Comcast: You owe us $640 (Original image: Sentinel & Enterprise)

Comcast billed a Leominster woman $640 for cable television equipment destroyed in a major apartment fire, despite promises from the company she would not be charged.

Lakisha Nunez spent months fighting with Comcast over the equipment lost when a fire broke out at the Columbia Hotel building on Nov. 24.

Two days later, Nunez contacted Comcast to inform them of the fire and to temporarily suspend service. A representative promised she would not be held accountable for the unreturned equipment because the fire was not her fault.

One month later, the company changed its mind and refused to discuss the matter further. When the $640 bill arrived, she complained.

“I called and was told that is what (renter) insurance is for,” Nunez told the Sentinel & Enterprise.

Another representative told her the fees would be waived if she filed a “fire report” with the local Comcast office. She complied, but Comcast still refused to remove the charges.

The bill was finally waived after Leominster Mayor Dean Mazzarella’s office intervened on her behalf and reporters from the Sentinel & Enterprise also began making inquiries.

Comcast spokesman Marc Goodman quickly apologized and promised to refund $233 in fees she already paid, believing it covered her monthly service.

Stop the Cap! reminds renters that buying renter’s insurance is essential to protect your personal property (and that belonging to others) in the event of a catastrophic loss. It is inexpensive and easy to buy from any large insurance company.

Data caps protect incumbent big studio and network content creators at the expense of independent producers and others challenging conventional entertainment business models.

That was the conclusion of several writers and producers at a communications policy forum hosted by Public Knowledge, a consumer group fighting for an open Internet.

A representative from the Writers Guild of America West noted that cord-cutting paid cable TV service has become real and measurable because consumers have a robust online viewing alternative for the first time. John Vezina, the Guild’s political director, noted how Americans watch television is transitioning towards on-demand viewing.

New types of short-form programming and commissioned series for online content providers like Netflix are also changing the video entertainment model.

Welch: It is about the money.

But a digital roadblock erected by some of the nation’s largest broadband providers is interfering with that viewing shift: the data cap.

Data caps place artificial limits on how much a customer can use their Internet connection without either being shut off or finding overlimit fees attached to their monthly bill. Critics contend usage caps and consumption billing discourage online viewing — one of the most bandwidth intensive applications on the Internet. With broadband providers like Time Warner Cable, AT&T, Verizon, and Comcast also in the business of selling television packages, cord-cutting can directly impact providers’ bottom lines.

Providers have traditionally claimed that usage limits are about preserving network resources and fairness to other customers. But Time Warner Cable admits they exist as a money-making scheme.

Rachel Welch, vice president of federal legislative affairs at Time Warner Cable, says the cable company is not worried about limiting data consumption. It considers monetizing that consumption more important.

“We want our customers to buy as much of the product as possible,” Welch told PC World. “The goal of companies is to make money.”

Time Warner now offers customers a choice of unlimited service or a $5 discount if customers keep their monthly usage under 5GB, but some worry that is only a prelude to introducing expanded usage limits on a larger number of customers in the future.

For many consumers already hard-pressed by high broadband bills, worrying about exceeding a data allowance and paying even more may keep viewers from watching too much content online.

For that reason, Vezina called data caps “anti-innovation.”

“It hurts consumers [and] it hurts creators who want to get as much out to the public in as many ways” as possible, he said.

Public Knowledge has become increasingly critical of data caps in the last two years. The organization has questioned how ISP’s decide what constitutes a ‘fair’ usage limit and criticized inaccurate usage meters that could potentially trigger penalties and overlimit fees.

Comcast’s David Cohen

Comcast is an American success story, but Americans that do business with the cable giant are getting slighted by overpriced, too-slow broadband service.

In a commentary piece in the Financial Times, Edward Luce indicts the company that bought NBC-Universal for pay-for-play campaign contributions that have kept the company from much  regulatory scrutiny and free to charge whatever it likes for a service now increasingly considered a necessity.

