Time Warner Cable CEO Glenn Britt told Wall Street the company is backing AT&T’s decision to cease unlimited access to its wireless data services.
“In most businesses when usage goes up, that’s a good thing because people pay more,” Glenn Britt, Time Warner Cable’s chief executive officer, said at a Sanford C. Bernstein Wall Street investor conference Friday in New York. “It’s going to get the industry better aligned with consumer behavior.”
But Britt also said AT&T’s decision was “more sensible than when we did it,” referring to the company’s April 2009 aborted experiment to charge customers up to three times as much for broadband service with a consumption billing scheme that got a hostile response from consumers.
Britt was speaking about the network capacity constraints that wireless data networks have that do not compare with the much wider pipeline available to wired provides like Time Warner Cable. Britt cited AT&T’s still-exclusive iPhone as being the single most significant factor in AT&T’s decision.
Britt told Business Week that “at the time” consumption “pricing was needed to maintain the expense and expansion of the network.”
But consumer advocates suggested the company targeted its overcharging experiment in cities where customers didn’t have strong competitive alternatives. That was particularly the case in Rochester, N.Y. and Greensboro, N.C., where alternative broadband meant significantly slower telephone company DSL service. In the case of Rochester, that service included a monthly 5GB usage allowance in Frontier Communications’ Acceptable Use Policy.
Without equivalent competing alternatives, broadband consumers would be trapped in a broadband backwater with significantly worse service than neighboring cities.
Despite Britt’s acknowledgment that his company backed off because of strong consumer opposition, he’s still willing to talk about bringing the overcharging scheme back, telling Business Week, “Exactly how it works and what the PR around it will be is something we can talk about.”
Rep. Dan Maffei (D-New York) has begun to worry broadband consumers in his western and central New York district.
In April 2009, when Time Warner Cable’s announced Internet Overcharging experiment was upsetting customers in Rochester, Maffei claimed he was concerned about limiting broadband usage for customers in the area. But when former Rep. Eric Massa introduced legislation to ban unjustified usage caps and consumption billing, Maffei told his constituents he wasn’t interested in Massa’s approach:
Thank you for contacting me regarding H.R. 2902, the Broadband Internet Fairness Act. I appreciate hearing from you and welcome the opportunity to respond. The Broadband Internet Fairness Act was introduced by Representative Eric Massa (NY-29) on June 16, 2009, and was referred to the Committee on Energy and Commerce. The bill would authorize the Federal Trade Commission (FTC) and the Federal Communications Commission (FCC) to review volume usage service plans of major broadband internet service providers to ensure that such plans are fairly based on cost.
When Time Warner Cable announced in April that Rochester would be used as a test market for charging Internet users based upon consumption usage, I, along with Representative Massa, opposed this policy. We helped persuade Time Warner to abandon the plan in the area. At that time, Representative Massa also introduced the Broadband Internet Fairness Act.
Other utilities, like water or electricity, charge customers based on usage, but Internet users have traditionally been charged a flat fee for unlimited access to the web. The Broadband Internet Fairness Act would require Internet Service Providers that want to implement usage-based pricing plans to go through several traditional regulatory hurdles. While I share many of the goals of Representative Massa’s legislation, I do not believe passing this stand-alone bill is the right approach at this time.
Of course broadband is nothing like water or electric utilities. In fact, Maffei’s inclusion of that reference is a classic talking point of the telecom industry. Notice they, and Maffei, didn’t mention telephone service — the one utility that provides flat rate calling for most Americans. It also happens to be the utility most comparable to broadband service!
New York's 25th Congressional District
But Maffei made a bad situation worse when he joined 72 other House Democrats co-signing a letter from Rep. Gene Green (D-AT&T), urging FCC Chairman Julius Genachowski not to fight a court decision overturning the agency’s ability to conduct broadband oversight.
