America’s most costly large cable internet service provider is Sparklight, formerly known as Cable One. Its internet plans are usually data-capped and it barely offers new customers a pricing break before high regular prices apply. Sparklight primarily services small cities and towns, many income-challenged, in the middle of the country. Customers do not have much to rave about, because Sparklight puts its own profits far ahead of its customers. The cable operator was among the first to slap on data caps and was the nation’s most aggressive at getting rid of costly cable television channels.

About the only thing that does move Sparklight’s pricing is the presence of a formidable competitor. In Meridian and Garden City, Ida., TDS Fiber (formerly TDS Telecom) has been bringing gigabit fiber to the home service to area residents at prices low enough to motivate Sparklight customers to abandon the cable company. That motivated Sparklight to improve their plans and lower prices.

First, let’s examine the internet rate card for ordinary Sparklight customers typically stuck choosing either the cable company or DSL from Frontier, AT&T, or Windstream:

Sparklight regular pricing nationwide

Notice the entry-level internet plan (100/10 Mbps) costs $55 a month, does not mention the $10.50/mo modem rental fee (required if you choose the company’s Wi-Fi service), an internet service surcharge of $2.75/mo (not charged in all areas), and a stingy data cap of just 350 GB, which is at least 100 GB less than what the average U.S. broadband household now consumes each month. Internet overlimit fees are $10 for each additional block of 100GB of data in excess of your allowance, up to a maximum of $50 a month. Unlimited service costs an extra $40 a month.

When you add it all up: for an unlimited (100/10 Mbps) internet service plan with in-home Wi-Fi, Sparklight charges $108.25 a month.

If you happen to live in a competitive service area, such as Meridian and Garden City, Ida., speeds are faster, prices are lower, and data caps are nowhere to be found:

Pricing for Sparklight in Meridian and Garden City, Ida.

Customers still face a $10.50/mo charge to lease a cable modem, and that $2.75/mo internet surcharge fee might also apply.

The prospect of competition could cut dramatically into company profits, which is one reason telecom companies are fiercely lobbying the Biden Administration not to fund municipal broadband projects or supply funds to a new competitor as part of the 2021 Infrastructure Plan.

Almost 20% of Charter Spectrum’s broadband-only customers now consume over 1 TB of data per month, with the average cord-cutting Spectrum customer now reaching 700 GB of usage.

Charter CEO Thomas Rutledge revealed the company’s increasing usage figures on a conference call with investors this morning. Rutledge pointed to a spike in pandemic-related, at-home video streaming, but also an explosion in video conferencing traffic from work-at-home customers. Video traffic constitutes the majority of consumer broadband traffic in the United States, and as video quality improves, so does the amount of data each customer consumes.

Recent pressure from some in Washington to increase upstream capacity has been noticed by company officials but largely dismissed. In fact, Rutledge claimed Spectrum had no capacity issues that it could not address with incremental capacity upgrades and neighborhood node splits.

“We don’t have any immediate need to expand the capacity of the plant,” Rutledge said, noting that Charter still has room to grow after adopting DOCSIS 3.1 technology. Rutledge added that with the majority of traffic still firmly originating from downloads and streaming, incremental network improvements could allow the company to boost some speeds, but only if market demand for it emerges.

Rutledge noted the company has the capacity to expand its existing infrastructure to 1.2 GHz by expanding network bandwidth. DOCSIS 3.1 can support multi-gigabit download speeds and 1,000 Mbps for uploads. Charter, along with many other cable companies, has been slow to move towards the next cable broadband standard, DOCSIS 4.0, which would exponentially increase speeds and capacity even further.

Another potential method of curtailing usage growth could come from data caps or usage-based billing, but Charter’s efforts to rid itself of its 2016 agreement not to impose data caps until at least 2023 (if ever) in return for approval of its merger with Time Warner Cable and Bright House Networks was withdrawn by the company after receiving significant opposition. The agreement’s expiration date remains May 2023.

Despite the usage growth, Charter’s chief financial officer Christopher Winfrey told investors the impact on the company’s capacity and costs were insignificant and remained confident Charter’s costs to deliver broadband service and expand it would continue to decline overall in the years ahead.

Comcast on Wednesday said it will give its customers a six month reprieve on implementing its 1.2 TB data cap after state legislators in Massachusetts and Pennsylvania’s attorney general complained about the prospect of families paying more for internet access during a pandemic.

“As Pennsylvanians continue to navigate this pandemic, we know millions are relying on the internet for school and work more than ever. This is not the time to change the rules when it comes to internet data usage and increase costs,” said Pennsylvania Attorney General Josh Shapiro. “My office negotiated with Comcast to delay the implementation of these overage charges and waive any early termination fees for customers who opt out through December 2021. We also limited the impact of these changes on low-income households.”