Comcast’s key employee as far as Washington is concerned is its senior vice-president, David Cohen, who also happens to be one of President Barack Obama’s largest fundraisers.

The revolving door between Comcast in Philadelphia and the federal government in Washington is always spinning.

Of Comcast’s 121 lobbyists, 85 are former government employees, according to Open Secrets, which monitors money and politics.

“Comcast employs the royalty of K Street [lobbyists],” says Sheila Krumholz, head of Open Secrets.

In 2011, the year the FCC approved Comcast’s merger with NBCU, the company spent more than $14 million on lobbying – the ninth-highest of any US company (it ranks 49th on the Fortune 100 list).

Luce adds Meredith Atwell-Baker, a former Republican FCC commissioner, took an executive position at Comcast shortly after voting to approve the merger-buyout between the cable operator and NBC.

This month Comcast acquired the 49 percent of NBC-Universal it did not already own in a $16.7 billion transaction that got less attention at the FCC than the lunch menu at the Chinese takeout down the street.

So while Comcast enriches itself, customers are left with Internet service that is nothing to brag about.

While only 7% of the U.S. is wired for fiber broadband, more than half of South Korea and Japan can buy fiber-fast broadband service from a range of broadband suppliers. Back home, Comcast and the local phone company have built a comfortable duopoly:

The company’s meteoric rise in the past decade parallels the relative decline of Internet service in the US. In the late 1990s the US had the fastest speeds and widest penetration of almost anywhere – unsurprisingly given that it invented the platform. Today the US comes 16th, according to the OECD, with an average of 27 megabits per second, compared with up to quadruple that in countries such as Japan and the Netherlands.

The contrast on price is just as unflattering. The average US cost for 1 Mbps is $1.10 compared with $0.42 in the UK, $0.34 in France and $0.21 in South Korea. It is not only places such as Hong Kong that put the US into the shade. Countries such as Estonia, Portugal and Hungary offer a significantly better Internet service. South Koreans joke that when they visit the US they are taking an Internet vacation. Yet bringing the US up to speed appears to be low on Mr Obama’s list of priorities (it did not even get a mention in his State of the Union address last month).

Comcast may be attempting to get around Federal Communications Commission regulations governing what cable companies can charge for cable equipment by recasting the monthly fee as a “service charge.”

The cable operator’s decision to start charging $1.99 a month for digital transport adapters (DTAs) — small boxes that can convert digital signals into analog for older televisions — has at least one Minnesota city up in arms.

Eagan city officials met with outraged residents Tuesday to discuss the fee hike and hear a number of complaints about how Comcast does business in the community.

“It really ran the gamut, from concerns about losing stations, to concerns about being bait and switched, to having gotten boxes for free and worried that you had to pay for them in the future,” Eagan Mayor Mike Maguire told WCCO-TV.

Comcast customers in Minnesota are receiving letters from the cable operator some call deceptive. The letter warns “digital equipment is needed on all your TVs to receive channels,” despite the fact many televisions manufactured after 2007 are equipped with QAM tuners that will receive the digital signals without extra equipment, at least for now.

Only in fine print at the bottom of the letter does Comcast admit QAM-equipped sets won’t need the equipment, saving $1.99 a month per set.

Letters have also been sent to customers who have used DTA equipment provided by Comcast at no charge… until now.

Comcast earlier announced it intends to collect $1.99 a month from each subscriber using DTA equipment, even if those customers previously had received the equipment for free.

But Comcast’s decision to charge $24 a year in perpetuity for a box with a wholesale cost of less than $50, depending on the model, may run afoul of Federal Communications Commission regulations that forbid cable operators from charging excessive amounts to lease cable equipment:

Cable operators may require their subscribers to use specific equipment, such as converters, to receive the basic service tier. They may include a separate charge on your bill to lease this equipment to you on a monthly basis. This monthly rate must be based on the operator’s actual costs of providing the equipment to you. Operators may also sell equipment to you, with or without a service contract. If an operator provides a choice between selling and leasing the equipment, the monthly leasing rate will be regulated but the sales price will be unregulated. If an operator only sells equipment and does not also lease equipment, then the sales price must be the actual cost of the equipment plus a reasonable profit, and any service contract should be based on the estimated cost to service the equipment. If the customer buys the equipment but does not purchase a service contract, the customer can be charged for repairs and maintenance. Cable operators may not prevent customers from using their own equipment if such equipment is technically compatible with the cable system.

