Comcast customers using the company’s growing network of Wi-Fi network hotspots will have their usage tracked to their broadband accounts, opening the door for Comcast to count wireless use against a customer’s future monthly usage allowance.

As part of a press release announcing that more than 300,000 Comcast hotspots are now available in New England, the cable company added that it is preparing to activate its Xfinity Wi-Fi Neighborhood Hotspots in the region, allowing other Comcast customers to share your Comcast Internet service over a separate Wi-Fi channel provided by your gateway. But it noted customers will need to log-in first, permitting Comcast to measure just how much of the wireless service you are using:

Xfinity WiFi Neighborhood Hotspots – In June of last year, Comcast announced its plans to create millions of WiFi access points for its customers through a neighborhood hotspot initiative. Comcast is the first major ISP in the country to deploy this innovative technology. This new initiative gives customers with Xfinity Wireless Gateways an additional “xfinitywifi” signal (or SSID) in their home that is completely separate and distinct from the private and secure home WiFi signal. Offered at no additional cost, the additional WiFi signal will allow visiting Xfinity Internet subscribers instant, easy access to fast and reliable WiFi without the need to share the home’s private network password and without an impact to the home subscriber’s speed. And since visitors sign in with their own Xfinity credentials, their usage and activities are tied back to their own accounts, not the homeowner’s.

Comcast is testing the reimplementation of a usage cap – now set at 300GB a month – in several cities in the southern U.S. Wireless usage could eventually also be counted against that cap.

Many of Comcast’s primary outdoor hotspots are in larger cities, such as Greater Boston. Most of the one million total hotspots Comcast hopes to activate are located in residential customers’ homes using Comcast’s Wireless Gateway.

Comcast’s discounted Internet service for the poor forces customers to jump through hoops to get the service and considers protecting revenue from existing customers more important than expanding the service to reach those who need it most.

Those are the views of John Randall, program manager at the Roosevelt Institute/Telecommunications Equity Project.

For $9.95 a month, those that can meet some complicated eligibility requirements and prove they are not existing Comcast customers are qualified for 3Mbps broadband service with a 768kbps upload rate. It represents a $30 savings off Comcast’s regular price — a considerable amount of revenue that Comcast is effectively forfeiting for the benefit of poor families who live in Comcast’s footprint.

Except Comcast isn’t actually “out” that much at all, argues Randall.

Of the 2.6 million households eligible for Internet Essentials from Comcast, only 150,000 have taken Comcast up on their offer. That represents only 5.8 percent of those eligible. In Comcast’s hometown — Philadelphia — there are just 3,250 families hooked up, which represents only 3.3 percent of those eligible.

Randall calls the program ineffective and says the onerous requirements to qualify (and re-qualify) are such a hassle, few families bother. What is worse, those families already sacrificing something else in their lives to get broadband service for the benefit of their school-age children are punished for their noble efforts — they are completely ineligible for Internet Essentials regardless of income or need because they are existing customers. Randall argues Comcast carefully constructed the program more as a public (and government) relations exercise than a charitable endeavor. Comcast zealously protects its existing revenues from being cannibalized by customers switching to the discount plan.

Some might argue that Comcast is managing the program with costs in mind, but Randall dismisses that as nonsense.

“Within its footprint (which spans 50 million households in 39 states– 45 percent of the US population), the cost for Comcast to connect additional households is vanishingly low,” says Randall. “With no additional network build needed, Internet Essentials represents almost pure profit for Comcast.”

Randall claims Comcast’s gross profit margin on its broadband service is around 95 percent where the network has already been built. At that rate, Comcast’s cheap Internet still delivers almost $18 million in additional income, and there is a promise of much more as soon as a customer defaults on a bill, misses a qualification deadline, or their children graduate. When any of these occur, Comcast will reset customers to regular rates.

“While most observers might assume that the program is an act of corporate generosity, it was originally conceived in the fall of 2009 as a way to turn a profit by offering slower connections to certain low-income households,” said Randall.

