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Antietam Broadband Ditches Usage Caps for Good: Pandemic Proved Caps Unnecessary

Phillip Dampier June 1, 2020 Antietam Broadband, Consumer News, Data Caps Comments Off on Antietam Broadband Ditches Usage Caps for Good: Pandemic Proved Caps Unnecessary

Maryland-based Antietam Broadband has permanently shelved internet usage data caps, retroactive to mid-March, for all of its customers.

An ongoing study of customer usage patterns during the early days of the COVID-19 pandemic by Antietam engineers showed data caps were no longer technically necessary. Antietam is one of dozens of telecom providers that temporarily shelved data caps under the FCC’s Keep Americans Connected Pledge, a voluntary effort to suspend data caps, late fees, and service disconnections. After three months of collecting data about customer usage patterns and upgrade activity, Antietam Broadband president Brian Lynch said there was no legitimate need to return to usage caps.

Antietam may be the first U.S. provider to drop usage based billing after the FCC’s pledge expires at the end of June.

Lynch said customers appropriately self-managed their accounts, with heavier users (such as those now working from home) moving towards more profitable, higher-speed internet packages on their own. Antietam has traditionally offered seven different speed tiers, each including its own (now defunct) usage allowance:

  • Internet Starter: 5 Mbps down / 1 Mbps up, 500GB per month.
  • Go Fast: 10 Mbps down / 1 Mbps up, 500GB per month.
  • Ultra Fast 30:  30 Mbps down / 5 Mbps up, 600GB per month.
  • Ultra Fast 50:  50 Mbps down / 5 Mbps up, 750GB per month.
  • Ultra Fast 100:100 Mbps down / 5 Mbps up, 1,250GB per month.
  • Ultra Fast 200: 200 Mbps down/ 10 Mbps up, 1,500GB per month.
  • Flight Gigabit Fiber: 1,000 Mbps down/ 1,000 Mbps up, no usage limit.

“These are uncertain times,” said Lynch. “We felt a need to give customers as much certainty over their bill as possible. Eliminating data usage caps means that customers will know the exact amount of their broadband bill every month.”

It also reduces customer confusion by eliminating the need to factor in data usage when selecting the right broadband package. Now, Antietam customers buy based exclusively on speed needs.

The pandemic caused a significant increase in data usage, but Antietam’s network was capable of handling usage demands, Lynch added.

“Since the pandemic began, we have seen as much increase in broadband usage as we generally would see over the course of a year,” said Lynch.

10% of Homes Now Exceed Comcast/AT&T/Cox’s 1 TB Usage Cap; Average Use Now 402.5 GB

Phillip Dampier May 4, 2020 Broadband "Shortage", Broadband Speed, Consumer News, Data Caps Comments Off on 10% of Homes Now Exceed Comcast/AT&T/Cox’s 1 TB Usage Cap; Average Use Now 402.5 GB

Note that data usage is slightly higher for users with “flat rate billing (FRB)” plans vs. those stuck with “usage-based billing (UBB).” (Source: OpenVault)

A record 10 percent of U.S. households now exceed 1 TB of data usage per month, putting some customers at risk of overlimit fees for exceeding data allowances that are usually enforced by AT&T, Comcast, Cox, and other telecom companies. Those caps are temporarily suspended because of the COVID-19 pandemic.

OpenVault, which collects average data usage from several service providers, reports a dramatic increase in the number of homes it designates as “power users” that consume at least 1 TB of data each month. In the first quarter of 2019, 4.2% of customers regularly exceeded 1 TB of usage. During the same period this year, that number shot up 138% to 10% of customers. “Extreme power users” that consume 2+ TB of data increased a record 215% from just one year ago, now representing 1.2% of broadband households. Last year it was 0.38%.

Overall total broadband usage across all users increased 47% in the first quarter of 2020, reaching an average of 402.5 GB a month. But that number mostly comprises average usage before the COVID-19 pandemic forced many to work from home. OpenVault originally predicted in January 2020 that monthly usage would reach 425 GB by the end of 2020. But with most Americans sheltering at home, measurements now suggest average broadband usage already exceeds that, reaching a record high of 460 GB in April.

“Nearly all the growth in broadband usage we would have expected for 2020 has now been achieved in the first quarter, with much of it concentrated in the last two weeks of the quarter,” OpenVault reported.

Despite usage growth, broadband providers in the United States are universally confident their networks are more than capable of sustaining the increased traffic. In fact, many providers report a spike in new customers, upgrades to higher speed tiers, and at least one — Spectrum, is confident enough of its network capacity to give away two months of broadband service to households with school-age children for free.

