc-seeks-data-dump-charter-twc-bright-house/394010
• [13] http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId={C60985CC-BEE8-43A7-84E8-5A4B4D8E0F54} (p.39)
• [14] http://www.consumerreports.org/cro/electronics-computers/computers-internet/telecom-services/internet-service-ratings/ratings-overview.htm
• [15] http://www.reuters.com/article/2014/01/30/us-charter-timewarnercable-rutledge-anal-idUSBREA0T01D20140130
• [16] https://www.spectrum.com/cable-tv#/channel-lineup
• [17] http://www.markey.senate.gov/news/press-releases/markey-blumenthal-decry-lack-of-choice-competition-in-pay-tv-video-box-marketplace
• [18] http://stopthecap.com/2014/12/22/time-warner-cable-deck-halls-8-modem-fees-fa-la-la-la-la-la-la-la-la-2-75-dta-fee/
• [19] http://www.usatoday.com/story/money/2015/07/24/fcc-approves-ts-acquisition-directv/30626421/
• [20] http://www.americancable.org/node/5229
• [21] http://www.multichannel.com/news/technology/suddenlink-boots-1-gig-broadband/392087
• [22] https://www.midco.com/PressRoom/2014/midcontinent-bringing-gigabit-internet-access-to-the-northern-plains/
• [23] http://www.multichannel.com/news/distribution/cox-plots-docsis-31-plans/393996
• [24] http://www.multichannel.com/news/cable-operators/mediacom-sets-residential-1-gig-rollout/393585
• [25] http://thehill.com/policy/technology/254431-obama-administration-declares-broadband-core-utility-in-report

Remember the good old days when cable and phone companies told you there was no demand for faster Internet speeds when 6Mbps from the phone company was all you and your family really needed?

Those days are apparently over.

Multichannel News, the largest trade publication for cable industry executives, warns cable companies gigabit broadband speeds are right around the corner and the technological transformation that will unleash has been constrained for far too long.

Say what?

Proving our theory that those loudest about dismissing the need for faster Internet speeds are the least equipped to deliver them, the forthcoming arrival of DOCSIS 3.1 technology and decreasing costs to deploy fiber optics will allow cable providers to partially meet the gigabit speed challenge, at least on the downstream. Before DOCSIS 3.1, consumers didn’t “need those speeds.” Now companies like Comcast claim it isn’t important what consumers need today — it’s where the world is headed tomorrow.

Comcast 2013:

Comcast executive vice president David L. Cohen writes that the allure of Google Fiber’s gigabit service doesn’t match the needs or capabilities of online Americans.

“For some, the discussion about the broadband Internet seems to begin and end on the issue of ‘gigabit’ access,” Cohen says, in a nod to Google Fiber. “The issue with such speed is really more about demand than supply. Our business customers can already order 10-gig connections. Most websites can’t deliver content as fast as current networks move, and most U.S. homes have routers that can’t support the speed already available to the home.” Essentially, Cohen argues that even if Comcast were to deliver web service as fast as Google Fiber’s 1,000Mbps downloads and uploads, most customers wouldn’t be able to get those speeds because they’ve got the wrong equipment at home.

Comcast 2015:

“We’ve consistently offered the most speeds to the most homes, but with the current pace of tech innovation, sometimes you need to go to where the world is headed and not focus on where it is today.”

“The next great Internet innovation is only an idea away, and we want to help customers push the boundaries of what the Internet can do and do our part to inspire developers to think about what’s possible in a multi-gigabit future.  So, next month we will introduce Gigabit Pro, a new residential Internet service that offers symmetrical, 2-Gigabits-per-second (Gbps) speeds over fiber – at least double what anyone else provides.”

Rich Nelson’s guest column in Multichannel News makes it clear American broadband is behind the times. The senior vice president of marketing, broadband & connectivity at Broadcom Corporation says the average U.S. Internet connection of 11.5Mbps “is no longer enough” to support multiple family members streaming over-the-top video content, cloud storage, sharing high-resolution images, interactive online gaming and more.

Nelson credits Google Fiber with lighting a fire under providers to reconsider broadband speeds.

“Google’s Fiber program may have been the spark to light the fuse — Gigabit services have fostered healthy competition among Internet and telecommunications providers, who are now in a position to consider not ‘if’ but ‘when and how’ to deploy Gigabit broadband in order to meet consumer’s perceived ‘need for speed’ and maintain their competitive edge,” Nelson wrote.

