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Charter Spending Its Money Renaming Charlotte’s Time Warner Cable Arena After Itself

Phillip Dampier August 17, 2016 Charter Spectrum, Consumer News 1 Comment

TIME_WARNER_CABLE_ARENA006Time Warner Cable Arena is no more.

After Charter Communications completed its acquisition of TWC, it discovered it had work to do rebranding all-things-TWC, including the Charlotte, N.C., sports arena that is home to the Charlotte Hornets.

Charter will be spending its time and resources rechristening the arena “Spectrum Center” in time for the new NBA season starting in late October. Charter’s suite of products is branded “Spectrum,” much the same way Comcast calls many of its products “XFINITY.”

The Charlotte-arena originally opened in 2005 and Time Warner Cable acquired the naming rights back in 2008.

 

Google Fiber Puts Expansion on Hold as It Contemplates Wireless Instead

google fiberFurther expansion of Google Fiber appears to be on hold as the company contemplates moving away from fiber to the home service towards a wireless platform that could provide internet access in urban areas for less money.

The Wall Street Journal today reports Google parent Alphabet, Inc., is looking to cities to share more of the costs of building faster broadband networks or using cheaper wireless technology to reach customers instead.

Six years after Google first announced it would finance the construction of fiber to the home networks, the company has made progress in wiring just six communities, many incompletely. Progress has been hampered by infrastructure complications including pole access, permitting and zoning issues, unanticipated construction costs, and according to one Wall Street analyst, the possibility of lack of enthusiasm from potential subscribers.

Google’s recent acquisition of Webpass, a company specializing in beaming internet access over fiber-connected wireless antennas between large multi-dwelling units like apartments and condos appears to be a game-changer for Google. Webpass was designed mostly to service urban and population dense areas, not suburbs or neighborhoods of single-family dwellings. Webpass’ reliance on wireless signals that travel between buildings removes the cost and complexity of installing fiber optics, something that appears to be of great interest to Google.

Google Fiber is planning a system that would use fiber for its core network but rely on wireless antennas to connect each home to the network, according to a person familiar with the plans. Alphabet chairman Eric Schmidt said at the company’s shareholder meeting in June that wireless connections can be “cheaper than digging up your garden” to lay fiber. The only question is what kind of performance can users expect on a shared wireless network. Google’s plans reportedly do not involve 5G but something closer to fixed wireless or souped-up high-speed Wi-Fi. A web video on Webpass’ website seems to concede “you get best speeds with a wired connection.”

Even Google's wireless technology solutions provider Webpass concedes that wired broadband is faster.

Even Google’s wireless technology solutions provider Webpass concedes that wired broadband is faster.

Former Webpass CEO Charles Barr, now an Alphabet employee, argues wireless solves a lot of problems that fiber can bring to the table.

“Everyone who has done fiber to the home has given up because it costs way too much money and takes way too much time,” Barr said.

Barr’s statements are factually inaccurate, however. Fiber to the home projects continue in many cities, but if they are run by private companies, chances are those rollouts are limited to areas where a proven rate of return is likely. Large incumbent phone and cable companies are also contemplating some fiber rollouts, at least to those who can afford it. Many of the best prospects for fiber to the home service are customers in under-competitive markets where the phone company offers slow speed DSL and cable broadband speeds are inadequate. Rural communities served by co-ops are also prospects for fiber upgrades because those operations answer to their members, not investors. Community broadband projects run by local government or public utilities have also proven successful in many areas.

subBut like all publicly traded companies, Google must answer to Wall Street and their investors and some are not happy with what they see from Google Fiber. Craig Moffett from Wall Street research firm MoffettNathanson has rarely been a fan of any broadband provider other than cable operators and Google Fiber is no different.

“One can’t help but feel that all of this has the flavor of a junior science fair,” Moffett said of Google Fiber, pointing out the service has managed to attract only 53,000 cable TV customers nationwide as of December. Moffett concedes there are significantly more broadband-only customers signed up for Google, but that didn’t stop him from suggesting Google Fiber has had very little impact on increasing broadband competition across the country.

Analysts suggest Google Fiber is spending about $500 per home passed by its new fiber network. But that is a fraction of the $3,000+ per customer often spent by cable operators buying one another.

Google’s wireless deployment will likely take place in Los Angeles, Dallas, and Chicago according to people familiar with the company’s plans. Less dense cities slated for Google Fiber including San Jose and Portland, Ore., may never get any service from Google at all, but they are likely to hear something after a six month wait.

