Big cable companies are targeting their non-customers, and those current customers who refuse to sign up for triple-play bundles, with some of the most aggressively-priced promotions in years.  The two largest, Comcast/Xfinity and Time Warner Cable, have been sending out letters offering dirt cheap $20 Internet service or cable television packages that include DVR service, a second set top box, and hundreds of digital cable channels for $49.99 a month for two years.

Comcast

Comcast promotions vary in different markets, depending on who their competitors are.  The best pricing goes to new customers, as a recent promotion sent to suspected DSL customers in their service areas illustrates.

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The cable company is pitching 12 months of Xfinity Performance (typically around 12Mbps) for $19.99 a month for the first year for new customers only.  Some customers report they can cancel penalty-free at the end of the first year, while others are told Comcast is actually pitching a two-year contract where the price of the service increases to $34.99 a month during the second year (a early cancellation fee pro-rated to less than $50 applies in some areas if you cancel early).  This pricing applies to standalone service, which makes it aggressively priced.  Most cable providers charge a higher price for Internet-only service.  Some customers also report a $25 or more installation fee applies (and in some areas an in-person install is required for new customers).  We’ve heard from some readers that successfully qualified for the promotion under the name of a spouse if they have had Comcast service previously.  Otherwise, Comcast usually requires customers to be without service for 90 days before they are considered “new customers.”

Customers can try calling 1-877-508-5492 to request this offer: $19.99/Month for 1 year with no additional service required (Code at bottom of letter: LTP79376-0014).

If that number does not work from your calling area, other numbers to try include: 1-877-298-0903 (CA, TX), 1-877-508-5492 (CA, WV), 1-877-494-9166 in NJ (currently pitching 6-month version of this promotion without contract.)

If 12Mbps is not fast enough, ask the representative what promotional pricing exists for faster speeds.  Some customers scored 35Mbps service for $10 more per month.

A separate ongoing promotion from Comcast offers Blast Internet service at 25Mbps+ on similar terms.  But pricing varies wildly in different markets.  Customers in California were able to purchase this promotion for as little as $19.99 a month with a year-long contract, while customers in Chicago were asked to pay $39 for essentially the same service.

Comcast’s promotions list runs several pages, so if you are shot down asking for these promotions, ask about other current offers or hang up and try calling again and asking to speak with someone else.  Your results may vary depending on the representative you speak with.  Remember Comcast’s 250GB usage cap applies to all residential service plans.

Time Warner Cable

In addition to regular Road Runner standalone Internet service promotions that deliver Standard Service speeds for $29-35 a month for a year, Time Warner has been getting very aggressive trying to win back cord-cutters and those who have left for a competing pay television provider.  The cable company has mailed letters to non-cable TV customers in the northeast pitching substantial discounts on cable TV service price-locked (but no commitment term for you) for two years and includes free DVR equipment, DVR service, and a second set top box with digital cable TV for $49.99 a month.  They’ll even credit back the cost of any early termination fees charged by another provider over the course of the first year of service.

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The promotion is intended primarily for customers who already receive service from another provider, but new customers can call 1-855-364-7797 and ask for the offer without the competing provider early termination fee rebate.  If you do receive service from another provider, there are various requirements and steps to follow to qualify for up to $200 in termination fee credits.  Visit SwitchtoTWC or call them to learn the details.

Neither of these promotions work for existing Time Warner Cable customers.  If you already subscribe, discounts will be offered when you threaten to cancel service.  Retention deals from Time Warner Cable can be as aggressively priced as new customer promotions.  We have found retention offers made during the initial call to request a service disconnection are often not very aggressive.  Most representatives try and pare back your package before starting to offer retention pricing (which gradually gets better the more times you reply, “is that the best you can offer?”)

Our best recommendation is to call and request to cancel service 2-3 weeks from today and wait for a Time Warner Cable retention specialist to call you (answer those mystery caller ID calls — it could be Time Warner).  The reps that call you directly often deliver the most aggressive retention deals.  If nobody does reach out to you, call Time Warner yourself a few days before the disconnect is scheduled and ask them to make you an offer to rescind your disconnect request.  You may find some serious savings taking this approach.  If not, you still have time to rescind your disconnect request on your own before the plug gets pulled.

Andre Vrignaud of Seattle has been benched for a year by Comcast for using too much of its Internet service.