“These plans were temporarily tabled at the direction of Comcast lobbyist David Cohen, who knew that this type of program would be attractive to the FCC and thus useful as a bargaining chip. When the time came for negotiations over Comcast’s $13.75 billion takeover of NBC Universal, Comcast was able to offer something it was planning on doing anyway. In the end, the FCC was able to claim credit for forcing Comcast to implement a program to combat the digital divide, while in reality no arm-twisting was needed,” he added.

One of the biggest challenges of America’s digital divide is making affordable Internet access available. Cable companies in particular are prepared to wring even more money from their Internet customers in the form of higher prices, new and increasing equipment rental fees, and consumption billing schemes that charge more for less service.

But that isn’t the story elected officials receive from Congress.

The potential public relations benefits far outweigh any costs to offer the service. Randall notes Comcast had delivered the Internet Essentials message to over 100 members of Congress and more than 2,000 state and local officials. To broaden its outreach effort, Comcast also engaged leading intergovernmental associations at the state and local level such as the National Governors Association, National Conference of State Legislatures, U.S. Conference of Mayors, and various other organizations of elected officials. On top of that, Comcast says that the impressions generated by media coverage of Internet Essentials launch events earned it “millions of dollars” worth of media.

What message don’t these public officials hear?

America is subjected to local broadband monopolies and duopolies that guarantee the lack of competition for high-speed Internet access.

“It earns Comcast good press while distracting regulators and public officials into thinking that changes in policy aren’t needed and that digital divide problems will somehow work themselves out on their own as a result of corporate generosity. In the long run, Comcast Internet Essentials will do no more than contribute to the delay of much-needed regulation,” concludes Randall.

A Philadelphia community group is accusing Comcast of keeping its low-income budget Internet program a secret and denying needy families access for the flimsiest excuses.

Action United, which fights for low and moderate income Pennsylvanians, dropped off complaints with federal officials in Philadelphia from residents who are upset because they never heard of the discounted Internet access program or were disqualified from applying.

Comcast’s Internet Essentials offers families who qualify for the federal student lunch program access to 1.5Mbps broadband for around $9.95 a month.  But an informal survey by the group found scores of residents who never heard of the program and would have applied if they had known it existed.

The group, which says it has 44,000 members in Philadelphia, Pittsburgh, Harrisburg and Allentown, says it could find only two families among its members that actually qualified to sign up for the service.  Some were disqualified because they didn’t participate in the school lunch program, others because they already have Internet service or had a long-forgotten past due bill.

“I feel as though the Internet service will help my son to progress in math, reading, spelling,” Dawn from North Philadelphia told CBS Philadelphia. But she says Comcast refused to sign her up.

“They told me I had a back bill from 10 years ago, so I was not qualified,” Dawn said.

As Stop the Cap! reported in September, Comcast’s program is effectively designed to reap positive publicity for the cable company while discouraging customers from applying and actually obtaining the service.

Action United protests the digital divide in downtown Philadelphia. (Courtesy: Action United)

Action United says area schools, an obvious place to promote low cost Internet for students, knew nothing about the program.

Comcast counters it sent mailings about Internet Essentials to 4,000 school districts, which covers 30,000 schools.

The group originally planned to protest Wednesday in front of Comcast’s corporate headquarters in Philadelphia to draw attention to the problem.  Earlier today, Action United announced it had reached an agreement to meet with Comcast executives to discuss the program and help cut some of the red tape for families experiencing trouble applying.

Comcast’s decision to offer budget Internet service came as a result of negotiations with the federal government to approve its merger with NBC-Universal. Critics contend Internet Essentials is too restrictive and requires applicants to navigate through a cumbersome qualification process.  After approval, the program only provides discounted service for a period of three years and can be terminated if a family falls past due on their account.

From the byzantine terms and conditions for enrollment in the Comcast Internet Essentials program:

The program is only available to households that (i) are located where Comcast offers Internet service; (ii) have at least one child who receives free school lunches through the National School Lunch Program (the “NSLP”) and as confirmed annually while enrolled in the program; (iii) do not have an overdue Comcast bill or unreturned equipment; and (iv) have not subscribed to any Comcast Internet service within the last ninety (90) days (sections 1(i)-(iv) collectively are defined as “Eligibility Criteria”). This program is not available to households that have children who receive reduced price lunches under the NSLP. The program will accept new customers for three (3) full school years, unless extended at the sole election of Comcast. Comcast reserves the right to establish enrollment periods at the beginning of each academic year in which it accepts new customers that may limit the period of time each year in which you have to enroll in the program.

