Ohio Gov. John Kasich is threatening to veto the state’s Agriculture Bill if it reaches his desk with telecom deregulation inserted as an amendment.

AT&T’s lobbyists in Ohio have convinced state legislators to ignore a veto threat from the governor’s office and insert a deregulation amendment into an unrelated water quality and agriculture measure.

Retiring House Speaker Bill Batchelder (R-Medina) is shepherding AT&T’s latest attempt at total deregulation through the Ohio House of Representatives, claiming it will break down barriers for businesses in Ohio and give new businesses the infrastructure they need to make Ohio their home. Among Batchelder’s top donors is AT&T.

Critics contend the measure will disconnect up to 5% of rural Ohio from all telephone service because they live in “no signal bar” areas of the state.

The amendment, inserted into HB490 (at Sec. 4905.71), would end AT&T’s requirement to serve as a Provider of Last Resort, which has guaranteed that every Ohio resident seeking telephone service has had it for nearly 100 years. If the measure passes, AT&T can unilaterally disconnect service and leave unprofitable service areas, mostly in rural and poor sections of the state. Current Ohio law only permits a telephone company to end service if it can prove financial hardship and show that reasonable alternatives are available to affected residents. AT&T earned $128.75 billion in revenue in 2013 and is unlikely to meet any hardship test.

Although AT&T is unlikely to stop service in suburban and urban areas, ratepayers across the state would lose oversight protections from lengthy service outages, unreasonable billing standards and credit requirements, the ability to quickly connect or disconnect service and access to important low-income programs like Lifeline. Rural customers could be forced away from traditional landline and DSL service in favor of AT&T’s wireless network, which costs considerably more.

Current AT&T customers in Ohio can subscribe to landline service for around $20 a month in rural areas and broadband DSL for as little as $15 per month. AT&T’s wireless alternative costs $20 a month for voice service and at least $60 a month for wireless broadband (with a usage cap of 10GB per month and an overlimit fee of $10 per gigabyte). An average landline customer consuming 20GB of data would pay $35 a month for both voice and data services. The same customer using AT&T’s wireless voice and data alternative would pay $180 a month, mostly in overlimit penalties.

AT&T’s lobbying has riled Ohio’s Republican governor, John Kasich, who has threatened to veto any agriculture bill that reaches his desk with telephone deregulation attached.

“The telecommunications language will force the governor to veto this bill, as he has personally said and has also been repeated several times by other members of the administration,” Jim Zehringer, director of the Ohio Department of Natural Resources told the Ohio Senate’s Agriculture Committee during an informal hearing on the legislation. “We would be sacrificing all the great work done so far on this bill if these provisions are not removed.”

The AARP is concerned the measure will not only hurt rural Ohio, but elderly and poor residents who cannot afford wireless service.

“They will only have wireless telephone service with no price controls or guarantees for low-income Ohioans in these areas,” AARP Ohio wrote in a released statement about the proposal. “Additionally, there are areas of Ohio where wireless service is minimal, and to provide the speed needed for those receiving tele-health services in those areas will be even more expensive.”

Interested Ohio residents can share their feelings with their state legislators and the governor’s office.

• Locate your Ohio House Representative: http://www.ohiohouse.gov/ or call 1-800-282-0253 and ask to be connected to your local representative.
• Governor John Kasich’s Office Phone: (614) 466-3555

AT&T CEO Randall Stephenson’s public hissy fit against the Obama Administration’s sudden backbone on Net Neutrality may complicate AT&T’s plans to win approval of its merger with DirecTV. forcing AT&T to retract threats to suspend fiber buildouts if the administration moves forward with its efforts to ban Internet fast lanes.

Hours after Stephenson told investors AT&T wouldn’t continue with plans to bring U-verse with GigaPower fiber broadband to more cities as long as Net Neutrality was on the agenda, the FCC requested clarification about exactly what AT&T and its CEO was planning. More importantly, it noted responses would become part of the record in its consideration of AT&T’s proposed acquisition of the satellite television provider. The regulator could not send a clearer message that Stephenson’s statements could affect the company’s $48.5 billion merger deal.

AT&T responded – four days after the FCC’s deadline – in a three-page letter with a heavily redacted attachment that basically told the Commission it misunderstood AT&T’s true intentions:

The premise of the Commission’s November 14 Letter is incorrect. AT&T is not limiting our FTTP deployment to 2 million homes. To the contrary, AT&T still plans to complete the major initiative we announced in April to expand our ultra-fast GigaPower fiber network in 25 major metropolitan areas nationwide, including 21 new major metropolitan areas. In addition, as AT&T has described to the Commission in this proceeding, the synergies created by our DIRECTV transaction will allow us to extend our GigaPower service to at least 2 million additional customer locations, beyond those announced in April, within four years after close.