NCTA–The Internet & Television Association reports the biggest increases in broadband traffic are occurring on the upstream side, likely because of video teleconferencing. Although downstream traffic also spiked after the pandemic forced many businesses to close their offices, that traffic has flattened out and most recently has even decreased slightly.

Source: NCTA

Broadband providers may have lost key arguments to support reimposing data allowances and usage caps after the pandemic eases. Not only have broadband networks managed dramatic spikes in traffic with no significant difficulties, there are no signs of any “data tsunamis” in the future, even as broadband usage growth exceeds predictions. NCTA reports that 99.8% of the time broadband providers had “ample” or “excess” capacity available, not only to sustain current traffic levels but also potential future spikes in traffic. Peak traffic usage reaching levels where reduced capacity was available was identified just 0.2% of the time, causing a “minor impact on performance and customer experience.”

The current crisis is likely to bring a flood of new revenue to many broadband companies, even without usage overlimit fees. Since the pandemic began, OpenVault reports a 3.75% growth in premium-priced gigabit speed upgrades, up 97% from the same time last year.  In the New York City area, gigabit service subscriptions at Altice/Optimum increased 56% as many workers began to telecommute.

The biggest challenge the cable broadband industry faces as a result of this year’s usage growth is a need to accelerate plans already under development to increase upload speeds. Much of the recent traffic growth came from upstream traffic, which is cable broadband’s biggest Achilles’ Heel. Cable broadband networks devote most available bandwidth to downloads, with only a small fraction devoted to upload speed. Cable companies are expected to modestly increase upload speeds in a few months and will eventually deploy the next DOCSIS standard, supporting far faster upload speeds, beginning sometime next year.

Siberia May Have Better Rural Internet Access Than You Do

Russian satellite television provider Tricolor, in collaboration with Eutelsat Networks, has launched satellite broadband service throughout Siberia, with data plans offering speeds up to 100 Mbps.

Customers can choose from packages of internet and television service or just go broadband-only. A one time fee of $136.75 gets the customer a startup package including a satellite receiver and data modem. Customers can pick up equipment from stores in Novosibirsk, Omsk, Tomsk, Krasnoyarsk, Barnaul, Irkutsk and Kemerovo or have it direct shipped to their home address.

Customers can choose between three “unlimited” data packages: 40/10 Mbps for $75/mo, 20/5 Mbps for $45/mo, or 10/5 Mbps for $27/mo. Like many satellite providers, Tricolor reduces data speeds during peak usage times for customers using over 50, 25, and 15 GB of usage per month, respectively. But Tricolor says speed reductions will not be as severe as some providers that reduce speeds to less than 1 Mbps. A faster, usage-limited tier with speeds up to 100 Mbps is also to be introduced, and customers can get discounted subscriptions by agreeing to usage caps on the three aforementioned speed tiers.

Tricolor provides solid reception across the Russian Federation, including the vast expanse of Siberia. Wiring a country the size of Russia is a daunting task, so satellite and wireless internet services are likely to be a major offering across the country for years to come.

Tricolor’s coverage map.

Spectrum: Go Ahead and Cancel Cable TV, We’ll Make a Fortune Selling You $70 Broadband Instead

Phillip Dampier September 3, 2019 Charter Spectrum, Competition, Consumer News 23 Comments

Charter Communications has set the stage for a Wall Street-pleasing boost in average revenue per user (ARPU) with a major broadband rate hike planned for this fall.

The rate of U.S. broadband subscriber growth slowed significantly in the second quarter of 2019, as the marketplace for internet access remains saturated and current customers are largely staying with the provider they know.

A MoffettNathanson report to investors shared by Light Reading reported subscriber growth is down from 3% during the first three months of 2019 to 2.8% over the late spring and early summer. In total, cable and phone companies added 438,000 new broadband customers in the second quarter, a significant drop from the 570,000 they added at the same time last year.

The number of new household formations continues to decline in the United States, presumably because younger Americans saddled with student loan debt are having a tougher time buying property or justifying high rent payments. Providers also believe the ongoing shift away from copper telco DSL service to cable broadband has slowed to a trickle, with those still loyal to DSL not concerned about internet speed, are happy with lower cost service, or do not have any other option. Craig Moffett, chief analyst for MoffettNathanson believes much of the growth in cable broadband at this point is coming from customers switching from services like AT&T U-verse, which still offers top speeds of under 30 Mbps in some areas. Other phone companies still relying on fiber-to-the-neighborhood service are likely also seeing customer departures triggered by recent discontinuation of video service. In most areas, cable operators are still the largest beneficiaries of provider changes. Phone companies relying on DSL continue to report broadband subscriber losses. Last year during the second quarter, phone companies lost 127,000 subscribers (a 1.1% decline). This summer, they lost 172,000 subscribers (a 1.3% decline).

