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Streaming Services Are Monitoring Customers for Signs of Password Sharing

Large media companies and streaming services are on to many of you.

If you are among the two-thirds of subscribers that have reportedly shared your Netflix, HBO GO, Hulu, or Disney+ password with friends and family, your provider probably already knows about it.

A recent report from HUB Entertainment Research found that at least 64% of 13-24-year-olds have shared a password to a streaming service with someone else, with 31% of consumers admitting they are sharing passwords with people outside of their home.

The reason many people share passwords is to save money on the cost of signing up for multiple streaming services. Many trade a Netflix password in return for a Hulu password, or hand over an HBO GO password in exchange for access to your Disney+ account. Research firm Park Associates claims that streamers lost an estimated $9.1 billion in revenue from password sharing, and can expect to lose nearly $12.5 billion by 2024 if password sharing is not curtailed.

Oddly, most streaming services are well aware of password sharing and the lost revenue that results from sharing accounts, and most care little, at least for now.

Marketplace notes a lot of the complaints about password sharing are coming from cable industry executives, shareholders, and Wall Street analysts, but for now most streaming services are just monitoring the situation instead of controlling it.

“I think we continue to monitor it,” said Gregory K. Peters, Netflix’s chief product officer, on the 2019 third quarter earnings call. “We’ll see those consumer-friendly ways to push on the edges of that, but I think we’ve got no big plans to announce at this point in time in terms of doing something differently there.”

Netflix sells different tiers of service that limit the number of concurrent streams to one, two, or four streams at a time. The company believes that if customers that share accounts bump into the stream limits, many will upgrade to a higher level of service which will result in more revenue.

Newcomer Disney+ not only recognizes password sharing is going on, it almost embraces it.

“We’re setting up a service that is very family friendly. We expect families to consume it,” Disney CEO Bob Iger said in an interview with CNBC. “We will be monitoring [password sharing] with the various tools that we have.”

The biggest tool Disney has to monitor account sharing is Charter Spectrum, which is aggressively encouraging streaming services to crack down hard on password sharing. Spectrum internet customers who watch Disney+ are now tracked by Spectrum, recording each IP address that accesses Disney+ content over Spectrum’s broadband service. When multiple people at different IP addresses access Disney+ content on a single account at the same time, Spectrum can flag those customers as potential password sharers.

Synamedia, a streaming provider security firm, uses geolocation tools to determine who is watching streaming services from where. If someone is watching one stream from one address and another person is watching from another city at the same time, password sharing is the likely culprit. For now, most companies are quietly collecting data to learn just how big a problem password sharing is and are not using that information to crack down on customers.

Streaming providers are more interested in stopping the pervasive sale of stolen account credentials on services like eBay and shutting down stolen accounts used to harvest content for unauthorized resale. But as sharing grows, so will calls from stakeholders to curtail the practice. Those in favor of vigorous crackdowns on password sharing argue billions of dollars of lost revenue will be lost. If a service like Netflix blocked password sharing, that could lead to dramatic increases in account sign-ups. But less established brands like Disney+ seem more concerned about losing the unofficial extra viewers that are watching and buzzing about shows on its new streaming platform.

Cable companies are frustrated about losing scores of cable TV customers to competitors that may be effectively giving away service for free. That has raised tempers at companies like Charter Communications.

“Pricing and lack of security continue to be the main problems contributing to the challenges of paid video growth,” Charter CEO Thomas Rutledge said in recent prepared remarks with Wall Street analysts. “The traditional bundle … is very expensive, and the actual unit rate of that product continues to rise, and that’s priced a lot of people out of the market. And it’s free to a lot of consumers who have friends with passwords. So our ability to sell that product is ultimately constrained by our relationship with content [companies], and we have to manage that in terms of the kinds of power that the content companies have.”

Charter’s power comes from its willingness to distribute cable networks like The Disney Channel to tens of millions of homes around the country. That forces Disney to listen to Charter’s concerns about piracy and password sharing and the issue is even documented in the latest carriage contract between the two companies.

Cable industry executives believe a crackdown on password sharing is inevitable, eventually. Just as the cable industry was forced to combat cable pirates during its formative years, streaming providers that welcome extra viewers today may lament the lost revenue those subscribers don’t bring to the table tomorrow.

 

Marketplace reports on the growing issue of streaming service password sharing. (2:19)

Another Cable Company Drops Cable TV

Phillip Dampier January 23, 2020 Competition, Consumer News, Online Video No Comments

Another independent cable company is dropping cable television service.

