Google Fiber may not be coming to a Kansas City apartment complex near you.

The coveted gigabit fiber to the home service is drawing criticism from owners of multi-dwelling units, condos, and apartment buildings because of its installation fee.

Google requires property owners to either go all-in or forget about getting the service. That means $300 for each apartment or condo, regardless of whether it is occupied or if an existing tenant wants the service or not.

Landlords tell the Kansas City Star the installation fee is just too much, especially when considering the phone and cable company wired their buildings for free. The newspaper notes that a 350-unit apartment complex opting in to Google Fiber will have to pay more than $100,000 upfront just to get the service.

Those living in one of nine CRES Management apartment complexes suspect they won’t be getting Google Fiber now or in the future — the property owners balked at an installation fee for their properties well into the six figures.

“I don’t know many apartment complexes that have $100,000 in the bank just waiting to be spent,” said Jon Gambill, CRES Management information technology director.

Google doesn’t offer volume discounts for multi-dwelling unit owners, but is willing to accept installment payments over 12 months. Google has also promised to refund the installation fees in $25 monthly increments for each paying customer until the $300 per unit fee is returned. But if a renter opts for the free, slower Internet service Google provides, the landlord will have to absorb the installation cost.

“If people can get free Internet, they’re not going to pay for premium,” Gambill told the newspaper. “If someone doesn’t want to pay for Internet, they really don’t have to, but then we’ve lost out on that reimbursement.”

Island residents are smoking hot about Voice Link

The New York Public Service Commission has extended the deadline for public comments about the Voice Link wireless landline replacement until Sept. 13, to give the growing number of customers on Fire Island with the service enough time to fully evaluate it over the summer months.

To date nearly 400 public comments have been filed with the Commission, every one of them negative.

Stop the Cap!’s comments are having an impact on the PSC’s exploration of the deployment of Voice Link in upstate New York. On our recommendation, the PSC has formally asked Verizon for more documentation about how Voice Link is being introduced in the Catskills:

Please provide the following information for all Voice Link devices/services that have been installed at any customer premises locations outside of the Western Fire Island area:

• The address of every Voice Link customer in upstate New York;
• Date Voice Link Installed;
• Reason Voice Link Installed;
• Was customer advised Voice Link service was optional or not;
• Voice Link Service Calls/Repairs identified by location, date, reason for service visit, repair action taken;
• If applicable to any locations, date Voice Link was uninstalled/disconnected and reason for termination;
• Please provide any marketing materials, scripts, and/or training materials in use by Verizon employees or contracted third-party workers to inform customers about Voice Link service;
• Please provide copies of any documentation provided to customers agreeing to accept Voice Link service outside of Western Fire Island, including Terms of Service Agreements. If there are any material differences between documentation and Terms of Service agreements for Western Fire Island customers, and customers in any other areas of New York State, please identify and explain those differences.

The PSC is also demonstrating that it is willing to go deep into the weeds with Verizon on this issue, a marked departure from the near-rubber stamp “light touch” regulation AT&T enjoys in several midwestern and southern states. At one point, the Commission found Verizon documentation indicating enough “spare pairs” — unused lines — were available that could be used to repair and reintroduce landline service on Fire Island, and wants to know why Verizon is not using them to bring back the service customers had before Hurricane Sandy did its damage:

The copper cable table shows that the spare cable pairs in the copper cable facilities serving the 11 identified communities is approximately 16% of the total available pairs in those cables. However, in specific communities such as Fair Harbor, Kismet, Robins Rest and Lonelyville, the percentage of spare pairs ranges from 21% to 66% of the total available pairs. Also, the number of working pairs in many locations is small compared to the total available pairs in the cables, despite the number of defective pairs reported by the company. Please explain why Verizon is not utilizing existing spare cable pairs, and performing routine cable maintenance in any communities, to restore wireline services to customers that do not request or desire Voice Link service.

The fiber cable table shows spare cable pairs in the fiber facilities serving the Ocean Beach, Lonelyville, Fair Harbor and Kismet communities is approximately 73% of the total available pairs in those fiber cables. By individual community, the percentage of spare pairs ranges from 62% to 94% of the total available pairs. Please explain why Verizon is not utilizing existing spare fiber pairs in any of the four named communities to restore wireline services to customers that do not request or desire Voice Link service.

Despite every effort by Verizon, Fire Island residents that lost landline service are increasingly opposed to Voice Link, if the public comments filed with the Commission are any indication.

