Imagine if your electric utility billed you for service based on a meter that was developed by the company, had no third party verification, no oversight by a Bureau of Weights and Measures, and wrote provisions into the company’s terms and conditions that allowed the company to terminate your service if you complained too much about the resulting bills.

Rethink possible.  AT&T.

When America’s largest phone company implements its arbitrary and unjustified Internet Overcharging scheme this May, it will bring its controversial usage meter to bear on every one of its broadband customers — a meter implicated in wild over-measurements of customers’ broadband usage — usage that will put customers perilously close to, or over the limits AT&T wants to establish.  The result?  Fat additional profits in the form of $10 overlimit penalties for every 50GB AT&T says you consumed for broadband traffic that costs them pennies to deliver.

The broadband usage meter is no stranger to controversy and lawsuits over accuracy issues.  Despite reflexive denials that a particular provider’s usage meter couldn’t be wrong, far too many have had to backpeddle and confess that the meter that should have measured $40 in usage and resulted in $4,000 bills instead “was in error.”

Whether providers are developing meters that are just flat inaccurate or are quietly putting a virtual finger on the scale to increase the opportunity of overlimit profits is unknown, but past history shows the meters typically overmeasure usage, not undercount it.

Without independent verification and ongoing oversight, some customers wonder if AT&T is sticking a virtual finger on AT&T's usage scale.

Some recent past history:

• Telstra is Australia was implicated in December for a wireless usage meter that occasionally reported more than three times the usage measured by wireless phone owners’ built-in usage measurement tools.  Company representatives ended up crediting some customers as much as $3500AUD in inappropriate overlimit fees that should never have been charged.  Complaints continue to arrive as late as February about overbilling;
• Telecom New Zealand’s usage meter overmeasured usage this month resulting in overcharges and throttled speeds under the ISP’s “fair use policy.”  One customer was billed for 27GB of usage during one overnight period, despite the fact the computer was switched off;
• BT in the United Kingdom confirmed it overbilled some of their broadband customers in February when their usage meter measured usage for customers who had switched their computers off or took them away on holiday.  As far as BT was concerned, those computers were still at home and still racking up web usage.  Only last week, the company finally confessed their meter was inaccurate — overmeasuring usage that never happened;
• AT&T’s counterpart in Canada — Bell, cannot manage to measure customer usage correctly either, so it suspended its usage tracker tool temporarily.  In February, one customer tired of overbilling proved a point when he took his computer to the United States just to guarantee it could not go near Bell’s network.  The result?  Bell said he used 500MB anyway;
• In February, a class action lawsuit was filed against AT&T for “overmeasuring” wireless usage in some instances by up to 300 percent;
• Last fall, Verizon was forced to refund $25 million dollars for phantom data usage charges for service many customers claimed they never used.

In virtually all of the prior incidents, a common pattern emerges, usually ending when providers fall on their swords, admit error and issue refunds:

• Phase 1: Initial denials from providers there is a problem with the meter, usually blaming the customer, the customer’s measurement tool, or the process used instead;
• Phase 2: Once proven to be an issue, an effort to downplay its significance and impact with claims that only a “tiny” percentage of customers were affected;
• Phase 3: Refusal to submit usage meters, wholesale costs, and other components of Internet Overcharging to third-party verification;
• Phase 4: Refusal to allow an independent audit of customer accounts to verify overbilled customers were properly refunded every penny of excess charges;
• Phase 5: Class action lawsuit or government investigation commences;
• Phase 6: Settlement reached with refunds or low value coupons to customers who take the time to request one;
• Phase 7: Report excess profits from unclaimed refunds on balance sheet.

In too many cases, multi-billion dollar telecom companies that rely on those meters to measure and bill customers for their usage were implicated not for undermeasuring usage, but overmeasuring it — often substantially.

