Alaska’s largest cable company today unveiled changes to its Internet plans, ditching surprise overlimit fees in favor of a speed throttle.

GCI has been the subject of bad press in the past, with some customers experiencing up to $1,200 in overlimit fees after exceeding GCI’s usage allowances. In an effort to avoid public relations nightmares like that, GCI will stop assessing automatic overlimit fees and instead impose a speed throttle on customers over their limit that will temporarily reduce broadband speeds to less than 1Mbps until the next billing cycle begins. Customers can voluntarily pay for more usage in $10 increments, which buys a reprieve from the speed throttle.

GCI “No Worries” Broadband Plans offer varying usage caps and extra usage allotments:

Customers on lower speed plans continue to face a lower usage allowance and will receive considerably less extra data for their $10 add-on data plan. GCI’s highest speed re:D offering does get a bigger usage allowance: 600GB, up from 500GB. An $11.99/mo surcharge continues for broadband-only customers.

GCI’s largest competitor remains telephone company ACS, which heavily markets its unlimited usage DSL plans. Almost as an afterthought, ACS now markets packages that include landline service with unlimited local calling and 180 minutes of long distance for free.

A price comparison between the two providers is somewhat hampered by the fact GCI does not publicize a broadband+home phone bundle package on their website. GCI Home Phone is priced at $19.99 a month.

A 10Mbps unlimited use package from ACS costs $110/month. A 10Mbps plan from the cable company with a 30 40GB allowance + GCI Home Phone costs $79.98. On price, GCI wins at this speed… if you stay within your allowance. A 50Mbps unlimited use package from ACS runs $180 a month. GCI charges $104.98 with 150GB of included usage. Again, the price winner is GCI if you stay within your allowance. Taxes, surcharges and government fees are extra.

Heavier users may find ACS’ initially higher prices worthwhile if they are forced to buy GCI’s add-on data buckets. Both companies charge considerably more than providers in the lower 48 states.

Last year, nearly 10% of GCI’s revenue was earned from automatically applied overlimit fees. Giving up some of that revenue is a concession, but one that is likely to end bill shock and negative media attention. Still, usage allowances remain arbitrary. GCI’s entry level 10Mbps plan only offers a paltry 30 40GB a month — an allowance largely unheard of among other U.S. cable providers. GCI will also have a difficult time explaining why $10 will only offer one customer 5GB of extra usage while others will get up to 30GB. The costs for the additional data to GCI are the same.

Our thanks to an anonymous reader for sharing the news.

Updated 4:08pm EST 1/15: After going to press, GCI changed their website, adjusting the usage allowance for their 10/1Mbps plan to 40GB (up from 30GB) and deleted references to the $11.99 surcharge for broadband-only customers, which apparently no longer applies.

President Barack Obama

President Barack Obama will be in Cedar Falls, Iowa today to announce steps his administration plans to take to improve broadband in the United States, including a call to end laws that restrict community broadband development that limits competition.

“Today, too few Americans have affordable and competitive broadband choices, but some communities around the country are choosing to change that dynamic,” says a statement issued by the White House. “As a result – as outlined in a new report being issued today – cities like Lafayette, Chattanooga, and Kansas City, have broadband that is nearly one hundred times faster than the national average, yet still available at a competitive price. By welcoming new competition or building next-generation networks, these communities are pioneers in broadband that works, and today in Cedar Falls, Iowa, the President is highlighting their remarkable success stories and providing municipal leadership and entrepreneurs new tools to help replicate this success across the nation.“

The report, produced by the National Economic Council and Council of Economic Advisers, finds no evidence to support industry contentions that community-owned broadband duplicates existing broadband services and wastes taxpayer dollars. It also challenges cable and phone industry-backed groups claiming publicly owned broadband networks are business failures.

It cites the success of Chattanooga’s EPB Fiber service, operated by the local municipal utility. Not only is EPB successful financially, but it has introduced Chattanooga residents to the kind of competition sorely lacking in most cities for telecom services.

“EPB’s efforts have encouraged other telecom firms to improve their own service,” states the report. “In 2008, for example, Comcast responded to the threat of EPB’s entrance into the market by investing $15 million in the area to launch the Xfinity service – offering the service in Chattanooga before it was available in Atlanta. More recently, Comcast has started offering low-cost introductory offers and gift cards to consumers to incentivize service switching. Despite these improvements, on an equivalent service basis, EPB’s costs remain significantly lower.”

In Wilson, N.C., Time Warner Cable customers pay significantly less for cable and broadband service than other North Carolina customers because of the presence of Greenlight, the community-owned fiber to the home provider. TWC customers in Wilson pay stabilized prices for service while residents in the nearby Research Triangle pay as much as 52 percent more for basic Internet service, according to the report. Greenlight’s competition has brought gigabit broadband to the community as well as lower prices for customers who decide to remain with Time Warner. The combined savings is estimated at more than $1 million annually for Wilson residents.

EPB is the municipal utility in Chattanooga, Tenn.

Those who believe municipal broadband is a waste of taxpayer dollars should consider the story of Lafayette, La.’s LUS Fiber. In addition to bringing superior broadband service to a city dominated by a cable operator that used to treat the market as an afterthought, the presence of LUS’ fiber to the home network has forced Cox Cable to improve service, offer significant customer retention deals to departing customers and defer rate increases. The investment in community broadband has saved residents an estimated $4 million from rate hikes that went ahead in other Cox cities, with an estimated total savings of between $90 and $100 million for Lafayette-area broadband customers over LUS’ first 10 years of service.

