Bewkes

What cord-cutting?

The “other” Time Warner — the separate entertainment company no longer affiliated with Time Warner Cable, has a chief executive who regularly downplays the threat of cable customers dropping television service and switching to alternate forms of online viewing.

At a conference in New York, CEO Jeff Bewkes said cord cutters largely fell in two categories:

1. Low income households who could never afford cable and still can’t;
2. Wealthy kids who grew up without cable television, still don’t have it now that they are living on their own, but can easily afford “three Starbucks a day” and don’t mind paying just about any price for the cost of content they actually want.

Bewkes cannot understand what people are complaining about when they open their monthly cable bill. After all, he argued, the value of  cable television and broadband have gone up with larger channel packages and speed upgrades without major price hikes.

But Bewkes’ definition of “major” may differ from those in middle class households who cannot afford rate increases that far outpace inflation year after year.

For now, Time Warner signaled it intends to remain loyal to the “all-or-nothing” cable package. That makes the chance of finding their entertainment shows available a-la-carte or online on-demand without a paid subscription pretty poor.

Time Warner Cable would like to thank the city of Charlotte and the state of North Carolina for the generous handouts of taxpayer-funded corporate welfare that helped make their newly-christened $82 million data center possible.

In return, Charlotte residents pay the nation’s highest cable bills, according to a piece in the Charlotte Observer.

Time Warner Cable maintains a cozy relationship with state and local officials — friendly enough to help win the company a state Job Development Investment Grant worth up to $2.9 million in public tax dollars in return for hiring 225 workers in their eastern national data center. Critics contend Time Warner was going to need to hire workers with or without the grant.

According to WhiteFence, the average Charlottean paid $51.18 for standalone high-speed Internet services in October.

The group surveys pricing from utility providers nationwide and builds a national price index for different services, including broadband.

No city pays higher prices that Charlotte, N.C., according to the group. The WhiteFence Index also shows Internet pricing is rising steadily, up from less than $40 charged this past May.

The Libertarian Party of North Carolina is probably the biggest opponent of corporate welfare handouts in the state:

By taking money from the taxpayers and giving it to businesses in the form of “corporate incentives,” our state and local governments are playing a game of Reverse Robin Hood. They are robbing from the poor and giving to the rich. The Libertarian Party of North Carolina denounces all corporate welfare programs as fiscally irresponsible and calls for their immediate abolition.

Millions of dollars are taken every year from our taxpayers and stashed into various funds and programs at all levels of government. The purpose of these funds is supposedly to attract businesses to our area and help them expand, under the theory that this will create jobs and promote general prosperity.

This theory has two fundamental defects. First of all, the government has no place in deciding which jobs should be created and maintained. A free market is infinitely better equipped to respond to the economic needs of businesses and consumers. When the government starts funding already successful companies, it becomes harder to compete in the marketplace if you have a new company with an innovative idea or service.

More directly, we can not have general prosperity until we rid ourselves of our excessive tax burdens. The first cause of economic prosperity is when consumers have money to spend. But we have less and less spending money, as governments take more and more from our paychecks. And then they use that money taken from us as legal bribes to entice their corporate favorites to come to North Carolina.

Cadillac prices for some sports networks you pay for whether you watch or not. (Early Summer 2012 – Prices have since risen for some networks)

About 50 percent of your monthly cable television bill covers the cost of live sporting events and the networks that cover them, and the price is not going down anytime soon.

At least $21 of that bill is split between more than 50 national and regional channels covering every imaginable sport.

What customers may not know is that a handful of self-interested giant corporations and major sporting leagues have successfully bid up the price to carry those events using your money.

The Philadelphia Inquirer took a hard look at spiraling sports programming costs last weekend, discovering a lot of cable subscribers are paying for sports programming they will never watch.

“Here is a little old lady who wants to watch CNN,” Ralph Morrow, owner of Catalina Cable TV Co. in Avalon, Calif., a 1,200-subscriber system, told the newspaper. “But I can’t give it to her without $21 a month in sports.”