2. In order to confirm your eligibility for the program, Comcast will need to verify that your children receive free school lunches through the NSLP in the initial enrollment year and each subsequent year you are enrolled in the program. In order to confirm eligibility, participants in the program will be required to provide copies of official documents establishing that a child in the household is currently receive free school lunches through the NSLP. Each year you will be required to reconfirm your household’s current eligibility by providing Comcast or its authorized agent with up-to-date documentation. If you fail to provide documentation proving your eligibility in the program, you will be deemed no longer eligible to participate in the program.

3. You will no longer be eligible to participate in the program if (i) you no longer have at least one child living in your household who receives free school lunches under the NSLP; (ii) you fail to maintain your Comcast account in good standing; (iii) Comcast ceases to provide the Covered Service to your location; or (iv) your account opened under the program is closed. A change in address may result in your account being closed, even if you continue to receive Comcast services at a different address. Program participation also may be terminated if the Covered Service is upgraded, altered or changed by you for any reason. If you are no longer eligible for the program, but continue to receive the Covered Service from Comcast, regular rates, and any other applicable terms and conditions will apply to the Covered Service.

1.5Mbps "broadband" is not the cure-all Comcast claims it to be.

When multi-billion dollar Comcast Corporation decided it was the right time to acquire multi-billion dollar NBC-Universal, one of the concessions Comcast made to win federal approval of the deal was to deliver budget-priced Internet service to those too poor to pay the company’s current asking price of $40-60 a month.

Comcast Internet Essentials was the result, and as Comcast rolls its publicity train from city to city, promoting the new package, politicians and cable executives have teamed up to take credit, suggesting the company’s limited-access $9.95 1.5Mbps service will somehow erase the high-tech job deficit, eliminate the digital divide, and will even somehow help America’s broadband speed gap with the rest of the world.

But it will do none of those things for the vast number of income-challenged families who won’t actually qualify for the three year program, either because they already scrape up enough for Comcast service, don’t have children, or manage to miss a payment due date.  In fact, 1.5Mbps budget-priced Internet is a service providers should have been willing to offer all along, to anyone who wants the service.  But it took a colossal-sized merger concession to get Comcast to sort of do the right thing.

I say “sort of” because the terms and conditions that accompany the service resemble the gotcha fine print the banking industry so loves:

The program is only available to households that (i) are located where Comcast offers Internet service; (ii) have at least one child who receives free school lunches through the National School Lunch Program (the “NSLP”) and as confirmed annually while enrolled in the program; (iii) do not have an overdue Comcast bill or unreturned equipment; and (iv) have not subscribed to any Comcast Internet service within the last ninety (90) days (sections 1(i)-(iv) collectively are defined as “Eligibility Criteria”). This program is not available to households that have children who receive reduced price lunches under the NSLP. The program will accept new customers for three (3) full school years, unless extended at the sole election of Comcast. Comcast reserves the right to establish enrollment periods at the beginning of each academic year in which it accepts new customers that may limit the period of time each year in which you have to enroll in the program.

2. In order to confirm your eligibility for the program, Comcast will need to verify that your children receive free school lunches through the NSLP in the initial enrollment year and each subsequent year you are enrolled in the program. In order to confirm eligibility, participants in the program will be required to provide copies of official documents establishing that a child in the household is currently receive free school lunches through the NSLP. Each year you will be required to reconfirm your household’s current eligibility by providing Comcast or its authorized agent with up-to-date documentation. If you fail to provide documentation proving your eligibility in the program, you will be deemed no longer eligible to participate in the program.

3. You will no longer be eligible to participate in the program if (i) you no longer have at least one child living in your household who receives free school lunches under the NSLP; (ii) you fail to maintain your Comcast account in good standing; (iii) Comcast ceases to provide the Covered Service to your location; or (iv) your account opened under the program is closed. A change in address may result in your account being closed, even if you continue to receive Comcast services at a different address. Program participation also may be terminated if the Covered Service is upgraded, altered or changed by you for any reason. If you are no longer eligible for the program, but continue to receive the Covered Service from Comcast, regular rates, and any other applicable terms and conditions will apply to the Covered Service.

