Zombie bill.

Time Warner Cable has pulled back on their winter promotions for new customers, bundling slower broadband and significant equipment fees into the bottom line price that may cost as much as $20 or more than the cable operator’s advertising suggests.

Several readers contacted Stop the Cap! over the last few weeks about the disparity between Time Warner’s advertised new customer pricing and the out the door price that arrives on the first month’s bill.

Diane, a Stop the Cap! reader in Brockport, N.Y., was attracted to an $89.99 triple play promotion for TV, Internet, and phone service until she learned what did not come with the deal.

“By the time I got off the phone, that $89.99 offer turned into more than $130 a month once adding a DVR, faster broadband service, and a second cable box,” Diane complains. “You really have to read the fine print. They only give you 3Mbps broadband speed on most of their offers now and DVR service is rarely included. In fact, all the equipment turned out to cost extra.”

Stop the Cap! checked out the offer Diane was interested in, and it turns out the $89.99 advertised price only tells half the story.

The wall of text. Time Warner’s rebate offer has hoops customers will consider an Olympic event.

First, Time Warner requires customers on this promotion to pay for at least one cable box, at $8.99 a month. A CableCARD is also available for $2.50 a month for televisions equipped to support that. Most consumers stick with traditional boxes. Diane wanted one DVR box and a second box for a bedroom. DVR Service from Time Warner, which does not include the box itself, has dramatically increased in price over the years. In 2013, the combined rate for the “box” and the “service” is $21.94 a month in western New York. A second cable box for Diane’s bedroom ran another $8.49 a month. The new Internet modem rental fee is also not included, so that adds an additional $3.95 a month.

Diane is also correct about broadband speeds. Time Warner bundles only 3Mbps service in most of its promotional packages. Increasing to Standard speed (15/1Mbps) generally costs an additional $10 per month. Now Diane’s monthly bill is well over $130 a month.

In fact, Diane should have selected a more deluxe package from Time Warner at the outset. Their $104.99 promotion bundles Turbo (20/2Mbps) Internet, free Showtime, and at least covers DVR service (although Diane still has to pay $9 a month for the DVR box). Her out the door price for that package is less than $127 a month.

Customers served by AT&T U-verse or Verizon FiOS stand to come out better if they plan to dump the phone company in favor of Time Warner. The cable operator is throwing in a debit card worth up to a $200, but only for customers switching away from a competitor. Diane just had Frontier phone service, so no $200 reward card for her. Time Warner requires customers to switch from services comparable to those selected from Time Warner to qualify for the maximum rebate.

For those that do quality, the rebate hoop-jumping begins:

• Customers qualifying for the reward card have to write down a promotion code and register their rebate request online within 30 days of starting service.
• Customers must remain active, in good standing and must maintain all services for a minimum of 90 days after installation.
• Customers are required to upload a scanned copy of their last provider’s bill, showing active service within the last 90 days. Card should arrive 4-6 weeks after a 90 day waiting period.
• Comparable services do not include wireless telephone service or online-only video subscriptions.
• Offer is not available to customers with past due balances with Time Warner Cable during the program period or customers who have been disconnected for non-payment during the twelve months preceding this offer.
• The customer’s name and address on file with Time Warner must exactly match the name and address on your former provider’s bill.
• Customers better spend the money quickly. After six months, the issuing bank deducts a $2.50 monthly “service fee” from the debit card until empty, except where prohibited by law.
• If the card is lost or stolen, there is a $5.95 Re-Issuance Fee. If you need to dispute a charge on the card, you are out of luck. The issuing bank will not intervene on your behalf.
• Customers cannot apply the rebate to their Time Warner Cable bill.

The Internet Innovation Alliance this week unveiled its 2013 Broadband Guide to the 113th Congress, outlining recommendations for a better broadband future that just so happen to fall in step with AT&T’s lobbying action agenda, guaranteeing near-total telecom deregulation and abandoning rural America’s wired telecommunications networks.

