Comcast says you must have the option to pay more for the same broadband service you already get, only now with an allowance

Comcast has announced it is considering testing an innovative new plan in several test markets offering “unlimited Internet access” to customers for a yet-to-be-determined price. Whoever heard of such a thing?

Comcast’s executive vice president David Cohen raised eyebrows last week when he predicted all Comcast customers nationwide would see usage-based billing for their Internet access within five years.

Such statements tend to muck up things like a $45 billion dollar merger with Time Warner Cable that both companies must prove is in the public interest. The buyer wants to limit your Internet usage and the seller got its fingers burned back in 2009 when it tried its own usage cap experiment and now advertises it has no data caps.

Telling Time Warner Cable customers it is in their best interest to lose unmetered Internet plans may be too tough to sell, so Cohen has spent much of this week backtracking and claiming he was “misunderstood:”

To be clear, we have no plans to announce a new data usage policy.  In 2012, we suspended our 250 GB data cap in order to conduct a few pilot programs that were more customer friendly than a static cap.  Since then, we’ve had no data caps for any of our customers anywhere in the country.  We have been trialing a few flexible data consumption plans, including a plan that enables customers who wanted to use more data be given the option to pay more to do so, and a plan for those who use less data the option to save some money.  We decided to implement these trials to learn what our customers’ reaction is to what we think are reasonable data consumption plans.  We certainly have no interest in adopting any plans that our customers find unreasonable or disruptive to their Internet experience.

It’s important to note that we remain in trial mode only.   We’re now also looking at adding some unlimited data plans to our trials. We have always said that as the Internet, and our customers’ use of it, continues to evolve, so will Comcast and our policies.

Cohen makes a careful distinction between a strict usage limit and the kind of usage-based billing that will fill the company’s coffers with overlimit fees. But any usage allowance is a limit of how much you can use the Internet before something bad happens — either your access is shut off or your bill explodes.

Stop the Cap! has talked with more than a dozen customers in Comcast’s test markets about their experiences with Comcast’s “data usage policy.” Although the company claims it is seeking customer reactions, it never asks whether those customers want usage limits or not, only what kind.

Giving customers “the option to pay more” is exactly the type of thinking that won Comcast the dubious distinction of being the worst company in America. No usage plan tested by Comcast actually offers savings to customers. It simply places an artificial, arbitrary usage allowance on the overpriced broadband service the company offers now.

At this point, Comcast is not offering any unlimited use trials, but we have learned the value they are likely to place on “unlimited” based on what certain customers have paid all along for that privilege. Ars Technica reports some avoided the 250GB cap by signing up for business class service. The cost? $133.79 a month for 50/10Mbps. If Google Fiber was in town, you’d pay $70 for unlimited 1,000/1,000Mbps service, and the search engine giant would still be making money.

Cohen claims nothing is set in stone, but considering Comcast’s “don’t care” attitude towards its customers, it is a safe bet they will do what is best for shareholders and ignore complaints from customers that often have nowhere else to go for 21st century broadband speeds.

Time Warner Cable’s major broadband speed upgrade is alive in the Astoria, Woodside and Long Island City neighborhoods of Queens, N.Y.

The Time Warner Cable Maxx upgrade is Time Warner Cable’s effort to catch up to other cable operators that have significantly upgraded broadband speeds for customers over the last 18 months. Time Warner Cable has traditionally been one of the slowest major cable broadband providers in the country, with most customers only able to buy speeds up to 50/5Mbps. But Time Warner Cable has also committed to keeping unlimited use service available to customers, unlike Comcast, Charter, Cox, Suddenlink, and Mediacom.

The free speed upgrades are the largest ever for Time Warner Cable, typically more than tripling speeds for most customers.

Stop the Cap! has heard from readers in Queens who discovered the upgrades took effect this week, so we have been able to take a closer look at what customers can expect as Time Warner rolls out upgrades across New York City and Los Angeles and finally extending faster speeds over the next two years in other cities.

(Image: ematrix)

Arris Touchstone Telephony Gateway TG1672g

The first notification your area is about to receive an upgrade will come in a letter from Time Warner Cable.

Customers subscribing to the fastest speed tiers may need new equipment. Time Warner Cable is using 8-channel bonding in Queens for its 100 and 200Mbps tiers and 16-channel bonding for its 300Mbps tier. Some older and low-end DOCSIS 3 modems only support four channel bonding. For instance, a customer using a four-channel capable Motorola 6121 modem in Queens with Time Warner’s 30/5Mbps Extreme tier will only get speeds up to 50/5Mbps after the upgrade. If the customer owned a Motorola 6141, which supports eight channel bonding, they will get the full advantage of the upgrade: 200/20Mbps. But even the 6141 isn’t enough for Time Warner’s top tier: 300/20Mbps. Customers would need an upgrade to a 16-channel capable modem.