But the greatest bottleneck to speed advances is spending money to pay for them. Verizon FiOS was one of the most extravagant network upgrades in years among large American telecom companies and the company was savaged by Wall Street for doing it. Although AT&T got less heat because its U-verse development costs were lower, most analysts still instinctively frown when a company proposes spending billions on network upgrades.

The advent of DOCSIS 3.1 — the next generation of cable broadband technology — suggests a win-win-win for Wall Street, cable operators, and consumers. No streets will have to be torn up, no new fiber cables will have to be laid. Most providers will be able to exponentially boost Internet speeds by reallocating bandwidth formerly reserved for analog cable television channels to broadband. The more available bandwidth reserved for broadband, the faster the speeds a company can offer.

Many industry observers predict the cable line will eventually be 100% devoted to broadband, over which telephone, television and Internet access can be delivered just as Verizon does today with FiOS and AT&T manages with its U-verse service.

The benefits of gigabit speeds are not limited to faster Internet browsing however.

Nelson notes communities and municipalities are now using gigabit broadband speeds as a competitive tool selling homes and attracting new businesses to an area. According to a study from the Fiber to the Home (FTTH) Council, communities with widely available gigabit access have experienced a positive impact on economic activity — to the tune of more than $1.4 billion in GDP growth. Those bypassed or stuck in a broadband backwater are now at risk of losing digital economy jobs as businesses and entrepreneurs look elsewhere.

The gigabit broadband gap will increasingly impact the local economies of communities left behind with inadequate Internet speeds as app developers, content producers, and other innovative startups leverage gigabit broadband to market new products and services.

The Pew Research Center envisioned what the next generation of gigabit killer apps might look like. Those communities stuck on the slow lane will likely not have access to an entire generation of applications that simply will never work over DSL.

But before celebrating the fact your local cable company promises to deliver the speed the new apps will need, there is a skunk that threatens to ruin your ultra high speed future: usage-based pricing and caps.

At the same time DOCSIS 3.1 will save the cable industry billions on infrastructure upgrade costs, the price for moving data across the next generation of super high-capacity broadband networks will be lower than ever before. But cable operators are not planning to pass their savings on to you. In fact, broadband prices are rising, along with efforts to apply arbitrary usage limits or charge usage-based pricing. Both are counter-intuitive and unjustified. It would be like charging for a bag of sand in the Sahara Desert or handing a ration book to shoreline residents with coupons allowing them one glass of water each from Lake Ontario.

Cox plans to limit its gigabit customers to 2TB of usage a month. AT&T U-verse with GigaPower has a (currently unenforced) limit of 1TB a month, while Suddenlink thinks 550GB is more than enough for its gigabit customers. Comcast is market testing 300GB usage caps in several cities but strangely has no usage cap on its usage-gobbling gigabit plan. Why cap the customers least-equipped to run up usage into the ionosphere while giving gigabit customers a free pass? It doesn’t make much sense.

But then usage caps have never made sense or been justified on wired broadband networks and are questionable on some wireless ones as well.

Stop the Cap! began fighting against usage caps and usage pricing in the summer of 2008 when Frontier Communications proposed to limit its DSL customers to an ‘ample’ 5GB of usage per month. That’s right — 5GB. We predicted then that usage caps would become a growing problem in the United States. With a comfortable duopoly, providers could easily ration Internet access with the flimsiest of excuses to boost profits. Here is what we told the Associated Press seven years ago:

“This isn’t really an issue that’s just going to be about Frontier,” said Phillip Dampier, a Rochester-based technology writer who is campaigning to get Frontier to back off its plans. “Virtually every broadband provider has been suddenly discovering that there’s this so-called ‘bandwidth crisis’ going on in the United States.”

That year, Frontier claimed most of its 559,300 broadband subscribers consumed less than 1.5 gigabytes per month, so 5GB was generous. Frontier CEO Maggie Wilderotter trotted out the same excuses companies like Cox and Suddenlink are still using today to justify these pricing schemes: “The growth of traffic means the company has to invest millions in its network and infrastructure, threatening its profitability.”

Just one year later, Frontier spent $5.3 billion to acquire Verizon landline customers in around two dozen states, so apparently Internet usage growth did not hurt them financially after all. Frankly, usage growth never does. As we told the AP in 2008, the costs of network equipment and connecting to the wider Internet are falling. It still is.

“If they continue to make the necessary investments … there’s no reason they can’t keep up” with increasing customer traffic, we said at the time.

