Happy Days Are Always Here for Top Telecom Execs

Our friends at Fierce Cable put together a list of the top-paid telecommunications executives, and they’re in the money. Your money. While your rates keep going up, their take-home pay often is, too.

Remarkably, actual performance as executives (or lack, thereof) often had no relationship to their ultimate pay package, with a handful of exceptions:

Cable & Satellite

Brian L. Roberts, Comcast — $26.9 million: The Roberts family has dominated Comcast since the 1980s, so it is no surprise their pay packages are as colossal as the company itself.

Michael J. Lovett, Charter Communications — $20.54 million: He resigned in Feb. 2012 but got a great golden parachute: nearly double the compensation he earned the year before. Charter is one of America’s least-distinguished cable companies, usually scoring just above “pond scum” in popularity with customers. But you can take that trash talk when you walk $20 million to the bank.

Glenn A. Britt, Time Warner Cable — $16.43 million: His pay went down slightly (well, by a million dollars but with that kind of money, does it really matter?) in 2011. Britt has been around at some iteration of Time since 1972… when Nixon was still president, so he worked his way to the top. But some of his best accomplishments are irritating his customers with talk of overcharging them for Internet access.

James L. Dolan, Cablevision — $11.45 million: The Dolan family and Cablevision go together like cookies and milk, but Wall Street can’t help but bet when the family will finally cash out of cable and sell the company to Time Warner or Comcast. With $11 million in salary, stock awards, and bonuses, what’s the hurry?

Joseph Clayton, Dish Network — $9.84 million: Clayton is a Dish freshman, only coming on board 11 months ago. His salary was a paltry $467,000 in 2011. Thank goodness for the $9 mil in stock and bonus pay!

Michael D. White, DirecTV — $5.94 million: Ouch… a pay cut. White made $32.93 million the year before. Now he’ll have to clip coupons from the Sunday newspaper like the rest of us.

Rodger L. Johnson, Knology — $3.13 million: Not bad for running a company almost nobody has heard of and will soon no longer exist.  WideOpenWest bought them out last month.

The Wireline Companies & Their Friends

Stephenson: Blew a $39 billion dollar merger deal with T-Mobile, but walks away with $22 million in pay anyway.

Lowell McAdam, Verizon — $23.1 million: McAdam’s promotion paid handsomely. As former chief operating officer, he only walked home with a little more than $7 million last year. Now he’s earning every penny conjuring up ways he can do away with your cell phone subsidy -and- keep Verizon Wireless’ rates as high as ever.

Randall Stephenson, AT&T — $22.01 million: If you blew a multi-billion dollar merger deal at your company, do you think the only punishment you’d receive is a $5 million pay cut? Stephenson is the cat that fell out of the wireless merger window, and landed on his feet unharmed. Unfortunately the same isn’t true for his customers.

Dan Hesse, Sprint — $11.88 million: His pay is down about $2 million from 2010, and he recently announced he was going to take another pay cut for the team. If anyone deserves hazard pay, Hesse is the man. Wall Street hates him for not following his competitors gouging customers with higher prices and more restrictive service plans and policies. The big money crowd in New York’s financial district already has his going away party well-planned.

Jeff Gardner, Windstream — $9.78 million: His pay is up around $2 million. Windstream can afford it, acquiring companies later stripped clean of employees. PAETEC workers will learn this lesson soon enough. At Windstream, all the money rises to the top… management that is.

George A. Cope, Bell Canada — $9.6 million: His salary more than doubled over 2010 and why not. Bell is the first telecommunications company in North America to be audacious enough to demand an entire country be stripped of flat rate Internet service. That move managed to organize 500,000 Canadians that normally are resigned to the fact the revolving door at the Canadian Radio-tv and Telecommunications Commission has locked them out for years. Thanks Bell!

Glen F. Post III, CenturyLink — $8.55 million: Post saw his pay slashed from $14.5 million the year before, but merger deals like Qwest (with the corresponding huge bonus for pulling it off) only come once or twice in a career.

Hesse: Wall Street's least-wanted.

