Time Warner Cable’s Business Class division has introduced new high-speed broadband packages designed for at-home teleworkers and telecommuters. But unless you need the advanced security, prioritized repair, and assurances that your Business Class online traffic will take precedence over residential traffic on Time Warner’s broadband network, you may be better off with residential service.

Four Teleworkers Solutions broadband bundles are now available in New York, New England and the Carolinas:

There is a setup fee for $75-150, a $23 fee for a static IP (free with Basic Plus or Premium Plus service), and rates are guaranteed for 1-3 years depending on the final contract. Businesses with 20+ telecommuter accounts will receive a volume discount.

In contrast, the best available residential promotional price for broadband-only 50/5Mbps service in the northeast outside of New York City is $78.94 a month, which includes the modem rental fee, does not include a Wi-Fi router, and is good for 12 months before the prices increases.

Let the gouging begin. Here was the price being charged by an eBay vendor this past Tuesday for the SB6141 cable modem.

A few days ago, Stop the Cap! notified readers Time Warner Cable was planning to charge a $3.95/mo modem rental fee for current High Speed Internet customers planning to keep using company-supplied equipment.

With over $300 million in potential new revenue, this new surcharge from the folks living high on 1% Mountain is guaranteed to make the cable company a tidy sum for doing… absolutely nothing. Time Warner is not improving your broadband service — they are just charging you separately for a piece of equipment needed to use the service you already paid for. It would be like selling you a lamp and then start charging an extra monthly fee to keep the power cord.

We’ve had our own illuminating experience here at Stop the Cap! headquarters finding our way around this newest surcharge — by purchasing our own DOCSIS 3 cable modem and sending the soon-to-be $47.40 a year (until the end of time) Ubee modem packing back to Time Warner. Only we can’t.

I am unsure what bothers me more: Time Warner’s scanty “approved modems for purchase list” — mostly Cadillac-priced models that would fit in at Barney’s New York or Nordstrom, the bottom feeder eBay and Amazon Marketplace sellers who are capitalizing on the modem fee by increasing their prices for customer-owned equipment to gouging levels, or Time Warner’s failure to activate customer-purchased modems because it “changed its billing system this week” in preparation for the new modem fees “and can’t activate customer owned modems at the moment.”

As Time Warner Cable customers began ordering the SB6141 online, the price doubled. This is the same vendor that charged $99.95 two days earlier.

Out of the five “approved” models, the obvious best choice for those who do not require a modem-router combination is the Motorola SurfBoard SB6141 DOCSIS 3.0 Cable Modem. It features support for 8×4 DOCSIS 3 channels, which in non-technical terms means it will handle the best speeds Time Warner is likely to offer in the foreseeable future. We do not recommend customers invest in DOCSIS 2 modems, because that technology is closer to the end of its useful life and simply will not support broadband speeds customers will crave in the next few years.

Once Time Warner Cable made the announcement, the race was on… for the handful of online retailers carrying the SB6141 to jack up the price as quickly as possible. I predicted this was likely in the comment section of our earlier piece. When the nation’s second largest cable operator plans to subject millions of broadband customers to unnecessary modem rental fees and smart customers are clever enough to avoid them, demand is going to rise. Prices would rise much faster.

In the last 48 hours, the cost of the SB6141 has literally doubled from $99 to $200 thanks to some eBay sellers looking for quick profits. This unit is now barely available from Amazon.com Marketplace vendors, typically with a waiting list, for around $130. It was selling for as little as $89 just a few weeks earlier. We even found some refurbished units on eBay that formerly sold for less than $100 now selling for $199, just after Time Warner’s new fee hit the media.

Buying a refurbished unit won’t save you much. Two days ago, this eBay vendor was charging $100 for the same used cable modem.

Finding retailers for this particular model has proven difficult and because of the relentless price gouging, we are now recommending customers hold off on buying their cable modems, at least until Time Warner expands their list of approved models or a broader number of retailers start selling the model to help force prices back down to earth. Don’t pay an eBay gouger twice the usual price!