We are happy to report we won our battle with Frontier Communications and today the company even markets the fact their broadband service comes without usage caps. In many of Frontier’s rural service areas, they are the only Internet Service Provider available. Imagine the impact a 5GB usage cap would have had on customers trying to run a home-based business, have kids using the Internet to complete homework assignments, or rely on the Internet for video entertainment.

So why do some providers still try to ration Internet usage? To make more money of course. When the public believes the phony tales of network costs and traffic growth, the duped masses open their wallets and pay even more for what is already overpriced broadband service. Just check this chart produced by the BBC, based on data from the Organization for Economic Co‑operation and Development. Value for money is an alien concept to U.S. providers:

The usual method of combating pricing excess is robust competition. With a chasm-sized gap between fat profits and the real cost of the service, competitors usually lower the price to attract more customers. But the fewer competitors, the bigger the chance the marketplace will gravitate towards comfort-level pricing and avoid rocking the boat with a ruinous price war. It is one of the first principles of capitalism — charging what the market will bear. We’ve seen how well that works in the past 100+ years. Back in 2010, we found an uncomfortable similarity between broadband prices of today with the railroad pricing schemes of the 1800s. A handful of executives and shareholders reap the rewards of monopolistic pricing and pillage not only consumers but threaten local economies as well.

The abuses were so bad, Congress finally stepped in and authorized regulators to break up the railroad monopolies and regulate abusive pricing. We may be headed in the same direction with broadband. We do not advocate regulation for the sake of regulation. Competition is a much more efficient way to check abusive business practices. But where an effective monopoly or duopoly exists, competition alone will not help. Without consumer-conscious oversight, the forthcoming gigabit broadband revolution will be stalled by speed bumps and toll booths for the benefit of a few giant telecommunications corporations. That will allow other countries to once again leap ahead of the United States and Canada, just as they have done with Internet speeds, delivering superior service at a lower price.

China now ranks first in the world in terms of the total number of fiber to the home broadband subscribers. So far, it isn’t even close to the fastest broadband country because much of China still gets access to the Internet over DSL. The Chinese government considers that unacceptable. It sees the economic opportunities of widespread fiber broadband and has targeted the scrapping of every DSL Internet connection in favor of fiber optics by the end of 2017. As a result, with more than 200 million likely fiber customers, China will become the global leader in fiber infrastructure, fiber technology, and fiber development. What country will lose the most from that transition? The United States. Today, Corning produces 40% of the world’s optical fiber.

Global optical fiber capacity amounted to 13,000 tons in 2014, mainly concentrated in the United States, Japan and China (totaling as much as 85.2% of the world’s total), of which China already ranked first with a share of 39.8%. Besides a big producer of optical fiber, China is also a large consumer, demanding 6,639 tons in 2014, 60.9% of global demand. The figure is expected to increase to 7,144 tons in 2015. Before 2010, over 70% of China’s optical fiber was imported, primarily from the United States. This year, 72.6% of China’s optical fiber will be produced by Chinese companies, which are also exporting a growing amount of fiber around the world.

John Lively, principal analyst at LightCounting Market Research, predicts China could conquer the fiber market in just a few short years and become a global broadband leader, “exporting their broadband networking expertise and technology, just like it does with its energy and transportation programs.”

Meanwhile in the United States, customers will be arguing with Comcast about the accuracy of their usage meter in light of a 300GB usage cap and Frontier’s DSL customers will still be fighting to get speeds better than the 3-6Mbps they get today.

Fans of the “hands-off” approach to broadband oversight finally have a country where they can see a deregulated free marketplace in action, where consumers theoretically pick the winners and losers and where demand governs the kinds of services consumers and businesses can get from their providers.

That country is the Philippines, which has taken the libertarian free market approach to Internet access in a dramatic leap away from the authoritarian Marcos era of the 1980s.

The Deregulation “Miracle”

Until 1995, the Philippines Long Distance Telephone Company (PLDT) maintained a 60-year plus government-sanctioned monopoly on telecommunications services. Its performance was less than compelling. Establishing landline service took up to 10 years on a lengthy waiting list. Getting a phone line was the first problem, making sure it worked consistently was another. Just over 10 years after the United States formally broke up AT&T and the Bell System, the government in Manila approved RA 7925 – the Public Telecommunications Policy Act of 1995, breaking PLDT’s monopoly and establishing a level playing ground for each of 11 regions across the country and its many islands in which private companies could compete with PLDT for customers.

