Britt

On this morning’s conference call for investors, Wall Street continued to pound Time Warner Cable CEO Glenn Britt about when the company would introduce an Internet Overcharging scheme for broadband customers in the form of so-called “usage based billing.”

This quarter, the pressure came from Deutsche Bank’s Doug Mitchelson, who used the occasion to remind Britt he called usage pricing “inevitable” and wanted to know when the company was going to get the ball rolling on the pricing scheme.

Britt was unprepared to answer, other than to make comparisons about his “inevitable” remark with wireless carriers, who have said the same thing about the end of unlimited use plans in wireless, a different technology.

After following Britt’s public statements for more than two years about this subject, we detected a moderating view.  Britt told investors he believes “there should remain an unlimited plan for those who want to buy that,” and suggested Time Warner Cable might not be interested in applying usage pricing on every level of its broadband service.  That could be good news, so long as Britt doesn’t believe the price of “unlimited” should be the $150 a month the company proposed in 2009.

“We’re more focused on affordability and lower income people who might be light users and might seek to pay less because they use less,” Britt said. “That’s a much better context than the usual ‘oh those people using all the bandwidth’ and caps and all that stuff.”

Britt added he doesn’t anticipate having caps across the board.

Mitchelson explained in a follow-up question why Wall Street is interested in the adoption of usage pricing – an increase in “ARPU growth” — the average revenue earned from each broadband customer in the form of more expensive usage plans.

Britt acknowledges what Stop the Cap! has predicted all along — ARPU growth can be realized instead from subscribers upgrading to faster speed tiers, which carry higher costs.  Britt told Mitchelson he, and other investors, can get the ARPU growth they crave by looking at those numbers instead of earnings from usage based pricing.

How long before Wall Street demands both speed-related ARPU growth and extra earnings from usage pricing is an open question, but Britt’s latest remarks represent a significant shift in attitude about pricing broadband, potentially because the company has a new found appreciation for the limited capability of customers to keep opening their wallets to pay higher and higher cable bills.  That was clearly in evidence as the company tried to explain another quarter of declining cable TV customers, many forced out of the service because of its high cost.

Time Warner Cable CEO Glenn Britt answers a question about usage-based pricing from Deutsche Bank’s Doug Mitchelson, just one of a parade of Wall Street banks pushing broadband providers to adopt Internet Overcharging to increase profits. July 28, 2011. (2 minutes)
You must remain on this page to hear the clip, or you can download the clip and listen later.

Purdue

North Carolina Gov. Bev Purdue today announced she will not veto H.129, Time Warner Cable’s special interest corporate welfare bill because there are too many votes available to overturn her veto:

Her statement:

“I believe that every school, household and business in North Carolina – no matter where they are – should have access to efficient and affordable broadband services.

There is a need to establish rules to prevent cities and towns from having an unfair advantage over providers in the private sector. My concern with House Bill 129 is that the restrictions the General Assembly has imposed on cities and towns who want to offer broadband services may have the effect of decreasing the number of choices available to their citizens.

For these reasons, I will neither sign nor veto this bill. Instead, I call on the General Assembly to revisit this issue and adopt rules that not only promote fairness but also allow for the greatest number of high quality and affordable broadband options for consumers.”

While we would have preferred she make the symbolic gesture of vetoing this horrible piece of legislation, by no means does this mean the battle for better broadband in North Carolina is over.

Stop the Cap!, along with other broadband proponents, will immediately begin our efforts to de-elect legislators who best represented the interests of Time Warner Cable and not their constituents.  Most are Republican, but many are Democrats.  They all need to feel the wrath of angry constituents.

It’s our view we had an uphill battle fighting this year’s bill for two reasons:

1. Big Telecom companies learned from their earlier mistakes;
2. The historic change of power to the very-corporate-friendly Republican Party in North Carolina.  Elections really do have consequences.

"I wish you'd turn the camera off now because I am going to get up and leave if you don't." -- Rep. Julia Howard

While not all Republicans are bad, and several rural North Carolina representatives expressed grave reservations about their areas going unserved, there are not enough good ones in office to offset the anti-consumer lockstep voting we saw on this bill.  Rep. Marilyn Avila, who we have consistently called the “Republican representing Time Warner Cable” is a case in point.  Time and time again, she demonstrated a complete lack of understanding about the technical nature of “her bill” and its implications on cities and towns across the state.  Indeed, a citizen activist even snapped photos of Avila hobnobbing with her cable lobbyist friends, who mopped up any goofs Avila made along the way.

