Mid-Rivers Communications, a Montana-based telecom co-op, wants everyone to believe their mandatory, usage-based broadband scheme that charges $19.95 a month + $0.20 per gigabyte is popular with their customers.

After the company noticed that fewer than 20% of customers were responsible for more than 90% of Mid-Rivers’ network traffic, it decided to ditch its traditional usage-capped, speed tier plans in favor of a compulsory usage-based billing scheme that included the maximum speed available, sometimes as high as 1Gbps, with no usage allowance.

To listen to Michael Candelaria, Mid-Rivers CEO and general manager, people have lined up at the doors just waiting to sign up, according to an interview published by Telecompetitor:

Initially the company tested usage-based pricing as an option in one CLEC market. But considering that 80% of customers opted for usage-based pricing within one year of its introduction, Mid-Rivers moved completely to usage-based pricing and launched it throughout all four CLEC markets.

Mid-Rivers has been particularly proud of the response it has received from local businesses. Candelaria noted that local hotels have seen occupancy drop after the area experienced an oil-related boom, followed by a bust. Nearly-empty hotels were paying $500 to $1,000 a month for high-bandwidth connections from competitors but only using a fraction of the capacity. The Mid-Rivers usage-based broadband offering was perfect for them.

During certain months, the hotels’ bills are dramatically lower than they were before.

“When the hotel is full, their bill goes up and they know why,” Candelaria said.

Meanwhile, as businesses that were not Mid-Rivers customers heard about the usage-based offering, “they came to us” after “we beat on their door for 20 years,” he noted.

But as news of the interview spread, it seems more than a few customers are not happy with Mid-Rivers’ new broadband pricing, and accused the company of propagandizing its usage based pricing scheme and censoring social media to suppress customer backlash.

Candelaria admitted the company used to take a lot of heat from customers that called up and asked for the cheapest internet plan available, which was $40 a month for 1.5Mbps service. At those speeds and prices, customer slammed the company’s Facebook page.

“This is where Candelaria time traveled a bit on his answer,” reflects Dan Corey, a customer rebutting Candelaria’s case. “Before the usage-based internet [plans], the tiers Mid-Rivers [offered] were 8, 12, and up to 50Mbps. There has not been a 1.5Mbps speed at Mid-Rivers for years.”

These days, Candelaria claims, complaints about speed and pricing are mostly gone.

“Of course they are gone,” responds customers J.P. and Kyle Jones, who jointly shared their feelings with Stop the Cap! “Mid-Rivers now censors their social media after taking a lot of heat so complaints are never publicly seen on their Facebook page.”

“Mid-Rivers must approve any comments made on their Facebook page, so 90% of the complaints are never seen unless Mid-Rivers has a full (even if not accurate) response ready to post along with it,” adds Corey. “No dissatisfied customers would know of others because of the control. Their Facebook page used to show all comments when posted, but that changed once they got a better understanding of how to control the flow of comments.”

Jones points out that the reason “80% of customers opted for usage-based pricing” is that any account change automatically forced the customer onto a usage-based pricing plan whether they wanted it or not. Most customers, including himself, do not want data caps or usage pricing, but he didn’t get a choice in the end.

“Put yourself in the shoes of a customer that used to be enrolled in Mid-Rivers’ Preferred Plan, which cost $59.95 a month and includes 600GB of usage at 12/1Mbps speeds,” writes J.P. “People don’t live in Montana for the social life so we spend a lot of time streaming video at home. Under Mid-Rivers’ new plan, if I used 500GB a month, I’d pay $20 for the account and $100 in usage charges — double what I paid a month earlier just for faster speed I could have paid more to get if I wanted or needed it. How many people do you think are enthusiastically waiting to pay double what they used to for internet?”

Mid-Rivers new usage-based plan.

For Candelaria, “Wide Open Wi-Fi”  is about selling fast internet access for less, and customers should only pay for what they use.

“People have been paying for utilities by usage for some time,” he told Telecompetitor. “Customers don’t tally up how much electricity they use and then order a 30-kilowatt plan and they don’t count how many showers they take to determine what kind of water plan they need. Why should the internet be any different? Everybody should have good internet. It doesn’t matter if you’re rich, poor, you should be able to afford fast internet.”

Customers like J.P. agree with wanting fast and affordable internet, but argue this isn’t that. Where available, “Wide Open Wi-Fi” quickly becomes the only option Mid-Rivers offers, he claims.

“The reason for the [high] ‘take rates’ is that if you attempt to change or upgrade service, you are forced onto the usage-based service,” adds Corey. “There is no choice, so the take rates are very misleading. Customer satisfaction would increase for those that don’t use the service as of now. However, with more and more of the world going to internet, those customers will feel the squeeze soon enough.”

For customers that avoid calling Mid-Rivers and keep their heads down to keep their current plan, that doesn’t stop the company from eventually notifying customers their plan was changing whether they liked it or not.