Although AT&T is willing to say it will deliver improved broadband to at least “15 million customer locations, mostly in rural areas,” it is also continuing its fiber shell game with the FCC by not specifying exactly how many of those customers will receive fiber broadband, how many will receive an incremental speed upgrade to their existing U-verse fiber/copper service, or not get fiber at all. AT&T routinely promises upgrades using a mix of technologies “such as” fiber to the home and fixed wireless, part of AT&T’s broader agenda to abandon its rural landline service and force customers to a much costlier and less reliable wireless data connection. It isn’t willing to tell the public who will win fiber upgrades and who will be forced off DSL in favor of AT&T’s enormously profitable wireless service.

Your right to know… undelivered. AT&T redacted information about its specific fiber plans.

Fun Fact: AT&T is cutting its investment in network upgrades by $3 billion in 2015 and plans a budget of $18 billion for capex investments across the entire company in 2015 — almost three times less than what AT&T is ready to spend just to acquire DirecTV.

The FCC was provided a market-by-market breakdown of how many customers currently get U-verse over AT&T’s fiber/copper “fiber to the neighborhood” network and those already getting fiber straight to the home. But this does not tell the FCC how many homes and businesses AT&T intends to wire for GigaPower — its gigabit speed network that requires fiber to the premises. Indeed, AT&T would only disclose how many homes and businesses it plans to provide with traditional U-verse using a combination of fiber and copper wiring — an inferior technology not capable of the speeds AT&T repeatedly touts in its press releases.

That has all the makings of an AT&T Fiber Snow Job only Buffalo could love.

AT&T also complained about the Obama Administration’s efforts to spoil AT&T’s fast lane Money Party:

At the same time, President Obama’s proposal in early November to regulate the entire Internet under rules from the 1930s injects significant uncertainty into the economics underlying our investment decisions. While we have reiterated that we will stand by the commitments described above, this uncertainty makes it prudent to pause consideration of any further investments – beyond those discussed above – to bring advanced broadband networks to even more customer locations, including additional upgrades of existing DSL and IPDSL lines, that might be feasible in the future under a more stable and predictable regulatory regime. To be clear, AT&T has not stated that the President’s proposal would render all of these locations unprofitable. Rather, AT&T simply cannot evaluate additional investment beyond its existing commitments until the regulatory treatment of broadband service is clarified.

AT&T’s too-cute-by-half ‘1930s era regulation’ talking point, also echoed by its financially tethered minions in the dollar-a-holler sock-puppet sector, suggests the Obama Administration is seeking to regulate AT&T as a monopoly provider. Except the Obama Administration is proposing nothing of the sort. The FCC should give AT&T’s comments the same weight it should give its fiber commitments — treat them as suspect at best. As we’ve written repeatedly, AT&T’s fabulous fiber future looks splendid on paper, but without evidence of spending sufficient to pay for it, AT&T’s piece of work should be filed under fiction.

Rep. Marsha Blackburn (R-Tennessee, but mostly AT&T and Comcast)

Rep. Marsha Blackburn (R-Tenn.) is angry that FCC chairman Tom Wheeler is sticking his nose into AT&T, Comcast, and Charter Communications’ private playground — the state of Tennessee.

In an editorial published by The Tennessean, Blackburn throws a fit that an “unelected” bureaucrat not only believes what’s best for her state, but is now openly talking about preempting state laws that ban public broadband networks:

Legislatures are the entities who should be making these decisions. Legislatures govern what municipalities can and cannot do. The principles of federalism and state delegation of power keep government’s power in check. When a state determines that municipalities should be limited in experimenting in the private broadband market, it’s usually because the state had a good reason — to help protect public investments in education and infrastructure or to protect taxpayers from having to bailout an unproven and unsustainable project.

Chairman Wheeler has repeatedly stated that he intends to preempt the states’ sovereign role when it comes to this issue. His statements assume that Washington knows best. However, Washington often forgets that the right answers don’t always come from the top down.

It’s unfortunate Rep. Blackburn’s convictions don’t extend to corporate money and influence in the public dialogue about broadband. The “good reason” states have limited public broadband come in the form of a check, either presented directly to politicians like Blackburn, who has received so many contributions from AT&T she could cross daily exercise off her “things to do” list just running to the bank, or through positive press from front groups, notably the corporate-funded American Legislative Exchange Council (ALEC).

According to campaign finance data compiled by the Center for Responsive Politics, three of Blackburn’s largest career donors are employees and PACs affiliated with AT&T, Comcast and Verizon. Blackburn has also taken $56,000 from the National Cable & Telecommunications Association, the lobby for the big telecoms.

Combined, those organizations donated more than $200,000 to Blackburn. In comparison, her largest single donor is a PAC associated with Memphis-based FedEx Corp., which donated $68,500.