Google is also reportedly asking cities if the company can lease access on existing fiber networks. Another tactic is requesting power companies or communities build fiber networks first and then turn them over to Google to administer. The latter seems less likely, considering there are successful public broadband networks operating on their own without Google’s help.

French Unions, Media Warn America: Beware of Altice!

Phillip Dampier August 15, 2016 Altice USA, Broadband "Shortage", Broadband Speed, Cablevision (see Altice USA), Competition, Consumer News, Editorial & Site News, Public Policy & Gov't, Suddenlink (see Altice USA) Comments Off on French Unions, Media Warn America: Beware of Altice!
Look what's in the box. MergeMaster Patrick Drahi. (Illustration: Michel Kichka)

Look what’s in the box. MergeMaster Patrick Drahi. (Illustration: Michel Kichka)

Cable conglomerate baron Patrick Drahi promised American, French and Portuguese consumers he would bring them value for money by taking control of large established telecom companies in both countries and revamp their products and services to bring improved service. Consumer advocates in all three countries continue to argue customers are still waiting for Drahi’s debt-laden Altice empire to deliver on its promises.

A flurry of mid-summer articles in the French media continue to acknowledge Drahi’s formula has brought results — for him and his top executive minions, but has caused headaches for employees, customers, and even the government.

The biggest firestorm involves Altice-owned SFR’s newly-announced plan to slash at least 5,000 more jobs at France’s fourth-largest mobile operator, which also provides wired cable-TV and broadband services in parts of the country. That represents at least one-third of SFR’s total workforce. The planned cuts run so deep, some in the French press call them “violent.” These new cuts are on top of the 1,200 jobs Drahi cut when he took control of SFR two years ago. An Altice executive warned that if they still perceive to be “fat on the bone,” there will be further cuts after that, presumably starting in 2019.

The job cuts have raised the ire of some in the French press because one of the conditions of Altice’s takeover of SFR was a commitment not to cut jobs. But some reporters may have missed the fine print negotiated with regulators  — the job protection agreement expires in July 2017, after which Drahi can slash at will. And he will.

Investment banks love it. American and European banks have loaned €50 billion ($55 billion) — a record amount — to Drahi to buy up telecom companies on a virtual credit card and deliver short-term results by slashing expenses, which at least temporarily boosts profits. When customers find out the implications of the draconian cuts, they complain and tend to leave. But savvy investors learn how to cash out before that happens, often walking away with huge returns. Such methods have been business-as-usual in the United States for a long time. But Drahi has improved on the old formula of relying on OPM – Other People’s Money – to build his empire.

Altice1Some of the money flowing through Altice’s coffers comes from the French taxpayer, currently footing the bill for unpopular French President François Hollande’s key measure to boost the competitiveness of French companies — the Tax Credit for Competitiveness and Employment (CICE), which significantly cuts employer’s labor expenses. Altice has been a grateful recipient of this gift from French taxpayers, who pay for it through new ecological taxes and an increase in Value Added Tax (VAT) rates, which like our sales tax, applies to goods and services one buys. The standard VAT rate in France is now 20%, with 10% charged on restaurant meals, transport, renovation/improvement works and certain medical drugs, and 5.5% on food, water and non alcoholic beverages, books, special equipment for the disabled and school meals. The other half of the money spent implementing the CICE came from decreased public spending on infrastructure and social service programs. Take from the poor and middle class and give to the corporations, Hollande’s critics claim. The program was supposed to protect employment, but critics say it has had little or no effect beyond enriching large corporate conglomerates who hire and fire for their own reasons, and are not particularly concerned about what that could do to future government payouts.

French newspaper l’Humanité is calling on the government and Mr. Drahi to account for his use of taxpayer-funded CICE aid. The paper demands the Hollande government to disclose exactly how much Altice’s SFR has received from the program.

Unemployment office in Connecticut

Unemployment office in Connecticut

Altice continues to claim the job cuts will be voluntary — a suggestion scoffed at by employee unions in both France and Portugal, where Altice operates telecommunications companies. In addition to asking Altice-owned Suddenlink and Cablevision employees whether the recent sudden separation from their paychecks was voluntary, unions claim they have the benefit of past experience.