Some AT&T customers are already disturbed with what could be history repeating itself.  A reader of Broadband Reports in Skokie, Ill., compiled his own detailed analysis and found AT&T’s measurement tool grossly overmeasured his usage, and even worse, couldn’t do simple math and overmeasured him again when adding up his daily usage totals:

AT&T said that I had used 361GB in a single month! Surely this couldn’t be right. I’m a heavy user, but every time I even so much as glanced at my usage stats they’ve always been in the 200GB range. Surely something was amiss, so I decided to dig deeper.

It’s an old habit, but the first thing I do when I suspect something is wrong with any bill is enter all the line items into a spreadsheet and add them up myself. It sounds like busywork, but sometimes you’ll catch unlisted charges that have been phantomly added to your bill, or occasionally an outright math error. I couldn’t believe what I found. AT&T’s usage meter results insist I had used 341.39GB down, and 20.18GB up. But when I added all the daily detail entries (the DSL equivalent of a call log), only 332.8GB down and 0.72GB up are accounted for.

AT&T is claiming that I used 361.57GB of data, but according to their own daily data I only used 333.52GB, an 8.5% overcharge.

This AT&T customer discovered AT&T overmeasured his usage far more than it undercounted it. (Lines above the baseline show downstream traffic AT&T overmeasurement; lines below show undercounted usage. Click to enlarge.)

In total, this particular customer reports his usage was overmeasured by a whopping 33 percent. He is not alone.  A robust thread of similar results is active on Broadband Reports.

AT&T’s response to the early criticism follows the same path taken by other providers, starting with denials.

“We’re addressing ways we can make the labels and information on the online metering tool more clear for customers between now and May (when the new policy goes into effect),” said AT&T spokesperson Seth Bloom.  “I can also assure you our team is performing checks everyday to ensure accuracy.  That said, we believe we have an accurate tool.”

“Other tools may measure at different 24-hour periods than we do, and most likely do not take into account the standard network protocols (e.g. Ethernet, IP) that are used to provide applications and content to our customers via the Internet.  As you know, this is fairly standard to incorporate when measuring broadband traffic and is applied by other ISPs who measure usage.”

Customers and columnists alike are worried about AT&T's new data limits. This Milwaukee Journal-Sentinel columnist is not thrilled, and neither are customers who overwhelmingly want unlimited broadband access.

“In the end, AT&T expects the caps to impact only the aforementioned 2% [that comprise its heaviest users].”

With the right level of over-measurement, virtually anyone can be a member of the “2% Club.”  One customer told Connected Planet AT&T was already overmeasuring her DSL account by as much as 4,700%.

How can you measure your usage to compare against AT&T?

“It’s not hard to maintain independent usage statistics to double-check AT&T’s numbers,” says the Broadband Reports reader in Skokie. “If you have a DD-WRT compatible router, it will keep your upload and download history automatically. If you don’t have a compatible router, you can still run WallWatcher or MRTG to get the total bandwidth used by your router. Finally, if your computer is connected directly to your DSL modem without a router, you can run software like Net Meter to track your internet usage.”

Customers inconvenienced by unnecessary usage meters which threaten to expose them to unjustified overlimit fees is just one more reason why we call out these Internet Overcharging schemes.  Call AT&T and let customer service know you intend to switch providers if AT&T implements their usage cap scheme in early May.  Tell them regardless of what kind of usage you incur each month, you cannot afford the chance AT&T’s apparently inaccurate usage meter could expose you to a higher bill.  Tell them you don’t want the hassle, and the only way you will remain as a customer is if they do away with the entire scheme.

Bell's Broadband Shell Game (image: Dave Blume)

The digital equivalent of a Trojan Horse was laid at the feet of Canadian telecom regulators Monday when officials from Bell, Canada’s largest phone company, announced they were withdrawing their controversial proposal to mandate usage-based billing on all wholesale broadband accounts.