Phillip “States’ rights don’t extend to local rights in Blackburn’s ideological world” Dampier

Blackburn’s commentary tests the patience of the reality-based community, particularly when she argues that keeping public broadband out protects investments in education. As her rural constituents already know, 21st century broadband is often unavailable in rural Tennessee, and that includes many schools. Stop the Cap! regularly receives letters from rural Americans who complain they have to drive their kids to a Wi-Fi enabled parking lot at a fast food restaurant, town library, or even hunt for an unintentionally open Wi-Fi connection in a private home, just to complete homework assignments that require a broadband connection.

Blackburn’s favorite telecommunication’s company — AT&T — has petitioned the state legislature to allow it to permanently disconnect DSL and landline service in rural areas of the state, forcing customers to a perilous wireless data experience that doesn’t work as well as AT&T promises. While Blackburn complains about the threat of municipal broadband, she says and does nothing about the very real possibility AT&T will be allowed to make things even worse for rural constituents in her own state.

Who does Blackburn believe will ride to the rescue of rural America? Certainly not AT&T, which doesn’t want the expense of maintaining wired broadband service in less profitable rural areas. Comcast won’t even run cable lines into small communities. In fact, evidence has shown for at least a century, whether it is electricity, telephone, or broadband service, when large corporate entities don’t see profits, they won’t provide the service and communities usually have to do the job themselves. But this time those communities are handcuffed in states that have enacted municipal broadband bans literally written by incumbent phone and cable companies and shepherded into the state legislature through front groups like ALEC.

Chairman Wheeler is in an excellent position to understand the big picture, far better than Blackburn’s limited knowledge largely absorbed from AT&T’s talking points. After all, Wheeler comes from the cable and wireless industry and knows very well how the game is played. Wheeler has never said that Washington knows best, but he has made it clear state and federal legislators who support anti-competitive measures like municipal broadband bans don’t have a monopoly on good ideas either — they just have monopolies.

That isn’t good enough for Congresswoman Blackburn, who sought to strip funding from the FCC to punish the agency for crossing AT&T, Comcast and other telecom companies:

Marsha is an avowed member of the AT&T Fan Club.

In July, I passed an amendment in Congress that would prohibit taxpayer funds from being used by the FCC to pre-empt state municipal broadband laws. My amendment doesn’t prevent Chattanooga or any other city in Tennessee from being able to engage in municipal broadband. It just keeps those decisions at the state level. Tennessee’s state law that allowed Chattanooga and other cities to engage in municipal broadband will continue to exist without any interference from the FCC. Tennessee should be able to adjust its law as it sees fit, instead of Washington dictating to us.

Notice that Blackburn’s ideological fortitude has loopholes that protect a very important success story — EPB Fiber in Chattanooga, one of the first to offer gigabit broadband service. If municipal broadband is such a threat to common sense, why the free pass for EPB? In fact, it is networks like EPB that expose the nonsense on offer from Blackburn and her industry friends that claim public broadband networks are failures and money pits.

In fact, Blackburn’s idea of states’ rights never seems to extend to local communities across Tennessee that would have seen local ordinances gutted by Blackburn’s telecommunications policies and proposed bills. In 2005, Blackburn introduced the ironically named Video Choice Act of 2005 which, among other things:

• Would have granted a nationwide video franchise system that would end all local oversight over rights-of-way for the benefit of incumbent telephone companies, but not for cable or other new competitors like Google Fiber;
• Strips away all local oversight of cable and telephone company operations that allowed local jurisdictions to ensure providers follow local laws and rules;
• Prohibited any mechanism on the local level to collect franchise payments;
• Eliminated any rules forbidding “redlining” — when a provider only chooses select parts of a community to serve.

More recently, Blackburn has been on board favoring legislation restricting local communities from having a full say on the placement of cell towers. Current Tennessee law already imposes restrictions on local communities trying to refuse requests from AT&T, Verizon and others to place new cell towers wherever they like. She is also in favor of highest-bidder wins spectrum auctions that could allow AT&T and Verizon to use their enormous financial resources to snap up new spectrum and find ways to hoard it to keep it away from competitors.

Not everyone in Tennessee appreciated Blackburn’s remarks.

Nashville resident Paul Felton got equal time in the newspaper to refute Blackburn’s claims:

Rep. Marsha Blackburn is on her high horse (Tennessee Voices, Oct. 3) about the idea of the Federal Communications Commission opposing laws against municipal broadband networks, wrapping herself in the mantle of states’ rights. We know that behind all “states’ rights” indignation is “corporate rights” protection.

The last I heard, there was only one Internet, and anyone can log into Amazon or healthcare.gov just as easily from any state. Or any budget.

No, this is about the one Internet being controlled by one corporate giant (or two) in each area, who want to control price and broadband speed, and now want to link the two. They don’t want competition from any pesky municipal providers hellbent on providing the same speed for all users, at a lower price. Check the lobbying efforts against egalitarian ideas to find out which side of an issue Marsha Blackburn always comes down on.

But comments like these don’t deter Rep. Blackburn.

