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Rogers Announces “Infinite” Data Plans That Are Finite and Throttle You

Canadians, living under a regime of three national wireless carriers (Bell, Rogers, and Telus) pay some of the highest wireless prices in the world. A new plan announced today from Rogers Communications is unlikely to change that.

“Introducing Rogers Infinite – Unlimited Data plans for Infinite Possibilities,” or so claims Rogers’ website.

Canadians’ initial enthusiasm and excitement for Rogers’ new “unlimited data plans” was quickly tempered by the accompanying fine print that makes it clear the plans may be free of overlimit fees, but very much limit their usability once the data allowance runs out. Customers can pool data with family and friends, but Rogers did not mention exactly how.

Rogers Infinite oddly offers three different price tiers, based on… usage, which is strange for an “unlimited” plan:

  • Infinite +10 offers 10 GB of data at traditional 4G LTE speed, bundled with unlimited calling and texting for $75 a month.
  • Infinite +20 offers 20 GB of data at traditional 4G LTE speed, bundled with unlimited calling and texting for $95 a month.
  • Infinite +50 offers 50 GB of data at traditional 4G LTE speed, bundled with unlimited calling and texting for $125 a month.

Those prices are steep by American standards, but Rogers also incorporates fine print that few carriers south of the border would attempt. First, Mobile Syrup reports included calls and texts must be from a Canadian number to a Canadian number. Extra fees may apply if you contact your friends in America and beyond. The “infinite” runs out when your allowance does. After that, it may take an infinitely long time to use your device because Rogers will throttle upload and download speeds to a maximum of 256 kbps for the rest of the billing cycle. American carriers, in contrast, typically only throttle customers on busy cell towers after exceeding an average of 20-50 GB of usage, although some mandate a throttle based entirely on usage. If customers want more high-speed data, they can purchase a Rogers Speed Pass for $15 and receive an extra 3 GB of high-speed data. In contrast, T-Mobile offers U.S. customers an unlimited line for $60 with no speed throttle until usage exceeds 50 GB a month. That is less than half the cost of Rogers’ Infinite +50 plan for an equal amount of high-speed data.

More fine print:

Rogers Infinite data plans include 10 GB, 20 GB or 50 GB of data at max speed on the Rogers network, extended coverage areas within Canada, and Roam Like Home destinations (see rogers.com/roamlikehome). You will continue to have access to data services with no overage beyond the max speed allotment at a reduced speed of up to 256 kilobits per second (for both upload and download) until the end of your current billing cycle. Applications such as email, web browsing, apps, and audio/video streaming will continue to function at a reduced speed which will likely impact your experience. We will send you a text message notifying you when you have used 90% and 100% of the max speed allotment included in your plan with the option to purchase a Speed Pass to add more max speed data to your plan. In all cases, usage is subject to the Rogers Terms of Service and Acceptable Use Policy.

AT&T Warning Tower Owners to Cut Prices or They Will Relocate

AT&T claims it is willing to play hardball to force cell tower owners to reduce the cost of leasing space for AT&T’s wireless services. If tower owners won’t lower their prices, AT&T is threatening to find someone else willing to build a new, cheaper tower nearby.

AT&T is closely coordinating its tower strategy with its biggest competitor, Verizon Wireless. Together, the two companies are looking to force costs down by seeking opportunities with newer tower companies Tillman, CitySwitch, and Uniti Towers that are willing to build new towers next to old ones, while offering “much cheaper” pricing than industry leaders American Tower, Crown Castle, and SBA Communications.

Light Reading notes AT&T would like to pay roughly half the current rent for its wireless infrastructure. But it is running into a roadblock because 65% of American cell towers have no competition within a half-mile radius. Getting zoning approval to construct new towers, especially in suburban and residential areas, can be difficult and costly. But the three upstart tower companies AT&T and Verizon are working with claim they will commit to tower construction when there are signed contracts in hand. AT&T is using this fact to leverage existing companies to lower prices or lose AT&T’s business.