The original proposal would have mandated that independent Internet Service Providers bill each of their individual customers a monthly fee based on their Internet usage in addition to the wholesale access rates paid to Bell all along.  The pricing proposal would have forced every ISP in Canada to abandon flat rate Internet service, raise prices, reduce usage allowances, and increase overlimit penalties.

Now Bell has told the Globe & Mail newspaper it wants to introduce something called “Aggregated Volume Pricing” instead — a plan Bell claims will shift financial penalties for “high usage” away from individual customers and onto the ISPs themselves. Bell also slashed the proposed overlimit fee from a heavily-defended-as-fair $2.50 per gigabyte to a more modest $0.30/GB, perhaps echoing AT&T’s forthcoming overlimit fee.

In fact, Bell’s revised plan is the same Internet Overcharging scheme under a new name.

The radical reduction in overlimit fees only further illustrates the “phoney-baloney” of providers attempting to monetize broadband usage under the guise of “fairness” and “congestion relief.”  Last week’s ’eminently fair’ $2.50 is this week’s ‘more than reasonable’ $0.30.

Bell exposed their hand — showing they have been bluffing about congestion all along.  An analysis of the proposed rates shows the company is still trying to target “heavy users.”  But instead of penalizing them into reducing their consumption, Bell is now seeking to monetize that usage, not control it.  By shifting aggregate usage costs to the wholesale market, Bell hopes individual customers will blame independent ISP’s for higher bills, not them.  Independent providers have to pass along their wholesale costs as part of the retail price of their service.  It’s a high tech shell game, one that consumers will always lose.

Despite this, Bell assumes the revised plan will take the bipartisan heat off its backside since it first proposed doing away with flat rate Internet service in Canada.

“With our filing today, we are officially withdrawing our UBB proposal,” said Mirko Bibic, Bell’s head of regulatory affairs. “Let’s move on, in my view, and use the CRTC hearing as an opportunity to approve those principles and get the implementation details right.”

"We don't like (Bell's proposal)."

Several Canadian officials were not impressed and one — Industry Minister Tony Clement — said exactly that.

Canada’s consumer groups and politicians have the giant telecom company on the run after using Bell CEO George Cope’s own words against him.  Cope openly admitted in conference calls with investors UBB had everything to do with monetizing broadband usage for profit.

Bell’s attempt to serve warmed-over Internet Overcharging from a new recipe isn’t flying among consumer groups either, who recognize it as more of the same leftovers, just under a new name.

Bill Sandiford, who heads a coalition of wholesale ISPs called the Canadian Network Operators Consortium, told the Globe & Mail Bell was simply presenting its usage-based pricing model in a more acceptable guise.

“We don’t think this is an about-face. It’s the same thing, just dressed up differently,” Mr. Sandiford said. “We don’t like it. It’s still wholesale UBB.”

Openmedia.ca, an online activist group, said Bell’s new proposal shows consumers are having an impact, but the fight is by no means over.

“We’re pleased that Canadians will now have the option to use indie ISPs like Teksavvy and Acanac to access the unlimited Internet,” said OpenMedia.ca’s Executive Director Steve Anderson. “This is a giant step forward for the Stop The Meter campaign, and a victory for those who support competition and choice in Canada’s Internet service market.”

“While this is a positive move, it is only a Band-Aid solution to a much larger problem. We at OpenMedia.ca hope the CRTC takes Bell’s submission as a sign that widespread usage-based billing is not an acceptable model for Internet pricing, and that it creates policy to support the affordable Internet.”

Phillip "I've heard this all somewhere before" Dampier

Shaw Communications today suspended its Internet Overcharging scheme as Canada’s firestorm over Internet Overcharging continues.  Western Canada’s largest cable company is taking a page from Time Warner Cable’s 2009 failed playbook and promising a ‘listening tour’ to “hear the views” of their customers on the subject of usage-based billing.