The letter represented one giant talking point — the false premise that enforcing a fair, free, and open Internet with Net Neutrality would somehow stifle investment in broadband expansion. Yet AT&T was required to honor the very same principles when it merged with SBC, and managed to remain a multi-billion dollar powerhouse well positioned to expand broadband service to additional customers in its ever-growing service areas.
The fact the broadband industry is a duopoly for most Americans — one that can threaten to pull back on service if it doesn’t get its way in Washington — is just one more reason the industry requires more oversight, not less.
Yet Rep. Maffei stood alone as the only member of the western New York Congressional delegation to sign his name to the agenda of big cable and phone companies.
Perhaps the congressman has forgotten these facts which trouble broadband consumers across western and central New York:
Rochester, NY was the only city in the northeast where Time Warner sought to conduct an Internet Overcharging experiment, made possible because of limited competition in the Rochester market;
Rochester’s other broadband provider, Frontier Communications, insists on a monthly usage allowance of just 5GB per month in its Acceptable Use Policy;
Verizon FiOS has suspended expansion indefinitely and the service will never be available in most of the 585 area code where Frontier operates, and it will take years for most of the rest of his Syracuse district to see the service reach those areas;
Time Warner Cable increased its broadband rates in 2010, as did Verizon;
Green’s letter dances around the real issue — telecommunications companies are spending millions to oppose pro-consumer reforms and stop a return of oversight authority the FCC lost after a recent court decision. Without this authority, the FCC cannot implement the National Broadband Plan’s insistence that American providers not block or impede network traffic. These Net Neutral policies preserve net freedom. The FCC cannot even require that providers tell the truth about broadband speeds and include the company’s terms of service in plain English.
Western New York is a hotbed of consumer activism on broadband issues, particularly because we are actual victims of provider abuse. No one knows more than we how critical 21st century broadband is to the transformation of this region’s perennially challenged economy.
Rep. Maffei needs a reminder this is a hot button issue for consumers from Irondequoit to Manlius. Perhaps he just doesn’t fully understand what’s at stake here. You need to remind him.
We’ve included a suggested letter you can use to help write your own. For maximum effectiveness, include some of your own personal stories, challenges, and frustrations with your local broadband provider. Feel free to share yours in the Comments section.
Dear Rep. Maffei:
I was extremely disappointed to discover you signed your name on a letter written by Rep. Gene Green urging FCC Chairman Julius Genachowski not to restore oversight authority over broadband. While Rep. Green’s letter illustrates he’s mostly concerned about the well being of AT&T, Verizon, Time Warner Cable and Comcast, as a consumer I am more concerned about the broadband duopoly that exists in Rochester & Syracuse.
If the FCC does not regain its ability to oversee broadband by reclassifying it under Title II — as a telecommunications service (which it very clearly is), the FCC can effectively do nothing to stop broadband provider abuses, such as Comcast’s notorious speed throttle on customers using certain Internet websites and services. It took an FCC investigation to finally get the cable company to admit the truth — it was interfering with customers’ broadband speeds. The oversight power the agency had was just what was needed to convince Comcast to stop.
Unfortunately, a DC Circuit Court recently disagreed it had that authority and effectively stripped it away. Chairman Genachowski is simply seeking a return to the status quo before that court decision was handed down. He’s not asking to regulate broadband anything like telephone service. In fact, he’s insisted on a “light touch.” That’s better than today’s court-imposed total-hands-off reality.
By signing Rep. Green’s letter, you effectively tell us you don’t support Net Neutrality protections that guarantee providers cannot censor or impede web traffic. You also do nothing to protect consumers from other provider abuses. Considering what residents of Rochester went through last year fighting a Time Warner Cable scheme that would have tripled broadband prices for the same level of service, I’m shocked you of all people would be a supporter of big telecom’s agenda.
Telecom companies are claiming that if regulations enforcing Net Neutrality are enacted, investment will suffer and broadband expansion will be slowed. Yet AT&T was required, as part of its merger with SBC, to respect Net Neutrality for several years. The company flourished, broadband was offered to more customers than ever, and investors liked what they saw.