From time to time, we get reports from Comcast customers victimized by the company’s 250GB usage cap.  The nation’s largest cable broadband provider implemented that arbitrary limit back in 2008 after the Federal Communications Commission told the company they could not throttle the speeds of customers using applications like peer-to-peer file sharing software — then pegged as the usual suspect for turning “ordinary” broadband users into “data hogs.”

For at least 18 months, Comcast’s usage cap came with no measurement tools or real explanation most customers could find about what a “gigabyte” was, much less how many of them they “used” that month.  Only last year, Comcast finally rolled out usage measurement tools for customers who bother to find them on their website.  New customers signing up for service never even realize there is a usage cap until a thick brochure of legalize comes with the installer outlining the company’s Acceptable Use Policy.

Still, compared to some of the usage cap battles Stop the Cap! was fighting three years ago, Comcast was the least of our problems.  Frontier’s infamous 5GB usage allowance was the worst we’d ever seen, Cable One’s IRS-like usage policies required an academic to explain them, and Time Warner Cable’s ‘lil experiment in broadband rationing with a 40GB usage cap experiment crashed and burned soon after being announced in the lucky test cities scheduled to endure it.  That doesn’t make Comcast’s cap fair or right, but protecting consumers from these schemes requires triage.

But we remember well Comcast’s promise that it would regularly revisit and adjust its usage cap to reflect the dynamic usage of its customers.  That’s just one more broken promise from a broadband provider with an Internet Overcharging scheme.  In fact, Comcast has not moved its cap one inch since the day it was announced, although they have increased their rates.  The only thing going for the cable giant is that it doesn’t treat “250GB” as a guillotine.  In fact, the cable company only sends the usage police after the top few percent of users that exceed it, issuing a warning not to exceed the cap again during the next six months, or face a year without having the service.

This punitive policy is what Time Warner Cable CEO Glenn Britt loves to rail against.  For him, broadband usage should never be penalized — it should be exploited for all the money the provider can possibly get from customers.  That’s why Britt favors a consumption billing system that starts off with a high monthly price for everyone, than goes much higher the more you use.  Would the neighborhood crack dealer cut you off for using too much?  Of course not.  Feeding your broadband usage habits can mean fat profits, and investors love it.

Andre Vrignaud, a 39-year-old gaming consultant in Seattle, wrote us (and many others) about his own experience with Comcast’s usage ban.  He’s a victim of it, having been warned once about usage and then ultimately told his cable modem was disabled for a year.  For Vrignaud, it was a case of using a cloud storage file backup provider, moving very high resolution images around, and having roommates.  Since Comcast counts upload and download traffic towards its usage limit, it’s not hard to see what can happen to anyone trying to back up today’s supersized hard drives.  What’s especially ironic is that Comcast itself sells online file backup services — which also counts towards your cap.

Comcast’s attitude about its decision to ban Vrignaud from its broadband service for a year was simple enough: it’s a clear cut case of violating their usage caps.  In their view, heavy users slow down broadband service for everyone else in the neighborhood.  So they set a policy that cuts them off when they use too much.

To add insult to injury, broadband-disabled Comcast customers have to call Comcast’s Retentions & Cancellations Department to get the billing stopped on his disabled service.  Vrignaud had to negotiate with a representative whose instinct is to keep you a Comcast customer at all costs, even when the company won’t allow you to be one!

But is Comcast really facing a congestion issue?  Not if you happen to be a business customer at the same address, using the exact same infrastructure that residential customers in the neighborhood use.  Business Class service has no usage limits at all — “congested neighborhood” or not.  And that is where Comcast’s argument simply starts to fall apart.

We’ve been in touch with Vrignaud privately in an effort to help him find a way back to his broadband service.  The alternative is DSL from Qwest/CenturyLink, and unless you live in an area where the phone company has upgraded their networks to support ADSL 2+ or other advanced flavors of DSL, that represents quite a speed downgrade.

Our readers have told us Comcast representatives have several unofficial ways of dealing with heavy users who have gotten their first warning from the company.  Some have told customers to sign up for a second residential account under the name of someone else in the home to allot themselves an additional 250GB of usage.  Others recommend signing up for a business account, which means no usage cap at all.  For those who have been cut off, signing up as a new customer under the name of someone else in the household usually gets you back in the door, albeit facing the same usage cap issue all over again.

The problem Vrignaud encountered is Comcast’s clumsy way of dealing with customers, like himself, who have been sentenced to a year without broadband service (from them).