“When they say ‘no job cuts’ and 1,200 have already been cut over the past 18 months, how can we trust them?” asked Frederic Retourney, a spokesman for the CGT-FAPT employee union. “We know that voluntary redundancies are made under duress in most cases. When SFR announces 5,000 job cuts when there are 14,400 employees at the company now, we do not see how one can speak of voluntary departures.”

The job cuts at Altice’s U.S. operations — Suddenlink and Cablevision — have just begun. In a filing with the Connecticut Department of Labor, Altice disclosed it is issuing a total of 587 termination notices in that state — 482 call center workers in Shelton who will lose their jobs Nov. 1 and another 105 in Stratford leaving in two waves Oct. 14 and Dec. 15. Cablevision’s chief Connecticut competitor Frontier Communications is turning Altice’s lemons into Frontier’s lemonade by capitalizing on the job cuts with a quickly organized media push for a job fair on Aug. 31 in New Haven targeting the soon-to-be-former Cablevision workers.

Frontier will hold interviews for the former Altice call-center workers and field technicians. The alternative, if those former Cablevision workers still want to work for Altice, is to move to New York or New Jersey and hope their jobs don’t get cut again. With Frontier, they can stay in Connecticut.

madagascarAltice-owned SFR Francophone call center workers face even bigger challenges from relentless demands for cost cuts. In 2015, Altice announced it was open to relocating its Moroccan-based customer care call center to Madagascar, a large and severely economically depressed island nation off the eastern coast of southern Africa. Drahi, who told Wall Street he likes to pay as little as he can in salaries, is evidently upset labor costs in Morocco now force Altice to pay salaries up to €500 a month ($560). The company said it was open to seeking solace hiring French-fluent replacement workers in Antananarivo, Madagascar’s capital city, where the average annual salary is $260. In contrast, Connecticut call center workers make an average of $14.80/hour, according to Indeed.

Connecticut State Rep. Laura Hoydick (R-Stratford) acknowledges employee life with Altice in charge of Cablevision may be a tough ride.

“Having gone through unemployment with family members — and now me — emphasizes how the Cablevision employees are nervous for their livelihood and existence,” Hoydick told The Hour. “I thought it was great that the Frontier folks saw that there was an already-trained workforce here in Connecticut.”

Other state Republicans are attempting to blame Democratic Gov. Dannel P. Malloy for Cablevision’s job cuts, characterizing them as evidence employers are fleeing the high taxes and expenses associated with running a business in Connecticut.

“People are making a choice: ‘Do I stay in Connecticut and weather the storm, or do I move out of the state?’” said state Rep. Jason Perillo (R-Shelton).

lexpressFor now, those decisions are mostly made by Altice’s cable company call center workers and some members of middle management. But Patrick Drahi’s long-term plan to conquer the media business depends on implementing his “convergence” strategy, which means owning and controlling not only the means of distribution, but also the product being distributed. l’Humanité compared Drahi’s business to a multibillion cephalopod, with octopus-like tentacles extending his control and influence well beyond the cable business.

In France, he is accomplishing his mission by buying up cable networks, newspapers, and other media outlets which he packages together. Now a customer doesn’t just buy cable TV — he buys TV, internet, phone, the daily newspaper, and magazines for one flat price. For about $22 a month, SFR customers get unlimited digital access to 17 newspapers and magazines including Libération, l’Express, and l’Expansion. Then you can watch Drahi’s new sports channels and local news channel — all owned by Altice. Drahi told the French Senate his new bundled media model could “save the press.” But dig a little deeper and you discover Drahi’s altruism is considerably more limited.

By bundling everything together, the Altice-owned businesses each enjoy the enormous benefit of having their products taxed at the special press VAT rate of 2.1%, down from the usual 20% that would be otherwise owed. Altice pockets the savings for itself — a considerable boost in gross revenue.

More conservative investors worry about how Altice is managing to pay for all of its acquisitions and still manage to cover its existing massive debt, especially as Drahi plots to bring his model to the United States. His goal in America: to create the largest or second-largest telecom company in the country. Worried shareholders have been placated by the news massive layoffs are in SFR’s future, with the cost-savings they bring. Those still not satisfied were quieted after Numericable, another Altice concern, borrowed almost two billion dollars and raided Altice’s treasury for another billion to finance a dividend payout to shareholders worth more than $2.5 billion. Of course, Mr. Drahi himself is among the top recipients.