Mid-Rivers older tiered plans.

“You will be ‘offered’ the Wide Open internet shortly I’m sure. Just like we in the cable modem towns were,” noted BigSkyGuy. “However, once not enough people switch to it, or it’s been some pre-determined amount of time, you’ll be forced onto it like the rest of us. Then you can enjoy the larger bills. Just like your forced router unfortunately.”

Mid-River sells its “Wide Open” service as a great way to get rid of data caps and tiered plans, and includes a free Wi-Fi router:

• Virtually unrestricted speeds
• Connected Home Wi-Fi included!
• No more tiered plans! You automatically get the fastest speed!
• No more data caps
• Pay for only what you use
• Your speed and experience will be greatly enhanced
• Your perfect plan – whether you need the fastest speeds or the most affordable option
• You as the customer will have control over your Internet bill*

That asterisk points to fine print that explains for $19.95 a month, you get no data allowance. You are billed $0.20 per gigabyte in one gigabyte increments. Don’t like the high bill that results?

“Your bill can be controlled by monitoring how much data you are using, use less and your bill will decrease,” the company explains.

But for most internet users, using less isn’t an easy option, especially as cord-cutting shifts more viewing towards the internet. Once Netflix, Hulu and similar services detect the faster speeds available on Mid-Rivers’ metered plan, their players increase video bandwidth to match available speed unless the customer intervenes. If they don’t, streaming can get very expensive.

“I have been hit with that Wide Open internet scam […] and unless you change your settings in [Netflix, Hulu, CBS, etc.] it’ll run you up to 7GB an hour, especially when it reads that speed setting from the Wide Open. In essence, Mid-Rivers is making you pay $1.40 per hour of Netflix,” writes BigSkyGuy. “Now granted, you can go in and change your settings, but how many people really know you can do that?”

The meter is lurking.

Candelaria argues the majority of Mid-Rivers customers use less than 100GB a month and their bill is less than $40, which is nearly $5 less than Mid-Rivers’ cheapest plan at $44.95, which includes a 300GB data allowance. He also claimed ‘the change to usage-based broadband has increased customer satisfaction and take rates – and while margins initially dropped, profitability was back to its previous level within six months.’

To accomplish that, either the company has signed up more new customers under the plan than it expected or usage charges from heavier users are covering the lost revenue. For Candelaria’s statement to remain true, “most customers” would have to use less than 100GB of usage a month for their bill to remain under $40. Lighter use customers may benefit from the faster speeds and continue to pay less as long as their usage stays at or near 100GB a month. But as average internet use continues to increase, so will customers’ bills.

Jones says the news isn’t all good for Montana businesses either.

“In areas where Charter/Spectrum offers business internet service, their bills are a fraction of what Mid-Rivers is charging if that business tends to run up a lot of usage, and there are no surprise bills from Mid-Rivers’ traffic charges,” Jones notes. “The problem is that Mid-Rivers is charging sky-high usage fees of $0.20/GB while other ISPs pay at most pennies per gigabyte. In fact, most ISPs buy bandwidth based on meeting demand during peak usage times, not traffic alone. During off-peak times, using your connection costs Mid-Rivers next to nothing, but Mid-Rivers keeps charging $0.20/GB day and night.”

BigSkyGuy notes other ISPs in the area are offering customers a better value proposition with flat-rate internet that will quickly be the envy of many Montanans facing future Mid-Rivers’ usage charges:

• RTC/Reservation Telephone Cooperative: (100/100Mbps) UNLIMITED DATA $55/month
• Midco/Midcontinent Communications: (75/5Mbps) UNLIMITED DATA $56/month or (25/3Mbps) UNLIMITED DATA $42/month
• Nemont: (10/10Mbps) UNLIMITED DATA $71/month

VDSL2 vectoring and G.fast are only as good as the copper wiring that extends to each customer. Up to 45 percent of North American wire pairs are in some state of disrepair.

Verizon has no interest in using advanced forms of DSL as part of its next generation broadband service.

Speaking at ADTRAN’s Broadband Solutions Summit, Verizon’s director of network planning Vincent O’Byrne made it clear DSL variants and copper wiring were not going to be a part of Verizon’s future network platform.

“We have no strategy for G.fast,” O’Byrne told Telecompetitor in response to a question about whether the company would upgrade or deploy advanced forms of DSL as part of overhauling its broadband networks.

Some telephone companies with large legacy copper networks have promoted DSL advancements including bonding, VDSL, and G.fast in lieu of costly fiber upgrades to shareholders and customers to improve the sluggish 6-10Mbps speeds many customers get from DSL service. But O’Byrne said Verizon has had nothing but headaches trying to make its legacy copper network actually deliver the improved broadband speeds those technologies promise on paper.

