Time Warner Cable customers who continue to lease a modem from the cable company instead of buying their own will soon pay Time Warner $120 a year for a modem that likely cost the company no more than $50.

Time Warner Cable customers have been sending Stop the Cap! copies of rate increase notifications that show some steep rate increases that will eventually reach every customer in early 2016:

• Time Warner Cable & Earthlink modem rental fee was $8 a month, now it will be $10;
• The “Sports Programming Surcharge,” paid by every Time Warner cable TV customer, is almost doubling from $2.75 to $5 a month;
• The “Broadcast TV Surcharge,” paid by every Time Warner cable TV customer, is going up by a dollar in many areas. This fee can vary but averages between $3.50-4.00 in most areas;
• Each traditional set-top (not DVR-equipped) box increases from $6.98 per box to $8.50 per box;
• Digital Adapters, used mostly on older analog-only sets (that Time Warner originally said would cost customers 99¢ per month) will now cost $3.25 a month, more than three times what the company charged just two years ago;
• Internet-Only customers will now pay $59.99 a month for Standard (15/1Mbps) Internet service (except in Maxx areas where the speed is 50/5Mbps);
• “Starter TV,” which includes mostly over the air stations, jumps from $14.99 to $18 a month in some areas, over $22 in others;
• “Standard TV,” the more common basic cable package is up $2, for most customers ranging from $80 to $84.99 a month;
• “Variety Pass,” is up $3 from $7 to $10 a month. TWC Sports Pass and Movie Pass are also both increasing to $10 each;
• Cinemax and Starz are both jumping from $12.95 a month to $14.99 each, but in some locations that price will rise to $15.99 and also include Showtime and The Movie Channel.

A typical rate hike notice in your monthly bill from Time Warner Cable. Exact prices vary by service area.

Other than the modem rental fee, the biggest money-maker for Time Warner Cable is their rapidly growing surcharges for sports and over the air stations. Originally added in the summer of 2014, both fees used to amount to $2.25 a month in many locations. Less than two years later, those surcharges will soon approach $10 a month.

Stop the Cap! recommends now, more than ever, customers take control over their Time Warner Cable bill. You can save substantially with just a little effort and less than an hour of your time.

• Buy your cable modem and save $10 a month: Stop the Cap! highly recommends the Arris (formerly Motorola) SB-6141, now available for under $70 on Amazon.com. It does not include built-in Wi-Fi, however. You can also occasionally find this model on sale for similar amounts at Best Buy, Walmart, and Newegg, especially during the holidays. Refurbished models for $10-20 less are also regularly available from eBay. These modems will do fine at speeds up to 100Mbps. If you are in a Time Warner Cable Maxx service area (speeds up to 300Mbps), you will need a different model only if you subscribe to speeds in excess of 100Mbps;
• Get rid of the Digital Adapter and attach a Roku set-top instead ($40-125 depending on model). Roku 3, All Roku 2 Models, Roku LT, Roku HD (2500X) and the Roku Streaming Stick are officially supported. Earlier models are not. Most of the TWC cable lineup is available on Roku, without the need to lease a box.
• If you are Internet-only customer and not bouncing back and forth between Time Warner Cable and Earthlink on new customer promotions, you are probably overpaying by up to $25 a month. Time Warner sells Standard service on a one year promotion for $34.99 a month. When it expires, switch to Earthlink over Time Warner Cable at a similar price for six months… then switch back to TWC.
• Check out our extensive guide on negotiating a better deal from Time Warner, especially if you are no longer paying a promotional rate.

Despite cost savings expected to run into the billions from the combination of AT&T U-verse and satellite TV provider DirecTV, AT&T isn’t sharing any of their savings with you and has announced a nationwide rate hike for early 2016.

For the latest round of price increases, AT&T is focusing on its U-verse TV and telephone services, blaming “increased programming costs” and “service delivery expenses.”

All customers not on a promotional rate contract will be affected, starting with billing statements issued after Jan. 28, 2016.

• AT&T’s Voice 1000 plan is increasing to $30 a month and the Voice 250 plan will rise by $2, to $27 per month;
• U-family and U-family All-In tiers increase $2 a month;
• U100, U200, U200 All-In, U200 Latino and U200 Latino All-In up $3 a month;
• U300, U300 All-In, U300 Latino, U300 Latino All-In, U400, U450, U450 All-In, U450 Latino and U450 Latino All-In rise $4 a month;
• Non DVR-TV receivers increase $1 per month;
• Regulatory Video Cost Recovery Surcharge: up 1¢ per month;
• Broadcast TV Surcharge: increasing $1 per month (except 46¢ in Detroit, Biloxi, Miss., and Wilmington, N.C.)

