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Shaw Invades Ontario With Approval of Mountain Cablevision Acquisition, Becomes Canada’s Largest Cable Operator

Phillip Dampier October 29, 2009 Canada, Competition, Public Policy & Gov't, Shaw Comments Off on Shaw Invades Ontario With Approval of Mountain Cablevision Acquisition, Becomes Canada’s Largest Cable Operator
Mountain Cablevision becomes part of the Shaw Cable family with the approval of the CRTC

Mountain Cablevision becomes part of the Shaw Cable family with the approval of the CRTC

The Canadian Radio-television and Telecommunications Commission has given approval to Shaw Communications for its acquisition of Hamilton-based Mountain Cablevision, Ltd., a small independent cable operator in southern Ontario.  The $300 million dollar transaction brings 41,000 cable customers, 29,000 Internet subscribers, 30,000 digital phone lines, and 135 Mountain Cablevision employees into the Shaw family, making the Calgary-based cable company Canada’s largest.

“This is a great move for us to come in there and be able to start being around that market. We always said that […] we want to be in Alberta, British Columbia, and Ontario,” Shaw chief executive Jim Shaw said Friday.

“Rogers had passed on the acquisition so we decided to go in there,” Shaw told analysts. “This is a great move for us, being around that market.”

Mountain Cablevision serves a small part of Hamilton and surrounding communities in southern Ontario

Mountain Cablevision serves a small part of Hamilton and surrounding communities in southern Ontario

Shaw’s entry into Ontario upset Rogers Communications, eastern Canada’s dominant cable provider.  Rogers sued Shaw in an Ontario court, claiming the purchase violated a near-decade long agreement made personally between Ted Rogers and Jim Shaw to stay out of each other’s territories — Shaw stays out of eastern Canada if Rogers moves no further west than Ontario.

Canadian courts aren’t compelled to recognize handshake deals made over dinner, and the court ruled against Rogers.

With the agreement swept away, some analysts predict Rogers will investigate acquisition opportunities in western Canada, probably in the more populated regions.

Shaw claims it will upgrade Mountain Cablevision’s small cable footprint, which serves only a portion of greater Hamilton – Hamilton Mountain and East Hamilton, as well as the communities of Mount Hope, Caledonia, Hagersville, Jarvis, Dunnville/Byng, Cayuga and Binbrook, all in Ontario.  The company promises better broadband, cable, and telephone service after the upgrades are complete.  Shaw also says it will expand the Mountain Cablevision system into several unserved neighborhoods and townships.  That’s an important distinction, because it indicates Shaw has no intention of competing head to head with Rogers or Ontario’s other dominant cable company Cogeco.

The deal comes during challenging times for Shaw, who announced a 6% decline in profits in the fourth quarter, with gains only from new digital cable additions.  More than 110,000 Shaw customers signed up for digital cable in the third quarter, up from 23,000 in the third quarter a year ago.

In other areas, Shaw lost customers — 5,000 canceling broadband, 4,500 dropping Shaw’s direct to home satellite service, and nearly 9,000 disconnecting their Shaw digital phone line.

Shaw’s next product introduction will likely be its new cell phone service.  The company spent $190 million dollars last year acquiring 18 airwave licenses in northern Ontario, Manitoba, Saskatchewan, Alberta, and British Columbia.

Mountain Cablevision's concentrated service area in the city of Hamilton

Mountain Cablevision's concentrated service area in the city of Hamilton (click to enlarge)

But Shaw is taking a “very cautious approach” to wireless mobile services, according to the company.  It has refused to set a timetable when service would begin.  Shaw faces a growing number of wireless competitors introducing service in Canada late this year and into early 2010.  DAVE Wireless, Wind Mobile, and Public Mobile are all poised to launch in major Canadian cities, expecting to put competitive pressure on pricing and bring about lower priced, more generous service plans.