Evidently, the half-million Canadians signing Openmedia’s petition rejecting this kind of pillage pricing out of hand isn’t sufficient, nor are polls showing overwhelming opposition to the end of flat rate usage plans in the country.  So in a bold PR move, Shaw is throwing the doors open to listen to their customers.*

It’s all just wonderful….  Hey, wait a minute.  Is that a speck on my monitor?  What is that spot at the end of the sentence up there?

Uh oh, it’s an asterisk.  I’d better scroll down to find out what that is all about:

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Are you still with me?  We’re on a tour of our own….

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This part of the tour is brought to you by Shaw.

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(*- If you want to be involved in the discussions, which are being held face to face – then you’ll need to email [email protected] to ask for an invite.  Use “Please send me an invitation to attend the Internet usage discussion” as the subject line.)

Oh.  You have to be “invited” to attend.  Because I need permission to speak my mind about Shaw’s overcharging schemes.

Yes folks, it’s all very reminiscent of the Tweeting Trio at TWC back in 2009, who promised us they’d value our feedback, right up until we learned they deleted it, unread.

It’s really quite simple.  The overwhelming majority of Shaw customers are already paying good money for the service they receive today, and they don’t want to pay a penny more.  Shaw is not hurting financially — Internet Overcharging just adds more sugar to the quarterly financial reports.

But Shaw persists in writing replies like this to those writing them on the subject:

Thank you for your interest in voicing your opinion over this controversial topic.

We will be posting a detailed signup form within the next week or so once we get venues arranged. Times will also be posted once venues are established. At this point in time though, only customers like yourself will be invited to attend. Please check back on the 14th of February (Monday) for the posted meeting dates and times. The site to visit will be: http://shaw.ca/Internet/New-Data-Usage/

In its current form, UBB has been put on hold until we can determine the more customer friendly approach to this topic. It will still be rolling out as the objectives are the same – increase overall effectiveness of the network, manage the high users, and improve overall functionality/customer experience with our products. As the current model has caused all kinds of backlash from our customer population, your input as to what would make the process amicable to you would be appreciated.

If you have any other questions or concerns, please don’t hesitate to contact us.

Cheers,

Neil – Rep 7368

eCare Team

Shaw Cablesystems GP

The “customer friendly approach” to Internet Overcharging is not to engage in it.  The “signup form” and meeting dates provide Shaw with a nice list from which to handpick those selected to attend.  What they’ll be treated to is a circus of slides showing why Shaw simply must overcharge Canadians for their Internet service.  There is no surprise why ordinary citizens have caused all kinds of backlash.  These wounds are self-inflicted.

A better idea is to set up an independent debate on the subject, say with representatives from Shaw and Openmedia.ca and let the truth prevail.  Throw the doors open to anyone who wants to attend.  If Shaw wants to really listen, let them hear.

Unfortunately, I fear Shaw is not in a listening mood, otherwise they would scrap their usage based billing schemes and deliver quality service at a fair price, no invitation required.

"This will never end well."

Stop the Cap! and our allies Free Press teamed up to expose Frontier’s usage limits for what they are — a broadband ripoff.

KOVR-TV in Sacramento ran an excellent piece on Frontier’s latest embarrassing screw-up: driving their declining landline broadband customers away with unjustified and arbitrary usage caps.

One new piece of the story: Frontier could bring its usage rationing sideshow to a community near you.  As Stop the Cap! informed readers from the beginning, the company has quietly been tracking customers’ usage, looking for outliers they can suggest are using too much.  Now the company says it is ready to drop the hammer on heavy users.

Stephanie Beasly, Communications Manager — Frontier Communications:

“The company letters were sent to customers that are using an excessive amount of the network. Well beyond any reasonable amount for an average user and significant enough to negatively affect other customers’ user experience.

The letters are meant to communicate to these customers that their usage is in excess and we would like to work with them to adjust their plan or their usage. In most cases our customers were not aware of their usage patterns and are willing to work with us to adjust their plans to fit their lifestyles. We do not have a customer capacity on our network. We are looking to work with these customers to help prevent degradation on our network to ensure the customer experience.