“Congress cannot sit idly by and let a federal agency trample on our states’ rights,” she wrote, but we believe she meant to say ‘AT&T’s rights.’

“Besides, the FCC should be tackling other priorities where political consensus exists, like deploying spectrum into the marketplace, making the Universal Service Fund more effective, protecting consumers, improving emergency communications and other important policies,” Blackburn wrote.

Remarkably, that priority list just so happens to mirror AT&T’s own legislative agenda. Perhaps that is just a coincidence.

Question: How will ripping out landline infrastructure in Kentucky help improve broadband service for rural areas?

Answer: It won’t.

This is not for a lack of trying though. AT&T has returned to the Kentucky state legislature year after year with a company-written bill loaded with more ornaments than a Christmas tree. In the guise of “modernizing” telecom regulation, AT&T wants to abolish most of it, replaced by a laissez-faire marketplace for telecommunications services not seen in the United States since the 1910s. AT&T claims robust competition will do a better job of keeping providers in check than a century of oversight by state officials. But customers in rural Kentucky have a better chance of sighting Bigfoot than finding a competitive alternative to AT&T’s telephone and DSL service. AT&T retains a monopoly in broadband across much of the state where cable operators like Time Warner don’t tread.

This year, Senate Bill 99, dubbed “The AT&T Bill” received overwhelming support from the Kentucky Senate as well as in the House Economic Development Committee. AT&T made sure the state’s most prominent politicians were well-compensated with generous campaign contributions, which helped move the bill along.

Since 2011, AT&T’s political-action committee has given about $55,000 to state election campaigns in Kentucky, including $5,000 to the Senate Republican majority’s chief fundraising committee and $5,000 more to the House Democratic majority’s chief fundraising committee. The company spent $108,846 last year on its 22 Frankfort lobbyists.

That generosity no doubt helped Republican Floor Leader Jeff Hoover find his way to AT&T’s talking point that only by “modernizing” Kentucky’s telecom laws would the state receive much-needed broadband improvements.

Hoover

Hoover is upset that the state’s House Democratic leadership stopped AT&T’s bill dead in its tracks, despite bipartisan begging primarily from AT&T’s check-cashers that the bill see a vote. Speaker Greg Stumbo, whose rural Eastern Kentucky district would have seen AT&T’s landline and DSL service largely wiped out by AT&T’s original proposal, would hear none of it.

He has been to AT&T’s Deregulation Rodeo before.

“When I served as attorney general, I dealt with deregulation firsthand to protect consumers as much as possible,” he wrote in a recent editorial. “In most cases, deregulation led to worse service and less opportunity to correct the problems customers invariably faced. It is now our job as House leaders to continue defending Kentucky’s consumers.”

Stumbo, like many across Kentucky, have come to realize that AT&T’s custom-written legislation gives the company a guarantee it can disconnect rural landline service en masse, but does not guarantee better broadband as a result.

“In fact, there is nothing in the legislation guaranteeing better landline, cell or Internet service,” Stumbo noted.

Hoover declared that by not doing AT&T’s bidding, Kentucky was at risk of further falling behind.

“This decision by Stumbo and House Democrat leadership, like many others, has unfortunately had a real effect on the lives of Kentuckians as we will go, at minimum, another year before these private businesses can focus on increasing broadband speed throughout the commonwealth,” he wrote. “It is another year in which we risk falling further behind our neighboring states and others in the competitive world of economic development.”

Stumbo

Stumbo responded the Republicans seemed to have a narrow vision of what represents progress. Hoover and his caucus voted against the House budget that included $100 million for a broadband improvement initiative spearheaded by Gov. Steve Beshear, Rep. Hal Rogers, and private interests.

By relying entirely on a deregulated AT&T, rural Kentucky residents may lose both landline and DSL service and be forced to wireless alternatives that come at a high price.

“There are citizens, many of whom are elderly or on fixed income, who depend on their landline or cannot afford more expensive options; these are the people I am fighting for,” said Stumbo. “I do not want to get a call from a family member who lost a loved one because that person could not reach a first responder in time.”

State residents watching the debate have increasingly noticed discrepancies between what AT&T wants and what it is promising Kentucky.

“No one has ever been able to satisfactorily explain to me how allowing phone companies to abandon landline service will help expand broadband Internet, especially since DSL service requires phone lines,” said H.B. Elkins, Public Information Officer at KYTC District 10.

Matt Simpson recognizes that Senate Bill 99 and other similar measures will not change the economic realities of AT&T’s for-profit business.

“Without regulation, the for-profit companies like AT&T are going to invest in the most profitable areas,” he wrote. “If they thought they could make a huge profit providing broadband in rural areas, they would already be doing it. Deregulation is not going to change that profit calculation. They will still view rural broadband as unprofitable, and they still won’t do it. The bill was a total giveaway to the industry, with no offsetting benefit to the consumers.”