The Point o’Woods Association on Fire Island, which represents more than 500 people who either seasonally or year round depend on Verizon’s landline network, is also highly critical of Voice Link’s performance and provided the Commission with very specific and detailed criticisms:

1. Verizon’s only cell site on Fire Island on the Ocean Beach water tower lacks reliable power backup contingencies;
2. Fire and medical first responders across Fire Island have declared Voice Link unsatisfactory for public safety;
3. Voice Link’s performance has been called unreliable. The sound is “plagued by echoes, connection delays, no connection at all, and frequent dropped calls;”
4. Voice Link only works with CDMA spectrum for voice calling, reducing the level of service (data) customers used to have with traditional landlines;
5. Customers cannot reach a live operator by dialing “0” and must dial all ten digits for all calls. The service also does not support collect calls, a feature “sometimes critical in emergency situations;”
6. The reception quality of Verizon’s data network varies widely across the island.

“Voice Link at its very best is a temporary solution suitable for deployment only while full communications infrastructure is in the process of restoration,” concludes D.R. Brown, vice president of the association.

The changes Verizon seeks for Fire Island are affecting even those who still have landline service. Customers regularly report that Verizon customer service is refusing repair requests in areas like Ocean Beach, pushing customers to the wireless replacement it wants them to accept.

Jean Ufer, a Fire Island resident, says Verizon is threatening the health of her husband by refusing to fix her service.

“They will not repair my landline, which my husband really needs, as he has a pacemaker which has to be monitored by a landline,” Ufer complained to the Commission. “They also refused to connect my DSL, even though they charged me  the monthly fee right through the winter.”

Wisconsin Republicans are outraged AT&T and CenturyLink are not able to charge taxpayers and students more than double the price for broadband in schools and libraries.

Wisconsin taxpayers and students could face substantially higher taxes and tuition fees because Republicans prefer AT&T and other commercial Internet Service Providers deliver high-speed Internet access to schools and libraries, even if prices are more than double those charged by the existing non-profit, cooperative provider.

Last week, under growing pressure and criticism from Republican legislators and the potential threat of private litigation, the University of Wisconsin withdrew its contract with WiscNet, fearing a costly backlash that could interrupt the school’s educational and research missions.

Republicans in the state legislature forced a competition ban in the 2011-2013 budget directly targeting WiscNet, an institutional broadband provider serving 300 public schools, state agencies, and 15 of 17 Wisconsin library systems. They consider WiscNet a direct competitive threat to the business interests of AT&T and other telecommunications companies.

The loss of business from UW has raised questions about the ongoing viability of WiscNet’s operations, and has encouraged critics to continue the campaign against public broadband.

“Isn’t it a sad day when political pressures from telephone company lobbyists keep us from working together,” asked WiscNet Wire. “It’s frustrating, yet fascinating.”

Many of WiscNet’s members report that “going private” for Internet connectivity will more than double their costs. This was confirmed by Wisconsin’s Legislative Audit Bureau, which reported a member paying WiscNet $500 month for Internet service would face bills of $1,100 or more if provided by AT&T or other telecom companies.

Republicans have complained WiscNet’s close ties to the state university system and its efforts to resist the Walker Administration’s efforts to dismantle the institutional fiber network’s current operational plans border on unethical.

Cheerleading the Republicans are providers including AT&T and CenturyLink, both filing their own respective complaints (AT&T) (CenturyLink). Joining them is the Wisconsin State Telecom Association (WSTA), which represents Wisconsin’s independent rural phone companies like Frontier Communications.

William Esbeck, WSTA’s executive director, has been on WiscNet’s case for years. He said WiscNet’s recent victory in a procurement process to supply Internet service across the UW system was proof the bidding was rigged.

“The UW simply created a ‘request for proposals’ that matched what WiscNet was already doing,” said Esbeck.

Republican legislators joined Esbeck threatening hearings and unspecified repercussions for the “civil disobedience” on display by university officials attempting an end run around the Walker Administration.

“There have been repeated, flagrant violations of state law — intentional deception at a level that I just am flabbergasted by, even today — and no accountability for it whatsoever,” said state Rep. Dean Knudson (R-Hudson), at a recent budget committee hearing. Among Knudson’s biggest campaign contributors: the WSTA and CenturyLink.

In a May 23 letter sent to UW System president Kevin Reilly, state Sen. Paul Farrow (R-Pewaukee) accused UW officials of “mismanagement and unethical behavior,” saying they’d shown disdain for the legislature and contempt for the laws and directives it passed, reported Bill Lueders, the Money and Politics Project director at the Wisconsin Center for Investigative Journalism.

Among Farrow’s biggest campaign donors: TDS Telecom and the WSTA.