No kids in your home?  No discount Internet access for you!  Refuse on principle to accept a government handout to pay for school lunches?  Sorry, you need to buy the full-priced Internet Comcast will happily sell you.  Missed a cable bill payment because you needed to buy medicine this month?  It will cost you your inexpensive access.  Comcast even reserves the right to cancel your discounted service if you choose (or are forced) to move.

Most would-be customers who assume they are eligible because they, like so many others, are income-challenged these days, are thrilled to read and watch news accounts about the discount Internet program for their kids.  But like Santa reneging on Christmas, the excitement turns to disappointment when they discover they are ineligible for one reason or another.

In Baltimore, WBAL-TV got nearly breathless with excitement telling their audience, “Things are looking up for Maryland families — way up. A new effort is under way to help connect 250 families to cyberspace at an affordable price.”

Baltimore is a city of 620,000 people.  Before the Great Recession, 15.4% of families and 19.3% of Baltimore’s residents fell below the poverty line, excellent candidates for inexpensive Internet access.  That’s more than 32,000 people, but Comcast is apparently making room for just 250.

Despite those figures, Comcast’s David Cohen thinks his company’s discount Internet will make all the difference.

“We believe we have a shot to be able to make a real impact on the digital divide with this program,” he told the Baltimore TV station.

He might be right… for 250 families anyway.  Everyone else… pay up or go without.

Terms and conditions apply

WBAL Investigative reporter Jayne Miller got slightly carried away on behalf of Comcast, equating their program with a solution for high-tech jobs and increased Internet speed:

Internet access and speeds have become national issues. The U.S. lags behind other countries in broadband availability, hurting what some believe to be the nation’s ability to compete, said Miller.

In comparison, “China recently graduated over 440,000 engineers, and we in the U.S. graduated 65,000,” said U.S. Rep. “Dutch” Ruppersberger.

I’m sorry to bring people back to reality, but 250 families getting the right to buy up to three years of Internet access at speeds that are half of what the FCC National Broadband Plan defines as actual broadband is not an answer to anything beyond Comcast’s poor public relations in the customer service department.  It’s not going to help America’s broadband speed rating (it will actually hurt it at 1.5Mbps).

WBAL is hardly the only station overdoing their celebrations of Comcast (a prolific advertiser by the way).  I’ve watched reports that suggest Comcast is doing this out of the goodness of their heart, not because they agreed to as a condition of their mega-merger with NBC.  Considering the lawyer-like limitations that are certain to keep many people out of the program and others from downgrading their existing service to something more affordable, charity is hardly a word I would extend to the nation’s largest cable operator who found cause to limit access to even the lowest broadband speeds to protect its bottom line, which it hopes will get much fatter with the acquisition of NBC-Universal.  When the three year program ends, let’s just see how charitable Comcast is about extending it.

[flv width=”480″ height=”290″]http://www.phillipdampier.com/video/KASA Santa Fe Internet Accessibility with Internet Essentials 8-26-11.mp4[/flv]

KASA-TV in Santa Fe talks with their “very good friend at Comcast” about Internet Essentials and the company’s general Internet expansion plans in New Mexico.  The interview resembles an infomercial for Comcast products and services.  (5 minutes)

Too bad Comcast doesn't allow their Internet customers to use the service until 'xfinity.'

A Comcast customer of seven years has been warned if he exceeds the company’s arbitrary 250GB usage cap one more time, his family will be cut off from the cable company’s Internet service for one year.

Jrodefeld is just one more example of a customer who never thought he would have to monitor an online usage gauge to enjoy the Internet service he pays good money to receive.  But Comcast has deemed him an Internet abuser for exceeding a usage limit the company takes pains to bury in its lengthy terms and conditions, far away from glitzy marketing promising a fast, always-on experience.

In my house there are five people with five computers, several smartphones, a Playstation 3 and AppleTV all connected to the Internet through a wireless router.  Several of us are tech minded people who need to be able to send and receive large amounts of data through our network and publish material on the Internet.