The record in western New York is clear — Time Warner Cable was willing to limit its customers access to broadband service, Frontier already does in its terms and conditions, and Verizon FiOS deployment has been suspended indefinitely. For too many of us, there are too few choices. In fact, the only thing we can be assured of is higher pricing and a strengthened duopoly.
I strongly urge you to remove your signature from Rep. Green’s letter and get on board with consumers like myself in your district who believe deregulation and oversight failures have given us nothing but nightmares — from Wall Street to BP’s oil spill. Let’s not make another mistake in handing cable and phone companies unfettered permission to abuse their customers.
Please get back in touch with me as soon as possible on this important matter.
Rep. Dan Maffei told constituents he was concerned about Time Warner Cable’s Internet Overcharging scheme proposed in April 2009. At a town hall meeting in Irondequoit, New York, he admitted Time Warner Cable held near-monopoly power over consumers in Rochester. What changed his tune when he signed on to Rep. Gene Green’s anti-consumer letter to the FCC?(April 9, 2009 — 2 minutes)
Average measured connection speed (All graphics courtesy: Akamai)
America is marching backwards with a gradual decline in broadband speeds, according to a new report issued today.
Akamai’s State of the Internet Report for the final quarter of 2009 (report only available with permission from Akamai) rates America 22nd fastest in broadband connections, averaging 3.8Mbps, and declining. Speeds dropped 0.9 percent for the quarter, 2.5 percent for the year.
Still on top are South Korea, Hong Kong, and Japan, now joined by former Soviet bloc countries Romania, Latvia, and the Czech Republic — all rapidly improving broadband speeds by double digit percentages.
Within the United States, among the top 10 individual states — five rated increased speeds and five measured lower speeds. Some attribute this to network congestion, others suspect some customers have downgraded service in a poor economy. But the biggest reason for the speed drop comes from wireless broadband. Some Americans are increasingly relying on broadband service delivered to smartphones or other wireless devices over slower speed networks.
Overall, 31 states saw average connection speeds increase in the fourth quarter – up from 25 in the prior quarter. Notable gains included South Dakota’s 18 percent jump to 4.5 Mbps. Fourth quarter decreases in average connection speeds were seen in 19 states and the District of Columbia, and included Virginia’s 13 percent drop to 4.0 Mbps. Akamai believes that the significant decline in Virginia was likely due, in part, to increased traffic seen from lower-speed mobile connections that entered the Internet through gateways within those states.
Increased speeds year over year were seen in 29 states, with Hawaii growing 33 percent to 4.7 Mbps.
South Korea’s introduction to the iPhone drove their average speeds down by a whopping 24 percent. KT (formerly Korea Telecom) is at fault here — the national wireless carrier has slow wireless Internet speeds.
Stop the Cap! readers in Rochester and Austin should notice both cities made the top ten fastest list, measured by Akamai.
[Thanks to Stop the Cap! reader Rob who sent us details.]
Fastest American Broadband Cities by Unique IP
Fastest Broadband States
Best Average Measured Connection Speeds (not suprisingly most are college towns)
A lobbying campaign to add language to a Senate bill that would retroactively apply a federal ban on a tax loophole could derail plans by Verizon to sell off landlines in 14 states to Frontier Communications.
Verizon has relied on provisions of the “Reverse Morris Trust” (RMT) — which lets companies spin-off subsidiaries that merge into smaller companies do so tax free — to dump landlines across the United States, leading to crushing debt and bankruptcy for the buyers.
The House Small Business and Infrastructure Jobs Tax Act of 2010 includes provisions killing off the tax loophole, and the measure passed the House at the end of March by a vote of 246 to 178. But the House measure only applies to new deals, not to those already on the table.
Union officials and several public interest groups are asking consumers to contact their senators and request insertion of language in the Senate companion bill that would apply the ban retroactively to the latest Verizon deal with Frontier Communications.
Such a ban would prevent Verizon and Frontier from walking away from a $600 million dollar tax obligation.