The pricing structure was put in place to help us maintain the network experience for all customers. If you choose to use a significant amount of bandwidth we believe you should pay for the service accordingly.

The letters were sent to four markets across the company. We routinely review network usage patterns and these users jumped out as consuming an inordinate amount of bandwidth, enough to negatively affect other customers’ user experience.

All of Frontier markets are reviewed for usage patterns as the markets receiving the letters were reviewed. These specific markets were not targeted.

The customers using an excessive amount of data negatively impact the network for other users. Preventing us from providing adequate bandwidth to all of our users during peak and non-peak times.”

There is less and less to like about Frontier Communications, despite the fact they plan to deliver broadband service to rural Americans unlikely to see it from anyone else.  We’re glad someone is willing to provide the service, but 1-3Mbps broadband with arbitrary usage limits and potentially confiscatory pricing ($250 a month for residential customers), is a trade the devil might make.

Stop the Cap! will continue to organize opposition to Frontier’s foolish pricing schemes wherever they appear.  We will help customers find an alternate provider wherever possible, preferably one that remembers a customer should be treated like gold, not mined for it.

In suburban Sacramento, we highly recommend SureWest — a fiber-to-the-home service provider that not only has no Internet Overcharging scheme, but provides service at speeds that frankly embarrass Frontier’s last-century DSL.  They will even cover up to $200 of any early cancellation fee Frontier charges (and if Frontier tries, we want to know about it).

Our reader, Mr. Brown, was pleasantly surprised to find that SureWest’s speeds just blow Frontier out of the water.  He’s saying goodbye to his 6/0.5Mbps DSL line from Frontier and hello to 25/25Mbps service from SureWest that will also save him $10 a month!  He is also happy to see the back of Frontier’s Overcharging Nanny telling him to get off the Internet.

“[These caps] are a slippery slope and Internet providers need to know that action such as these will result in lost profits,” Mr. Brown wrote on KOVR’s website.  Departing customers typically drop -all- of their Frontier services, costing the company landline revenue as well.

Indeed, Frontier continues to lose more landline customers than its adds, and bungling policies like overcharging for Internet service will only accelerate the departure of angry customers.

Unfortunately, Frontier’s failures extend way beyond their broadband service.

The golden parachute for some, just not for you.

Frontier’s way of doing business has:

• given customers one more reason to cancel their landline service;
• ruined a fiber-to-the-home service that a child should be able to market successfully;
• irritated subscribers with “price protection agreements” that are little more than tricks and traps — delivering all of the protection to Frontier’s bottom line and making you pay the price;
• destroyed what few reasons remain for customers to waste their time with DSL broadband wherever cable or municipal providers exist;
• delivered big dividends and results only to shareholders, siphoning away important financial resources needed to upgrade their facilities.

In Everett, Washington Frontier cannot even manage the steady flow of customers canceling FiOS video service after news of a shocking $30 a month rate increase.  After telling customers they should “upgrade” their Frontier service to DirecTV satellite, those customers that tried encountered news that DirecTV never heard of the promotion Frontier was offering:

Two hours on the phone, six customer service people and a disconnected call — it wasn’t the introduction to DirecTV that one local man had hoped.

A FiOS television customer, Rick Wright sought to take advantage of an offer made last week by Frontier Communications and its partner, DirecTV.

[…]When Wright called initially, the Frontier customer service person was familiar with Frontier’s offer and transferred Wright to DirecTV to get an installation date before cancelling his FiOS TV service. At DirecTV, Wright spoke to six people over a two-hour span before being disconnected. Wright called back to DirecTV the following day only to be told that he was misinformed about the offer. Frontier spokeswoman Stephanie Beasly said Thursday that she was taking care of Wright’s problem.

On Friday, more than a week after Frontier first announced its new offer, Wright said his television service still remained up in the air. Several other FiOS television customers in Snohomish County reported difficulty in getting the free DirecTV offer.