Shaw claims it’s not concerned, telling The Financial Post, “If they’re in there, we don’t really care. We already have a relationship with customers and they have zero,” Shaw said. “We have 3.4 million customers we have a relationship every month with.”

Telecommunications companies are increasingly concerned with offering customers “bundles” of telecommunications services from video, broadband, wired phone lines, and now increasingly wireless data and mobile phone services.  Customers purchasing bundles tend to remain loyal to the companies offering them.

Net Neutrality Is Not A Truck, A Marxist Plot, A Puppy, or Within the Realm of Understanding for Sen. John McCain

Sen. John McCain (R-Arizona)

Sen. John McCain (R-Arizona)

What a week.  Broadband policy now has its very own death panel, in the form of accusations that Net Neutrality policies are:

  • a Marxist-Obama plot to control the Internet;
  • designed to silence conservative talk radio like the Fairness Doctrine;
  • going to ruin Sen. John “I don’t use e-mail” McCain’s (R-Arizona) day.

Just a few years ago we watched former Sen. Ted Stevens (R-Alaska) tell us the Internet is not a truck but a series of tubes.  Glenn Beck earlier this week was coddling a small, terrified puppy that he claimed represented cowardly media missing out on the grand Marxist conspiracy underway, and Net Neutrality was just the latest piece of the coup puzzle.  Now one Tennessee congresswoman believes Net Neutrality is the Fairness Doctrine of 2009 and is being run by a czar.

Let’s review:

Sen. John McCain (R-Arizona) has introduced the ironically named “Internet Freedom Act” to free the broadband industry from potential oppressive government overregulation.

“Today I’m pleased to introduce ‘The Internet Freedom Act of 2009’ that will keep the Internet free from government control and regulation,” said McCain.  “It will allow for continued innovation that will in turn create more high-paying jobs for the millions of Americans who are out of work or seeking new employment,” McCain continued.  “Keeping businesses free from oppressive regulations is the best stimulus for the current economy.”

It’s certainly a stimulus — for broadband provider coffers and for McCain himself, who is Congress’ top recipient of big telecom money in the form of campaign contributions (over $900,000 and counting).  He’s the best senator the telecom industry could buy.  But wait, the guy who doesn’t own a computer or use e-mail says ‘father knows best’ for America’s online communities? McCain released a statement introducing his new bill:

The wireless industry exploded over the past twenty years due to limited government regulation.  Wireless carriers invested $100 billion in infrastructure and development over the past three years which has led to faster networks, more competitors in the marketplace and lower prices compared to any other country.  Meanwhile, wired telephones and networks have become a slow dying breed as they are mired in state and Federal regulations, universal service contribution requirements and limitations on use.

And we all know who has one of those dying breed rotary dial wired telephones, don’t we?

In fact, wireless industry profits have exploded over the past twenty years as the vast majority of Americans signed up for service.  The industry has been so awash in cash they’ve been on a consolidation shopping spree for at least the past three years, buying each other out through mergers and acquisitions.  The number of competitors John McCain thinks he sees growing is, in reality, a case of double vision.  He should get that checked.  Lower pricing?  Not quite.

Consumers don’t dump wired telephones because of government regulations:

“Honey, I can’t believe they are doing a Reverse Morris Trust deal with the phone company over in West Virginia.  We should cancel our Verizon phone line and take our business elsewhere… to Verizon Wireless instead — that will show them!”

Consumers confronting two telephone bills, one for the wireless and one for the wired phone, makes one redundant for those Americans trying to economize in this difficult economy.  The McCain family doesn’t have to

The dog knows more than it's telling

The dog knows more than it's telling

economize thanks to Comcast, AT&T and Verizon – just a few cutting checks to the self-described maverick.  Increasingly, consumers are looking for better deals and finding one with the cable company’s “digital phone” product, or an Internet-based Voice Over IP service.  State and federal regulations aren’t the problem — the quality and price of the service can be.