Taxpayer-supported institutions like local government, law enforcement, and schools have also seen dramatic savings by switching to municipal solutions. In Scott County, Minn. the local government’s annual bond payment for constructing their own broadband network is $35,000 less than what the county used to pay private companies for a much slower network. Area schools that formerly paid private sector telecom companies $58 per megabit of Internet speed now pay $6.83 — a savings of nearly 90 percent. Schools also received dramatic speed increases from 100 to 300Mbps. They paid less for more service — from $5,800 a month before to $2,049 a month today. Those payments go straight back to the county government instead of into the hands of out-of-state investment bankers and shareholders. On the state level, Minnesota’s public institutional network is saving taxpayers almost $1 million a year.

With the broadband profit gravy train for big cable and phone companies grinding to a halt in competitive areas, several of these companies have spent millions lobbying state governments to outlaw public broadband services. They have succeeded in 19 states, primarily with the assistance of the corporate-funded American Legislative Exchange Council (ALEC), which appeals to primarily Republican lawmakers with claims government broadband is unfairly competing with the private sector. In fact, private providers have not been driven out of communities where they face municipal competition, but they have been forced to lower prices and improve service for customers.

Today the president will call for a new effort to support local self-determination for broadband by strongly opposing industry-backed, anti-competitive deterrents and bans on community-owned networks. The president will also sign a letter addressed to FCC chairman Thomas Wheeler encouraging him to move forward with a federal ban on state broadband laws that restrict broadband development.

He will also announce additional funding for rural broadband expansion and take steps to bring local leaders together to explore how the development of community broadband initiatives in their cities and towns can make a major difference in the 21st century digital economy. The president recognizes that most Americans lack sufficiently competitive choices for broadband service and often have just one choice — the cable company — for broadband speeds greater than 25Mbps. That means many Americans are seeing their broadband speeds lag while their monthly bills continue to grow.

Community-owned broadband may be the only alternative many cities have for better broadband as would-be competitors are scared off by high construction costs and an inability to secure cable television programming at competitive prices for their customers.

It’s a Merry Christmas from Time Warner Cable, with rate increases for one and all!

The cable company that usually waits for the holiday season to end before sending out annual “rate adjustment” notices got an early start this year with some dramatic price changes for many customers, with further rate hikes likely to follow later in 2015.

Taking a lead from Comcast, Time Warner Cable is hiking its broadband modem lease fee from $6 a month to $8 a month in January. That equals $96 a year for a modem that not too long ago used to be included at no extra charge as part of your broadband subscription. A typical customer with a Motorola SB6141 DOCSIS 3 cable modem can buy a brand new unit for nearly $20 less than what Time Warner will collect from customers each year for refurbished or used equipment… forever.

In 2013, Time Warner Cable’s Rob Marcus admitted the company does not charge modem rental fees to defray the cost of the equipment, but as a hidden rate increase designed to generate more revenue.

“The modem fee is a rate increase by all accounts, it takes a different form than usual […] it’s very much a part of the overall revenue generation program,” Marcus told an audience of investment banks.

Customers that lost analog channels after Time Warner Cable began converting part of its lineup to digital-only service were offered free Digital Adapters to continue receiving digital cable channels on older analog sets. Customers were expecting a promised $0.99 monthly lease fee for the devices starting January 1, 2015. Instead customers will now pay $2.75 a month for each DTA device, estimated to cost cable companies less than $50 each three years ago.

But the charges don’t end there.

• The Broadcast TV Surcharge for cable television subscribers will increase from $2.25 to $2.75 a month;
• A new “Sports Programming Surcharge” of $2.75 a month now applies to all cable television customers, whether they watch sports channels or not;
• That on-screen program guide does not come for free. The primary outlet “discounted guide” surcharge is rising from $2.77 to $3.27 a month;
• HBO will increase from $14.99 to $16.99 a month; the Movie Pass package of Encore movie channels and certain other networks is rising $2 a month, from $5.99 to $7.99.

Part of the sales pitch Time Warner makes to justify rate increases is that broadband speeds have increased up to 100Mbps. Except they haven’t in many Time Warner Cable markets, which remain locked in with maximum speeds of 50/5Mbps for the indefinite future.

Thanks to Stop the Cap! reader Joseph for sharing Time Warner’s letter with us.

Speed upgrades won’t help Comcast customers if they exceed a market-tested 300GB usage cap that could extend nationwide in 2015. (Image courtesy: “Funch”)

Comcast will double the broadband speeds of many of its broadband customers at no extra charge in the Pacific Northwest and Rocky Mountain region just in time for Christmas.

• Performance will increase from 25Mbps to 50Mbps;
• Blast! will increase from 50Mbps to 105Mbps;
• Extreme 105 (105Mbps) will be replaced with Extreme 150 (150Mbps).
• Certain areas will qualify for new speed plans of 305 and 505Mbps.

The new speeds are planned to begin on Dec. 16 and a modem reset may be required. Comcast indicates the speed increase excludes parts of New Mexico, Tucson, Ariz., and Fort Collins, Col.

These markets are not part of Comcast’s ongoing usage cap market trials testing a 300GB monthly usage cap with a $10 penalty for each 50GB customers exceed their allowance.

Although some customers are pleased about the speed increases, with usage caps potentially looming the benefits may prove fleeting.

One customer who has cut cable television and now streams all of his video entertainment online found Comcast would empty his bank account if the overlimit fee was in place in his area.

“I figured I’d go and see how much data I actually used in those months and found that I used 996GB in September, 706GB in October and 553GB in November,” wrote Funch. For the month of September, he would have owed Comcast an extra $140 in penalties on top of his usual Internet bill thanks to viewing Hulu and Netflix.

Customers in Comcast usage capped markets are turning down the video quality of Netflix to conserve their usage allowance, resulting in degraded video performance.

“They boost their speeds but then charge you more if you actually use them,” said Nashville customer Paul Frankel. “It’s the Comcast way.”