For customers who mistakenly ended up buying our earlier recommended model we quickly crossed off the list (the SB6121), we’ve found Amazon.com especially accommodating, even supplying a prepaid return shipping label, after explaining the modem model mess to Amazon’s customer service and requesting a free return. So yes, we got stuck with the wrong model too. Sending the 6121 back is our best recommendation as Time Warner Cable customer service explained as late as this evening they cannot activate customer-owned equipment not on their approved-for-purchase list (or anything else at the moment).

Our second order, for the SB6141 at the pre-gouge price of $99 arrived this afternoon, and that led to more frustration with Time Warner Cable, who ultimately failed to activate the modem.

After a very lengthy hold time, a Time Warner representative took my modem’s MAC address to activate the device, and it failed to register. A supervisor eventually explained Time Warner Cable updated their billing system to accommodate the forthcoming modem rental charge and in the process brought down the customer-owned equipment activation system (the one that will let Time Warner know who will not have to pay the fee) earlier this week. In other words, while adjusting their billing system to charge you more, a “glitch” made it impossible for customers across the eastern United States to prevent that from happening.

The problem, it was explained, was temporary and they expected to fix it by the end of the week. After explaining today is Thursday (the end of the week is already near), I was told to “call back this weekend or Monday” and “hopefully” the problem would be fixed. Hopefully before October 15th, when the fee kicks in for the Big Apple anyway. That was 40 minutes of my life I will never get back.

One would think if Time Warner was planning to throw a Money Party for themselves, they would at least take some of the forthcoming $300 million to invest in a better way to keep customers from long hold times and inconvenience to avoid the latest unnecessary fee, only to be told everything was broken and to call back some other time. This is why cable companies regularly earn the disdain of their customers.

Time Warner Cable has lost between 10-15 percent of their analog cable television customers over the past year, according to Time Warner Cable president and chief operating officer Rob Marcus.

Speaking at this morning’s Goldman Sachs Communacopia Conference, Marcus noted the economic downturn has continued to cost the cable operator “single play” subscribers. Marcus noted that roughly 60 percent of the cable company’s customers are now on discounted or retention plans, and the company has no plans to reduce aggressive retention offers and promotions in the immediate future. Time Warner Cable will also exercise caution when customer promotions expire, an allusion to the company’s practice of gradually resetting rates to retail prices over an extended period of time to avoid antagonizing customers into switching providers.

Marcus acknowledged broadband is now a key service for Time Warner Cable, one that the company will continue to exploit to drive earnings. Some investors have complained Time Warner has only managed an increase of 2-3 percent in Average Revenue Per User (ARPU) for broadband, a key metric for Wall Street. Marcus was asked why Time Warner, with its superior market share over telephone companies, was not “exercising the price lever a little bit more” in a marketplace lacking serious competition.

Marcus

“I think it is fair to say that as the utility of the [broadband] product increases in customers’ minds, their willingness to pay for it (assuming they are able) goes up, so I think it stands to reason that we can continue to increase rates on high speed data,” Marcus said.

But even more important to Time Warner Cable is its differentiated broadband speed tiers, which the company is refining to pick up additional revenue and price-resistant customers. Broadband usage caps will be a part of that equation.

Marcus confirmed that Time Warner Cable will provide unlimited broadband packages to its premium tier customers, but will introduce usage-limited service on its budget tiers. Currently, the company only imposes a usage cap of 5GB on its Internet Essentials package, which offers a $5 discount off regular prices. But Marcus seemed to acknowledge that the company plans to experiment further with additional limits.

“We are going to deliver very fast speeds, unlimited consumption, and now mobile capability via our Wi-Fi network to those customers who demand it and are willing to pay premium prices for those tiers of service,” Marcus said. “At the other end of the spectrum we are going to have budget products as we do today that offer lower speeds, more limited consumption like our Internet Essentials product, and those probably won’t have access to our Wi-Fi hotspots. We think that is the best way to drive revenue and profitability.”

Marcus also told investors the company was working on the next generation of the company’s electronic program guide, which he said will be cloud-based. Time Warner Cable continues to signal it is willing to work with third party set top box manufacturers to let customers dump traditional set top boxes, but only so long as Time Warner Cable gets the credit in the minds of customers. The company is also working on rolling out video-on-demand for its online video apps.