In the last 20 months, some of the biggest names in sports programming including Comcast/NBC, Fox, ESPN, CBS, and Turner have agreed to collectively pay $72 billion in TV rights to air pro, college, and Olympic events over the next decade. Costs are anticipated to soar to $100 billion or more once those contracts come up for renewal.

To cover the growing expense, the pay television industry’s business model insists that every subscriber must pay for sports networks as part of the “basic package” whether they watch or not. Nothing fuels annual rate increases faster than sports programming, and there is no end in sight.

Many contracts specifically prohibit operators from selling their networks “a-la-carte” or in special “sports tiers” that carry extra monthly fees.  Any additional costs are quickly passed onto subscribers in the form of regular rate hikes.

Charlie Ergen from Dish Networks suggests at the current pace of sports programming rate increases, it won’t be long before subscribers will face cable bills up to $2,000 a year, just to watch television.

If you don’t believe him, consider estimates from NPD Group, which predicts the national average for cable TV bills could reach $200 a month as soon as 2020. That is up from the already-high $86 a month customers pay today, after all costs and surcharges are added up.

It was not always this way. As late as the 1980s, the overwhelming majority of marquee sporting events were televised on “free TV” networks like ABC, CBS, and NBC. For decades, major broadcast networks largely had only themselves and the economics of advertiser supported television to consider when submitting bids to win carriage rights.

With the advent of cable sports networks, supported by dual revenue streams from both advertising and subscriber fees, ESPN eventually amassed a back account large enough to outbid traditional broadband networks. If another network moves in on ESPN’s action, the cable network simply raises the subscription fee charged to every cable subscriber to up the ante.

Broadcasters have enviously watched this dual revenue stream in action for several years now, and have recently insisted they be treated equally. Today, cable operators face demands for similar monthly payments from television stations and their network owners. In effect, customers are paying both sides to outbid one another for sports programming.

Consider ESPN as a case study in sports programming inflation. From 1989-2012, ESPN rates increased 440 percent. Today, every cable subscriber pays at least $5.13 for ESPN alone. In fact, the actual amount is considerably higher, because ESPN has successfully compelled most cable and satellite programmers to also carry (and pay for) several additional ESPN-branded networks also found on your lineup.

But why do cable companies agree to pay astronomical fees for sports networks, only to later alienate customers with annual rate hikes?

First, because customers watch sports. If a cable company does not carry the network showing a game or team a customer wants to see, that company will likely hear about it, either in a complaint call or cancellation.

Second, watching live sporting events is not easy for a cord-cutter. With fewer games appearing consistently on broadcast television, a cord cutting sports fan risks missing the action only available from a pay television provider.

In a defensive move, many cable and satellite companies assume the more live sports a  provider offers, the lower the chance a sports enthusiast will consider canceling service.

Cross-ownership also muddies the water for consumers. Comcast, the largest cable operator in the country, has an obvious self-interest loading its systems up with its own sports programming and compelling customers to pay for it.

Comcast owns about a dozen regional sports networks, NBC, NBC Sports Network and Golf.

Other large cable operators are concluding if you can’t beat ’em, join ’em. Time Warner Cable found one lucrative reason to own its own sports networks: its ability to charge competing cable and satellite providers sky high prices to carry that programming.

Time Warner is asking fellow cable, telco, and satellite providers to pay $3.95 a month for its SportsNet English and Spanish language networks, which feature the Los Angeles Lakers. For good measure, the same cable company that routinely complains about being forced to pass on mandatory sports programming costs from others insists companies place both of their sports channels on basic lineups, which guarantees every subscriber will also pay the price for two more sports channels, one in Spanish, they may have no interest in watching.

Time Warner Cable has changed account numbers for a number of their customers in upstate New York, creating a problem for those who failed to update their electronic bill payment service with the new number. Many of those accounts are now past due and Time Warner Cable is having trouble tracking the payments sent on behalf of the old account number.