Rainbow Communications of Everest, which serves customers in northeastern Kansas, has set a “TV End” date for customers of June 30, 2020, after which it will only sell broadband and phone service:

As your local communications provider, we strive to bring innovative solutions for both entertainment and business purposes. Now a high-quality and less-expensive technology exists for watching TV by using an internet connection. In fact, most of our customers have chosen this route because watching video now accounts for 80% of our internet network traffic. Therefore, we have decided to focus our efforts on delivering the best internet experience possible, and end our TV service offering.

Rainbow TV service will end on June 30, 2020.

Rainbow, like many smaller cable operators, faces spiraling costs for video programming without the benefit of the volume discounts large national cable companies routinely receive. As streaming live TV video providers expand, they can now out-compete many independent cable companies by delivering a lower cost lineup of video channels. As a result, a growing number of small cable companies are deciding to exit the video business, concentrating on selling broadband and, to a lesser extent, phone service to their customers.

Rainbow claims customers will save up to $600 a year dropping its cable TV service in favor of a streaming video package from providers like YouTube TV or Sling. As large streaming providers continue to add local over the air channels to their lineups, many consumers can get the same or better lineup from a streaming provider at a lower cost.

The move will also allow Rainbow to dedicate all of its cable bandwidth towards data services, including digital phone service. That could allow the company to boost broadband speeds.

Charter Spectrum Planning Major Fall Rate Increase: $70 Internet, $94 Cable TV

Phillip Dampier August 26, 2019 Charter Spectrum, Competition, Consumer News 43 Comments

Charter Spectrum TV customers will pay at least $94 a month for cable television starting this October, thanks to a sweeping rate increase that will hike the cost of TV packages, internet service, equipment, and fees. Internet customers will soon face a base price for internet service of just under $70 a month.

Cord Cutters News quotes an anonymous source that claims the rate increases will begin in October, and will impact just about every plan except phone service.

The most striking increase is the Broadcast TV Fee, charged to recover the costs imposed by local TV channels. After increasing the price by $2 earlier this year to $11.99, Spectrum customers will now be required to pay $13.50 a month — almost $1.50 more. The Broadcast TV Fee alone will soon amount to $162 a year, just to watch TV stations you can receive over the air for free. Just a year ago, the average Spectrum customer paid a Broadcast TV Fee of $8.75 a month.

A Spectrum receiver is considered required by most customers, and starting this fall, it will cost $7.99 a month to lease one (up about $0.50 a month).

Cable TV packages are also getting more expensive:

  • Spectrum TV Select: $72.49 a month (was $64.99 a month)
  • Spectrum TV Silver: $92.49 (was $84.99)
  • Spectrum TV Gold: $112.49 (was $104.99)

Internet customers will not escape Charter’s rate hikes either. The entry-level package — Spectrum Standard Internet (100 or 200 Mbps in some areas), will increase $4 a month to $69.99. If you use Spectrum’s equipment for Wi-Fi service, your price is increasing $5 a month to $75.99.

Although the rate increases are significant, they are not outlandish when compared with the regular internet-only prices charged by other cable providers:

  • Comcast: 150 Mbps (a 1 TB cap applied in most areas) costs $80 plus $13 gateway rental fee = $93/mo
  • Cox:  150 Mbps (a 1 TB cap applies in most areas) is priced at $84 a month plus $11 modem rental fee = $95/mo
  • Mediacom: 100 Mbps (a 1 TB cap applies) costs $95 a month plus $11.50 modem rental fee = $106.50/mo

Note: Gateway/Modem Rental Fee can be waived if you purchase your own equipment. Prices are lower when bundling, and you may get a better deal threatening to cancel or agreeing to a term plan.

One Wall Street analyst, New Street’s Jonathan Chaplin, predicted in 2017 that the cable industry would use its market power to nearly double rates consumers paid just a few years ago, which for most would mean an internet bill of at least $100 a month.

“We have argued that broadband is underpriced, given that pricing has barely increased over the past decade while broadband utility has exploded,” the researcher said in 2017.

Customers should watch their September bills for Charter Spectrum’s official rate increase notification. Customers on promotional or retention plans are exempt from increases except the Broadcast TV Fee and equipment charges until their promotion expires.

Customers that bundle multiple services will pay slightly lower prices as a result of bundling discounts, but the overall price increase will still be noticeable to most customers.

Cord-cutting is likely to accelerate dramatically because of Spectrum’s TV rate hikes, as customers reassess the value of a basic cable television package that is nearing $100 a month.