Country Cablevision, a small cable operator providing service in the heart of the Blue Ridge Mountains in rural northwestern North Carolina, will deploy fiber to the home service to Mitchell and Yancey counties, home to more than 33,000 people, thanks to $25.3 million (75% grant/25% loan) from the U.S. Department of Agriculture’s Rural Utilities Service.

The money is intended to fund broadband expansion in areas currently not served by the cable operator. When the project is complete in 2013, 97% of all homes in both counties will have access to the fiber network. Faster Internet speeds and competitive phone service will also be available to area businesses, and medical facilities in both counties will enjoy improved high speed connectivity.

Country Cablevision is one of the first cable operators in the country choosing to upgrade to an all-fiber network instead of extending its current, traditional cable infrastructure into currently unwired areas.

Modern utilities came to rural America through some of the most successful government initiatives in American history, carried out through the United States Department of Agriculture (USDA) working with rural cooperatives, nonprofit associations, public bodies, and for-profit utilities. Today, USDA Rural Development Utilities Programs carries on this tradition helping rural utilities expand and keep their technology up to date, helping establish new and vital services such as distance learning and telemedicine.

The CWA’s Verizon-Cable Company Deal Monster

While Verizon customers in more than two dozen towns and communities around Boston can enjoy fiber optic broadband service today, residents inside the city of Boston cannot buy the service at any price. It is largely the same story in Syracuse, Buffalo, and Albany, N.Y., and Baltimore, Md.

With Verizon’s fiber network FiOS indefinitely stalled, local community leaders and union workers are more than a little concerned that Verizon is spending time, money and attention promoting a deal with the cable industry — its biggest competitor.

The Communications Workers of America is stepping up its protest of a proposed deal between Verizon’s wireless division and large cable operators including Comcast and Time Warner Cable that would result in cross-marketing agreements that sell cable service to Verizon Wireless customers and wireless service to cable customers.

The union is urging the Federal Trade Commission and the Federal Communications Commission to stop the deal because, in their view, it will destroy any further expansion of fiber optic-based FiOS, reduce competition, and raise prices for consumers.

The union notes that cable operators are not being asked to promote Verizon’s FiOS network, only Verizon Wireless’ phone services. Verizon Wireless, which barely mentions FiOS service in many of its wireless stores, would suddenly be promoting Comcast and Time Warner Cable instead.

The odd-network-out is clearly Verizon’s fiber optic FiOS service, which was originally envisioned as a competitor against dominant cable operators. But when the economy tanked, Verizon stalled fiber deployment, agreeing only to wire areas where the company already concluded negotiations with local officials. That leaves urban population centers in the northeast (except New York City) stuck with the cable company or Verizon’s DSL service, which has been become increasingly difficult to buy.

Verizon countered the deal would be good for consumers, especially those buying cable packages.

“We believe these agreements will enhance competition, allowing Verizon Wireless to take market shares from other wireless companies, while allowing cable companies to more vigorously compete by enabling them to offer wireless services as part of a triple or quad-play package of services,” the company said in a statement.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/CWA TV Ad Behind Closed Doors.flv[/flv]

The Communications Workers of America launched this new ad — “Behind Closed Doors” — last week in Washington, D.C., Virginia, and Pennsylvania media markets. (1 minute)

But union workers in FiOS-bypassed communities like Binghamton, N.Y. suggest customers will simply be on the short end of Verizon’s stick. They note the nearest city where Verizon is deploying fiber optics is suburban Syracuse — more than 70 miles to the north.

BALTIMORE: Left behind as FiOS spreads to six surrounding counties

BOSTON: No Internet revolution

ALBANY: The Empire State’s capital city has no FiOS

BUFFALO: Hit hard by the digital divide

SYRACUSE: Surrounded by high speed—but none for the city

[flv width=”580″ height=”380″]http://www.phillipdampier.com/video/WBNG Binghamton Union Fights Verizon Deal 8-8-12.mp4[/flv]

WBNG reported on a CWA-sponsored protest against Verizon’s deal with cable companies in FiOS-deprived Binghamton, N.Y.  (1 minute)