Maggie Wilderotter, Frontier — $6.72 million: No, we don’t understand it either. Her pay is down from $8.58 million, but considering Frontier’s current stock price and bottom-rated service, wouldn’t half of this money be better spent on improving broadband in states like West Virginia?

John F. Cassidy, Cincinnati Bell — $6.06 million: Cassidy earned more than two million more the year before. Cincinnati Bell is an aberration in an industry that is convinced the only good thing telecom companies can do is merge with each other to get bigger and bigger.

Paul H. Sunu, FairPoint — $4.25 million: The company that couldn’t find one customer’s business on a service call despite being literally right next door to FairPoint itself, is clawing its way back from bankruptcy and Sunu’s pay package reflects that. He only earned $775,000 the year earlier.

Ian Paul Livingston, BT — $3.8 million: British Telecom’s chief got a modest salary hike in 2011, and the U.K. phone company has done modestly better recognizing better broadband in the key to its future. BT is the AT&T of the United Kingdom, but British salaries are downright frugal compared to the high flyers on this side of the Atlantic.

David A. Wittwer, TDS Telecom — $2.29 million: You can’t complain about a cool $2 million in salary for a company with only around 1.1 million customers.

Ben Verwaayen, Alcatel-Lucent — $2.25 million: His salary dropped slightly from 2010. Alcatel-Lucent could do considerably better if they can win the public policy debate that fiber optic broadband is the wave of the future. Alcatel-Lucent is a major player.

Habsburg Empire Redux: Slovakia achieves leadership in broadband speeds.

Fiber-fast broadband networks, advanced DSL, and the latest cable broadband technology has allowed Bohemian broadband to help kick Canada and the United States into middle place for broadband speeds and web page loading time, according to statistics released by Google.

Google crunched the data from visits to websites all over the world by site owners supporting Google Analytics. Google’s measurement of web page load times gives researchers several clues about how to assess broadband quality. The data combines the speed of the user’s broadband network, how congested that network is, the quality of the service provider’s backbone connection, and the design of the web site visited.

The findings deliver a boost to central Europe where the Czechs and Slovaks are nearly neck and neck for top honors.

Google found the world’s fastest page load times in Slovakia (formerly the eastern half of Czechoslovakia.)

From Bratislava to Košice, Slovaks wait an average of 3.3 seconds for web pages to load on their desktop computers. On mobile devices, the slightly longer wait time of 7.6 seconds still places the country in the top 10.  Americans wait 5.6 seconds for desktop connections, 9.2 seconds for wireless.

South Korea took second place.  Koreans have enjoyed the world’s fastest broadband in speed rankings for years, but Eastern Europe’s enormous investment in fiber broadband and upgrades to legacy telephone and cable networks all make a difference.

The Czech Republic won third place.  That’s not surprising, considering Spanish owned Telefónica O2 Czech Republic has been in a hurry to completely overhaul the former state-owned Český Telecom.  While Americans fight for 1-3Mbps DSL from suburban and rural phone companies, O2 provides most Czechs ADSL2+ or VDSL service in non-cable TV areas at speeds up to 25Mbps.  In larger Czech cities cable companies like UPC offer budget speeds of 2Mbps or lightning fast service up to 120Mbps for those who want it.

The lighter the color, the faster the speed.

The top scores for broadband speed were achieved in Europe or Asia.  Farther down the list are the United States and Canada.  Canada scored slightly higher than the United States.

Most of the countries stuck at the bottom are in Latin America, Africa, and poorer Asian nations.

Google refused to release the raw data, but Bloomberg News did a lot of the work identifying broadband winners and losers.

Examine the rankings below the page jump:

… Continue Reading

As wireless carriers watch their revenues from texting and calling begin to decline as consumers increasingly turn to third-party applications that offer free alternatives, some companies are striking back.

Vodafone Group (part owner of Verizon Wireless) and Deutsche Telekom (owner of T-Mobile USA) are introducing new instant messaging applications this summer that will directly confront free services offered by Google and third party providers like WhatsApp.

Operators have already lost nearly $14 billion is text/SMS revenue in 2011 as subscribers shut off lucrative texting and messaging plans, according to Ovum, a mobile market researcher.