To attract investment and competition, the government declared all value-added services like Internet access deregulated and guaranteed the complete privatization of all government telecom facilities no later than 1998. It also initially limited the number of companies that could compete against PLDT in each region to two new entrants. The government felt that would be necessary to attract competitors that knew they would have to quickly invest millions, if not billions, to build telecom infrastructure in the Philippines. It would be hard to make a case for investment in a region where a half-dozen companies all engaged in a price war fighting for customers while stringing new telephone lines and building cell towers.

To prevent cherry-picking only the wealthiest areas of the country, the government declared its desire for a privately funded nationwide telecom network and used the 11 regions, combining urban and rural areas in each, to get it. Competitors were required to support at least 300,000 landlines and 400,000 cellular lines in each region. That assured new networks could not simply be built in urban areas, bypassing smaller communities. After building their networks, companies largely operated on their own in a mostly-free deregulated market, slightly overseen by the National Telecommunications Commission (NTC) — the Philippines equivalent of the FCC.

The early years of telecom deregulation seemed promising. PLDT, much like AT&T in the United States, kept the lion’s share of customers (67.24%) after deregulation took effect, but new competitors quickly captured one-third of the market. But with lax regulation and oversight, some of the Philippines’ most powerful families, many benefiting under years of the Marcos dictatorship, managed to gain influence in the newly competitive Philippines telecom business. In the United States, telecom competition meant a choice between Sprint, MCI, AT&T or others. In the Philippines, you dealt with one or two of nine powerful family owned conglomerates, each operating with a foreign-owned telecom partner. It would be like choosing between companies owned by the Rockefellers, the Astors, the Carnegies, or the Morgans.

The NTC remained more “hands-off” than the FCC, avoiding significant involvement in critical interconnection issues — how competing telephone companies handle calls from subscribers of a competing provider. That was last an issue in the United States in the early 1900s, where rare independent competitors to the rapidly consolidating Bell System faced a telecom giant that initially refused to handle calls from customers of other companies. American regulators eventually demanded interconnection policies that guaranteed customers could reach any other telephone customer, regardless of what company handled their service. In the Philippines, the NTC eventually mandated less-demanding access, allowing companies to charge long distance rates to reach customers of other companies. In the 1990s, it was not uncommon to find businesses maintaining at least two telephone lines with different companies to escape long distance expenses and stay accessible to all of their potential customers.

PLDT initially fought the opening of the marketplace but benefited handsomely from it once it took effect. The company got away with setting sky-high interconnection rates to connect calls from other smaller providers to its customers. It also made access to its network a minefield of bureaucracy and often required competitors to sign unfair revenue sharing agreements.

It is Cheaper to Buy Out the Competition Instead of Competing With It

The investment community eventually balked at the cost of constructing competing telecommunications networks, especially after the dot.com crash in 2000, and a drumbeat for industry consolidation through mergers and acquisitions quickly grew too loud to ignore. Investors fumed over the amount of money being spent by providers to meet their service obligations in the 11 subdivided regions. Instead of building redundant or competing infrastructure, allowing competitors to merge would cut costs and enhance investor return. The NTC let the marketplace decide, as did the government, and it led to a frenzy of industry consolidation that ran far beyond what the FCC and American Justice Department would ever tolerate.

In 2011, the government backed a colossal merger that brought together the wireless networks of Pilipino Telephone Corporation, PLDT, and Smart under the PLDT brand. The three former competitors became one and controlled 66.3% of the Philippine’s wireless customers. The merger was comparable to allowing Verizon to buy out Sprint.

Additional mergers in response to the super-sized PLDT rapidly reduced the competitiveness of Philippine’s telecommunications marketplace to a duopoly. Just two companies — PLDT, Globe, and their respective house brands — dominate landline, DSL, cable, and wireless telecommunications service in the Philippines. The investment community celebrated the deal’s approval as a lucrative goldmine of future revenue gains from a less competitive market.

Philippine Broadband: Hey, It’s at Least Moderately Better Than Afghanistan

Broadband performance, under any measure other than financial success, has proved abysmal for Philippine consumers and businesses. The country’s broadband speeds are among the worst in the world, only beating Afghanistan in many speed tests. Look the other way–oversight led to a bribery scandal in 2007 that threatened to bring down the government. Officials exploring the development of a National Broadband Network were accused of soliciting kickbacks from Chinese equipment vendor ZTE, which would have been responsible for supplying equipment for the project. The government canceled the project as the scandal widened and some of the principals left the country or in at least one case were kidnapped.