Eagan Mayor Mike Maguire

In a possible attempt to avoid regulatory language regarding cable equipment, Comcast has declared its new $1.99 fee is actually an “additional outlet service charge,” not an equipment fee.

“The deployment of DTA technology allows us to bring more value to our customers through additional HD channels and faster Internet speeds, both of which are used by the majority of our customers,” said Mary Beth Schubert, vice president of corporate affairs. “These types of enhancements require significant investment, and we feel the nominal fee now being implemented for DTA additional outlet service on our digital tiers reflects the additional value of the service.”

“There is no charge for the first three DTA devices,” said Schubert. But she quickly added, “After the digital transition in March and April, those TVs will not have access to these channels unless they are paying the $1.99 DTA additional outlet service fee.”

Michael Bradley, an attorney representing 20 local communities, is investigating to see if Comcast’s language about its new fee violates FCC rules.

The new charge is expected to be lucrative for Comcast, earning the company at least $550 million annually in new revenue.

Comcast intends to boost that even further as it embarks on encrypting its digital lineup, making QAM-equipped televisions useless to receive scrambled cable channels.

“These customers will eventually need to connect a digital device to their QAM tuner equipment at a future date as we implement additional network security features,” warned Schubert. “Customers will be provided complete information well before any additional measures take place.”

The FCC previously negotiated an agreement with cable operators intending to encrypt their cable lineup to keep customers from experiencing bill shock from new, mandatory equipment fees:

But by recasting new fees as unregulated “additional outlet fees,” Comcast and other cable operators may have successfully outwitted the FCC’s good intentions, earning billions in new revenue annually as a result of a simple language change.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/WCCO Minneapolis Comcast Fee Causes Outrage in Minn 2-20-13.mp4[/flv]

WCCO reports the city of Eagan held an informational meeting Tuesday about Comcast’s newest fee for digital boxes required on older televisions. Comcast customers nationwide will soon pay the new $1.99 “DTA additional outlet service fee” for each television equipped with the digital set top DTA box “to offset increasing programming and operational costs.”  (2 minutes)

In an effort to tap into the credit-challenged market, Comcast has unveiled a prepaid Internet service in Philadelphia that requires no credit check or ongoing service contract.

Similar to prepaid cellphone service, would-be customers can buy a “starter kit” that includes a DOCSIS 3 cable modem and a unique sign-up PIN code for a suggested retail price of $70.

The offer is most likely to appear in wireless retail outlets that specialize in prepaid service, but will also be sold online. At present, the service is available in parts of Philadephia, Delaware, and New Jersey.

Light Reading notes there are some important restrictions on the offer:

1. You must live in an area where Comcast provides service;
2. The address where you hook up the modem must not currently receive Comcast broadband service;
3. You must use the cable modem in the startup kit;
4. The maximum available speed is 3Mbps down, 768kbps up;
5. The price is just a few dollars less than faster connections available from the cable operator.

The service is presently undergoing a trial in Philadelphia and it is unknown if or when the prepaid offer will expand to other cities.

Comcast is targeting low-income customers and those without bank accounts or a healthy credit profile. The prepaid offer requires a customer to pay in advance for service, and refill PIN cards will be available from retailers, or the customer can renew with a debit or credit card.

Comcast has little to fear from its prepaid service cannibalizing its traditional broadband offers. Comcast’s 6Mbps Performance Starter service runs $49.95 per month, just four dollars more than 30 days of prepaid 3Mbps service.

There is no mention of any usage caps with the prepaid service.