But Wall Street analysts suggest AT&T is bluffing. Research of FCC public records between January 2017 and April 2019 found 1,000 new tower applications, but only 500 had been built. Only 40% of those applications were to build new towers near existing ones. When one considers there are about 110,000 cell towers in the U.S., fewer than 0.5% of cell sites are likely to face competition based on the applications already filed.

The wireless industry prefers to co-locate infrastructure on existing towers, which means Verizon Wireless, AT&T, T-Mobile and Sprint could all theoretically be leasing space on the same tower. This was originally both a cost-saving measure and a bow to reality because new tower applications often take years to approve and often face local opposition. Most wireless companies sign 10-year contracts with tower companies, so any organized effort to force competition will probably take years.

AT&T complains it is the victim of a lack of competition and is fed up with the “vicious model” of monopoly tower companies charging excessively high prices and raising fees anytime AT&T changes their contract. Many of their customers can relate.

WarnerMedia’s Streaming Service Will Cost $16-17 and Bundle HBO/Cinemax

Phillip Dampier June 6, 2019 AT&T, Competition, Consumer News, HBO Max, Online Video No Comments

WarnerMedia’s forthcoming streaming service will showcase HBO and Cinemax at the heart of a one-size-fits-all streaming package priced at $16-17 a month, featuring premium movies and Warner Bros. vast movie and TV show collection.

AT&T plans to begin beta testing of the service later this year, with plans to sell the service to consumers as early as March 2020, according to the Wall Street Journal.

John Donovan, CEO of AT&T Communications, signaled AT&T’s “radical reshape” of television on a Credit Suisse Communications conference call event on Wednesday.

“The streaming strategy, whether you call it an OTT or IPTV or thin client, we’re going to transform our product,” Donovan said. “It is the consumer product I am most excited about since the iPhone. It radically reshapes what your concept of television is.”

The “new concept” is a radical departure from AT&T’s earlier plan to offer “good,” “better,” and “best” price points, varying the amount of content depending on how much subscribers were willing to pay. Instead, Donovan proposes one price point for every subscriber, with access to an unprecedented amount of content produced by one of the country’s largest Hollywood studios. Warner Bros. has produced thousands of movies and series since the early days of television in the 1950s and the advent of commercial filmmaking in the early 20th century.

Donovan

“The idea of three tiers never made much sense and is too complicated to fly in the marketplace,” analyst Craig Moffett of MoffettNathanson told the newspaper.

Despite the potential of an enormous library of streamed content, consumers may balk at WarnerMedia’s asking price, especially if they have no interest in HBO or Cinemax. Netflix’s most popular two-stream plan costs $12.99 a month and second place Hulu is available for $5.99 a month with ads or $11.99 a month without. Most niche streaming services like MHz Choice, CBS All Access, Acorn Media, BritBox, and other similar services are all under $10 a month. AT&T proposes to set its price higher than traditional premium movie network services like HBO, which usually costs $14.99, to protect the relationships and revenue it earns from cable, satellite, and telco TV providers. But AT&T’s new service may be a tough sell, especially considering forthcoming streaming services like Disney+ plans to launch Nov. 12 at $6.99 a month, and Viacom’s Pluto TV and Sinclair’s STIRR are ad-supported and free. In fact, most of the newly announced streaming services yet to launch are targeting much lower price points, fearing consumers may be nearing their budget limits for more content.

AT&T warns it may adjust pricing before the service launches next year, and there may eventually be a cheaper, ad-supported version, making the service comparable to Hulu. AT&T has also not disclosed how much original made-for-streaming programming it plans to include in the venture, which may be an important consideration to attract price-sensitive customers not interested in watching repeats and movies they can watch elsewhere. Consumers may also be overwhelmed and fatigued by the amount of content already available to watch through established players like Netflix and Hulu, so WarnerMedia may find their streaming service a difficult sell, especially as cord-cutters find prices for streaming live TV services already rising as fast as their old cable TV subscriptions.