That should come as no surprise, because the IIA’s principal backer is AT&T, along with a host of public interest and non-profit groups that have received significant contributions and backing from the phone giant.

The IIA’s chief recommendation: allow phone companies to abandon wired landline networks in favor of all-IP-based technologies that escape most regulatory requirements and are not subject to much oversight by local, state, or federal officials.

The IIA guide unintentionally illustrates that AT&T’s largest service area in the central and southern U.S. has some of the lowest broadband rankings in the country.

In order for consumers to enjoy the speed and bandwidth capacity of IP networks and to take advantage of the programs and services (including education, gaming, entertainment, social media) that require fast and robust data transmission, the United States should encourage the upgrade to a digital, all-Internet Protocol (IP) broadband infrastructure. Current legacy wired networks fail to meet the FCC’s definition of broadband, yet outdated laws essentially assume that incumbent telephone companies continue to maintain and operate these slow, antiquated networks, even as incumbents invest and deploy separate IP infrastructure and fewer and fewer consumers rely on the outdated voice-only networks.

Requiring incumbent telephone providers to maintain costly antiquated networks siphons investment away from deployment of advanced, high-speed next-generation IP-based networks that consumers prefer. Reforming antiquated 1930s regulations designed for monopoly providers in a copper-wire, analog era will encourage the private sector investment needed to upgrade non-IP-based facilities with newer and faster broadband infrastructure, creating jobs and growing our economy.

In addition, today’s 4G LTE wireless networks are IP-based, but the spectrum required to fuel consumers’ advanced wireless devices on these networks is becoming severely congested. Releasing more spectrum, the radio waves that carry everything from television to texts to mobile video, is necessary to maintain and improve service quality on wireless networks. The government controls the allocation of spectrum and should reallocate more of it for consumer use in order to sustain the increasing public demand for data and continue the benefits offered by the mobile revolution.

Nowhere in IIA’s guide does the “Alliance” disclose its largest backer is AT&T, one of the “telephone providers” IIA talks about as if it was a third party that had no direct connection to the group.

IIA’s guide takes care not to come down too hard on its benefactor for not upgrading rural telecommunications networks to support next generation broadband. In fact, AT&T has dragged its feet providing even ordinary DSL service in many of its rural service areas. The IIA is also careful not to disclose AT&T’s real plan: not to upgrade existing networks to fiber but rather abandon them altogether in favor of its high-profit, high revenue wireless service. That assures everyone deemed unworthy of wired broadband investment will be relegated to the company’s high-cost wireless platform with paltry usage caps and speed throttles.

At the start of 2013, we are witnessing exciting changes enabled by mobile broadband: an app economy that didn’t even exist five years ago now employs more than 500,000 Americans, according to Economist Michael Mandel; the inexorable shift to the cloud and its more efficient information storage; proliferating creative tools that are transforming consumers’ business and personal lives; rapacious appetite for faster speeds, greater bandwidth opportunity and more capacious storage; overwhelming competition with 90 percent of consumers able to choose from at least five different providers, as reported by the FCC; and accelerating innovation cycles where tomorrow’s technology is invented today. The future of broadband is bright and the benefits to consumers and our nation could be boundless. To realize these benefits we need only to let our innovators innovate, our entrepreneurs compete, and ensure our consumers have the knowledge and freedom to make the most of the technology available to them.

…and let AT&T do whatever and charge whatever it wants, while depriving rural America of a wired broadband future.

The IIA hopes its message gets through to members of Congress. Helping make that happen are two former Washington, D.C. insiders that have bipartisan support for AT&T’s agenda.

“We love technology here and believe in its power to change the country, the world, and that it’s a non-partisan issue,” gushes Bruce Mehlman, IIA’s founding co-chairman and former assistant secretary of commerce for technology policy in the George W. Bush Administration.

Mehlman was recognized by Washingtonian Magazine as one of the city’s top lobbyists and is a founding partner of his own lobbying firm. Mehlman is considered an expert in running issue campaigns and “developing advanced lobbying strategies that achieve impactful policy outcomes.” At least AT&T hopes so.