Cable Industry Has Low Latency Software Upgrade for DOCSIS 3.1; <1ms Possible

Phillip Dampier June 24, 2019 Broadband Speed, Consumer News, Cox 1 Comment

CableLabs has published a new specification for the DOCSIS 3.1 cable broadband platform that will support <1 ms latency, optimal for online gaming and virtual reality.

The new specification, dubbed low-latency DOCSIS (LLD), costs little to implement with a simple software upgrade, but some cable companies plan to charge customers nearly $15 a month more to enable the extra performance.

CableLabs Blog:

VR needs incredibly low latency between head movement and the delivery of new pixels to your eyes, or you start to feel nauseated. To move the PC out of the home, we need to make the communications over the cable network be a millisecond or less round trip. But our DOCSIS® technology at the time could not deliver that.

So, we pivoted again. Since 2016, CableLabs DOCSIS architects Greg White and Karthik Sundaresan have been focused on revolutionizing DOCSIS technology to support sub-1ms latency. Although VR is still struggling to gain widespread adoption, that low and reliable DOCSIS latency will be a boon to gamers in the short term and will enable split rendering of VR and augmented reality (AR) in the longer term. The specifications for Low Latency DOCSIS (as a software upgrade to existing DOCSIS 3.1 equipment) have been released, and we’re working with the equipment suppliers to get this out into the market and to realize the gains of a somewhat torturous innovation journey.

Your provider may already have LLD capability — the updates were pushed to cable operators in two stages, one in January and the most recent update in April. It will be up to each cable company to decide if and when to enable the feature. Additionally, low latency is only possible if the path between your provider and the gaming server has the capability of delivering it. Cable companies may need to invite some gaming platforms to place servers inside their networks to assure the best possible performance.

Cable operators are already conceptualizing LLD as a revenue booster. Cox Communications is already testing a low-latency gaming add-on with customers in Arizona, for which it charges an extra $14.99 a month. But reports from customers using it suggest it is not a true implementation of LLD. Instead, many users claim it is just an enhanced traffic routing scheme to reduce latency using already available technology.

A Cox representative stressed the service does not violate any net neutrality standards.

“This service does not increase the speed of any traffic, and it doesn’t prioritize gaming traffic ahead of other traffic on our network,” said CoxJimR on the DSL Reports Cox forum. “The focus is around improving gaming performance when it leaves our network and goes over the public internet, like a Gamer Private Network. No customer’s experience is degraded as a result of any customers purchasing Cox Elite Gamer service as an add-on to their internet service.”

CableLabs is treating LLD as a part of its “10G” initiative, expected to upgrade broadband speeds up to 10 Gbps. Among the next upgrades likely to be published is full duplex DOCSIS, which will allow cable operators to provide the same upload and download speeds.

Suddenlink Putting Its Lines Anywhere It Wants, Drooping in Yards and Roadways

Phillip Dampier June 17, 2019 Altice USA, Consumer News, Public Policy & Gov't No Comments

Suddenlink is taking full advantage of a lax approach to regulatory oversight in Texas by laying its cables just about anywhere it pleases, and without talking to local officials about exactly what the cable system is doing.

Huntington residents have been complaining to city officials about Suddenlink’s ongoing expansion of its cable system in the city, reporting the cable company is putting cables just about anywhere it wants, often leaving them drooping in yards and roadways. The Altice-owned cable company’s ultimate plans are a complete mystery to the city, because the cable company has said nothing specific about its expansion plans or where exactly the company’s crews are working.

The Lufkin Daily News reports Huntington City Manager Bill Stewart has been hearing second hand about Suddenlink’s expansion since March 2016, but the company has never approached the city formally to share details.

“For the most part, when they finally decided to do it they just started laying lines,” Stewart told the newspaper.

The quality of the construction work is what bothers residents, who complain Suddenlink’s lines are hanging low across yards and even across city streets, with no sign of repair crews willing to fix the problem.

“If they’re going to come in and do something, we expect it will be done right and will be taken care of correctly,” Stewart said. “We want to have a positive relationship with them. But things just need to be done differently if you’re going to come and do something like that. You need to fulfill what you say, and at this point a lot of people are upset because that’s not been done.”

Suddenlink’s response was a general statement:

“Since launching our Suddenlink by Altice broadband, TV, and phone services in Huntington earlier this year, we have seen great demand from residents and have been bringing additional resources to the area to ensure a positive experience for all of our new customers,” Suddenlink media representative Lindsey Angioletti said. “We thank our customers for their support and look forward to serving them with advanced products and services for many years to come.”

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