AT&T claims its services remain a good value at the higher price because the company’s TV Everywhere service now allows mobile/tablet customers access to more than 270 live channels while inside the home and more than 205 channels when on the go.

Customers appear not to be impressed. AT&T admitted 92,000 U-verse customers left AT&T for good during the last quarter and analysts expect further customer losses during this quarter as AT&T refocuses its value conscious customers on cheap and easy to install DirecTV instead of U-verse, which can be costly to get up and running.

CEO Randall Stephenson also warned customers should expect a harder line on pricing due to the company’s ‘new focus on profitability.’ AT&T has cut back on promotional pricing and is especially reluctant to extend deals to customers with a “propensity to churn.” That means AT&T does not want to extend lower pricing to customers threatening to leave who are unwilling to pay the regular price after their deal ends. The company noted price sensitive customers often bounce back and forth between providers just to secure new customer pricing.

A decision by Great Britain’s broadband industry to follow America’s lead consolidating the number of competitors to “improve efficiency” and wring “cost savings” out of the business resulted in few service improvements and a much bigger bill for consumers.

In business, it’s crucial to navigate employee relations carefully. If you’re facing workplace issues related to such decisions, an employee dispute lawyer can offer valuable legal advice and help resolve conflicts efficiently, protecting your company’s interests.

A Guardian Money investigation examining British broadband pricing over the past four years found customers paying 25-30 percent more for essentially the same service they received before, with loyal customers facing the steepest rate increases.

It’s a dramatic fall for a market long recognized as one of the most competitive in the world. In 2006, TalkTalk — a major British ISP — even gave away broadband service for free in a promotion to consumers willing to cover BT’s telephone line rental charges.

But pressure from shareholders and investment bankers to deliver American-sized profits have spurred a wave of consolidation among providers in the United Kingdom, similar to the mergers of cable companies in the United States. Well known ISPs like Blueyonder, Tiscali, AOL, BE, Tesco, O2, and others in the United Kingdom have all been swallowed up by bigger rivals – often TalkTalk. As of last year, just four major competitors remain – BT, Sky, TalkTalk and Virgin, which together hold 88% of the market. If regulators allow BT’s takeover of EE, that percentage will rise to 92%.

As consumers find fewer and fewer options for broadband, they are also discovering a larger bill, fueled by runaway rate increases well in excess of inflation. While consolidated markets in the United States and Great Britain increasingly lack enough competition to temper rate increases, heavy competition on the European continent has resulted in flat or even lower prices for broadband along with significant service upgrades. British consumers now pay up to 50% more for broadband than many of their European counterparts in Germany, France, the Benelux countries, and beyond.

Also familiar to Americans, the best prices for service only go to new customers. Existing, loyal customers pay the highest prices, while those flipping between providers (or threatening to do so) get much lower “retention” or “new customer” pricing. But only those willing to fight for a better deal get one.

In October, TalkTalk, responsible for much of the consolidation wave, raised broadband prices yet again — the second major price hike this year. Customers are reeling over the rate increases, despite the fact they still seem inexpensive by American standards. Landline rental charges are increasing from $25.40 to $26.91 a month, and are a necessary prerequisite to buying Internet access from TalkTalk. Its Simply Broadband entry-level package is jumping another £2.50 a month just four months after the last rate hike. That means instead of paying an extra $7.60 a month for broadband, customers will now pay $11.40. The average British consumer now pays an average of $57.79 a month for a phone line with enhanced DSL broadband service.

In France, competition is forcing providers to move towards fiber optic broadband and scrap DSL service. But French consumers are not paying a premium for upgrades necessitated by competition on the ground. While British households pay close to $60 a month, a comparable package in France from Orange known as L’essentiel d’internet à la maison costs only $36.50 a month, including a TV package and unlimited calling to other landlines. But the deal gets even better if you shop around. Free, a major French competitor, offers a near-identical package for just $32.19 a month. In the United States, packages of this type can cost $130 or more if you do not receive a promotion, $99 a month if you do.