Michael Yancy summed up his views more colorfully.

“The ‘AT&T bill should be classified as a sheep bill. It was all about pulling the wool over the eyes of the public,” Yancy said. “Anyone who thinks the people of Kentucky will benefit from more of the same, needs to make inquiries into moving the Brooklyn Bridge to the Ohio River.”

[flv]http://www.phillipdampier.com/video/KET Phone Deregulation Kentucky Tonight 1 2-19-13.mp4[/flv]

Kentucky Educational Television aired a debate between AT&T and the Kentucky Resources Council on the issue of telephone deregulation in 2013. The same issues were back this year in AT&T’s latest failed attempt to win statewide deregulation and permission to switch landline customers in rural Kentucky to less reliable wireless service. In this clip AT&T argues it should be able to shift investment away from landline service towards wireless because wireless is the more popular technology, but not everyone gets good coverage in Kentucky. (Feb. 19 2013) (3:00)

[flv]http://www.phillipdampier.com/video/KET Phone Deregulation Kentucky Tonight 2 2-19-13.mp4[/flv]

In this second clip, AT&T claims customers who want to keep landline service can, but Kentucky Resources Council president Tom Fitzgerald reads the bill and finds AT&T’s claims just don’t hold up under scrutiny. The carrier of last resort obligation which guarantees quality landline phone service to all who want it is gone if AT&T’s bill passes. Customers can be forced to use wireless service instead. (Feb. 19 2013) (4:33)

Comcast told the New York Public Service Commission that the overwhelming majority of the substantive comments submitted to the regulator “express a strong desire and enthusiasm for the improved and expanded voice, data, video, and broadband services” that the merger of Comcast and Time Warner Cable will bring to the state.

“Given these many concrete benefits, and the lack of any harm to competition or consumers, it should come as no surprise that the overwhelming majority of the substantive comments (approximately 110 out of a total of about 140 substantive comments) filed in this proceeding support Commission approval of the transaction,” Comcast wrote in its latest submission.[1]

Comcast’s “new math” applies a subjective (and undisclosed) standard about what constitutes “substantive,” but in the end the cable company has urged the Commission to disregard the sentiments of more than 2,700 New York State residents who have filed comments in strong opposition to the merger because their remarks simply fell beneath Comcast’s standards.

“The minority of organizations and individuals who filed substantive comments opposing the transaction largely ignore the significant public interest benefits of the transaction,” writes Comcast. “Instead, these detractors raise issues that are not relevant to the transaction and are factually inaccurate and speculative – such as unfounded concerns about Comcast’s broadband management practices, misplaced criticisms of Internet Essentials, and general fears that ‘big is bad.’ None of these commenters identify any reasonable basis to reject or condition the Joint Petition.”

Comcast did not apply the same rigorous standards of ‘substantiveness’ to comments sent by its supporters, who often used what New York Assemblyman Joe Morelle admitted was a Comcast-supplied template ghost-written by the company itself.[2]

“Supporters of the transaction span a wide range of groups and individuals, including governmental officials (e.g., mayors, town supervisors, county commissioners, city councils, state legislators, and school superintendents); businesses and non-profits; state and local organizations focused on economic development; community service, youth and family, and diversity organizations; arts and education groups; and others,” writes Comcast.

But the company never disclosed the many financial ties between Comcast and its political and civic supporters. In fact, a large percentage of the “template” letters of support originated from politicians like Assemblyman Morelle, who recently received a $1,000 check from Comcast[3] and Rochester city councilman Adam McFadden, whose group claims to receive $50,000 annually from Comcast.[4] [5]

In fact, it is hard not to find financial connections between Comcast’s supporters and the cable company itself. A random sampling uncovers multiple instances of Comcast contributions that were followed by letters of support for its merger:

The Urban League has received at least $12 million in in-kind contributions from Comcast since 2007, in addition to direct financial contributions to local chapters around Comcast’s service area.[6] In just one example Stephen Thomas, Comcast’s area vice president, who also serves on the Chicago chapter’s board of directors, presented the organization with a check for $40,000.[7] Just a few months later, Andrea L. Zopp, president of the Chicago Urban League, wrote to urge the FCC to approve Comcast’s merger deal.[8]

“Comcast is a strong supporter of the Urban League movement throughout the country. … I sincerely ask that you approve this transaction so that the Urban Leaguers and everyone else can benefit,” Zopp wrote.

Various chapters of the Boys and Girls Club also submitted glowing letters in favor of the merger. Comcast has partnered with local Boys & Girls Clubs since 2000, providing more than $68 million in cash and in-kind contributions. But no chapter was willing to openly admit Comcast asked them to share their views with New York regulators and only a few disclosed the financial ties the organization has with Comcast. The Boys and Girls Club has been a very loyal supporter of whatever Comcast has on its corporate agenda. Chapters submitted letters urging regulators to approve the Comcast-NBC merger in 2010 as well.[9]

Another strong supporter Comcast quotes from in its filing is the National Black Chamber of Commerce. But they don’t mention Comcast is a corporate sponsor of the group.[10]

Comcast (falsely) claims their $9.95 Internet Essentials is the country’s only discount Internet program for the disadvantaged. But Google Fiber gives it away for free to anyone who wants it.