Eight years later, broadband in the Philippines would be considered a North American nightmare. The free market approach has led to free-flowing profits and a profound lack of marketplace competition, with broadband ripoffs and broken promises rampant across the country.

Although both PLDT and Globe Telecom are spending large sums on infrastructure, much of it benefits their very profitable wireless networks and business customers. Despite the investments, residential customers are stuck with some of the world’s worst broadband speeds and performance.

An independent Quality of Service test revealed the bad news all around:

The findings of the Philippine QoSE tests were expected, but nevertheless still disappointing.

The best performing among the three ISPs delivered only 21% of actual versus advertised speed on average. This same ISP also offered at least 256kbps download speed (generally accepted definition of broadband) only 67% of the whole time it was tested, falling short of the required 80% service reliability.

The Broadband Commission defines the core concepts of broadband as an “always-on service” with high capacity “able to carry lots of data per second.” While there is no official definition of broadband locally, the Philippine Digital Strategy 2011-2016 defines broadband Internet service as 2Mbps download speed.

Finally, like the last nail in the coffin, Philippine ISPs performed the worst in terms of value for money when compared to select providers in South Asia and Southeast Asia. The highest value given by any of the three Philippine ISPs tested was a measly 22kbps per US dollar. This figure is too low when compared to similar mobile broadband ISPs that offer 173kbps per dollar in Jakarta, Indonesia and 445kbps per dollar in Colombo, Sri Lanka.

These results have huge implications on truth in advertising, consumer welfare, and the need for appropriate regulation.

My DSL Service is So Bad I Prefer 3GB Usage-Capped Slow Wireless Instead

Home DSL broadband is so bad that customers have increasingly dropped service in favor of tightly managed wireless service. Companies report DSL customer losses over the past few years, with no end in sight.

The telecom regulator has generally just shrugged its shoulders at the situation, suggesting competition between equally poor providers will somehow resolve the problem. That view is applauded by service providers who claim the Internet is “just a value-added service” not essential to basic living needs. But consumer groups wonder why providers are allowed to make false advertising claims about the speed of their service with no repercussions. A range of position papers appealing to the government to create a meaningful minimum broadband speed have been introduced and some are being pushed by members of the Philippine Senate.

Senator Loren Legarda joined scores of other frustrated customers complaining about unreliable and expensive Internet in the country. In a 2014 hearing Legarda complained she had once again lost her DSL Internet connection in her office and her wireless connection was so slow it was unusable.

“As we speak now, there is no Internet connection in my office,” Legarda said. “I received a message this morning from my staff on my way here because I may be e-mailing, etc. And for someone whose deadline was yesterday, I always want things done fast and I’m sure many of you want that efficiency too to serve our people better.”

[flv]http://www.phillipdampier.com/video/ANC Poor Broadband Internet 5-14.flv[/flv]

ANC aired this story about Sen. Legarda’s broadband problems and how Philippines’ providers oversell their networks back in 2014. (4:56)

We Oversold Our Networks So Sue Us, Except You Can’t

Providers blame the problem on oversold networks that attempt to manage too many paying customers on an inadequate network. In other words, they blame themselves with little fear any regulator will create problems for them.

Wireless service is no panacea either. Customers in the Philippines face draconian “fair use policies” on so-called “unlimited plans” that leave them throttled after 1GB of usage per day or 3GB of usage per month, whichever happens first. Providers suggest the policy is a benefit, promising them a better user experience. Besides, they suggest, even those that run into the speed throttle can still browse the Internet, albeit at as speed resembling dial-up:

Your internet speed will slow down if you use up 1GB of data for the day, or accumulate 3GB of data usage for the month.

If you hit the 1GB/day threshold, you’ll experience slower speed, but no worries because as we mentioned above, you can still surf! You’ll move up to normal speed at midnight. If you hit the 3GB/month threshold, your speed will move up to normal speed on the next calendar month (not based on bill cycle).

Say Hello to the “Promo Pack” – Your Net Neutrality Nightmare Come True

Remember the scary ads from Net Neutrality proponents promising a future of Internet add-ons that would charge you to surf theme-based websites without facing network slowdowns or stingy usage caps if Net Neutrality protections were not forthcoming? In the Philippines, the nightmare came true. Mobile providers sell added cost “promo packs” that bundle extra throttle-free usage with theme-based apps. A package with Spotify runs about $6.50US a month and includes 1GB of usage. Anyone can buy a Spotify premium membership in the Philippines for around $4.37US without the add-on. But even worse are app-based promo packs that bundle free-to-download-and-use apps in the U.S. with special designated usage allowances.