The vast majority of those consumers switching to wireless do not escape “universal service contribution requirements” either.  More often than not, wireless phone bills are decorated like Christmas trees with add-ons for everything from USF fees to 911 support surcharges, local, county, state and federal taxes, among others.

Limitations on use?  That would not be the wired telephone line’s flat rate calling plan.  The limitations are more commonly found on the wireless side, where many consumers get an allowance and a per-minute fee for exceeding it.  It sounds like the out of touch senator probably still makes station to station calls to “enterprise numbers.”  Welcome to the 21st century.

In short, John McCain doesn’t understand what he is talking about.  He apparently does understand those big telecom industry checks he gets, however.  No doubt that is the real inspiration for this industry-friendly legislation.

Rachel Maddow spent several minutes Friday night breaking down McCain’s legislation and what Net Neutrality is really all about.

[flv width=”596″ height=”336″]http://www.phillipdampier.com/video/MSNBC Rachel Maddow Net Neutrality 10-23-09.flv[/flv]

Rachel Maddow and Xeni Jardin, co-editor of Boing Boing discuss Sen. McCain’s “Internet Freedom Act” and Net Neutrality. (6 minutes)

Glenn Beck from His Morning Zoo days on KZZP-FM Phoenix

Glenn Beck from His Morning Zoo days on KZZP-FM Phoenix - Would Thomas Paine approve?

We’ve already dealt with the psychotic world of Glenn Beck.  The self-described “rodeo clown” is entertaining, as long as you recognize reality has a restraining order against Beck and must keep at least 900 feet away from him at all times.  Art Brodsky from Public Knowledge speaks to Beck’s worldview:

“Mr. Beck fails to understand the fundamentals of how the Internet works. He should be in favor of Net Neutrality, because it guarantees streaming of his program will not be able to be placed behind, say, Keith Olbermann’s Countdown. That could happen if NBC’s owner decided to pay protection money for prioritized data transmission.”

Meanwhile, Rep. Marsha Blackburn (R-Tennessee) took time out from her tireless efforts to root out the czar problem in the Obama White House to conflate Net Neutrality with the Fairness Doctrine, conservative talk radio’s garlic-to-a-vampire bugaboo.  Appearing at an event sponsored by the Astroturf group “Safe Internet Alliance,” Blackburn railed against “government interference” in broadband, as Kim Hart from The Hill took it all down.  It was an amazing feat, considering she stumbled her way through a statement:

“Net neutrality, as I see it, is the Fairness Doctrine for the Internet,” she said.  The creators “fully understand what the Fairness Doctrine would be when it applies to TV or radio.  What they do not want is the federal government policing how they deploy their content over the Internet and they want the ISPs to manage their networks and deploy the content however they have agreed on with ISP.  They do not want a czar of the Internet to determine when they can deploy their creativity over the Internet. “They do not want a czar to determine what speeds will be available….  We are watching the FCC very closely as it relates to that issue.”

When it comes to broadband expansion, she said, she wants to make sure “all individuals’ rights are respected and that we look at the freedom of all broadband participants.” She said Congress needs to make sure the groups receiving stimulus funds for broadband expansion are able to deploy reasonable and effective network management tools so they can be helpful in tracking down illegal activity.”

“We shouldn’t look at technology as how do we punish and impede, but how do we encourage innovation,” she said.  “That needs to be a key thought as we move forward.  How do we encourage that innovation and not impede it?”

Blackburn herself is impeding a rational discussion with her word salad.

Rep. Marsha Blackburn (R-Tennessee)

Rep. Marsha Blackburn (R-Tennessee)

Blackburn doesn’t see or understand much of anything.  Her off the rails representation of Net Neutrality as the equivalent of the Fairness Doctrine is bizarre at best, just plain rock stupid at worst.  Indeed, the Fairness Doctrine did dictate a form of balance in opinions for licensed radio and television stations in this country before it was repealed.  Net Neutrality specifically requires Internet providers, and everyone else, to keep their hands out of determining whether something is balanced or not.  The Internet is not a licensed medium, and the free exchange of ideas possible on today’s Internet already provides the ultimate fairness, where ideas can be freely expressed by anyone.