Vrignaud explored the route we recommended — Business Class service — and found he couldn’t sign up.  Evidently Comcast’s ban is tied to his personal Social Security number, and when he tried to enroll in Business Class service using it, he was stopped dead in his tracks.

Turns out that once Comcast has cut your broadband account for violating their data cap policy you are verboten from being a Comcast customer for 1 year. That’s right:

After being cut off from Comcast’s consumer internet plan due to using too much data, I’m told I’m ineligible to use Comcast’s recommended solution, their business internet plan that allows the unlimited use of data — solely because I made the mistake of actually using “too much” data in the first place.

As the sales rep said in my Google Voicemail message, “what’s interesting is that if you would have started off on the business side of the house, since we don’t have a cap limitations [sic] you would’ve been fine.”

Vrignaud also mentioned he was unsure if Comcast required a business Taxpayer Identification Number (TIN) in order to sign up for Business Class service.  In fact, for our readers who have gone this route, it turned out not to be necessary.  They just put their Social Security number in the space reserved for a TIN and had no problems.  Vrignaud would have a problem, however, because his Social Security number is effectively “poisoned” for the year.  He would need to obtain a specific kind of TIN — an Employer Identification Number (EIN) to proceed.  Luckily, it takes less than five minutes to apply for one online and is free.  The number displayed at the end of the process would be the one to use with Comcast.  An alternative suggestion would be to sign up for service under the name of someone else in the household.

For those on Comcast’s bad side, there is more hoop-jumping to get your service back than at the Ringling Bros. circus.

Should all this even be necessary?

Broadband service carries up to a 90% profit margin.

Stop the Cap! thinks not.  While Comcast may have endured last-mile congestion on its shared cable broadband network in days past, the company’s aggressive upgrades to DOCSIS 3 technology makes congestion-based usage limits more of an excuse than a reality.  Comcast is pitching faster broadband speeds than ever, all hampered by the same 250GB usage limit.  While residential and business class customers share the same physical cable lines strung across neighborhoods, one faces a usage cap and the other does not.  It’s simply not credible.  Comcast’s punitive usage cap scheme throws away their own customers and the revenue they bring.

Vrignaud wants the option of getting his service back, perhaps by buying additional usage.  That’s Time Warner Cable’s dream-come-true, and one we are concerned about.  Once broadband usage is limited and monetized, it becomes a commodity that can be priced to earn enormous additional revenue for cable operators, regardless of the actual cost of providing the service.  That’s a dangerous precedent in today’s duopolistic broadband marketplace, because the cost per gigabyte will likely be on the order of a thousand times or more the actual cost, with no competitive pressure to keep that cost down.  That’s how Canada ended up in its Internet Overcharging pickle, where providers call $1.50-$5 per gigabyte “reasonable,” even though it costs them only pennies (and dropping) to deliver.  Some providers are even raising those prices, even as their costs plummet.  That’s not a road we want the cable or telephone industry walking down, or else we’ll find today’s enormous cable TV bills pale in comparison to the outrageous broadband service bills of the future.  Time Warner Cable provided a helpful preview in 2009 when they proposed unlimited 15/1Mbps residential service at the low, low price of $150 a month.

Vrignaud is just one more example of why Internet Overcharging risks America’s broadband future.  It’s an end run around Net Neutrality, its arbitrary, and unjustified.  The rest of the world is racing to discard what they called congestion pricing almost as fast as America’s providers (and their Wall Street cheerleaders) are racing towards Internet Overcharging.  The United States should be following Canada’s lead and hold providers to account for this kind of Internet pricing and force them to prove its warranted, or be rid of it.  With virtually every provider earning enormous profits off Internet service at today’s speed-based pricing, there remains no justification to overcharge customers for their broadband usage.

When Stop the Cap! reader Nancy learned earlier this year AT&T was pushing yet another deregulation bill in the Michigan legislature allowing the company to abandon landline service if and when it chooses, she called AT&T and her state representatives to protest.

“When I called AT&T, the representative literally told me if the company ever did decide to stop offering basic phone service in Michigan, I should just ‘get a cell phone,'” Nancy reports.  “Naturally they tried to sell me one of theirs and I replied I was not likely to be loyal to a company that was willing to abandon me and hundreds of thousands of other rural customers.”