Mehlman’s D.C. lobbying firm promises “we get things done in Washington.”

“It’s critical that policymakers be well-informed as they make decisions affecting the Internet in order to promote and encourage the expansion of Internet investment, access and adoption,” echoed IIA honorary chairman Rick Boucher, a former Democratic member of Congress from the state of Virginia.

Boucher has never strayed too far from AT&T money either. AT&T was his third largest contributor overall from 1989 until he lost re-election in 2010. Today, Boucher is a partner in the law firm of Sidley Austin, which has represented AT&T’s interests for over 100 years.

Grab this bargain: Frontier’s website accidentally placed two different DSL packages on our order despite only requesting one. We didn’t ask for the phone line or satellite TV either, but there they are.

Frontier Communications is in the process of redesigning their website — a project long overdue in an age where customers can pre-qualify themselves for service and schedule installation from most cable operators without ever picking up the phone.

But judging from some e-mail from Frontier employees working on the project, the forthcoming “upgrade” is about to make a bad situation much worse.

Frontier is the sixth largest phone company in the country with customers in 27 states, but they have never run a modern, well-functioning website. Frontier’s service pre-qualification tool has never worked properly in Rochester, N.Y., the largest city where Frontier provides service, and placing an order for service is fraught with confusion for customers who don’t speak telecom jargon.

Based on a reader tip, we tested the website this afternoon here at Stop the Cap! HQ.

Placing an order for DSL service is currently based on your street address, but the order process gives no indication if the company can actually provision service at the speeds requested.

As a customer journeys through a cumbersome 10-step order process, it becomes easy to be sidetracked with endless promotional tricks and traps in numbers I haven’t seen since last ordering a domain name from GoDaddy. The shopping cart also erroneously added two different broadband service packages on our order, despite only selecting one.

Step 1 offers murky promotions such as the impenetrable “Shop Promo VISA CD 100 2Y Challenger.” Promotions do not clearly disclose their terms up front. This one only discloses the two year service agreement with a steep early termination fee with the designation: “2Y.” Avoiding promotions still did wonders for our monthly bill, especially considering we were just looking for broadband service. We found Frontier quietly added a “digital unlimited phone” we could care less about for $30.99 a month, America’s Top 120 (presumably satellite TV we did not request) for $44.99 a month, Broadband Max (the slower DSL service we did not want) for $34.99 and Simply Broadband Ultimate (the service we did) for an extra $59.99. Our out the door price for what was supposed to be broadband-only service? A low, low $170 a month minus a $5 service loyalty credit for taking two services.

Step 2 piled on another $5 fee for satellite-delivered local channels for the satellite package we never asked for, but the duplicate broadband service was gone. Now we were stuck with the slower Broadband Max. Step 3 forced us to wade through more than a dozen phone feature packages for the phone line we don’t need. Step 4 sticker-shocked us with installation fees ranging from $50 for a self-install kit to $175 for a home installation of DSL and Wi-Fi. Those fees can be waived with a perpetually-renewing two year service contract (up to a $135 credit). At that point we had enough and bailed on the order.

This represents Frontier’s online shopping experience today. A Frontier employee who wishes to remain anonymous warns Stop the Cap! things could get much worse.

Our source tells us Frontier has outsourced much of the work on its forthcoming redesigned website to third party contractors who are now reportedly in over their heads, unaware that Frontier operates with a range of very different products and services depending on the service area. For them, one-size-fits-all seemed good enough:

[These contractors] don’t understand products or how those products interact with each other, yet they have been put in charge of creating the ability for customers to order them based on where they live.  The company has current issues with their website in that they can’t figure out how to get the right products to display for a customer in Rochester, N.Y. vs. a customer in Fort Wayne, Ind. Instead, Frontier has products configured by region, then broken down by zip code, and then by the customer’s phone exchange.

Unfortunately, new customers don’t know what phone number they will be assigned and that leaves them unable to determine what products are actually available to them. The products offered should be based on the customer’s actual service address, but these contractors don’t appear to have the expertise to make that adjustment.