Want to use Google Maps on your wireless provider? A “promo pack” including it costs around $2.17 a month and includes 300MB of usage. That money doesn’t go to Google — it stays in the pocket of the provider – Globe Networks. Twitter will set you back $4.37US a month and includes 600MB of usage, which seems odd for a short message service when contrasted with an identically-priced promo pack for Facebook, that needs the extra usage allowance more than Twitter likely would. But then they also get you for Facebook Messenger, which costs an extra $2.17US per month and comes with its own usage allowance — 300MB.

While segmenting out popular mobile apps for special treatment, Philippine mobile providers have also taken Verizon and AT&T’s lead, pushing plans like myLIFESTYLE that bundle unlimited text and phone calls with expensive data plans.

Lifestyle Promo Packs:

Lifestyle Bundle	Price (Philippine Peso)	Consumable MBs/GBs	Description
Spotify	299	1GB	Premium membership to Spotify, with 1GB data
Work	299	1GB	Access to Gmail, Yahoo Mail, Evernote, + 10GB Globe Cloud Storage
Explore Bundle	99	300MB	Access to Agoda, Trip Advisor, Cebu Pacific, PAL
Navigation Bundle	99	300MB	Access to Waze, Grab Taxi, Google Maps, MMDA app, Accuweather
Shopping Bundle	299	1GB	Access to Zalora, Amazon, Ebay, OLX, Ayosdito
Facebook	199	600MB	Access to Facebook
Twitter	199	600MB	Access to Twitter
Viber	99	300MB	Access to Viber
FB Messenger	99	300MB	Access to FB Messenger
Chat Bundle	299	1GB	Access to Viber, Whats App, FB Messenger, Kakao Talk, Line, WeChat
Photo Bundle	299	1GB	Access to Instagram, Photogrid, Photorepost, Instasize

Extra Add-ons:

Basic	Price	Description
Consumable	100	Stackable Amounts of P100 denomination consumables
Unli Duo	299	Unlimited Calls to Landline/duo
Unli Txt All	299	Unlimited Texts to other networks
Unli iSMS	399	Unlimitend International SMS to one intl. number
Unli IDD	999	Unli IDD calls to one intl. number
DUO International	499	Unlimited calls to US landlines

The Philippines Should Regulate Under the American Example vs. The Philippines Should Not Regulate Under the American Example (It’s Obama’s Fault)

Providers in the Philippines have learned a lot from America’s telecommunications lobbyists. Their advocacy campaigns revolve around the theme that the United States has the best wireless networks in the world, developed under a largely hands-off regulatory philosophy that the Philippine government should follow.

The government and regulators largely acquiesced to that campaign until this year, when that idea came back to haunt providers. Earlier this year, the Obama Administration and the FCC began taking a more hands-on approach to telecom regulation after recognizing the marketplace is not as competitive as providers suggest. Strong Net Neutrality enforcement, limits on mergers and acquisitions and strong signals marketplace abuses would no longer be tolerated are now being pushed in Washington by the White House and the Federal Communications Commission. Providers in the Philippines no longer advocate following the American model, but it may now be too late.

The NTC is close to issuing new minimum broadband speed and performance standards and is now listening to Filipino consumers that launched Democracy.net.ph to fight usage caps in the Philippines back in 2011. The NTC may soon require providers advertise average speeds and performance, not “up to” speeds nobody actually receives. Those getting poor service would be entitled to refunds or rebates.

That could be the first step towards a more activist NTC that may have learned the lesson that listening to the broken promises of better service through deregulation has resulted in some of the worst broadband performance the world has to offer. The Philippines took the advocacy arguments of the deregulation crowd and doubled down, not only allowing providers to lie and distort in their advertising, but also permitting massive industry consolidation reducing the choice for most Filipinos to just two providers for almost all telecommunications services. The government looked the other way as corruption turned into a scandal and today it is left with two very powerful conglomerates that deliver third world Internet access while pocketing the generous proceeds.

A Better Way to Better Broadband

A deregulated, free market only works where healthy competition exists. Too few players always leads to reduced innovation, poorer service at higher prices, and a corporate fortress deterring would-be competitors that are unlikely to be able to survive in a fair, competitive fight. For the Philippines (and by extension the United States) to fully benefit from healthy competition, large conglomerates must be broken up and further mergers must be prevented above all else. Until sufficient competition can self-regulate the marketplace, strong oversight is necessary to protect consumers from the abuses that always come from monopolies and duopolies. Charging wireless customers for free apps and suggesting 3GB of usage is equal to unlimited broadband are two places to start cracking down, quickly followed by an investigation into where investment dollars are being spent and for whose benefit. It seems like customers are not reaping any rewards in return for high-priced service.