As in Wisconsin, AT&T’s lobbying efforts follow the same basic playbook: use friendly legislators and dollar-a-holler groups financed in part by AT&T to push deregulation as “improving competition” and making the state “business friendly.”  But as Nancy learned from experiences in Wisconsin, those are empty promises when rates go up.

“These same people pushed to deregulate cable in Wisconsin so they could offer AT&T’s cable TV service, promising lower prices if we had AT&T competing against Time Warner Cable,” Nancy remembers.  “Time Warner and AT&T raised their rates for both services, instead.”

Nancy has a good memory.  So do we.  Yet again, AT&T’s chief Astroturfer is Thad Nation, this time under the name of the Midwest Consumers for Choice and Competition.  While consumers get ignored, Nation gets time to testify before the House Energy and Technology Committee.

Nation, who runs a lobbying firm, told legislators companies like AT&T should not have to invest in old copper-lines that consumers don’t care about.  He claims it prevents AT&T and other companies from investing in broadband and wireless.

The only thing missing from this group are actual consumers. Instead, their "partners" include: AT&T, groups funded by AT&T, and several chapters of the Chamber of Commerce.

In reality, legislation pushed by AT&T will allow them and other phone companies to abandon providing even basic landline service in the rural areas they no longer care about. There is no evidence (and no regulation) AT&T will invest in either broadband or improved wireless service in rural areas where the company is unlikely to quickly recoup its investment.

Our friends at the Michigan Telephone Blog pointed us to a piece in the Huron Daily Tribune, a newspaper at ground zero for rural Michigan’s potential loss of landline service should the deregulation bill pass.

Located in Michigan’s “thumb” — the northeastern part of the state separated by Saginaw Bay, Tribune reporters drilled down into the implications for the loss of traditional landline service in this largely-rural area of Michigan.

Huron County Commissioner John Bodis, who chairs the Legislative Committee, said he’s aware of the bill and foresees some issues with it, particularly in regard to the provision allowing phone companies to discontinue landline service in an area where Voice over Internet Protocol (VoIP) or cell phone service is available.

“If it’s not mandated, they’re not going to do it,” he said. “So, I’m hoping the Senate version will tweak that a little bit and hold their feet to the fire, but I don’t know.”

In its May Capitol Currents, the Michigan Township Association reported its concerns center around residents losing their land-line phone services when other options are not adequate (i.e. poor cell phone coverage because of hills, trees, etc.).

In written testimony to the House Energy and Technology Committee, Brian Groom, president of the International Brotherhood of Electrical Workers, Local 1106, stated over the past decade, the Michigan Legislature has gradually removed telecommunications providers from the oversight of the MPSC, and HB 4314 would complete that process by eliminating the last vestige of regulation — the Primary Basic Local Exchange Service.

“This service, as currently mandated in state statute, requires residential service providers to offer — at the very least — a basic calling plan to customers in their service territory,” Groom stated. “In 2005, when (M)PSC regulation of larger calling plans was eliminated, proponents argued that the public would continue to be protected by the existence of a Primary Basic Local Exchange Service requirement.”

“This means telecommunication companies providing basic local exchange or toll service will be able to discontinue or deny service to any customer who has access to ‘a comparable voice service.’ Nothing in the bill ensures that such service would be affordable, reliable or of a minimum quality,” Grooms continued. “For customers living in remote areas which are of a higher cost to serve via landlines, this legislation could result in them having to depend on higher cost and less reliable forms of telecommunication services. This bill would create a telecommunications environment where large areas of the state have no access at all to traditional landline telephone service.”

“That means people like me and my friends in places like Bad Axe, Elmwood, and Minden City — communities few people outside of Michigan would have heard of, get disconnected because they are too rural to get much attention from these companies,” Nancy says.

Frontier Communications, which provides service in some areas of the state, claims monopolies don’t exist in the phone business:

In written testimony, Bob Stewart, Frontier Communications state director of governmental affairs for Michigan and Indiana, indicated the current atmosphere is no conducive toward monopolies.

“The telecommunications industry in Michigan has moved to a highly competitive environment where monopoly powers even in rural areas do not exist,” he stated. “Unneeded and outdated regulations in the Michigan Telecommunications Act are cleaned up by HB 4314. Michigan needs to celebrate the success of the MTA by declaring victory; not over regulating simply for the sake of regulation.”

But many rural Michigan residents far from cable television and strong signal cell phone service would beg to differ.