Glenn Beck sees Marxists.  Marsha Blackburn sees czars.  These folks need to cut down on the borscht for lunch.

Blackburn’s only priority for broadband stimulus seems to be using the money to help ferret out illegal activity online.  Perhaps she can come over and clear out my spam folder.

I didn’t even realize we had a Broadband Speed Czar.  I want to be the Broadband Speed Czar, moving across the land and banishing slow, expensive, and just plain lousy slow broadband technologies.  I decree no Internet Overcharging experiments and fiber-fast speeds for all!

As for the “Safe Internet Alliance,” considering their members include AT&T, the National Cable & Telecommunications Association, Verizon, and a whole mess of other astroturfers (many who also belong to Broadband for America), we can guess the kind of safety they are looking for.

Pondering Glenn Britt, CEO of Time Warner Cable

Phillip Dampier October 14, 2009 Data Caps, Editorial & Site News, Online Video, Video Comments Off on Pondering Glenn Britt, CEO of Time Warner Cable
Glenn Britt, CEO of Time Warner Cable

Glenn Britt, CEO of Time Warner Cable

I spent the morning dealing with the dentist and some significant tooth pain, which could end up leading to another delightful root canal.  It’s times like these when I like to share the pain.  Back on April 2nd, Time Warner CEO Glenn Britt spoke with CNBC reporter Julia Boorstin about Britt’s thoughts on Internet Overcharging, the state of the cable industry, the growing reliance Time Warner Cable has on its broadband products, and where online video fits into the picture.  Although Time Warner Cable shelved the consumption billing experiment, the belief in such billing experiments has not changed.

Virtually everything else in the interview remains largely the same for the company, including the all-important topic of TV Everywhere and online video content, which is back in the news.

If you want to understand the challenges facing big cable, this is must-see-online-TV. (Check out the unintentionally ominous background music which appropriately turns up around four minutes in.)

[flv width=”400″ height=”300″]http://www.phillipdampier.com/video/CNBC Glenn Britt 4-6-09.flv[/flv]

CNBC’s Julia Boorstin talked with Time Warner Cable CEO Glenn Britt on April 2nd about the cable company and the state of the industry these days. (15 minutes)

When Your Cable Company Has An Outage: Busy Signals – Bright House’s One Hour Outage Nets Loose Change in Credits

Phillip Dampier October 7, 2009 Issues Comments Off on When Your Cable Company Has An Outage: Busy Signals – Bright House’s One Hour Outage Nets Loose Change in Credits
Bodecker

Bodecker

Bright House Networks’ cable system in Orlando, Florida experienced a major outage last Friday, resulting in frozen TV screens and other service interruptions for approximately one hour in the middle of prime time. Orlando: No new episode of NBC’s Law & Order for you!

The Orlando Sentinel‘s Hal Bodecker, who writes The TV Guy and More column, took note of the outage:

What caused TV screens to freeze for many customers of Bright House Networks Friday night?

The cable provider still doesn’t know, spokeswoman Sara Brady said Monday.

So will this be another of television’s unsolved mysteries?

“We will identify a cause,” Brady said.

If you were affected, you can request a credit from Bright House. The outage did not affect all customers, although the company doesn’t know how many lost service. “We handle credits on a case-by-case basis,” Brady said.

Many customers took note the perpetual busy signals they received when calling Bright House Networks to inquire about the outage.  Brady spun the time-honored truth that calling a cable company’s customer service number and getting nothing but busy signals confirms there is an outage — potentially a big one, when she told Bodecker that busy phones indicate that the company is aware there’s a problem.