The companies blame messaging competitors like WhatsApp, Apple and Skype for the loss of that revenue and will confront them with the launch of Joyn, a new service that will offer a suite of features such as instant messaging and video-calling.  Joyn will quickly achieve prominence as carriers intend to automatically install the application on smartphones as the service launches.

Joyn will first be offered in Spain and Germany, and possibly also eastern Europe.  But providers expect to expand the service to North America if the initial launch is successful.

In Europe, Vodafone already bans Skype calls that travel over the company’s data network unless customers pay an additional charge.  Deutsche Telekom blocks these external services for customers in the United Kingdom altogether.  In the United States, Verizon Wireless routes domestic Skype calls over Verizon’s network.

KPN, the largest mobile phone company in the Netherlands, summed up providers’ attitudes about third-party apps and services bypassing the company’s own services by raising rates on smartphone customers to win back the revenue they lost.

“You can’t just have free services,” Deutsche Telekom’s Kobus Smit told Bloomberg News. “Because who is going to pay for it.”

North America’s broadband rankings continue to take a beating at the expense of countries deploying fiber optic broadband.  While the United States and Canada cope with aging landline technology and an uncompetitive marketplace that tells consumers they don’t need fiber-fast broadband speed, countries like Bulgaria, Lithuania and Estonia are lighting up 50-100Mbps networks that often charge lower prices than North Americans pay for 1-3Mbps DSL.

Ookla, a global leader in broadband testing and web-based network diagnostic applications, reports that the best performing broadband networks for speed, value, and performance are increasingly in Europe and Asia.  While both the United States and Canada used to be among the world leaders in broadband infrastructure, that is no longer true.

Some examples:

• The United States now scores 31st in average download speed, Canada is 33rd;
• In upload speed, America now ranks 37th, Canada a woeful 69th;
• Ookla’s Household Quality Index, which ranks packet loss and general reliability of home connections found Canada scoring 27th place, the United States 38th;
• At a cost per megabit, neither the US or Canada offers very good value.  The USA ranked 29th ($4.95 per megabit), Canada 33rd ($5.85 per megabit);
• Neither country does a great job delivering the speeds and service promised either.  The USA ranked 25th, Canada 32nd.

Ookla found that while speeds are rising in North America, they are not increasing nearly as fast as in other, higher-ranked countries.  Most of the speed gains in North America come from cable or limited fiber-broadband deployments like Verizon FiOS or community-owned fiber to the home networks.  Wireline ADSL service, which represented a larger proportion of home Internet connections in 2008, continues to lose ground to faster options from cable companies, community-owned broadband, and phone company fiber upgrades.  In eastern Europe, the Baltics, Russia and Ukraine, many of the dramatic boosts in broadband speed and quality come as a result of national fiber network upgrade projects.

While speeds in North America are gradually increasing, both the U.S. and Canada are being outpaced by many countries in Europe and Asia.

While providers in the United States and Canada often dismiss fiber as too costly, Ookla found fiber-based networks delivering some of the world’s best values in broadband.

For example, on a cost-per-megabit basis, Bulgaria’s new fiber networks deliver the world’s cheapest Internet service, at an average of just $0.64 per megabit.  The average broadband speeds in the country are now higher than 21/11Mbps.

Elion headquarters in Tallinn. Elion delivers fiber broadband to homes across Estonia.

Contrast that with average speeds in the United States (12.41/2.97Mbps) and Canada (11.95/1.70Mbps).  Other top scoring countries for cost-per-megabit include:

• Romania $0.97 USD
• Lithuania $1.11 USD
• Ukraine $1.17 USD
• Republic of Moldova $1.41 USD
• Latvia $1.80 USD
• Hungary $2.00 USD
• Slovakia $2.04 USD
• Hong Kong $2.26 USD
• Russia $2.51 USD

In terms of download speed, Estonia’s investment in a national fiber network is now paying dividends, with a dramatic increase in national average broadband speeds to 50/28Mbps.  As new cities join Estonia’s fiber network, speeds take a dramatic upswing.  Contrast average speeds in Saue (101.03Mbps), Viimsi (98.98Mbps), Tallinn (69.80Mbps), and Võru (65.58Mbps) with ADSL-rich Pärnu (12.55Mbps), Paide (12.40Mbps), Rapla (8.93Mbps), and Valga (7.71Mbps).