Another major problem can be found in Rep. Julia Howard (R-Davie, Iredell).  She claimed her word is her bond, right before she broke it.  When the media pressed her on the $7000 in campaign contributions she received from Big Telecom and whether that connected to her support for H.129, she threatened to flee the interview if a Raleigh television station didn’t immediately shut the camera off.

There is a real classy example of standing up for your principles, whatever were that week.  The former realtor and appraiser helped foreclose North Carolina’s broadband future, handing it back to the near-exclusive control of Time Warner Cable and CenturyLink.

Appealing for less broadband competition under the guise of smaller government might be fine for some, but big and bigger cable bills are not, and that is what H.129 will deliver to every resident in the state.  We’ll prove it to you soon enough.

Two can play the legislative game.  We’ll be encouraging new legislation in the state to improve and expand competitive broadband opportunities for consumers and businesses.  Real conservatives should agree: competition is a great antidote to Internet Overcharging.

Some Time Warner customers think there is more up the cable company's sleeve than "subscriber convenience."

Time Warner Cable customers across the country have been coping with some dramatic channel realignments over the past year, in some cases finding as many as a half-dozen channels gone missing from their analog basic cable lineup when it’s all said and done.

Communities in South Carolina, Ohio, and Nebraska are the latest to find dozens of channels assuming new positions on the dial, some now requiring a $7-10 digital set top box rental to keep watching.

The reasons for the changes?  To make room for an increasing number of HD channels, upgrade to DOCSIS 3 technology to support faster broadband, and to simplify finding networks on a lineup with hundreds of choices.

In Lincoln, Neb., Time Warner Cable will be aligning all of their analog and digital standard definition channel numbers with their HD counterparts.  So if CNN occupies channel 120 on the standard definition cable lineup, CNN HD will be found on channel 1120.  Customers simply have to add a “1” in front of the three digit channel number to get the same network, when available, in HD.

Lincoln residents may appreciate the fact some channels will be easier to find, but many analog customers without a cable box are not happy several of those channels will be gone from their lineup altogether.  The “victims” of the analog to digital switcheroo are familiar to those who have already been through channel realignments — C-SPAN 2, ShopNBC, TruTV, Travel Channel, and Oxygen will be available only to those who have a digital cable box or CableCARD.

In the Myrtle Beach, S.C., area, Time Warner Cable also moved the Speed channel to a new digital-only home.  Brett Phillips who lives in Georgetown called that a hidden price increase, telling The Sun News Time Warner was effectively taking away a channel while not reducing his cable bill.

In Nebraska and Ohio, Time Warner is handing out “free” digital boxes for 12 months, but only to those who do not have one now.  Those with existing digital boxes cannot obtain a second one or get their existing box for free.  Some critics, including our Lincoln reader Marta says that is a ripoff.

“As a good customer who already pays for two digital boxes and spends almost $200 a month on my cable service, why am I paying for my digital boxes when those who want the lowest priced analog service get one for free,” Marta asks.  “Clearly this is a way to get those boxes into peoples’ homes so at the end of the year they will reluctantly pay for the $7 a month to keep renting it.”

Marta was turned down when she asked if she could get a free extra box for her kitchen television.

“No, Time Warner only gives these free boxes to people who never had them before,” she said.  “I understand the company needs to make room for new things, but they have got to get these box prices down — they could turn the whole system digital as far as I care -if- the boxes were free, or at least much cheaper.”

Some other subscribers have their own conspiracy theories about the channel realignments.

One Nebraska resident noted Time Warner Cable was moving Fox News Channel to channel 44 — an ominous turn of events for this individual:

“It seems that the liberal unionized TWC is putting Fox News on channel 44. Obama is the 44th President. [George] Soros is behind this I just know it.”

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/WEWS KSHB Time Warner Channel Changes 4-6-11.flv[/flv]

WEWS-TV in Cleveland and KSHB-TV in Kansas City tell their respective viewers about the grand shuffle in their channel lineups.  (3 minutes)

Avila’s bill, H129, is up for a vote early this afternoon.  If you live in North Carolina, this is your last chance to contact the members of the committee voting on the bill and encourage them to vote NO.  Tell them you are tired of these anti-competitive bills coming up year after year.  Let them know you support community broadband, that the bill does not exempt existing networks from its lethal regulatory requirements, and that there is no need for these kinds of bills, as local governments already answer to voters.