Many cable companies do not automatically credit customers for service outages — customers are required to contact the cable operator and specifically request service credits.  Many operators will not provide credit for short term outages either, but Bright House Networks did grant customer requests for credits:

Susan Segal of Ocoee said she learned she was getting … 24 cents.

She called that situation “absolutely a disgrace.” Segal added: “We pay through the nose.”

Duane Beaudry of Orlando told me his refund would be … 35 cents.

He called to get the refund, learned that there would be a three-minute wait and spent 20 minutes on the phone before learning the amount.

“It wasn’t worth the time,” he said. But he laughed when he said that.

After customers told Bodecker about the paltry refunds, he penned an update today titled, “Bright House Networks: Maybe that refund wasn’t such a good idea.”

Charter Cable to Bankers, Business Owners, a Former State Senator & 55 Others: Pay $1,850 Each for Internet

Phillip Dampier October 6, 2009 AT&T, Charter Spectrum, Rural Broadband 5 Comments
The Mountain Pointe subdivision, northwest of Cleveland, Tennessee

The Mountain Pointe subdivision, northwest of Cleveland, Tennessee

The rural broadband divide doesn’t just impact the middle class.

Residents of the affluent Mountain Pointe subdivision in Cleveland, Tennessee (any neighborhood with an extra “e” on end of the name always spells money) are unhappy to find a home life without broadband service.  Like many wealthy enclaves set outside of clustered suburban neighborhoods, homes are too few and far between in the subdivision, making it too expensive for Charter Cable to wire service there.

Charter Communications Director of Government Relations Nick Pavlis told The Cleveland Daily Banner that it was not profitable to provide service to the 55 homes affected.

Generally, Charter Cable will not wire a neighborhood or street if it costs much more than $500 per home to provide service, including the collective cost of bringing wiring to that area.  In the case of Mountain Pointe, Pavlis said it would cost the cable company $130,000 to run an underground cable 2.5 miles to supply the subdivision with service, and that’s “not a reasonable payback,” considering the company expects a 36-48 month return on investment.

Charter is willing to wire the subdivision, if the residents agree to pay $1,850 apiece to pay for the wiring expenses.

That is a cost some homeowners may be willing to pay, considering the affluence of many of them.  Among the residents, according to Cleveland Mayor Tom Rowland, are bankers, business owners, and a former state senator.

“These are the kind of people you want to provide service for — they would subscribe to all of your services if they were available,” said Rowland.

But before opening their wallets, residents are looking for alternatives.  Mountain Pointe resident Lou Patten told the newspaper he and his neighbors are frustrated because a newer subdivision on Freewill Road has service from both Charter and AT&T.

A few residents have braved wireless broadband as their best option, for now, but the neighborhood’s terrain makes service unreliable.  AT&T DSL service is not available because Mountain Pointe is too far away from the central office serving the neighborhood, located northwest of the city of Cleveland.

With Charter remaining intransigent, the mayor met with five of the neighborhood’s residents and State Rep. Kevin Brooks, City Attorney John Kimball and AT&T Regional Director Mary Stewart Lewis to see if AT&T could find a solution.

A DSLAM manufactured by Siemens designed for outdoor installation

A DSLAM manufactured by Siemens designed for outdoor installation

Tennessee’s statewide franchise agreement with AT&T points to Bradley County being wired for U-verse, a hybrid fiber-phone line TV, broadband, and telephone service, by July of next year.  But such agreements do not require 100% coverage and doesn’t guarantee Mountain Pointe service.

Lewis told the newspaper she would consult AT&T engineers for a possible solution to the problem.

“We’ve got to see where you are,” Lewis said.

In the short-term, AT&T could provide DSL service by installing equipment nearby that would reduce the distance between Mountain Pointe residents and AT&T’s switching equipment, using a device known as a Digital Subscriber Line Access Multiplexer (DSLAM).  It is commonly installed in more remote locations to provide DSL service in areas where direct service isn’t possible.

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