Take It Or Leave It Pricing: No, You May Not Have a Better Deal!

GIVE us more money and TAKE what we offer you.

Bloomberg News is reporting what many of you already know — it is getting tougher to get a better deal from your cable or phone company.

As Stop the Cap! has documented since the completion of the Time Warner Cable/Bright House/Charter Spectrum merger in 2016, companies are pulling back on promotions, taking advantage of a lack of competition and offering best pricing only to new customers.

Charter Spectrum and Cable One (soon to be Sparklight) are the most notorious for implementing “take it or leave it” pricing. In fact, one of Charter CEO Thomas Rutledge’s chief complaints about Time Warner Cable was its “Turkish Bazaar” mentality about pricing. Rutledge claimed Time Warner Cable had as many as 90,000 different promotions running at the same time, typically targeted on what other companies were theoretically providing service and how serious the representative felt you were about canceling service. Time Warner Cable had basic retention plans available for regular representatives to offer, better plans for retention specialists to pitch, and the best plans of all to customers complaining on the “executive customer service” line or after filing complaints with the Better Business Bureau. There were plans for complaining over the phone and different plans for complaining at the cable store. Rutledge was horrified, because customers were now well-trained on how to extract a better deal every year when promotions ran out.

Last month, Rutledge said he was indifferent about cash-strapped consumers that cannot afford a runaway cable TV bill on a retired/fixed income or the urban poor who can’t imagine paying $65 a month for basic broadband service. To those customers, pointing to the exit is now perfectly acceptable. In fact, companies make more profit than ever when you drop cable television service and upgrade your broadband connection to a faster speed. That is because there is up to a 90% margin on internet service — provisioned over a network paid off decades ago and designed for much less space efficient analog television. Charging you $20 more for faster internet service is nearly 100% profit and costs most companies next to nothing to offer, and Time Warner Cable executives once laughed off the financial impact of so-called “heavy users,” calling data transport costs mere “rounding errors.” 

Even with a much tougher attitude about discounting service, Charter and Comcast are still adding new broadband customers every month, usually at the expense of phone companies still peddling DSL. So if you cancel, there are probably two new customers ready to replace you, at least for now.

Cable One redefines rapacious pricing. The company specializes in markets where the incumbent phone company is likely to offer low-speed DSL, if anything at all. As a result, they have a comfortable monopoly in many areas and price their service accordingly. Cable One’s basic 200 Mbps plan, with a 600 GB data cap, costs $65 a month, not including the $10.50/mo modem fee, and $2.75 monthly internet service surcharge. To ditch the cap, you will pay another $40 a month — $118.25 total for unlimited internet.

In fact, Cable One charges so much money for internet, they even have Wall Street concerned they are overcharging!

When Joshua May tried calling Spectrum to deal with the 29% more it wanted (around $40 a month) after his promotion expired, the customer service representative told him to go pound salt.

“I expected they’d at least offer free HBO or Showtime,” May, 34, of Springfield, Ohio, told Bloomberg News. “They did nothing.”

He did something. He cut the cord. The representative could have cared less.

The product mix cable and phone companies offer has not really changed, but the era of shoving a triple play bundle of internet, TV, and phone service sure has. Charter and Comcast now treat cable television as a nice extra, not the start of a bundle offer. Broadband is the key item, and the most profitable element, of today’s cable package. Beleaguered phone service gets no respect either. Time Warner Cable used to sell its triple play bundle including a phone line for less money than their double play bundle that omitted it. Today, it’s a simple $9.99/mo extra, given as much attention as a menu offering premium movie channels.

Comcast differs from Charter by offering a plethora of options to their customers. If you don’t want to spend a lot for high speed internet, spend a little less for low speed internet. Their television packages also vary in price and channel selection, often maddeningly including a “must-have” channel in a higher-priced package. Like Spectrum, their phone line is now an afterthought.