Ironically, one of the House leaders strongly supporting the loophole-closing legislation is Rep. Louise Slaughter (D-NY), whose district covers Frontier’s largest service area — Rochester, New York.
“This tax avoidance loophole does nothing to help people in rural communities who rely on traditional landlines for their phone service,” Slaughter said. “If these transactions are allowed to go forward, Verizon may drop landlines in 14 different states, a development that would mean a loss of jobs for workers and poor quality phone service for millions of Americans.”
For Rep. Peter Welch (D-VT), passage of the ban represents some late justice for the disastrous tax-free deal between Verizon and FairPoint Communications, which took over phone service in his state and other parts of northern New England. FairPoint staggered under the debt load from the deal before collapsing in bankruptcy.
Slaughter
“The RMT was used by Verizon to avoid federal taxes when it sold its northern New England landline operations to FairPoint Communications in 2008,” Welch’s office noted.
“This loophole is bad for taxpayers, bad for consumers and bad for workers. By closing it and investing the savings in job creation, hardworking Americans – not corporations – will benefit,” Welch said.
The ban has special importance for West Virginia, which faces the prospect of turning over most of the state’s phone business to Frontier.
“The House has recognized the Reverse Morris Trust as a greedy grab by corporations to avoid paying their fare share of taxes,” said Elaine Harris, spokeswoman for the Communications Workers of America. “We pay our taxes. Why shouldn’t Verizon have to pay one cent on an $8 billion deal?”
“The Reverse Morris Trust was designed by Wall Street for Wall Street, not West Virginians,” said Ron Collins, a union vice president. “We’re happy Congress shares our view that the Reverse Morris Trust is a tax break for corporations, not a job-creating tool. Without this tax loophole, I don’t believe Verizon would be so eager to sell to Frontier.”
The Charleston Gazette attempted to get the views of Verizon and Frontier over the bill’s passage in the House. Verizon spokeswoman Christy Reap declined comment. A Frontier spokesman couldn’t be reached for comment.
Time Warner Cable may be robocalling you any day now with news that your set top box is getting what the cable company is calling an upgrade.
Time Warner Cable is making this robocall to customers with set top boxes announcing an upcoming upgrade. (1 minute)
You must remain on this page to hear the clip, or you can download the clip and listen later.
Calls are being made to customers with set top boxes in Buffalo and Rochester notifying them an upgrade to the new Mystro platform begins as early as April 13th, depending on the box being used. Syracuse and southern tier residents can expect their upgrade to commence in May. The company maintains a website that will let you find the exact schedule for the Mystro upgrade in your area.
Time Warner Cable’s Navigator software displays the electronic program guide, helps you program and control your DVR, and also includes the setup menu for the box.
The upgrade will result in a dramatic change in the look and feel of the box’s on-screen graphics, change how you navigate through the program guide, and provide more options for hooking up today’s HDTV sets. If you have a DVR box from Time Warner Cable, the upgrade sets the stage for an upcoming feature that will let you remotely program your DVR while away from home.
Not everyone is thrilled with the upgrade, however. In fact, a Google search for “Time Warner Navigator upgrade” reveals a large selection of websites and forums filled with complaints. Regularly reported problems include:
Sluggish performance, especially on older set top boxes;
Poor responsiveness on fast forward/rewind functions for DVRs, making it difficult to land precisely where you want to be;
The loss of “virtual HD” channels which some boxes passed through to even standard analog-only TV’s (albeit not in HD of course);
DVR bugs that made recording reliability inconsistent;
A DVR menu that makes it difficult to record only new episodes of series that repeat regularly on the channel lineup;
Box crashes, lost program guide data, and issues with the box retaining settings, especially for more complex HDTV setups;
Time Warner Cable began testing Mystro at least two years ago in selected markets, and the company believes it has worked out a number of the bugs noted above along the way. Time Warner plans to systematically upgrade their customers to the new platform nationwide now that testing has been completed.
This customer was so bemused with the Time Warner Navigator upgrade, he made a video illustrating the absurd journey he took to find a science-fiction movie to watch.