Comcast also called criticism of its Internet Essentials discount Internet program “inaccurate and unavailing,” despite the fact the company’s own senior vice president David Cohen admitted the program was stalled to use as a political chip to win approval of its merger with NBCUniversal.[11]

Comcast also falsely claims it is the only Internet discount program for the poor of its kind.

“[Critics] simply advocate a different broadband adoption program – one that no company has ever implemented, that has never been attempted or even analyzed, and that may not be equally sustainable or popular or easy to publicize,” Comcast wrote. “Comcast is the only company to offer a program of this kind, and it has continually and voluntarily expanded the scope, breadth, and eligibility for and benefits of the program.”

In fact, it may have escaped Comcast’s attention that Google has provided residents in their fiber service areas with free Internet service with absolutely no income qualification or needs test, after paying a “construction fee” ranging from $30 in Provo, Utah [12] to $300 in Kansas City.[13] Residents in the latter community can break the somewhat steep construction fee into 12 payments of $25 each and have a guarantee of free service for up to seven years. Over the course of both programs, Google offers a more compelling and less expensive offer without onerous qualification requirements.

Yr    Google Fiber Cost  Comcast Internet Essentials Cost (@$9.95/mo)

1          $300                            $119.40
2          $0                                $119.40
3          $0                                $119.40
4          $0                                $119.40
5          $0                                $119.40
6          $0                                $119.40
7          $0                                $119.40

Over the course of seven years, a Google Fiber customer selecting discounted Internet would pay $300. A Comcast customer would pay $835.80 – a difference of $535.80.

While Google Fiber’s service area is very limited, it does offer an evidence-based challenge to Comcast’s inaccurate claim that its Internet Essentials program is unprecedented and represents the best solution for New York. A well-designed program designed to help New Yorkers will sell itself far better than the complicated, restrictive, and revenue-protection-oriented Internet Essentials, and its lack of penetration in long-standing Comcast service areas speaks for itself.

The California Emerging Technologies Fund also found serious problems with Internet Essentials from top to bottom.[14]

“Comcast makes the sign-up process long and cumbersome,” CETF claimed.[15] “The application process often takes 2-3 months, far too long for customers who are skeptical about the product in the first place, and have other pressing demands on their budgets. The waiting period between the initial call to Comcast and the CIE [Comcast Internet Essentials] application arriving in the mail can stretch 8-12 weeks, if it comes at all. After submitting the application, another 2-4 weeks elapse before the equipment arrives. Many low-income residents do not have Social Security Numbers (SSNs) and are required to travel long distances to verify their identities because Comcast has closed many of its regional offices. Recently, some potential subscribers with SSNs were rejected over the phone and told they had to visit a Comcast office. Comcast has a pilot effort in Florida that should be expanded to allow customers to fax or e-mail photocopied IDs as proof of identification.”

CETF also found widespread violations of Comcast’s own program rules when the cable company conducted credit checks on customers, which can reduce a customer’s already challenged FICO score with a credit inquiry on their file.

“Comcast conducts credit checks for some customers, contrary to CIE rules,” the CETF filing said. “Dozens of clients are receiving letters from Comcast saying that they have failed a credit check. Comcast specifically states and advertises no credit check is needed for CIE. This has repercussions beyond obtaining broadband service. The act of performing a credit check can negatively impact the consumer’s credit worthiness. Initially, some CIE service representatives told customers they could pay $150 deposit to avoid a credit check, also contrary to program rules.”

Customers have also been redirected to Comcast sales call centers, where they receive aggressive sales pitches for higher-cost products and services.

Comcast’s celebration of its commitment to minority television programming does not mention the expansion of minority programming was a condition of the FCC’s approval of the Comcast-NBCUniversal merger.

Among Comcast’s “compelling” minority programming that customers are asked to pay for: Baby First Americas, a network for bilingual infants aged 0 to 3.

Subscribers got less than compelling programming and more rate increases to pay for it.

National Public Radio noted Comcast’s new minority channels are not exactly drawing significant audiences[16]:

Out of the gate, well, first was Baby First America — for bilingual infants aged 0 to 3.

ASPiRE, a channel focused on African-Americans, is mostly reruns and talk shows. Writer Anita Wilson Pringle called the network’s programming “crap.”

Next came Aspire, a family-oriented network from ex-basketball star and entertainment impresario Magic Johnson. Its lineup includes reruns of The Cosby Show plus even older fare: Julia, Soul Train and The Flip Wilson Show.