AT&T and Verizon have their own approaches to deal with reluctant customers. Verizon FiOS customers face steep price hikes when their promotions expire, but the opportunity to score a better deal is still there, if Verizon is in the mood that quarter. Verizon remains sensitive about their subscriber numbers and growth, so when a quarter looks like it will be difficult, the promotions turn up. AT&T prefers to play a shell game with their customers. Most recently, the company has given a cold shoulder to its U-verse product, treating it like yesterday’s news and best forgotten. AT&T literally markets its own customers to abandon U-verse in favor of AT&T Fiber. Verizon and AT&T treat their DSL customers like they are doing them a favor just by offering any service. All the best deals go to their fiber customers.

AT&T Randall Stephenson is a recent convert to the “who cares about video customers” movement. Services like DirecTV Now were originally channel-rich bargains, but now they are a place for rate hikes and channel deletions. Over a half-million streaming customers have already canceled after the most recent price hikes, but Stephenson claims he does not mind, because those bargain-chasers are low-quality customers worthy of purging. AT&T’s dream customer is one who appreciates whatever AT&T gives them and does not mind a parade of rate hikes.

Comcast’s chief financial officer Mike Cavanagh said it more succinctly: seeking subscribers that “really value video and our bundle despite the increases in prices,” and has “the wallet for a fuller video experience.”

Customers who decide to take their business to a streaming competitor are already learning the industry still has the last laugh. As package prices head north of $50/month, that is not too far off from the pricing offered by cable and phone companies for base video packages. In fact, Spectrum has begun undercutting most streaming providers, offering $15-25 packages of local and/or popular cable channels with a Cloud DVR option for around $5 more a month.

Cable One: A Regime of High Prices and Data Caps

Cable One has the highest average revenue per customer of any publicly traded cable company in the United States, with the average customer paying Cable One $70.80 a month, mostly for internet access.

The company’s first quarter earnings growth of 5.5% reflect the company’s recent price increases and regime of low-allowance data caps, which have pushed 10 percent of its customers to pay an extra $40 a month to bring back unlimited access. Others are upgrading to costlier, faster tiers with more generous usage allowances.

“During the first quarter, we saw roughly 50% of our new customers choose our 200 Mbps or higher speed service and nearly 10% of our new customers opted to purchase our unlimited data plan,” said Julia Laulis, Cable One CEO.

Laulis

Cable One’s 200 Mbps plan (with a 600 GB data cap) costs $65 a month after promotions expire. A DOCSIS 3.0 modem lease fee of $10.50 applies. A $2.75 monthly internet service surcharge may apply. If a customer wants unlimited access to avoid overlimit fees, there is an additional charge of $40 a month (a 5 TB cap applies to the “unlimited plan”). Customers choosing a 200 Mbps broadband-only package with unlimited data will pay up to $118.25 a month.

Cable One’s broadband customers are concerned about staying within the data caps to avoid overlimit fees. While Comcast and Charter Spectrum customers consume over 300-400 GB of data per month (Comcast has a 1 TB cap, Spectrum only sells unlimited service), Cable One customers use an average of 290 GB, with usage growing at a 30-35% annual rate. Many Cable One customers have little choice either. Laulis noted that Cable One’s DSL competition is not very relevant when customers want to watch streaming video. Speeds are often so slow, customers do not have a good experience streaming HD video over DSL.

 

Cable One is also shedding its video customers in record numbers, with just 305,000 of its cable TV customers left. More than 29,000 departed year over year, and that number continues to rise as consumers rebel against the company’s high prices and unwillingness to negotiate.

MoffettNathanson warned that Cable One’s high pricing may eventually price itself out of broadband growth, as consumers elect to sign up with telephone companies instead. But many of its service areas are still served by low-speed DSL, and despite Cable One’s high cost, the company added 10,600 new internet customers in the last quarter.

In addition to raising prices, the company also plans to spend between $9-11 million to change its name from Cable One to Sparklight over the next two years.

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