In France, providers rarely claim they need to cap Internet usage or raise prices to cover the cost of investing in their networks. That is considered the cost of doing business in a fiercely competitive marketplace, and it forces French providers to deliver good value and service for money. Providers like Patrick Drahi/Altice’s SFR-Numericable attempted to reap more profits out of its cable business by cutting costs, discontinuing most promotions and marketing, and offshoring customer support to North African call centers. At least one million customers left for better service elsewhere in 2015.

In Britain, there are fewer options for customers to seek a better deal, and the remaining providers know it. As a result, marketplace conditions and an increasing lack of competition have made conditions right for rate increases. BT, Sky, Virgin, and Plusnet (controlled by BT) have all taken advantage and hiked prices once again this year between 6-10%, on top of other large rises.

Ewan Taylor-Gibson, broadband expert at uSwitch.com, told the Guardian, “it’s the existing customers that have borne the brunt of the increase in landline and package costs over recent years.”

Many British consumers are afraid of disrupting their Internet access going through the process of changing providers in a search for a better deal. Some report it can take a few days to a week to process a provider change that should take minutes (because most providers rely entirely on BT’s DSL network over which they offer service). Those willing to make a change are about the only ones still getting a good deal from British providers. Customers are starting to learn that when their new customer promotion ends, asking for an extension or signing up with another company is the only way to prevent a massive bill spike that Taylor-Gibson estimates now averages 89%.

BT spent $1.36 billion dollars securing an agreement with Champions League football.

Providers with the largest increases use the same excuses as their American counterparts to defend them. BT claims a reduction in income from providing landline service is forcing it to raise prices to make up the shortfall. Critics suggest those increases are also helping BT recoup the $1.36 billion it controversially paid for the rights to carry Champions League football — money it could have invested in network upgrades instead.

The current government seems predisposed to permit the marketplace to resolve pricing on its own, either through competition among the remaining players or allowing skyrocketing prices to reach a level deemed attractive by potential new entrants into the market. The usually protective British regulator Ofcom also seems content taking a light hand to British ISPs, enforcing price disclosures as a solution to increasingly costly Internet service and making it easier for consumers to bounce between the remaining providers many think are overcharging for service.

Things could be worse. British consumers could face the marketplace duopoly or monopoly most customers in the United States and Canada live with, along with even higher prices charged for service. The Guardian surveyed telecom services across several European countries and found that, like in the UK, most customers are required to bundle a landline rental charge and broadband package together to get Internet access, but they are still paying less overall than North Americans do.

Here is what other countries pay for service:

United Kingdom: Basic BT home phone service with unlimited “up to 17Mbps” DSL broadband costs $31.12 per month, plus a monthly landline charge of $27.35 including free weekend calls. An unlimited calling plan with no dialing charges costs an extra $12 a month. Competitor TalkTalk charges $11.40 for unlimited broadband on its entry-level Simply Broadband offer, plus $26.91 for the monthly landline rental charge.

France: Many Orange customers sign up for the popular L’essentiel d’internet à la maison plan, which bundles broadband, a phone line with unlimited calling to other landlines, and a TV package available in many areas for $36.50 a month. Competitor Free.fr charges $32.19 for essentially the same package.

Germany: Deutsche Telekom offers its cheapest home phone/broadband package for $37.75 after a less expensive promotional offer expires. One of its largest competitors, 1&1, offers the same package for $33.29 a month after the teaser rate has ended.

Spain: Telefónica, Spain’s largest phone company, offers service under its Movistar brand combining an unlimited calling landline and up to 30Mbps Internet access for $46.21 a month. Its rival Tele2 offers a comparable package for a dramatically lower price: $29.11 a month.

Ireland: National telecom company Eircomis is overseeing Ireland’s telecom makeover, replacing a lot of copper phone lines with fiber optics. Basic broadband starts with 100Mbps service on the fiber network with a promotional rate of $26.82 for the first four months. After that, things get expensive under European standards. That 100Mbps service carries a regular price of $66.51 a month, deemed “hefty” by the Guardian, although cheaper that what North Americans pay cable companies for 100Mbps download speeds after their promotion ends. For that price, Irish customers also get unlimited calling to other Irish landlines and mobiles. If that is too much, rival Sky offers a basic phone and broadband deal for $32.18 with a one-year contract.