Both Farrow and Knudson are also known members of the American Legislative Exchange Council (ALEC), a corporate financed group that produces anti-public broadband draft legislation for introduction by the group’s members. Both CenturyLink and AT&T are sponsors of ALEC, AT&T in particular.

The Walker Administration has given the UW System an extra six months to sever all ties with WiscNet.

New York State residents have until July 2 to share their views about a proposal by Verizon Communications that would allow the company to drop landline service in rural upstate New York and other locations and replace it with a wireless substitute — Voice Link, as its sole service offering.

Stop the Cap! has covered the issue of rural landline service extensively since 2008. In the past few years, while CenturyLink, Windstream, FairPoint, and Frontier have developed business plans to sell lucrative landline telephone and broadband service in rural areas, AT&T and Verizon have proposed abandoning their landline networks in certain areas in favor of wireless.

Verizon has sought to stop offering rural landline service in areas where it feels no longer economically justified providing it. It ultimately means dismantling communications infrastructure that has provided reliable voice telephone service for more than 100 years.

Voice Link is first being introduced as Verizon’s “sole service” for beleaguered residents living on the western half of Fire Island, which was devastated by last fall’s Hurricane Sandy. Verizon does not want to foot the bill to rebuild and repair the damaged copper wire infrastructure and does not believe installing its fiber optic network FiOS is economically justified either. That leaves residents with one option for basic phone service: Voice Link.

Unfortunately, many of the residents now encountering Voice Link have told the Public Service Commission it has proven unreliable or unsatisfactory and represents a downgrade from the landline service they used to have. (Stop the Cap! has repeatedly offered to test Voice Link’s workability and sound quality ourselves, but Verizon has not taken us up on that offer.)

The company does admit Voice Link is incompatible with basic data services, which means Verizon customers using Voice Link will lose DSL and dial-up Internet access. It also does not work with fax machines, home alarms, and medical monitoring services. Verizon has promised to address these issues in the future, but has offered no timeline or guarantees. Instead, it suggests customers consider purchasing added-cost services from Verizon Wireless, which could cost some residents hundreds of dollars a month for phone and broadband service.

Stop the Cap! believes Voice Link should be offered only as an optional service for customers who wish to use it. In its current form, it is unsuitable, unproven, and insufficient to serve as Verizon’s sole offering, particularly when the company is the carrier of last resort for many rural residents, as well as those on Fire Island.

At the very least, Verizon must be compelled to offer an equal or better level of service, not diminish it. That means better voice quality, rock solid cell coverage, an equivalently priced, unlimited wireless broadband service option for DSL customers, and compatibility with the data services that are now supported over the plain old telephone network.

The Commission should also explore the true costs of repairing and/or replacing wired infrastructure before allowing the company to dismantle it. Once the wired infrastructure is removed, the costs to provision rural New York with fast, reliable, wired broadband service in the future will become prohibitive. Wireless service is no panacea for rural New York, where coverage issues abound, especially in the mountainous areas upstate and across the rolling hills of the Southern Tier. Verizon’s lawyers admitted as much when they wrote the terms and conditions governing Voice Link and other wireless services, walking away from significant liability if calls to 911 go unconnected:

“In the absence of gross negligence or willful misconduct by Verizon, our liability to you, to anyone dialing 911 using the Service, or to any other person or party, for any loss or damage arising from any acts, errors, interruptions, omissions, delays, defects, or failures of 911 services or emergency personnel, whether caused by our negligence or otherwise, shall not exceed the amount of our charges for such Services during the affected period of time. This limitation of liability is in addition to any other limitations contained in this Agreement.”

In other words, Verizon’s only responsibility is to credit your account for the time you could not reach 911 or your call summoning help was dropped. You will see that credit reflected on a future bill, assuming you are still among the living when the emergency is over.

We strongly urge our fellow New Yorkers to share their personal views about Voice Link as a landline substitute with the PSC. This issue is important not only to Fire Island but to the rest of rural upstate New York as well, particularly pertaining to whether customers will have broadband service or not. Verizon management has clearly stated their agenda is to retire copper landline service and replace it with wireless in non-FiOS areas deemed too costly or unprofitable to keep up or upgrade.

Sharing your views is fast and easy and can be done in several ways. Be sure to reference “Matter/Case: 13-00986/13-C-0197” in your comments and include your contact information. All submissions will become publicly viewable on the Commission’s website under the “Public Comments” tab. You can find submissions from Stop the Cap! there as well.