The postponement applies to Comcast broadband customers in Connecticut, Delaware, Maryland, Maine, Massachusetts, New Hampshire, New Jersey, North Carolina, New York, Pennsylvania, Vermont, West Virginia, and the District of Columbia.

In addition to a delayed introduction of data caps, Comcast has also agreed to:

• not implement any data caps for low-income customers enrolled in Comcast’s Internet Essentials discount internet program for the rest of 2021;
• waive any early termination fees for customers planning to switch providers and signed a contract before November 2020;
• delay any overlimit fees until July, which will first be seen on customers’ August bills;
• more prominently disclose the fact Comcast has a data cap in its marketing materials.

Pennsylvania consumers concerned about how Comcast’s data threshold may affect them should file a complaint with the Office of Attorney General’s Bureau of Consumer Protection.

Comcast also reminded customers the data cap postponement announced today only applies to customers in the northeastern U.S. states noted above.

Spectrum internet customers can be assured of an additional two years of unlimited internet service after Charter Communications dropped its petition Tuesday with the FCC to allow the cable company to introduce data caps.

The FCC’s Wireline Competition Bureau acknowledged receipt of Charter’s withdrawal of its petition to end a prohibition on the company imposing data caps and usage-based pricing mechanisms two years before the original agreement with the regulator expires on May 18, 2023.

The company claimed it had no immediate plans to impose data caps or usage-based pricing, but its decision to rescind the request assures that. The FCC imposed a seven-year ban on Spectrum imposing data caps as part of its approval of Charter’s 2016 merger with Time Warner Cable and Bright House Networks. The earliest the company can impose data caps is May 18, 2023.

Sources tell Stop the Cap! Charter likely made the decision to withdraw its petition after realizing the current Republican-dominated Commission was not planning to approve it in the waning days of the Trump Administration and it was highly unlikely to win approval under the incoming Biden Administration. It is not uncommon for petitioners to quietly withdraw requests to avoid the publicity of having them publicly rejected.

House Energy & Commerce Committee

Democrats serving on the House Energy & Commerce Committee today blasted the nation’s largest internet service providers for price increases and data caps placed on consumer broadband services at the height of a global pandemic, questioning the industry’s commitment to keeping Americans connected.

“Over the last ten months, internet service became even more essential as many Americans were forced to transition to remote work and online school. Broadband networks seem to have largely withstood these massive shifts in usage,” wrote Democratic Reps. Frank Pallone, Jr (N.J.), Mike Doyle (Penn.) and Jerry McNerney (Calif.). “Unfortunately, what cannot be overlooked or underestimated is the extent to which families without home internet service — particularly those with school-aged children at home — have been left out and left behind.”

Pallone

The congressmen questioned nine providers after reading media coverage of rate hikes and the implementation of data caps by Comcast and the potential for Charter Spectrum to impose data caps as early as May 2021.

“This is an egregious action at a time when households and small businesses across the country need high-speed, reliable broadband more than ever but are struggling to make ends meet,” the three Democrats wrote.

In March 2020, many cable and phone companies relaxed a number of restrictions on customers in response to the emerging COVID-19 pandemic. Many volunteered to suspend data cap overlimit fees, provide affordable broadband options to the economically disadvantaged, offer free months of service, open restricted Wi-Fi hotspots, and discontinue collection efforts or service disconnects on customers falling behind on bills.

Despite the pledge, consumers filed a significant number of complaints with the Federal Communications Commission alleging the companies broke their promises, by far most often for not following through on free service offers or continuing aggressive collections of past due bills and shutting off service.

Consumer complaints filed with the FCC regarding the “Keep America Connected” pledge, received from March-November 2020. (Source: FCC)

The Energy and Commerce Committee has now sent letters to the CEOs of many providers, seeking answers to these questions as part of ongoing oversight of the industry:

• Did the company participate in the FCC’s “Keep Americans Connected” pledge?
• Has the company increased prices for fixed or mobile consumer internet and fixed or phone service since the start of the pandemic, or do they plan to raise prices on such plans within the next six months?
• Prior to March 2020, did any of the company’s service plans impose a maximum data consumption threshold on its subscribers?
• Since March 2020, has the company modified or imposed any new maximum data consumption thresholds on service plans, or do they plan to do so within the next six months?
• Did the company stop disconnecting customers’ internet or telephone service due to their inability to pay during the pandemic?
• Does the company offer a plan designed for low-income households, or a plan established in March or later to help students and families with connectivity during the pandemic?
• Beyond service offerings for low-income customers, what steps is the company currently taking to assist individuals and families facing financial hardship due to circumstances related to COVID-19?

The full letters are available below:

Altice USA

AT&T

CenturyLink/Lumen

Charter Communications

Comcast Cable Communications

Cox Communications

Frontier Communications

T-Mobile US

Verizon Communications