The Philippine government should also continue exploring a National Broadband Network strategy that puts the country’s broadband needs above the profit motivations of the current duopoly. Governments build roads and bridges, airports and railways. Broadband is another infrastructure project that needs to be developed in the public interest. If private companies want to be a part of that effort, that is wonderful. But they should not be dictating the terms or holding the country back from what may be the biggest scandal of all — broadband that barely performs better than what the Taliban can get these days in Helmand province.

Despite claims from Net Neutrality critics that increased oversight of the broadband business would lead to reduced investment and upgrades, Charter Communications CEO Thomas Rutledge said the new rules would have no effect on Charter’s investment plans.

Last week Rutledge sat down with FCC chairman Thomas Wheeler to discuss Charter’s proposed merger with Bright House Networks and Time Warner Cable. He was joined by Catherine Bohigian, Charter’s executive vice president for governmental affairs and FCC general counsel Jonathan Sallet and senior counselor Phil Verveer.

“Mr. Rutledge explained that the transactions will bring substantial consumer benefits, including providing a better Internet experience for watching on-line video, gaming, and using other data-hungry apps at more competitive prices, and that the mergers will not harm competition,” according to a one page filing with the FCC disclosing the meeting.

Despite repeated claims from pro-industry policy wonks that Net Neutrality and Title II oversight of cable broadband would cause operators to reconsider their investment plans, Rutledge made it clear Charter’s spending plans are unaffected.

“Mr. Rutledge agreed that the Commission’s decision to reclassify broadband Internet access under Title II has not altered Charter’s approach of investing significantly in its network to deliver cutting edge services including: the fastest entry-level broadband service (60 Mbps) with unlimited usage; out-of-home Wi-Fi hotspots; a state-of-the art, cloud-based user guide, allowing search and discovery across linear, video on demand and online content; open, non-proprietary downloadable security; and an innovative video app with hundreds of live and downloadable channels and the ability to display over-the-top content seamlessly on the television,” the disclosure continues.

Charter’s chief executive said the company supports Open Internet rules, including no throttles or blocks on lawful content and no paid prioritization. But he does worry about regulatory uncertainty while the FCC explores its expanded powers of oversight.

It has been 14 months since we heard for the first time Comcast was planning to acquire Time Warner Cable. It was the night of February 12, 2014. I still remember where I was the moment I first learned the news.

Stop the Cap! has maintained a civil relationship with Time Warner Cable for the most part over our seven-year struggle fighting usage caps, lousy broadband, and high prices. We fought one major battle with the company in April of 2009, when Time Warner executives planned a compulsory usage cap experiment on customers in Rochester, N.Y., Austin and San Antonio, Tex., and Greensboro, N.C.

Just as we had done with Frontier Communications a year earlier, we successfully beat down their efforts to impose usage allowances on customers already paying a significant chunk of money for broadband Internet access. After that battle ended, Time Warner Cable changed their position on usage caps and stated emphatically that customers should always have the option of unmetered/unlimited access. They have kept their word. In fact, their optional usage cap experiments have been a spectacular flop, attracting less than 1% of their customer base and delivering the message we’ve tried to get across the industry for years: customer hate usage caps, usage-based billing, and speed throttles.

Comcast is a company that long ago stopped listening to their customers. It applied an arbitrary usage cap on all their customers in retaliation for a FCC decision that disallowed them from running hidden speed throttles on peer-to-peer Internet traffic. Comcast lied about throttling traffic, paid homeless people to stack a hearing on the issue to keep company critics out of the room, and slapped the caps on in the fall of 2008 with the flimsy excuse it represented “fairness” to customers. Only later, we would learn usage caps were never about “fairness” or good traffic management. It’s just a way to deter customers from spending too much time on the Internet, especially if that time is spent watching online videos. Too much time spent watching Netflix might convince you your cable TV package isn’t necessary any longer.