Be Sure to Read Part One: Astroturf Overload — Broadband for America = One Giant Industry Front Group for an important introduction to what this super-sized industry front group is all about. Members of Broadband for America Red: A company or group actively engaging in anti-consumer lobbying, opposes Net Neutrality, supports Internet Overcharging, belongs to […]
Astroturf: One of the underhanded tactics increasingly being used by telecom companies is “Astroturf lobbying” – creating front groups that try to mimic true grassroots, but that are all about corporate money, not citizen power. Astroturf lobbying is hardly a new approach. Senator Lloyd Bentsen is credited with coining the term in the 1980s to […]
Hong Kong remains bullish on broadband. Despite the economic downturn, City Telecom continues to invest millions in constructing one of Hong Kong’s largest fiber optic broadband networks, providing fiber to the home connections to residents. City Telecom’s HK Broadband service relies on an all-fiber optic network, and has been dubbed “the Verizon FiOS of Hong […]
BendBroadband, a small provider serving central Oregon, breathlessly announced the imminent launch of new higher speed broadband service for its customers after completing an upgrade to DOCSIS 3. Along with the launch announcement came a new logo of a sprinting dog the company attaches its new tagline to: “We’re the local dog. We better be […]
Stop the Cap! reader Rick has been educating me about some of the new-found aggression by Shaw Communications, one of western Canada’s largest telecommunications companies, in expanding its business reach across Canada. Woe to those who get in the way. Novus Entertainment is already familiar with this story. As Stop the Cap! reported previously, Shaw […]
The Canadian Radio-television Telecommunications Commission, the Canadian equivalent of the Federal Communications Commission in Washington, may be forced to consider American broadband policy before defining Net Neutrality and its role in Canadian broadband, according to an article published today in The Globe & Mail. [FCC Chairman Julius Genachowski’s] proposal – to codify and enforce some […]
In March 2000, two cable magnates sat down for the cable industry equivalent of My Dinner With Andre. Fine wine, beautiful table linens, an exquisite meal, and a Monopoly board with pieces swapped back and forth representing hundreds of thousands of Canadian consumers. Ted Rogers and Jim Shaw drew a line on the western Ontario […]
Just like FairPoint Communications, the Towering Inferno of phone companies haunting New England, Frontier Communications is making a whole lot of promises to state regulators and consumers, if they’ll only support the deal to transfer ownership of phone service from Verizon to them. This time, Frontier is issuing a self-serving press release touting their investment […]
I see it took all of five minutes for George Ou and his friends at Digital Society to be swayed by the tunnel vision myopia of last week’s latest effort to justify Internet Overcharging schemes. Until recently, I’ve always rationalized my distain for smaller usage caps by ignoring the fact that I’m being subsidized by […]
In 2007, we took our first major trip away from western New York in 20 years and spent two weeks an hour away from Calgary, Alberta. After two weeks in Kananaskis Country, Banff, Calgary, and other spots all over southern Alberta, we came away with the Good, the Bad, and the Ugly: The Good Alberta […]
A federal appeals court in Washington has struck down, for a second time, a rulemaking by the Federal Communications Commission to limit the size of the nation’s largest cable operators to 30% of the nation’s pay television marketplace, calling the rule “arbitrary and capricious.” The 30% rule, designed to keep no single company from controlling […]
Less than half of Americans surveyed by PC Magazine report they are very satisfied with the broadband speed delivered by their Internet service provider. PC Magazine released a comprehensive study this month on speed, provider satisfaction, and consumer opinions about the state of broadband in their community. The publisher sampled more than 17,000 participants, checking […]
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Time Warner Cable CEO Glenn Britt told Wall Street the company is backing AT&T’s decision to cease unlimited access to its wireless data services.
Britt was speaking about the network capacity constraints that wireless data networks have that do not compare with the much wider pipeline available to wired provides like Time Warner Cable. Britt cited AT&T’s still-exclusive iPhone as being the single most significant factor in AT&T’s decision.