O’Byrne admitted Verizon’s copper network has not aged well, calling it “poor” in some areas. Verizon’s previous efforts to deploy VDSL and ethernet over copper to multiple dwelling units (MDUs) like apartment buildings and condos turned out so poorly, O’Byrne does not want to repeat those mistakes in the future.

For urban areas and MDUs, O’Byrne stressed he plans to take fiber all the way to each condo unit or apartment and get rid of the copper.

Verizon’s next generation fiber strategy will depend heavily on NG-PON2 technology, which is managed by unpowered splitters and filters — dramatically cutting the hardware costs associated with active fiber networks. Many PON networks are fiber to the premises, but then rely on Wi-Fi or Ethernet wired networks once inside a building. Verizon prefers an all-fiber solution, which is unusual among U.S. carriers. AT&T, CenturyLink and Windstream still use G.fast for relatively short runs of existing copper phone wiring inside MDUs and homes.

Verizon’s O’Byrne believes an all-fiber solution may cost more upfront, but will deliver better longevity, value, and fewer problems over time.

Comcast customers in Bucks, Chester, Delaware, Montgomery, and Philadelphia counties in Pennsylvania as well as parts of New Jersey and New Castle County, Del. can now subscribe to the company’s DOCSIS 3.1-powered gigabit broadband service.

Jim Samaha, senior vice president of Comcast’s “Freedom Region” surrounding southeastern Pennsylvania says at least two million customers will be able to subscribe to the new, faster broadband speed immediately.

“We have been on a pace of doubling our network capacity every 18 to 24 months, ensuring that we stay well ahead of demand,” said Samaha in a statement.

Comcast is running an introductory promotion that will price the gigabit service at $79.99 a month with a one-year contract or $104.95 a month for month-to-month service. A 1TB usage cap did apply to customers on a gigabit plan who did not agree to a term contract, but there was some debate on that point with Comcast representatives giving conflicting answers. Customers who want a cap-free experience with Comcast may have to pay an additional $50 a month.

While Mediacom introduces gigabit speeds to a growing number of their customers, it also acknowledges it has one of the worst customer satisfaction scores of any cable company in the country.

Company officials were in the Quad-Cities of northwest Illinois and southeastern Iowa to speak about 1,000Mbps service introduced earlier this year for its 92,000 customers in the area, according to an article in the Dispatch-Argus.

“No where else in the country has this much broadband capability,” said Phyllis Peters, director of communications for the north central division of Mediacom. “You can live in Port Byron or Ottawa or down the road in Marion or Carbondale, and you’re using the same amount of bandwidth. You have just as much demand and need for bandwidth as if you were living in Austin, Texas.”

To support the expansion, the company added nearly 30 miles of additional fiber capacity to support the faster internet speeds. But so far, fewer than 250 customers in the area have upgraded to gigabit speeds. Most seem content with paying less for slower speeds, but that does not mean customers are not using their internet connections.

“We’ve been looking at an internet business that has been growing,” said J.R. Walden, senior vice president of technology and chief technology officer for Mediacom. “The bandwidth is growing at as much as 65 percent a year for close to 20 years. It means we have to double the size of the network every 18 months.”

Walden

Walden claims that once gigabit speed is embraced by a larger number of their customers, they will contemplate another upgrade to 10Gbps speeds.

Along with faster wired internet, Mediacom has also been installing Wi-Fi hotspots for its customers. XStream Wi-Fi is available to non-customers for a 30-minute trial or unlimited use during certain special events. Mediacom’s broadband customers get free unlimited access by logging in with their Mediacom username and password.

The cable company has 249 Wi-Fi hotspots in Moline, Rock Island, East Moline, Silvis, Davenport and Bettendorf, mostly in business districts or around event venues. Mediacom customers can also use their credentials to access Wi-Fi from other nearby cable operator-operated hotspots, notably those belonging to Comcast, which dominates in Illinois.

The cable company has also been promoting its internet program for the income-challenged. Connect2Compete is a $9.95-a-month internet service for families with at least one student in kindergarten through 12th grade who qualifies for the federal school lunch program. But like most cable companies, Mediacom’s first interest is to protect its own revenue, so it excludes current customers from enrolling if they already scrape enough money together to pay for regular broadband service or who have a past-due balance or unreturned equipment from an old disconnected account.

The American Consumer Satisfaction Index rates Mediacom dead last in 2017.

That is one of the many reasons Mediacom’s customers dislike the company. It perennially scores dead last among all the nation’s cable operators in Consumer Reports’ annual surveys. The Better Business Bureau has also documented multiple bad reviews and KWQC-TV in Moline reports Mediacom’s internet service is notorious for its repeated outages:

JoEllen Seibel said she’s used the company for internet for the last 8 years and has had little to no connection for the last four months.

“It’s all day long, all day long we get no reception.”