Comcast customer service horror stories reached a level unparalleled by other cable companies when a Comcast predator-installer was convicted of raping and strangling to death 23-year old Comcast customer Urszula Sakowska,  whose lifeless body was found in a bathtub inside her Chicago-area home back in 2006. But Triplett’s violent service calls didn’t stop there. He also faced charges in the death of 39-year old Janice Ordidge, a Comcast customer in Hyde Park. Those two Comcast customers lost their lives. In 2009, another Comcast installer set a Pennsylvania customer’s house on fire. Other installers stole jewelry right out of customers’ homes. Others have exposed themselves in front of female customers or fallen asleep on their couches.

Billing errors are the stuff of legend at Comcast. Offshore call centers with language barriers, inept customer service, and long, long, long lines at cable stores with windows only partially manned by agents sitting behind bullet-proof glass also helped cultivate a customer relationship that can best be described as “perp and victim.”

Comcast isn’t just a bad cable company, it’s a menace. We didn’t have to spend hours proving our case. Fortunately, Comcast’s appalling reputation preceded it. Outside of two executive suites in Philadelphia and New York, nobody was for supersizing Comcast. Just to make sure our regulators knew this, we traveled to Buffalo in June of last year to testify at a Public Service Commission hearing on the subject of the merger. We didn’t mince words.

Sure, there were non-profit groups like the Boys & Girls Club that absolutely sullied their reputation pushing for the merger (Comcast wrote large checks to the organization so you need not give the group a single penny of your money in the future). “Civil Rights” organizations like the Urban League, NAACP, and others that used to defend minority rights now concern themselves with defending the interests of giant cable companies, just as long as they get a nice check in the mail with Comcast’s name on it. Among the worst of all – Shakedown Al Sharpton who will either be your merger deal’s best friend or will go away and leave victims of racism in peace, if you cut his organization a big fat check. (Now that the merger has collapsed, perhaps Comcast-owned MSNBC will end the thinly veiled quid-pro-quo arrangement it has with the man that gives him an hour a night to perform a talent train wreck.)

My own state assemblyman, Joe Morelle, who served as New York’s interim assembly speaker for about five minutes literally plagiarized his letter in support of the Comcast merger (after cashing their check) almost word-for-word from Comcast press releases and congressional testimony. Say it ain’t so, Joe!

N.Y. State Assembly Leader Joe Morelle: “The combination of Comcast and Time Warner Cable will create a world-class communications, media and technology company to help meet the increasing consumer demand for advanced digital services on multiple devices in homes, workplaces and on-the-go.”

 

David Cohen, executive vice-president, Comcast: “The combination of Comcast and TWC will create a world-class communications, media, and technology company to help meet the insatiable consumer demand for advanced digital services on multiple devices in homes, workplaces, and on-the-go.”

 

There was not a doubt in my mind that replacing Time Warner Cable with Comcast would be a disaster for Time Warner Cable customers. Despite promises Comcast would upgrade Time Warner’s network, it would also upgrade customer bills, resorting in higher priced service, higher modem fees, and lousy customer service. Comcast vice president David Cohen also made it clear usage caps would be a part of our life within five years. No amount of protesting or rational argument would stop Comcast from being Comcast. Don’t like it? Just try to cancel.

Time Warner Cable can be bad but it is no Comcast.

Life will be just fine without Comcast, but danger lurks on the horizon. Still interested in the possibility of taking over Time Warner Cable is the smaller Charter Communications, now effectively controlled by cable magnate John Malone (he owns his own castles). Malone has a long history of enriching himself at the expense of customers with no other choices for cable/broadband service. He used to control Tele-Communications, Inc. (TCI), a cable company that literally threatened city officials who didn’t do what TCI wanted.

We remain unsure exactly what will happen next. Charter could bid aggressively to buy Time Warner Cable, Time Warner Cable could go it alone, or Time Warner Cable could start buying other cable companies (like Charter).

What we hope will happen is Time Warner Cable will refocus its energy on expanding its Maxx upgrade program as quickly as possible to reach all Time Warner Cable markets with faster broadband and a better cable TV experience. We also hope the company will stand by its word that compulsory usage caps are off the table.

I’d like to thank all of our readers who took the time to get involved in the fight and helped make a difference. Wall Street and Washington, as well as Comcast CEO Brian Roberts are all shocked the merger deal collapsed after a torrent of criticism from consumers. It also left state regulators cautious about how to proceed. New York’s Public Service Commission delayed making a decision eight times, recognizing the merger as a hot potato.

Our experience demonstrates that ordinary citizens can wield considerable power when unified and involved. We’ve proved that with multiple victories on the usage cap front as well as the AT&T/T-Mobile merger and Net Neutrality.

Let the fight for better broadband continue!