Altice Slashathon Continues: 600 Cablevision Jobs Eliminated in Connecticut

Phillip Dampier August 9, 2016 Altice USA, Cablevision (see Altice USA), Consumer News, Public Policy & Gov't Comments Off on Altice Slashathon Continues: 600 Cablevision Jobs Eliminated in Connecticut

Optimum-Branding-Spot-New-LogoAt least 600 Cablevision employees will be out of a job by this November as parent company Altice USA continues to slash expenses to squeeze cost savings out of the cable business for the benefit of shareholders.

Altice announced this morning that the Cablevision call center in Shelton and a back office in Stratford, Conn., will be closed, with some jobs shifted to existing Altice USA call centers in New Jersey and Long Island, N.Y. The job cuts hit hard, with 50-100 employees being employed by Cablevision for more than 15 years, with some close to retiring.

“People have kids and everything like that to take care of at home. So, I’m sure it was sudden for a lot of them to hear this news.”

Employees said about 50 to 100 workers had been there over 15 years, some close to retiring.

“People have kids and everything like that to take care of at home,” an unnamed employee told WTNH-TV. “So, I’m sure it was sudden for a lot of them to hear this news. Some people are upset for sure.”

A spokesperson for Cablevision said employees will be given a severance package and can re-apply for an unspecified number of jobs in and out of the state.

“Over the last few years, there have been investments and enhancements to our Optimum products and services, making them more reliable and providing more customer service touch points than ever before,” the company said in a statement. “As a result, we have seen a significant improvement in customer call volume and patterns. As we look to strengthen our operations in the nation’s most competitive market, we are aligning our contact center organization to meet the current needs of our customers.”

Some employees speculate the real motive is saving money. An employee told WTNH that customer calls have slowed down, but Cablevision is also still hiring workers, presumably for less compensation.

“I don’t think it’s because of calls to be honest. They’re hiring a lot of people to work from home too,” the employee said.

Altice told New York and New Jersey regulators it wouldn’t lay off customer service employees for four years, but made no such agreement in Connecticut.

N.Y. Governor Announces “Sweeping Progress” Towards Broadband-for-All-NY’ers Goal

broadband nyGovernor Andrew M. Cuomo yesterday announced that the “New NY Broadband Program” is well on its way to achieving “sweeping progress toward achieving its nation-leading goal of broadband for all” New Yorkers.

The governor claimed that 97% of New York residents will have access to high-speed internet access by 2017, with a vague goal of serving 100% of New Yorkers by the end of 2018.

To do this, Gov. Cuomo relies heavily on the state’s new and overwhelmingly dominant cable operator – Charter Communications, which closed on its acquisition of Time Warner Cable earlier this summer. A press release promoting the governor’s efforts quotes Charter’s executive vice president of government affairs Catherine Bohigia as being excited to work with the governor and his administration to expand service to about 145,000 households currently not served by Time Warner Cable or Charter in New York.

Charter officials are working with the Public Service Commission to identify the households to be served, and highly redacted documents suggest Charter is identifying new housing developments and areas immediately next to existing Charter/Time Warner Cable service areas for this expansion.

A second separate plan to subsidize private cable and phone companies to help cover the costs of reaching another 34,000 homes that won’t be served by Charter is only expected to reach 50% of the remaining unserved homes and businesses in the state. A further round of funding will target the the remainder of unserved areas, including certain rural landline areas where Verizon has shown no interest in offering customers internet access of any kind.

Charter Communications

Charter Communications has effectively canceled the Time Warner Cable Maxx upgrades that were either underway, in progress, or in the planning stage in upstate New York. Instead, Charter plans to speed up the roll-out its own originally proposed upgrade, which includes two tiers: 60 and 100Mbps, for more than two million upstate homes and businesses by early 2017 in Buffalo, Rochester, Syracuse, Binghamton and Albany.

Customers in Central New York are likely to be left in limbo, some already getting Maxx upgraded 300Mbps internet access while others were scheduled to get the speed upgrade the same week Charter froze further Maxx upgrades. Those customers are now likely to receive a maximum of 100Mbps service sometime next year under Charter’s new plan.

Charter is also negotiating with state officials about where it will deploy broadband to 145,000 currently unserved homes in upstate New York over the next four years.