With slowing cable broadband growth, companies are still under pressure to report positive quarterly results to shareholders. Without a significant number of new customers, Moffett believes operators will raise broadband prices to deliver higher revenue, especially in light of ongoing video cord-cutting. Moffett points to Charter Communications’ Spectrum in particular. Spectrum has one of the cable industry’s lowest ARPU numbers, because it does not impose cable modem rental fees or usage caps. That may explain the company’s plans to hike general internet pricing 6% starting in October, soon collecting $69.99 for Standard 100 (or 200 Mbps) service and $75.99 a month for customers bundling Standard Internet with Wi-Fi.

“The broadband increases alone would suggest significant upside to Charter ARPU estimates,” Moffett said. He also noted Charter’s plan to dramatically increase video pricing also “underscores their recent pivot towards ‘letting’ video customers leave if they want, and repricing those who remain for profitability.”

That means customers outraged by Spectrum’s cable TV rate hikes will not get much sympathy from customer retention agents. Moffett believes customers will be invited to cancel cable television service, because Charter does not make as much profit on the service as it used to, and customers will probably still keep their Spectrum internet service, which is enormously profitable for the cable operator. Customers will also pay an even higher price for standalone internet service once they stop bundling television service, increasing Charter’s profits even more.

Ironically, the more Spectrum customers drop cable TV packages, the more profit Charter can report to shareholders. Those keeping cable television won’t hurt Charter’s bottom line either. Customers that readily agree to pay more with each cable TV rate hike are statistically the least likely to complain or cancel.

Deutsche Telekom Loses All-You-Can-Watch StreamOn Dispute in Germany Over Net Neutrality Violation

Phillip Dampier July 17, 2019 Consumer News, Data Caps, Net Neutrality, Online Video, Public Policy & Gov't, Telekom Deutschland, Wireless Broadband Comments Off on Deutsche Telekom Loses All-You-Can-Watch StreamOn Dispute in Germany Over Net Neutrality Violation

While net neutrality in the United States has been neutered by the Republican-controlled FCC, the concept of an online level playing field is alive and well in Germany, and T-Mobile’s parent company Deutsche Telekom (DT) just got called out for a foul ball.

The German telecom giant has lost its legal battle with Germany’s telecom regulator, the Federal Network Agency (Regulator Bundesnetzagentur) over StreamOn, its all-you-can-stream mobile video product that does not count against customer usage allowances. The company introduced the unlimited video streaming service in Germany in 2017, emulating a similar service available in the United States that offers zero rated mobile video content at a reduced video resolution. An appeals court in Münster this week ruled that the German regulator was correct to forbid DT from continuing to offer StreamOn to customers in its present form for two reasons:

  • StreamOn was only available to T-Mobile customers inside Germany or those who visited the country, violating Europe’s “roam like at home” rules that require carriers to not restrict or charge more for mobile services or features when traveling between member states of the European Union.
  • StreamOn violates German net neutrality rules by delivering only T-Mobile approved, speed-throttled, low resolution video content that won’t count against a customer’s usage cap.

“StreamOn must conform to the ‘roam like at home’ principle and customers must have video streaming available in an unthrottled bandwidth,” said Federal Network Agency president Jochen Homann. “The rule of equal treatment is a cornerstone of European net neutrality regulations. The principle of equal treatment has made the internet a driver of innovation, and the diversity of applications and services benefits all consumers.”

Hohmann

DT immediately contested the regulator’s decision and sued. The case has been drifting through German courts since December 2017, with the most recent ruling in favor of the regulator issued by an appeals court, which declared its ruling to be final.

DT has claimed it finds the regulator’s objections “very puzzling indeed,” claiming StreamOn has been wildly popular in the United States and Germany. Two years ago, it warned that if the courts upheld the regulator’s ruling, it would force the company to stop offering it.

“The Bonn-based regulatory authority is ordering us to also offer StreamOn in other EU countries. It bases this order on the EU Roaming Regulation,” DT said in a statement in 2017. “Fulfilling the order would mean the end of our free service, because we would not be able to offer it cost-effectively in other countries.”

Despite its threat to shutter StreamOn in Germany, the company claimed this week it would continue offering the service for the time being, without increasing prices.

“We are delighted that the court has confirmed our interpretation of the law,” a Federal Network Agency spokesman said after the decision was announced. “We will take quick action to ensure that Telekom adjusts its product accordingly.”

“We expect the [Federal Network Agency] to allow an appropriate amount of time to make the necessary adjustments,” a DT spokesman said. “We are convinced that StreamOn is a legal product and will explore all our legal options.”

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