Rep. Marilyn Avila (R-Time Warner Cable) is getting significant blowback from some of her own constituents for introducing a bill that benefits a cable company, and almost nobody else.

Avila’s district extends into the northern part of Raleigh, the capital city of North Carolina.  Now, the city is making it clear it wants no part of Avila’s bill, H129, which will guarantee residents will continue to pay escalating cable bills year after year.

Raleigh’s City Council adopted a resolution opposing Avila’s legislation, written on behalf of Time Warner Cable.

H129 will destroy North Carolina’s community-owned broadband networks and prevent new ones from launching.

Council Member Bonner Gaylord, who authored the resolution, says passage of these kinds of anti-competitive bills would stop local governments from providing needed communications services, especially advanced high-speed broadband, and deny local governments the availability of federal grants under the American Recovery and Reinvestment Act to assist in providing affordable access to high-capacity broadband service in unserved and underserved areas.

North Carolina’s broadband rankings do not speak highly of the state’s existing broadband penetration, speeds, or pricing.  Large parts of western North Carolina lack broadband altogether, and what is available is often very slow speed DSL, often providing just 1.5Mbps service.  The mountainous western areas of the state are not well-reached by cable companies, and because of geographic and distance impediments, even telephone company DSL service is sporadically available.

Take Rockingham County, where the local government is pre-occupied with trying to find providers — any providers — to extend broadband service across the north central part of North Carolina.  Adjacent to Caswell County (which Stop the Cap! featured last year), it’s just one more example of how providers have ignored large sections of the state too rural, too poor, or too difficult for them to reach.

On Monday, Mark Wells, executive director for the Rockingham County Business and Technology Center, delivered a report to the county on his progress trying to get someone to provide service between the communities of Wentworth and Madison, which currently have no access to broadband.  Wells reports he is doing all he can to get CenturyLink, the area’s phone company, to step up and provide service, and the county is trying to see if Clearwire could extend service into the northern sections of the state.

Rockingham County, N.C.

Unfortunately, Clearwire has proved to be no broadband replacement, heavily throttling their customers to speeds that occasionally seem more like dial-up than actual broadband.

Rockingham County opposes H129 for the same reasons the city of Raleigh does.  The Board of Commissioners recognizes the broadband reality of northern North Carolina.  Unless local governments have a free hand to address the digital divide themselves, there will be no long-term solution for broadband availability in rural North Carolina.  That’s the message they are sending to their representatives in Raleigh.

Addressing the state’s broadband shortage requires public and private assistance.  Public governments can construct networks that require a longer window to pay off than private “return on investment” requirements allow, and private companies can access community networks to sell their services to the public they currently do not serve (or serve well).

But because companies like Time Warner do not want the competition, particularly from networks more advanced and capable than their own, they would prefer to see them shut down and banned — which is exactly what Avila’s bill would accomplish.

Last year, Sen. David Hoyle openly admitted Time Warner Cable wrote his bill.  There is little doubt the same is true for Avila’s bill this year.

The city of Raleigh, North Carolina

The city has an entirely different set of recommendations for Avila to consider:

1. The State of North Carolina adopt policies to encourage the development of high-speed broadband, including advanced, next-generation fiber-to-the-premises networks, in order to fully serve the citizens and advance education and economic development throughout the state;
2. The General Assembly provide incentives for both public and private development of high-capacity connections in order to handle rapidly growing data needs;
3. The General Assembly promote competition by curtailing predatory pricing practices that are used to push new providers and public broadband services out of the market; and,
4. The General Assembly reject any legislation similar to the Level Playing Field bills that would have a chilling effect on local economies and would impede or remove local government’s ability to provide broadband services to enhance economic development and improve quality of life for their citizens.

The resolution also noted that several North Carolina municipalities; including Wilson, Salisbury, Morganton, Laurinburg and Davidson, already have successfully launched local high-speed broadband networks in response to private provider’s unwillingness or inability to provide high-speed service “to serve the public and promote economic development in their respective areas.”

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/WCPO Cincinnati Can Google TV Replace Cable 2-18-11.flv[/flv]

Can Google TV replace your monthly cable bill?  WCPO-TV in Cincinnati explores whether the time is right for getting rid of cable television.  (3 minutes)