Writer Anita Wilson Pringle, for one, is no fan of that lineup of TV retreads.

“He promised innovative, new fresh ideas, new fresh programming, and it’s not,” she says.

Pringle is upset that Aspire’s managers were merely reshuffled from the old Gospel Music Channel. And she says the people Aspire is supposed to serve — African Americans — don’t exactly need more reruns or talk shows.

“It’s crap, if you really want to know the truth,” she says. “But my thing is, they did this to break that monopoly that Comcast was having on all these stations, and all that has happened is that Comcast has a stronger monopoly.”

Comcast’s commitment to improve energy efficiency is comparable to Time Warner Cable’s own commitments, providing no net gain for New York consumers.[17]

Comcast’s promised commitments to deliver better customer service have been made annually for several years with no significant improvement, as measured by independent customer satisfaction studies. Comcast relies on a quotation from a Wall Street analyst, Craig Moffett, who provides only anecdotal evidence of customer service improvements and has supported the merger’s potential benefits for shareholders.

Comcast’s idea of effective competition is using your Verizon Wireless connection for home broadband use. A 16GB monthly plan will cost consumers as much as $170 a month before taxes and fees.

Comcast’s assertion that the Commission should ignore or downplay bad customer service experiences of customers outside New York is made despite their own admission they serve only a tiny number of New York customers today. Is Comcast suggesting it would be inappropriate to consider their customer service record in comparable-sized cities across the country, some likely served by the same national and offshore customer care centers New Yorkers will reach when they have future problems with Comcast?

Comcast’s claims of plentiful broadband competition also do not exist in the real world for many New Yorkers. The Commission has faced such a large number of complaints about Verizon landline service, which also supports DSL, it launched a Verizon Service Quality Improvement Plan. When a Verizon landline becomes inoperable for several months, as customers in Inwood experienced earlier this year[18], their DSL broadband is also inoperable. For customers served by cable, but not reached by DSL service from telephone companies like Verizon, Windstream, and Frontier Communications, their only realistic home broadband connection comes from the local cable company. Wireless broadband, advocated as a competitive alternative by Comcast, does not penetrate well indoors in large sections of rural upstate New York and is constrained by very expensive service plans and severe limits on data usage, compelling customers to pay excessive fees to obtain service.

A family consuming 16GB of data per month (less than today’s average use per person) would face Internet bills of $170 a month with Verizon Wireless ($40/mo Monthly Line Access – Internet Device + 16GB Data Plan ($130/mo Monthly Account Access)[19] Wired broadband accounts from Time Warner Cable in comparison cost as little as $14.99 a month for unlimited usage.

Where DSL service is available, it is typically offered at speeds lower than a cable operator can offer. As an example, at our residence in the Town of Brighton, N.Y., Frontier Communications can only offer a maximum speed of 3.1Mbps from their DSL service because of our distance from the central office.

Comcast will have a near-total monopoly on all broadband service in excess of 15Mbps in current Time Warner Cable territories not serviced by Verizon FiOS. Verizon’s maximum speed DSL offer is for speeds “up to 15Mbps.”[20] Verizon FiOS expansion outside of already-committed territories has ended, and the majority of upstate New York is not served by Verizon’s FiOS fiber upgrades.

Comcast claims there is a world of difference between highly regulated energy-generation utilities and the “competitive” marketplace for telecommunications.

“Proposals that the Commission approach this transaction with the same mindset, and apply the same types of burdensome conditions, are entirely unjustified,” argues Comcast.

“Electric and gas utilities remain the quintessential public service utilities,” says the cable company. “Their markets are characterized by a lack of competition, captive customer bases, and direct rate-setting and operational oversight by the Commission.”

In fact, many cable customers in New York do face a lack of competition for fast broadband speeds, are stuck with the single cable operator serving their community, and lack the consumer protections offered by the Commission that apply to other utilities.

The Commission can test Comcast’s claims of competitiveness for itself. Stop the Cap! offers a challenge to find more than one provider that can deliver consistent, widely obtainable broadband speeds of 15/3Mbps or greater in downtown Buffalo, Rochester, Albany or Syracuse.

The Commission will discover there is only one provider now capable of delivering that service across the entire urban centers of upstate New York: the local cable company.

In far western New York, Verizon FiOS is available only in small parts of South Buffalo and North Buffalo and select suburbs.

In Rochester, Frontier Communications does not offer consistent access to speeds greater than 10Mbps.

Albany and Syracuse are also bypassed by Verizon FiOS, left with Verizon DSL, which only offers speeds “up to 15/1Mbps.” Most customers get less.

Comcast would have the Commission believe any review of its broadband service is off-limits and outside of their jurisdiction anyway.

“The Commission has no authority to review broadband transactions and lacks statutory authority to regulate broadband services – and beyond this, cable broadband services are interstate information services that are not properly subject to state jurisdiction,” claimed Comcast.