Write (U.S. Mail):

Hon. Jeffrey C. Cohen, Acting Secretary
New York State Public Service Commission
Three Empire State Plaza
Albany, New York 12223-1350

E-Mail:

[email protected]

Online Comments:

You can post comments directly to the Commission’s Document and Matter Management System (DMM). Choose the “Post Comments” link on the upper-right of your screen. An online submission form will appear asking for your contact information. You can include your comments in the provided text box on that form or attach a .PDF, .DOC, or .TXT file.

“We just don’t see the need of delivering [gigabit broadband] to consumers.” — Irene Esteves, former chief financial officer, Time Warner Cable, February 2013

“For some, the discussion about the broadband Internet seems to begin and end on the issue of ‘gigabit’ access. The issue with such speed is really more about demand than supply. Most websites can’t deliver content as fast as current networks move, and most U.S. homes have routers that can’t support the speed already available.” — David Cohen, chief lobbyist, Comcast Corp., May 2013

“We don’t focus on megabits, we don’t focus on gigabits, we focus on activities. We go to the activity set to get a sense of what customers are actually doing and the majority of our customers fit into that 6Mbps or less category.” — Maggie Wilderotter, CEO, Frontier Communications, May 2013

“It would cost multiple billions” to upgrade Cox’s network to offer gigabit speeds to all its customers. — Pat Esser, CEO, Cox Communications, Pat Esser, chief executive of Cox Communications Inc., January 2013

“The problem with [matching Google Fiber speeds] is even if you build the last mile access plant to [offer gigabit speeds], there is neither the applications that require that nor a broader Internet backbone and servers delivering at that speed. It ends up being more about publicity and bragging. There has been a whole series of articles in the paper about ‘I’m a little startup business and boy it is really great I can get this’ and my reaction is we already have plant there that can deliver whatever it is they are talking about in those articles, which is usually not stuff that requires that high-speed.” — Glenn Britt, CEO, Time Warner Cable, December 2012

“Residential customers, at this time, do not need the bandwidth offered with dedicated fiber – however, Bright House has led the industry in comprehensively deploying next-generation bandwidth services (DOCSIS 3.0) to its entire footprint in Florida – current speeds offered are 50Mbps with the ability to offer much higher. We provision our network according to our customers’ needs.” – Don Forbes, Bright House Networks, February 2011

‘Charter [Cable] is not seeing enough demand to warrant extending fiber to small and medium-sized businesses — and certainly not to every household.’ — “Speedier Internet Rivals Push Past Cable“, New York Times, Jan. 2, 2013

Unless you live in Kansas City, Austin, in a community where public broadband exists, or where Verizon FiOS provides its fiber optic service, chances are your broadband speeds are not growing much, but are getting more expensive. The only thing innovative coming from the local phone or cable company is a constant effort to convince customers they don’t need faster Internet access anyway.

At least until a competitor threatens to shake up the comfortable status quo.

Time Warner Cable claims they are perfectly comfortable offering residential customers no better than 50/5Mbps, except in markets like Kansas City (and soon in Texas) where 100Mbps is more satisfying. Why is a glass Time Warner claims is full to the brim everywhere else in the country only half-full in Kansas City? Google Fiber might be the answer. It offers 1,000/1,000Mbps service for less money than Time Warner used to charge for 50Mbps service, and Google is also headed to Austin.

AT&T scoffed at following Verizon into the world of fiber optic broadband, where broadband speeds are limited only by the possibilities. Instead, they built their half-fiber, half-Alexander Graham Bell-era copper wire hybrid network on the cheap and ended up with broadband speeds topping out around 24Mbps, at least in a perfect AT&T world, assuming everything was ideal between your home and their central office.

At the time U-verse was first breaking ground, cable broadband’s “good enough for you” top Internet speed was typically 10-20Mbps. Now that incrementally faster cable Internet speeds are available from recent DOCSIS 3.0 cable upgrades, AT&T is coming back with an incremental upgrade of its own, to deliver around 75Mbps.

It is still slower than cable, but AT&T thinks it is fast enough for their customers, except in Austin, where Google Fiber provoked the company to claim it would build its own 1,000Mbps fiber network to compete (if it got everything on its Christmas Wish List from federal, state, and local governments).

Are you starting to see a trend here? Competition can turn providers’ investment frowns upside down and get customers faster Internet access.

Wilderotter: Most of our customers are satisfied with 6Mbps broadband.

In rural markets were Frontier Communications faces far less competition from well-heeled cable companies, the company can claim it doesn’t believe most of its customers need north of 6Mbps to do important things on the Internet. If they did, where would they go to do them?