The new account numbers are now in place for New York customers in Albany, Rochester, Syracuse, Watertown, and other nearby communities. Customers in Portland, Maine are scheduled to be assigned new account numbers the first week of November.

Time Warner Cable attached this notification letter to bills mailed in August and September to customers in Rochester, N.Y., and other upstate cities.

Stop the Cap! reader Charles dropped us a note noting his account went past due because his payment, sent by his bank under the old account number, has been cashed but never credited to his account. Time Warner Cable  customer service agents can no longer access his old account to see if the payment was misapplied, and won’t take his word for it.

Oops: A bill covering Sep. 28-Oct. 27 still reflects the old Time Warner Cable account number.

“I have to fax in something that shows the bank paid the bill,” Charles reports. “I’m surprised there was not some connection between the old account numbers and the new ones. The system could have at least made the connection, credited the new account number and automatically notified me (email would be easy) that the account number had changed.”

Area banks across western and central New York report there have been a significant increase in complaint calls over Time Warner’s demands for evidence of payment.  Typically, companies like banks and insurance companies changing account numbers will transfer payments sent under old account numbers and automatically apply them to the proper account. That is not happening with the cable company.

More irritating for customers is that Time Warner Cable did indeed notify customers in early September that their account number was going to change, but never bothered to share the new account number at that time so customers could take action with their financial institution. When billing statements dated for service as late as September 28 were mailed, they still reflected the old account number.

Customers who use the cable company’s own recurring auto-pay service were not affected.

You can now find your new account number under Time Warner Cable’s MyServices section, under the PayXpress Billing Center heading.

Customers with missing payments should call their local Time Warner Cable customer service center to begin an investigation and avoid any late fees.

Comcast’s porn charged cable bills run into the hundreds of dollars for one 80-year old customer who claims she never ordered them.

An 80-year-old Richmond, Virginia woman has been billed more than a thousand dollars by Comcast for adult pay per view movies she never ordered.

Shirley Mascaro has been fighting with Comcast for nearly a year over an endless series of $13.99 titles that have regularly appeared on her monthly bill since February.

Mascaro not only says she never watched the movies, she has no idea how to order pay per view programming.

Mascaro refused to pay for the movies she did not order, resulting in one bill for $700. Comcast shut off her service, despite regular complaints and promised service credits for the movies.

One young Comcast employee stood in Mascaro’s living room and doubted her veracity when she claimed she was not watching titles like “Xtsy,” “Pant,” and “Juicy.”

“‘Everybody says they don’t order these moves, but they really do,'” Mascaro recalls the Comcast employee telling her.

Another employee offered that perhaps one of Mascaro’s neighbors was stealing her cable.

“Maybe they are but I don’t know,” Mascaro replied. “You need to find out.”

Mascaro suspects Comcast’s cable box might be the culprit. The charges began right after Comcast installed the box on her new television.

With no end in sight to the porn fees, Mascaro contacted WWBT in Richmond and appealed to their consumer reporter for assistance. That quickly got the attention of Comcast, who called the entire matter “an isolated problem.”

Comcast released a statement to NBC12 apologizing to Mascaro and crediting all disputed charges on her account. But Mascaro, and the TV station, are not so sure the charges will not be back. 12 On Your Side reporter Diane Walker promised to keep watching.

Mascaro also wants Comcast to send her a letter just in case the company tries to ruin her credit over the unpaid porn movies.

[flv width=”640″ height=”500″]http://www.phillipdampier.com/video/WWBT Richmond Elderly woman charged hundreds of dollars by Comcast for porn 10-2-12.mp4[/flv]

An 80-year-old Richmond, Va. woman’s year-long dispute over hundreds of dollars in Comcast pay-per-view-porn she says she never ordered may finally be over. WWBT reports.  (3 minutes)