It further argued the Commission must ignore “matters beyond the Commission’s jurisdiction,” quoting from a 2006 proceeding.

Comcast evidently forgets the law has changed in New York. In 2006, the Commission had to disprove a petition was in the public interest to reject it. In 2014, the applicant is solely responsible for carrying the burden of proof that their proposal is in the public interest.

Nothing in Section 222 of the Public Service Law places restrictions on what the Commission can consider when weighing public interest benefits.

Comcast’s claims of its wish to expand service into rural, unserved areas also must be questioned. Comcast automatically sets a high bar for expansion suggesting it will occur only “where economically feasible,” which is the same standard in place with the incumbent cable operator.

“Where economically feasible” is the reason cable companies in New York have rarely expanded their service territories, except in high growth areas where population density warrants expansion. All cable operators have an internal formula governing Return On Investment requirements that must be met before expansion begins. The Commission must review that information and compare the standards used by both applicants, because it will ultimately govern any future natural expansion of cable service in rural New York.

Conclusion

Comcast’s rosy picture of New York’s future with a merged Time Warner Cable-Comcast is belied by the real world experiences of New York consumers who have learned from long, hard experience that when a cable company starts promising a better deal, the result has too often been higher rates and fees, unwanted channels, poorer customer service, and new restrictions.

Don’t close your eyes to the facts.

Cable operators have enjoyed unfettered power to escape oversight with inflated claims of fierce competitiveness that they suggest will keep prices and abusive behavior in check, but in reality rates are rising and Comcast’s customer approval ratings live in the basement.

Comcast’s most recent filing continues to dismiss these very real concerns for New Yorkers who will not have a choice of a cable operator other than Time Warner Cable or Comcast. Calling the comments of more than 2,700 New Yorkers largely opposed to this merger “unsubstantive” is precisely the attitude of a cable company that has earned its bad reputation with customers.

Sending “templates” to politicians and non-profits that have received funding from Comcast and asking them to send letters to regulators urging approval of the company’s latest item on the agenda is the kind of “substantive” evidence Comcast wants the Commission to rely on in this proceeding.

But worst of all, Comcast suggests that any review of the company’s broadband service, its pricing and performance, and the potential for usage allowances and usage fees above and beyond the current high cost of Internet service is off-limits to New York regulators. The Commission already recognizes the growing importance of broadband in New York State and that it is, in reality, nearly a necessity.

Time Warner Cable recognizes that and is moving ahead on an upgrade program that delivers broadband benefits above those offered by Comcast and at a lower price, with no usage allowances or overlimit fees likely in the foreseeable future. It remains clear to us that Time Warner Cable is the better choice for New York. We have a well-documented history of not being great fans of Time Warner Cable, but we know worse when we see it, and we see it in Comcast.

[1] http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId={60D7F65E-3AAB-4507-B58D-7F14E31E130A}

[2] http://www.rochesterfirst.com/news/lawmakers-write-letters-supporting-comcast-deal/190434972

[3] http://www.rochesterfirst.com/news/lawmakers-write-letters-supporting-comcast-deal/190434972

[4] http://stopthecap.com/2014/08/11/rochester-city-councilman-adam-mcfaddens-love-for-comcast-and-the-50k/

[5] http://www.nlc.org/corporate-partnership-program/corporate-partners-program

[6] https://corporate.comcast.com/news-information/news-feed/national-urban-league-resource

[7] https://www.thechicagourbanleague.org/cms/lib07/IL07000264/Centricity/Domain/14/impact-jan-2014.pdf

[8] https://www.thewrap.com/consumer-groups-urge-fcc-to-reject-comcast/time-warner-cable-deal/

[9] https://ecfsapi.fcc.gov/file/7020462210.pdf

[10] https://www.nationalbcc.org/news/progress-reports/2107-recap-of-22nd-annual-conference

[11] http://stopthecap.com/2013/07/10/comcasts-internet-essentials-facade-padding-the-bottom-line-without-cannibalizing-your-base/

[12] https://fiber.google.com/legal/schedule/

[13] https://fiber.google.com/legal/schedule/

[14] https://arstechnica.com/information-technology/2014/07/comcasts-internet-for-the-poor-too-hard-to-sign-up-for-advocates-say/

[15] http://www.cetfund.org/files/140711_CETF_Partners_Comcast-TWC_FCC_PR_and_Filing.pdf

[16] http://www.npr.org/2013/11/12/244558834/comcast-deal-puts-new-minority-run-channels-in-play

[17] http://www.timewarnercable.com/en/about-us/corporate-responsibility/environment.html

[18] http://manhattan.ny1.com/content/shows/ny1_for_you/203064/ny1foryou–inwood-verizon-customers-want-phone-service-outages-to-stop

[19] http://www.verizonwireless.com/wcms/consumer/shop/shop-data-plans/more-everything.html

[20] https://www.verizon.com/?lid=//global//residential