Where Comcast and AT&T directly compete, major Internet speed increases are a matter of “why bother – who needs them.” Comcast is more generous where it faces down Verizon FiOS. AT&T also knows the clock is ticking where Google Fiber is coming to town.

Verizon FiOS, Google Fiber, and a number of community-owned fiber to the home broadband networks like EPB in Chattanooga and Greenlight in Wilson, N.C. seem more interested in boosting speeds to build market share, increase revenue to cover their expenses, and make a marketing point their networks are superior. They respond to requests for speed upgrades differently — “why not?”

Verizon figured out offering 50/25Mbps service was simple to offer and easy to embrace. Two clicks on a FiOS remote control and $10 more a month gets a major speed upgrade for basic Internet customers that used to get 15/5Mbps service. Verizon management reports they are pleased with the number of customers signing up.

In Chattanooga, Tenn. EPB Fiber offered gigabit Internet service because, in the words of its managing director, “it could.” The community-owned utility did not even know how to price residential gigabit service when it first went on offer, but the costs to EPB to offer those speeds are considerably lower over fiber to the home broadband infrastructure.

Broadband customers in Chattanooga, Kansas City and Austin are not too different from customers in Knoxville, Des Moines, and Houston. But the available broadband speeds in those cities sure are.

LUS Fiber in Lafayette, La. changed the song Cox was singing about their ‘adequate’ broadband speeds. Earlier this year, Cox unveiled up to 150/25Mbps service to cut the number of departing customers headed to the community owned utility, already offering those speeds.

Convincing Wall Street that spending money to upgrade networks to next generation technology will earn more money in the long run has failed miserably as a strategy.

“Competitors have been overbuilding, investors are wondering where the returns are,” said Mark Ansboury, president and co-founder of GigaBit Squared. “What you’re seeing is an entrenchment, companies leveraging what they already have in play.”

With North American broadband prices rising, and some cable companies earning 90-95% margins selling broadband, one might think there is plenty of money available to spend on broadband upgrades. Instead, investors are receiving increased dividend payouts, executive compensation packages are swelling as a reward for maximizing shareholder value, and many companies are buying back their stock, refinancing or paying off debt instead of pouring money into major network upgrades.

That is not true in Europe, where providers are making headlines with major network improvements and speed increases, all while charging much less than what North Americans pay for broadband service.

UPC Netherlands is Holland’s second biggest cable company and is in the middle of a broadband speed war with fiber to the home providers.

In the Netherlands, the very concept of Google Fiber’s affordable gigabit speeds terrify cable operators like UPC Netherlands, especially when existing fiber to the home providers in the country are taking Google’s cue and advertising gigabit service themselves. UPC rushed to dedicate up to 16 bonded cable channels to boost cable broadband speeds to 500Mbps in recent field trials, without giving any serious thought to the cable operators in the United States that argue customers don’t need or want the faster Internet speeds fiber offers.

“We had to address it head on very recently because of the fiber (competition)” said vice president of technology Bill Warga. “The company is called Reggefiber in the Netherlands. What they’re touting is a 1Gbps service, [the same speed] upstream and downstream. We came out with 500Mbps service. We had to build a special modem because (DOCSIS) 3.1 chips aren’t out yet. We had to double up on the chips in the modem and put it out there because we had to have a competing product, if anything just in the press. That was a reaction but that tells you how quickly in a marketplace that something can move.”

Despite that, groupthink among cable industry attendees back home at the SCTE Rocky Mountain Chapter Symposium agreed that Google Fiber was a political and marketing stunt, “since the majority of users don’t need those types of speed.”

Who does need and want 500Mbps? Executives at UPC, who have it installed in their homes, admits Warga. But cost can also impact consumer demand. Currently, the most popular legacy UPC broadband package offers 25Mbps for €25 ($32.50). The company now sells 60/6Mbps for €52,50 ($48.75), 100/10Mbps for €42,50 ($55.25) or 150-200/10Mbps for €52,50 ($68.25).

Warga also admits the competition has put UPC in a speed race, and boosted speeds are coming fast and furious.

“They’ll come in and say they’re 100, or 101Mbps we’ll come back and say we’re 110 or 120, or 130Mbps,” Warga said. “It’s a bit of a cat and mouse game, but we always feel like we can be ahead. For us DOCSIS 3.1 can’t come soon enough.”

[flv width=”640″ height=”367”]http://www.phillipdampier.com/video/WSJ Cable Broadband Speeds 1-13.flv[/flv]

The Wall Street Journal investigates why cable companies are getting stingy with broadband speed upgrades while gigabit fiber networks are springing up around the country. (4 minutes)