Time Warner’s notification letter says customers can swap out a company-owned cable modem for a 16-channel capable model, currently the Arris TG1672g, either by mail, through an area Time Warner Cable store, or with a service call. The usual modem rental fees still apply.

The TG1672g (download user manual) is a fully capable broadband and Wi-Fi home gateway that also supports Time Warner’s phone service:

• 16×4 Channel Bonding
• Full Capture Bandwidth Tuner
• Multi Processor Technology with an Intel Atom Core Application Processor
• DOCSIS® 3.0 and PacketCable™ 2.0 compliant design
• 4 port Gigabit Ethernet Wireless Router
• 3×3 Integrated Dual Band Concurrent
• 2.4GHz and 5GHz 802.11n radios with Beam Forming
• USB 2.0 Host Port
• Upcoming support for DLNA and File Storage
• Two FXS lines of carrier-grade VoIP with HD voice support
• MoCA1.1 for in Home Video and Data distribution over Coax
• Dual Stack IPv4/IPv6 Home Router
• Internal Power Supply for Highest Reliability and reduced energy consumption
• Battery backup: Single battery pack for reaching a full 8 hours of standby support

If picking up new equipment, a Time Warner representative will probably let you know if your account is flagged “Maxx-capable,” which means your neighborhood’s upgrade is imminent or complete. Time Warner may also want to swap out your set-top boxes if you subscribe to cable television, although readers report cable television service and the on-screen guide in Queens doesn’t look any different at present. The backup battery inside the cable modem is rated for up to 10 years of life and is replaceable by the user for around $60.

Customers who own their own cable modem might have to buy a new one if they are seeking the company’s fastest speeds. Time Warner’s latest approved modem list should guide what, if any, new equipment you might need. If you are considering buying your own modem, you might plan your purchase around the model(s) that support the speeds you want.

Time Warner Cable’s Latest Approved Modem List

[flv]http://www.phillipdampier.com/video/TWC Techs Launch 300 Mbps Internet Speeds at Queens NY Hub 5-6-14.flv[/flv]
Technicians launch 300Mbps broadband speeds for Time Warner Cable customers in Queens, N.Y. (1:27)

Neil Smit, CEO, Comcast Cable (left), Ryan Lawler, TechCrunch (right)

Of all the tech companies to turn up at TechCrunch’s Disrupt New York 2014 event, Comcast Cable seemed the least likely to qualify as the kind of innovative start-up TechCrunch loves to cover.

But there sat Comcast Cable CEO Neil Smit with TechCrunch’s Ryan Lawler, discussing Comcast’s mega-merger with Time Warner Cable, its peering agreement with Netflix, broadcast TV streamer Aereo, and Comcast’s legendary dismal customer service.

Smit’s arrival on stage to a smattering of tentative applause was a clear sign there was no love for the cable giant in the audience, particularly from many New York area Time Warner Cable customers dreading a future with Comcast.

Smit was immediately confronted with the fact Comcast was recently voted the Worst Company in America by Consumerist readers, prompting yet another promise that improving customer service was Comcast’s “top priority,” the same promise Comcast gave in 2007, 2008, 2009, 2010, 2011, 2012, and 2013.

“I think if there’s one thing to disrupt in our business, it’s customer service,” Smit added.

Smit defended Comcast’s merger with Time Warner, relying heavily on video subscribers to downplay the concentrated market power Comcast would have after the merger. Smit pointed out Netflix has the largest subscriber count of any pay television channel or platform and denied Lawler’s contention that a merger would give Comcast more than 50% of the American broadband market.

“I think the number is a little less than that — it is closer to 40% but if you include wireless than it would be less than 20%,” Smit responded, referring to the LTE 4G wireless networks from wireless carriers that come with very low usage caps and very high prices.

Smit also promised major broadband speed upgrades and other improvements for Time Warner Cable customers, but nobody mentioned Comcast’s gradual reintroduction of usage caps on residential broadband accounts.

Comcast Cable’s CEO also addressed several other hot button issues:

Smit claimed Comcast has a good working relationship with the FCC and is providing advice on whatever changes to Net Neutrality FCC chairman Tom Wheeler will propose later this month.

Despite the fact Comcast could ultimately benefit if Aereo is found to be legal by the U.S. Supreme Court, Smit recognized Comcast also owns NBC and other broadcast programmers and was concerned about the economic impact if cable operators stopped paying for over-the-air programming.