State-funded Rural Broadband Awards – Round I

New York State will help subsidize broadband rollouts to approximately 34,000 homes and businesses currently not served (or not served adequately) in rural areas. All but two of these projects will rely on fiber to the home service and each will offer service to a few thousand people:

Applicant Namesort descending Technology REDC Region Census Blocks Housing Units Total Units State Grant Total Private Match Total Project Cost
Armstrong Telecommunications, Inc. FTTH Finger Lakes, Southern Tier, Western NY 176 1,135 1,162 $3,930,189 $982,549 $4,912,738
Armstrong Telephone Company FTTH Southern Tier, Western NY 74 466 504 $1,778,256 $444,564 $2,222,820
Citizens Telephone Company of Hammond, N.Y., Inc. FTTH North Country 146 1,789 1,860 $3,316,810 $829,202 $4,146,012
Empire Access FTTH Southern Tier 124 719 724 $1,797,894 $449,474 $2,247,368
Empire Access FTTH Southern Tier 117 1,202 1,268 $1,598,480 $399,620 $1,998,100
Frontier Communications FTTH Southern Tier 1 62 65 $67,592 $16,899 $84,491
Frontier Communications FTTH North Country 3 188 216 $129,634 $32,409 $162,043
Frontier Communications FTTH Southern Tier 12 129 142 $197,104 $49,276 $246,380
Frontier Communications FTTH Capital Region 23 391 394 $318,304 $79,576 $397,880
Frontier Communications FTTH Mohawk Valley 30 402 405 $924,663 $231,166 $1,155,829
Frontier Communications FTTH North Country 105 1,928 2,096 $1,702,246 $425,562 $2,127,808
Germantown Telephone Company FTTH Capital Region 208 2,195 2,334 $2,512,562 $628,140 $3,140,702
Haefele TV Inc. FTTH Southern Tier 413 3,029 3,238 $271,568 $67,892 $339,460
Hancock Telephone Company FTTH Southern Tier 136 1,505 1,675 $4,915,920 $1,228,981 $6,144,901
Heart of the Catskills Communications Hybrid-Fiber Coax Southern Tier 216 2,836 3,177 $1,224,946 $524,977 $1,749,923
Margaretville Telephone Company FTTH Mid-Hudson, Southern Tier 209 1,882 2,002 $4,791,505 $2,053,503 $6,845,008
Mid-Hudson Data Corp Fixed Wireless Capital Region 60 647 663 $950,184 $237,546 $1,187,730
Mid-Hudson Data Corp FTTH Capital Region 6 354 362 $59,155 $14,789 $73,944
State Telephone Company, Inc. FTTH Capital Region 231 3,801 4,134 $5,805,600 $1,451,400 $7,257,000
State Telephone Company, Inc. FTTH Capital Region 101 516 595 $2,914,960 $728,740 $3,643,700
TDS Telecom FTTH Southern Tier 156 2,369 2,423 $1,895,390 $1,895,390 $3,790,780
TDS Telecom FTTH North Country 74 506 543 $1,084,000 $1,084,000 $2,168,000
TDS Telecom FTTH Central NY, Finger Lakes 106 996 1,038 $1,424,793 $1,424,793 $2,849,586
TDS Telecom FTTH Southern Tier 395 3,528 3,551 $4,989,570 $4,989,570 $9,979,140
The Middleburgh Telephone Company FTTH Capital Region, Mohawk Valley 250 1,596 1,651 $5,562,548 $1,390,637 $6,953,185
Federally Funded Rural Broadband Awards – Round II

After Verizon abdicated any interest in participating in rural broadband expansion funding through the FCC’s Connect America Fund, New York’s Broadband Program Office (BPO) and the Public Service Commission urged the FCC to keep the original funding intended for rural New York intact and open to other applicants seeking to build rural broadband projects. The FCC has not fully committed to do this, but it is an agenda item. Assuming this funding becomes available, it will be used to help pay for independent broadband providers or rural cable operators to begin delivering broadband service into still unserved parts of New York not included in the Charter expansion or Round I projects noted above. Many Verizon territories are expected to be included.

Applicants will have to provide at least 100Mbps service in most places or a minimum of 25Mbps in the most remote corners of New York. The application form discourages applicants from delivering broadband over DSL or wireless and clearly favors fiber to the home or cable broadband technology. Price controls will be in place for the first few years to assure affordability and those winning funding are strictly prohibited from introducing usage caps or usage-billing.

A vaguely defined “third phase” is scheduled to launch early next year to offer internet access to all remaining unaddressed service areas. Nobody mentions where the money is coming from to cover the last 1-3% of unserved areas, which are likely to be notoriously expensive to reach.

Gov. Cuomo explains progress on his New York Broadband for All program. (26:31)

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