An expert hired by Charter Communications to offer “qualified” views on the competitive impact of a merger involving Charter, Bright House Networks, and Time Warner Cable got his facts wrong about Charter’s data cap policy, a mistake that calls into question his analysis about the company’s potential to abuse broadband customers by imposing data caps after its three-year commitment not to expires.

Theodore Nierenberg, a professor of economics at the Yale School of Management, among other things, offered an expansive rebuttal to opponents of the Charter merger deal, arguing that it would enhance competition and deliver consumers enhanced benefits.

Nierenberg does not believe Charter has any interest in imposing data caps on customers, despite the fact Charter quietly shelved existing caps on Oct. 1, 2014, several months before unveiling a bid for both Time Warner and Bright House, neither of which have capped customer usage.

“I conclude that actions such as charging interconnection fees, imposing usage based billing or data caps, or degrading network performance are very unlikely, both because New Charter has no incentive to undertake them, and because the FCC will enforce New Charter’s commitments,” Nierenberg wrote.

But his facts are in error. The same company that believed usage caps were an essential part of its broadband service between early 2009 until October 2014 has suddenly turned over a new leaf? Nierenberg claims there was effectively no leaf to turn, claiming Charter had no “active data cap” since January 2012¹:

For 3 years, New Charter will not charge consumers additional fees to use specific third-party Internet applications, or engage in zero-rating (discriminatory exemptions from a data cap).

These binding commitments provide further assurance beyond the economic reasoning I describe below — assurance that New Charter will not engage in these types of conduct: charging higher interconnection fees, using discriminatory data plans, or reducing the quality of OVD signals. (Note that Charter already does not have data caps for its residential broadband customers. Notwithstanding the dramatic but welcome rise in data usage by broadband customers, Charter has not had an active data cap since January 2012.)

Customers in some areas were called by Charter for exceeding their usage allowance, and usage rationing remained a fact of life in Charter’s Acceptable Use Policy until late last year, not January 2012 as Nierenberg claims.

So what assurance should a customer take from a company that believed strongly in usage caps for more than five years? Surely not that Charter will never consider engaging in data capping yet again three years from now.

Charter can assure consumers of its good intentions by declaring it will always offer affordable unlimited access Internet without a three-year expiration date. Quietly dropping a cap several months before executing a well-planned buy of Time Warner Cable and Bright House doesn’t inspire confidence. Too often short term rate freezes are followed by accelerated rate hikes once the deal conditions expire.

¹ Page 48

Another satisfied customer

After more than a decade of legal wrangling, a class action lawsuit originally valued at up to $875 million filed on behalf of Philadelphia-area cable customers accusing Comcast of rigging a cable monopoly has settled for $50 million.

A federal judge in Philadelphia has approved a considerably reduced payout to affected subscribers and ex-customers who earlier submitted a claim form.

Under the settlement, former Comcast cable customers in the Philadelphia area qualify for a $15 check. Current Comcast customers can choose a $15 bill credit, six free pay per view movies, or two free months of The Movie Channel. If you failed to file a claim form before the July closing date, enjoy The Movie Channel for two months at no charge — it represents your default damage settlement.

Comcast is happy the suit, originally brought in 2003, has now come to a close. So are the lawyers who brought the case, who will receive $15 million in fees.

The lawsuit accused Comcast of colluding with other cable companies to buy or swap area cable customers to form a regional monopoly in southeastern Pennsylvania, where it could safely raise prices and scare off would-be competitors. The suit sought refunds and damages up to $875 million for Comcast’s allegedly ill-gotten gains.

Comcast’s attorneys eventually mowed down much of the plaintiff’s case when they convinced the U.S. Supreme Court the class action was too broad, involving cable customers that were formerly served by other cable companies before they were snapped up by Comcast. Because any potential damages inflicted by Comcast’s rate hikes and service varied depending on the date of ownership transfer, it was impossible, the attorneys argued, to determine appropriate damages. The Supreme Court agreed with Comcast and eventually eliminated class members who lived outside of Philadelphia and the four counties that surround the city. Having gutted much of the case, the two parties reached a settlement amounting to a fraction of the original request for damages.

Customers seemed less than thrilled.

“The Movie Channel? Really?,” complained Linda Martinez of Philadelphia. “They already give that channel away like candy when you phone up Comcast and complain about their lousy service. I had it for six months and I never even found it on the TV.”