“We pay $9 billion a year for content,” Smit said. “One of the things that I question in the Aereo solution is: are they paying for content? The spend for that content has to come from somewhere.”

Smit also noted Comcast is increasingly targeting younger audiences by signing deals with college campuses to bring Comcast service to students to hook them as future subscribers. Comcast is also creating new packages with fewer channels to appeal to millennials. Smit also acknowledged many younger family members are accessing cable programming using passwords associated with their parent’s cable account.

[flv]http://www.phillipdampier.com/video/TechCrunch Interview with Neil Smit 5-6-14.mp4[/flv]

Here is the complete interview TechCrunch conducted with Comcast Cable CEO Neil Smit. (22:20)

As of May 1^st, Frontier Communications has raised the price of its standalone DSL service $5 a month, primarily because its competitors have also raised prices.

Current subscribers to Frontier’s basic 6Mbps ADSL service Simply Broadband will continue to pay $29.99 a month for now, but new customers will see a rate increase to $34.99.

“We increased the price [… because it] better reflects the value of that offering, given the robust capability of our network and comparable pricing from our competitors,” Frontier CEO Maggie Wilderotter told Wall Street analysts on a quarterly results conference call.

Frontier also announced Frontier FiOS TV price increases that “reflect increasing programming costs” also taking effect this month.

Frontier added 37,000 new broadband customers during the first quarter, a record for the company and the fifth consecutive quarter of broadband customer growth. Frontier increasingly depends on broadband to retain existing customers and develop new customer relationships in rural areas where broadband service has not been available in the past.

“As of April, 74% of our customers have access to 12Mbps, up from 60% in the fourth quarter,” said chief operating officer Dan McCarthy. “Now 61% of households we pass can get 20Mbps or greater, and 83% can get 6Mbps. At the end of the fourth quarter in 2012 only 40% of our network was capable of 20Mbps and only 50% was capable of 12Mbps.”

Despite the speed increases, cable competitors still made their presence known. Most cable companies sell faster service than Frontier offers and on the low-end, Time Warner Cable’s 2Mbps $15 broadband package, marketed to current DSL customers, was acknowledged to have an impact by Wilderotter, but not enough to bring a significant change in competitive intensity.

Frontier continues to argue that broadband speeds are simply not that important to most customers. McCarthy claimed that less than 20% of Frontier’s broadband customers subscribe to speeds above 6Mbps.

“Quite frankly we’ve had focus groups with our customers and potential customers […] and what they say is that they don’t really know what speed they have,” McCarthy said. “They just need enough and that’s really what it’s about — providing a good quality product that’s reliable and gives them the speed that they need. It’s not necessarily a 60Mbps connection that they’re really never going to use.”

“We’ve also found [in the focus groups that we do] that a lot of customers, even those upgrading to higher speeds don’t really change their behavior,” Wilderotter added. “It’s not like they have 10Mbps more so now they’re a gamer. They just keep doing the same thing they were doing before. We still have the majority of our customers taking around 6Mbps and they have a choice to go up but they decide that that’s enough for what they’re doing and we’re happy to sell them just what they need.”

Frontier has also reduced its landline losses nationwide to 9,600 during the last quarter. It will begin running advertising this year that reminds customers landline service is often more robust than wireless or Voice over IP during power or weather-related outages. Wilderotter said emphasizing the traditional landline as a protective and security measure really resonates with Frontier’s customers.

Fixed line (wired) broadband is still a critically important technology in Germany.

Vodafone Deutschland and Kabel Deutschland, now both owned by Vodafone, have launched a joint marketing agreement to pitch wired broadband to customers across Germany under the new brand Zuhause Plus (At Home Plus).

Customers have the choice of either Vodafone’s VDSL at speeds up to 50Mbps or cable broadband from Kabel Deutschland at speeds up to 100Mbps. Vodafone is trying to convince customers to abandon VDSL in favor of cable broadband, which also offers television service. Vodafone is working on bringing television to its VDSL customers at some point in the future, but it would compromise available broadband speeds.

To provoke DSL customers to consider a change, a special offer of $27.72 a month for phone and broadband service is available for those agreeing to switch to cable.

Together, Vodafone and Kabel Deutschland reach nearly 98% of German homes. At least 40% get DSL speeds exceeding 25Mbps. The company is targeting speeds of at least 100Mbps for its DSL, cable and LTE wireless networks.

The Kabel Deutschland brand will soon disappear in favor of the Vodafone brand. The two companies were merged last October in a $15.3 billion dollar deal.