“The further inland you head on the ‘thumb,’ the worse things get,” Nancy reports.  “Much of this is farm country and they can’t even get DSL service, and cell reception might be barely adequate outside, but walk inside and your signal is gone.”

Despite consumers like Nancy getting upset when they learn the long term implications of these bills, without a public outcry it is easy for legislators to vote with AT&T.  In the House, HB 4314 passed 102-6.  The six standouts that stood up for consumers?

Reps. Vicki Barnett (D-Farmington Hills, Jeff Irwin (D-Ann Arbor), Steven Lindberg (D-Marquette), Lesia Liss (D-Warren), Edward McBroom (R-Vulcan) and Phil Potvin (R-Cadillac).

Some AT&T customers unhappy about the company’s forthcoming implementation of usage caps are being offered an uncapped alternative from Comcast — Business Class service.

More than a few customers facing AT&T’s imminent 150/250GB usage caps who live in a Comcast service area are informally being pitched cap-free Business Class service as an alternative.  Jim, a Stop the Cap! reader near Chicago, tells us Comcast sales representatives are rushing to sign up customers coming back to the cable company.  Although he is not served by U-verse, he points us to messages on AT&T’s own message boards from customers sharing their experiences as they pull the plug on the phone company.

“Comcast is offering us unlimited access at 12/2Mbps speeds for $59.95 per month, which is more expensive than the company’s residential broadband service, but potentially cheaper than getting a bill from AT&T with overlimit fees on it,” Jim says.

For now, Jim is heading back to Comcast residential service because he doesn’t use more than the cable company’s current limit – 250GB per month.  But he appreciates there is an alternative service available that comes without a usage limit, something he’ll keep in mind for the future.

“I feel sorry for AT&T customers stuck with them as their only broadband provider, and I think customers should continue to call and complain about the unjustified limits,” Jim offers.  “The best way AT&T customers can tell the company it has gone too far is to take their business somewhere else.”

Comcast does not normally market business products to residential customers, but many sales representatives will offer the service if a consumer expresses concern about the residential service’s usage limit.

Cope

In another example of providers telling the public (and lawmakers) one thing, while saying something very different to their own shareholders, Bell Canada’s CEO made a remarkable admission about why the company imposes Internet Overcharging schemes on its customers:

“As we see a growth in video usage on the Internet, making sure we’re monetizing that for our shareholders through the bandwidth usage charges,” CEO George Cope told listeners in a financial conference call last autumn.

That is a far cry from the story Mirko Bibic, Bell’s government affairs representative tells to anyone who will listen. Michael Geist, a Canadian syndicated columnist on technology law issues notes Bibic has told a different tale while appearing before Parliament’s Standing Committee on Industry to answer questions on usage based billing held in February.

For Bibic, usage-based billing is about “fairness” and solving alleged congestion issues.

“As for small businesses, which are generally on the same network as residential users, what you have is really a case where the congestion during peak periods is largely a residential phenomenon. It’s in that area that we’ve addressed the usage-based billing issue, and all we’re asking the CRTC for is to follow a fundamental principle of fairness,” Bibic told MPs. “If we asked 97% or 98% of Canadians if they would be prepared to pay more so that the 2% of heaviest users pay less, I’m pretty sure of what the answer would be.”

Bibic

Bibic’s argument has been repeatedly undercut by his own bosses, Geist notes.

In August, Cope told shareholders “our data revenue growth was 3.8% for our Residential Services business, particularly driven through an increase in Internet ARPU of 3.3%. And interesting, almost all that increase now coming from usage based billing as the demand for Internet use explodes through the use of video services, and we’re continuing to see an increase in the revenue per customer.”

By November, Cope was turning Bibic’s bandwidth “fairness and congestion” lemons into lemonade, celebrating data revenue growth of 5 percent, “driven principally by the bandwidth usage revenue being up 83% year-over-year.”

Cope not only decapitates his company’s arguments for usage-based billing, he also shines the light on who they will impact: if providers are to be believed that usage caps will only affect a tiny percentage of customers, how can data revenue be up a whopping 83 percent year-over-year. Are a handful of Canada’s “heavy” broadband users responsible for this growth, or are an increasing number of Canadian consumers finding themselves over the “generous” limits Bell has established because they used their broadband connections to stream movies and television shows.

As Geist notes, “no one should be under the illusion that UBB is anything other than a revenue maximization strategy in a market with limited competition, not one premised on fairness or network congestion.”