Late last week, Frontier acknowledged some miscommunication between the company and its partner, DirecTV. On Thursday, Beasly said she believed those issues had been resolved. She did not return a request for further information Friday.

DirecTV spokeswoman Jade Ekstedt suggested in an e-mail that FiOS customers should contact Frontier directly for assistance.

“The offer … is a valid Frontier Communications promotion that includes DirecTV service, and DirecTV always works with its partners on valid offers that they introduce into market,” Ekstedt wrote, when asked whether DirecTV is honoring Frontier’s offer.

Complaints are arriving at a steady pace, reports the Washington State Attorney General’s office.

This is a story that never ends well.  But don’t worry — the executives responsible for the notorious bungling have their spots on the compensation lifeboats already reserved.  Too bad customers will likely go down with the ship.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/KOVR Sacramento Call Kurtis Bill May Triple For Excessive Internet Usage 1-13-11.mp4[/flv]

KOVR-TV in Sacramento worked with Stop the Cap! and Free Press to develop this story about Frontier’s unjustified Internet Overcharging schemes.  (4 minutes)

Commissioners of the National Telecommunications Commission (NTC), led by its chair Gamaliel Cordoba (middle, in blue shirt) preside in a public hearing Tuesday on the proposed circular requiring broadband data limit for consumers and minimum broadband speed for service providers. The event, which was held at the NTC main office in Quezon City, was attended by various industry stakeholders, including telcos, bloggers, and consumer advocacy groups. Photo by Melvin Calimag; Courtesy: GMANews.tv

Philippine consumers won a major victory this morning, successfully stripping language permitting Internet usage limits from a broadband reform measure before the country’s telecommunications regulator.

In a newly revised draft, this language written by and for some of the nation’s largest telecom providers was removed after a major consumer push-back:

“WHEREAS, it has been observed that few subscribers/users connect to the internet for unreasonably long period [sic] of time depriving other users from connecting to the internet; NOW, THEREFORE… Service providers may set the maximum volume of data allowed per subscriber/user per day.”

Consumer rights group TXTPower was instrumental in exposing the provider-written language and generating a groundswell of opposition to broadband usage limits.  The group’s leader Tonyo Cruz said Internet Overcharging schemes like usage caps deliver all of the benefits to providers while limiting consumer access and increasing bills.

“The adoption of [usage caps] will destroy social media in the Philippines and affect businesses,” Cruz told commissioners at a National Telecommunications Commission public meeting attended by consumers.

Cruz compared broadband in the Philippines with a turtle race.

“Imposing caps would be like putting speed limits on slow-moving turtles,” he said.  “It is one thing for telcos to say that a small percentage of consumers abuse their networks, but is another and more important thing to know whether they actually deliver the promised services and whether they have at the moment or in the future the capacity to deliver them.”

Cruz says his group doesn’t oppose providers dealing individually with consumers who use their accounts to the point of creating problems for other users on the network, but a blanket usage limit punishing every Filipino was unacceptable.

The issue rapidly became a political hot potato when ordinary Filipinos contacted their elected representatives to protest the measure.

Kabataan Partylist representative Mong Palatino put the Commission on notice: “NTC’s draft memo [including usage caps] is clearly anti-consumer and regressive. It tramples on the rights of the consumers to get what they pay for in terms of a reliable Internet service,” Palatino wrote in a widely distributed statement. “By allowing telcos and Internet Service Providers (ISPs) to limit Internet speed and connection, NTC seemingly wants the whole nation to regress to an Internet era that is much slower and highly unstable,” Palatino explained.

For Cruz, the entire argument for usage caps and the complaints about consumers using too much Internet service “ring weird.”

“The telcos who complain about over-use are the same companies actively encouraging consumers to use the Internet and become avid Internet users, to watch and upload videos and photos,” Cruz noted.

Cruz and other consumer activists want the Commission to hold additional public hearings, and stream them live over the Internet.