It is much the same story in other fiber-rich countries, where broadband speeds far exceed the averages in the United States and Canada:

Look what happens to Estonia's broadband speed rankings when it switched on its national fiber broadband network.

• Lithuania 31.65 Mbps
• South Korea 31.44 Mbps
• Latvia 25.42 Mbps
• Sweden 24.62 Mbps
• Romania 24.47 Mbps
• Netherlands 24.36 Mbps
• Singapore 22.94 Mbps
• Bulgaria 21.12 Mbps
• Iceland 20.53 Mbps

Despite all of the bad news, the cable industry’s trade publication Multichannel News tried to find victory in the jaws of defeat, noting things could be worse… if they ran traditional phone companies.

Cable operators delivered the fastest average broadband download speeds in 2011 — with major MSOs easily blasting by rival telco and satellite Internet services — according to data from independent testing firm Ookla.

For the full year, the six fastest residential Internet service providers in the U.S. based on average download speed were Comcast, Charter Communications, Cablevision Systems, Time Warner Cable and Insight Communications.

[…] Comcast and Charter delivered average download speeds of 17.19 Megabits per second, followed by Cablevision at 16.40 Mbps, Cox at 15.76 Mbps, TWC at 14.41 Mbps and Insight at 14.22 Mbps.

Verizon Communications fared better than its telco peers with an average download speed of 12.94 Mbps, thanks to FiOS Internet, its fiber-to-the-home service that provides up to 150 Mbps downstream. And overall, Verizon had the highest upstream speeds with an average of 7.41 Mbps. Still, the company’s legacy DSL services dragged down overall speeds.

Behind DSL were woefully slower speeds from the nation’s wireless ISPs (which include 3G broadband from large companies like Verizon Wireless and AT&T), and perennially last place satellite Internet.

Moffett

Despite repeated claims by providers that consumers don’t need fiber-fast broadband speeds, industry analyst Craig Moffett at Sanford Bernstein tells a different story:

“Technology adoption is creating a feedback loop that increasingly favors cable’s physical infrastructure,” Moffett wrote in a research note last month. “As more people are served by higher-speed connections, more and more applications are evolving to take advantage of them. Customers with lower-speed connections are increasingly being forced to upgrade to higher speed connections… or be left behind.”

The conclusion reached by Multichannel News columnist Todd Spangler:

“The relative broadband speeds of cable vs. telco isn’t merely an academic curiosity: Major providers are increasingly touting Internet performance in their marketing as they fight for consumers’ dollars.”

Unfortunately for the cable industry, although DOCSIS 3 upgrades have afforded dramatic increases in broadband download speeds, upload speeds lag behind.  Fiber to the home networks are best positioned to achieve victory in the global broadband race.  That is important not only because it delivers consumer dollars to the best provider in town, but fuels the further development of the digital, knowledge-based economy North America increasingly seeks to lead.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/Broadband Blindness.flv[/flv]

Toast Sacramento produced this 28-minute documentary which succinctly tells the story of North American broadband, and how commercial providers have set us up for long-term failure, especially in rural and suburban areas.  Whether you live in the United States or Canada, phone and cable companies dominate the telecommunications landscape.  Unlike other modern-day necessities, broadband is almost entirely in the hands of an unregulated free market that fails millions.  Where competition exists, customers can get reasonably fast service, but it costs more than it should.  Where competition is hard to find: slow speeds, spotty access, and out-of-sight prices predominate.

The documentary explores:

• the neglect of suburban and rural DSL from large phone companies like AT&T;
• how phony, industry-influenced broadband availability maps convince public officials there isn’t a big broadband problem;
• why the country’s broadband demands may be too great for providers to handle without major new investments, leading to usage limits and slowdowns to delay needed upgrades;
• and how the latest broadband technologies being installed overseas fall victim to Wall Street temper tantrums back home.