Not only that, but I have (legally) downloaded films through places like iTunes and downloaded games and software in the same manner.  I create digital content (web pages, animation, other content) and publish it on the Internet. Not only that, but I send this content to friends and colleagues through web hosting sites like Netload.  I download games and watch streaming Netflix through my Playstation 3.

I think it is absolutely beyond belief that Comcast can offer the speeds that they do, with the evolving demands of the Internet and modern digital demands that people have, and think that 250GB is sufficient for even the moderately tech savvy user.  This data cap is absolutely horrible and is an insult to my family and an abomination given how much money we have given to Comcast over the last several years for their service, amounting in the thousands of dollars.  Not to mention that we signed up with the idea of getting an “always on”, unlimited service.

Jrodefeld claims his family steers clear of the usual suspect of heavy usage consumption — peer-to-peer software.  But with five tech-savvy teenagers and high-tech workers living under one roof, Comcast’s usage meter reflected the family was several times over the company’s usage limits:

• In May, 2011 the total data used was:  1363GB
• In June, 2011 the total data used was:  758GB
• In July, 2011 the total data used was:  1271GB

Based on a review of the applications being run by those achieving that level of usage, online file backup is usually the culprit generating the most usage.  That is closely followed by avid online streaming and gaming.  While game-play itself is probably not much of a factor, the relentless number of game updates and new games distributed over an Internet connection can easily exceed several gigabytes each.  The family also streams some very high bitrate HD movies over a video rental service that uses their Comcast Internet connection to provide the video.  That can run nearly 10GB an hour in some cases, Jrodefeld says.

For usage cap opponents, this represents the perfect example of what can happen in families that rely on video streaming and have teenagers living at home.  While one individual may have little trouble staying within Comcast’s arbitrary 250GB limit, unchanged since its introduction in 2008, the more Internet-savvy members in a household sharing a connection, the bigger the risk for Internet Overcharging or a warning e-mail.

Comcast says their average user keeps usage well under 10GB per month.  But they don’t provide any demographic breakdown of usage profiles.  Older households may pay for an Internet account exclusively for web browsing and e-mail.  Younger households, those with teenagers, and cord-cutters who rely on Internet video streaming will almost certainly use considerably more.

Jrodefeld can’t believe Comcast has stuck his family with a “one size fits all” Internet experience.  And their reasons for the 250GB usage cap don’t make any sense.

“On the one hand, it is said that a user going over that threshold hurts the Internet experience for other users in your area, and on the other hand Comcast claims that the ‘average’ user uses only 2-4gb per month,” he notes. “If that is the case, then multiple users who average 250GB a month would slow down the Internet far more than one individual who uses, say, 500GB in a month.”

“If such a small number of users exceed the cap, Comcast’s network should easily be able to allow that without it affecting other users,” he argues. “If, on the other hand, many users are exceeding the cap, it means that the limit is far too small and Comcast should upgrade their infrastructure if they cannot keep up with user demands.”

The cap-free alternative for Comcast's "heavy users."

In fact, Comcast has upgraded the Internet experience for most of their customers considerably since they introduced a usage cap.  The company has aggressively deployed DOCSIS 3 upgrades, exponentially increasing the amount of bandwidth available in individual neighborhoods, allowing them to sell highly-profitable, faster tiers of service and eliminating congestion issues.  But no matter what speed you buy, or how much you spend, Comcast imposes the same 250GB usage limit on all residential accounts.

Comcast company officials had nothing to offer Jrodefeld, but several other Comcast customers did: upgrade to a Business Class account, if only to be rid of the usage limits.  Comcast Business Class service currently has no usage limitations, and carries this pricing in the northeast, before taxes and fees:

• Starter Plan — 12/2Mbps:  $59.95/mo Best Value
• Preferred Plan — 16/2Mbps:  $89.95/mo
• Premium Plan — 22/5Mbps:  $99.95/mo Best Speed/Performance Value
• Deluxe Plan — 50/10Mbps:  $189.95/mo
• Installation Fee: 1 year contract = $199, 2 years = $99, 3 years = $49

The alternative is to sign with a telephone company provider, but AT&T also has a 250GB usage limit on their U-verse service, and charges an overlimit fee of $10 for every 50GB of excess usage.  Verizon FiOS offers unlimited service.