The shopping cart application has also proved a problem, according to our source. Internal testing of the new site’s functionality has proved distressing because components of the site are still being developed. Recent tests found customers could not correctly select products available in their area or the site could not properly apply them to the shopping cart (a problem we found ourselves using the live site available now).

Our source tells us Frontier’s project manager is hell-bent on bringing the site up by Feb. 9, ready or not.

“We have brought up the fact that there are HUGE navigation issues that are completely not friendly to the customer,” says the employee. ” They are not concerned with any of those issues at the moment, just getting the product to launch. We have been told to manipulate the processes we are to use in order to be able to get any testing done.”

The whistleblower informs us customers are likely to have a range of problems using the new site if it launches in its current state:

• Customers will be able to place orders for products they can’t get;
• Customers will receive inaccurate information about the products and pricing;
• Customers will not be able to get any promotions that they can currently get on the existing Frontier.com application;
• Customers may not be correctly informed about installation charges or taxes, deposit requirements, credit validations, etc.

Frontier needs to take a lesson from some of their competitors that have greatly simplified the ordering process for consumers that can get quickly confused. Frontier should de-emphasize the tricks and traps from the many add-ons and service commitment agreements thrown at customers. Efforts to repeatedly up-sell customers on products and services should be managed separately, perhaps in a follow-up verification phone call where a customer service agent can handle any order changes required. With customers getting a choice between a cable, satellite, or a telco provider, those overwhelmed by one company’s website will simply find another provider.

In the meantime, those with questions or concerns about Frontier might do better just calling them directly at 1-800-921-8101.

North Carolina has achieved a new low. It is now tied with bottom-rated Mississippi as America’s least-connected state, at least in terms of broadband adoption.

Christopher Mitchell and Todd O’Boyle add up the cost to the state’s economy from years of broadband neglect from dominant providers like Time Warner Cable, AT&T, and CenturyLink.

Although the largest cities in the state do reasonably well, suburban and rural North Carolina continue to suffer with slow or no service at all, thanks to last-generation cable and spotty DSL service that has not kept up with other states.

Mitchell and O’Boyle blame much of the problem in their editorial in the Charlotte News & Observer on two factors: a lack of competition and a legislature that cozied up to corporate dollars to pass an anti-competitive community broadband ban in 2011.

After state legislators collected more than $1 million in campaign donations from Time Warner Cable and AT&T, the General Assembly passed a law in 2011 that effectively barred communities from building their own networks. These corporations are members of the American Legislative Exchange Council, a national organization that drafts business-friendly “model bills” to push a corporate agenda in statehouses across the country.

The impetus for that effort was the city of Wilson’s decision to build its own network after existing providers declined to improve their services. The city’s globally competitive fiber optic network offers Internet connections far faster than possible on DSL or cable – and it is far more reliable.

Because it is owned by the city, the Wilson network keeps its prices affordable. And because locals now have a choice, Time Warner Cable priced its services more competitively in Wilson than in nearby towns without meaningful competition.

Time Warner Cable, AT&T and CenturyLink waged a multiyear lobbying campaign to secure the 2011 bill. They claimed it encouraged fair competition, but their real goal was to eliminate consumer choice, as documented in a new report by the Institute for Local Self-Reliance and Common Cause: “The empire lobbies back: How national cable and DSL companies banned the competition in North Carolina.”

As a result, although Time Warner Cable has invested in a data center and billing operation in the state (and received taxpayer-funded tax breaks in the process), average consumers are still receiving service that lags far behind community-owned fiber networks in cities like Wilson and Salisbury.

AT&T’s response to a call for investment was news it told 75 of its Greensboro-area workers to either move to Alabama or start looking for work somewhere else.

Both authors argue that North Carolina’s state legislature has decided to outsource the state’s broadband future to a handful of out-of-state corporations that have been able to increase rates, trickle out service improvements, and keep true competition at bay.

Christopher Mitchell works for the Institute for Local Self-Reliance and Todd O’Boyle is affiliated with Common Cause.