Seibel said technicians have come to her house multiple times to fix the problem but is still without service.

“It makes me frustrated if something is really going on on their end that’s what they need to tell their customers or something instead of just sending someone out.”

Nathan, another Mediacom customer, complained to the Better Business Bureau his internet service is completely unreliable.

“As much as I was excited about our internet speeds, they are never persistent. Internet goes out at least ten times a day,” he told the BBB.

Glendon adds Mediacom advertises fast internet speeds it cannot reliably provide its customers.

“I subscribe to 150/30Mbps internet. I rarely get 150 down, usually 50-60, and during peak [usage periods], [speeds drop] into the teens,” he complains, noting things have not improved despite multiple technician visits and a manager’s intervention.

“Very incompetent company that doesn’t seem to care if they’re billing you for a service they can’t provide,” is Glendon’s conclusion.

“We’re not unaware that some of the customer satisfaction scores put out by third-party organizations have had us on the lower end and we think we can do better and to some extent deserve a better score and we’ve been working on that,” Walden told the TV station.

…for our outrageous pricing!

Spectrum’s customer service agents are apologizing to customers for the rate shock they are experiencing when their existing Time Warner Cable or Bright House Networks promotions expire and customers find out the Spectrum plans and pricing being offered instead turn out to be nothing close to the deals customers used to get.

“You may get a call asking about my performance today, the survey is about me and my job today only,” a customer service agent explained to Jason, a Spectrum customer in Elmhurst, N.Y., who shared his experience on DSL Reports. “It doesn’t have anything to do with how you feel about Spectrum or TWC. If you are upset about the new pricing, please use the comments portion to explain. I look forward to hearing your feedback.”

Customer service representatives are on the front line of delivering bad news to cable customers facing double-digit rate increases, especially when customers realize they also receive fewer TV channels after changing plans.

“I’m guessing these agents must be getting destroyed in the surveys, [and] having worked retail where these types of surveys are used, I felt bad for the reps,” explained the Spectrum customer. “I know in my neighborhood, everyone seems to have their TWC promos expiring in the next month or so and are very unhappy.”

That unhappiness is getting worse as word about Charter Communications’ mid-year rate increase is showing up on customer bills. Broadband prices are increasing at least $1 a month, the Broadcast TV Surcharge is rising to $7.50 a month, and set-top box equipment rentals also increased by $1 a month for each piece of equipment starting in August 2017.

Premium speed broadband customers are now also facing a higher internet bill.

Spectrum’s Ultra tier, which is 100Mbps in some markets, 300Mbps in others, is increasing to $119.99 a month, up from $104.99 in most markets. The increase is less if you also subscribe to Spectrum TV, which reduces the rate to $113.99 a month. Spectrum rate cards from around the country do not yet reflect the $1 rate increase for traditional Spectrum 60/5Mbps internet (100Mbps in select markets):

Low income customers enrolled in Spectrum’s Everyday Low Price (ELP) internet package — a carryover from Time Warner Cable — also got the rude shock of a $5 rate increase on a service that used to cost $14.99 a month. That represents more than a 33% rate hike, which is just fine with Charter.

“In some of our markets the price has increased for the ELP package,” said spokesperson “Julie_R”. “Notifications were sent via bill statements and became effective with the August statements. Our ELP package is not a promotion.  From time to time, Spectrum makes decisions to adjust the pricing for our products and services to account for network investments.  We understand that value is important.  ELP is still a very good value at $19.99.”

The rate increase does not apply to New York State residents, where regulators placed significant deal conditions on the Charter/Time Warner Cable merger to help protect consumers in that state.

We have also been receiving reports from readers that Spectrum’s Internet Assist (SIA) program, designed for the elderly and income-challenged, is not easy to enroll in and customer service representatives have rejected a number of applicants for a variety of reasons. SIA offers a 30Mbps broadband connection for $14.99 a month to those qualified for:

• The National School Lunch Program (NSLP); free or reduced cost lunch
• The Community Eligibility Provision (CEP) of the NSLP
• Supplemental Security Income (SSI) ( ≥ age 65 only) Programs that do not qualify for Spectrum Internet Assist: Social Security Disability (SSD), Social Security Disability Insurance (SSDI), and Social Security Retirement and Survivor Benefits are different from Supplemental Security Income (SSI) and do NOT meet eligibility requirements.

The biggest problems encountered so far:

• Representatives lack information about the program and attempt to upsell customers to regular pricing and packages.
• Bundling additional services with SIA can be more expensive than just choosing a traditional bundled package sold to everyone, especially if it is a new customer promotion.
• There is considerable confusion over the qualifications for SSI recipients. Be sure to recognize you must be 65 or older and note SSD, SSDI, and certain other programs noted above do not qualify you to receive SIA.

We are continuing to monitor the SIA program looking to ensure Spectrum is making the program available to customers that qualify for it.