Time Warner Cable CEO Glenn Britt says the cable company is once again testing technology to allow it to implement the same type of Internet Overcharging system consumers immediately rejected in 2009.

Speaking at the Cable Show in Chicago Thursday, Britt said the company has not yet decided whether it will actually introduce the system, but will have the technology in place to quickly implement it.

Unlike some other cable companies with a fixed bandwidth limit, once again Time Warner is considering a combination cap and tier system with fixed allowances for different levels of service.  In 2009, Time Warner Cable proposed a usage allowance of just 40-60GB per month for their Standard Service customers.  Customers seeking unlimited use service faced broadband bills as high as $150 a month.

Customers overwhelmingly rejected the pricing scheme in test markets in 2009, and political pressure only hastened the shelving of the test.  But Britt remains undeterred, telling Wall Street investors he remains a true believer in usage-based billing

Wall Street analysts told Bloomberg News they didn’t have a problem with it.  Bloomberg also quoted Netflix CFO David Wells as saying he had no objection to Internet providers covering the cost of increasing bandwidth capacity.  But Bloomberg quoted Wells speaking on a June 1 conference call, not in reaction to Britt’s specific announcement yesterday.  Further, Wells clarified his comments were directed towards network optimization and traffic shaping, not broadband usage caps.

Netflix is among the most likely online services that would expose broadband customers to potential overlimit fees, especially if Time Warner Cable brings back the same usage allowances it proposed in 2009.

As political pressure over Usage Based Billing continues to keep providers from gravitating towards more stringent Internet Overcharging schemes, western Canadians are enjoying significant victories as providers relax usage caps and increase speeds for broadband service.

Weeks after Shaw Communications announced new packages with increased usage allowances and a few unlimited use plans, Telus has now followed Shaw’s lead and doubled usage caps on many of its Internet plans, slashed overlimit fees by more than half for some, and plans to increase upload speeds for one of its premium plans:

Among the major changes are dramatically increased usage allowances and the reduction of overlimit fees.

Telus customers receive their service from the phone company in various flavors of DSL.  Some older suburban and rural areas still receive speeds averaging 3Mbps, but those lucky enough to be served by VDSL can comfortably achieve the company’s fastest broadband speeds.  The increased usage allowances are welcome news, even if Telus has never strictly enforced any of them:

• High Speed Turbo 25 increased to 500GB, was 250GB;
• High Speed Turbo increased to 250GB, was 125GB;
• High Speed increased to 150GB, was 75GB;
• High Speed Lite increased to 30GB, was 13GB;
• The overlimit fee for High Speed Lite has been reduced from $5/GB to $2/GB;
• Unofficial reports suggest upload speed for Turbo 25 is being increased from 2Mbps to 3Mbps, to be rolled out gradually.

Is Telus following Shaw's lead?

The reduction in the overlimit fee for High Speed Lite was predictable in light of recent political events.  It is difficult to sustain the argument that overlimit fees and usage caps are priced to control network congestion when the lightest users face the most draconian limits and penalty fees.

But unlike their cable competitor Shaw Communications, Telus has not seen fit to offer customers a truly unlimited plan, which presents a problem for some.

“Telus needs to remember they cannot win a speed race with Shaw so they should be lowering prices, taking the usage caps off, and competing with something they can actually win — delivering customers the unlimited service they want at a reasonable price,” says Stop the Cap! reader Abel from Burnaby, B.C.

Separately, Telus also quietly introduced a rate increase for basic home telephone service.  What used to be $21 a month is now $25, an increase of four dollars.

The dramatic plan changes underway in western Canada come in response to political pressure and consumer ire against Usage Based Billing (UBB).  Bell, which provides much of Canada with wholesale broadband access, was seeking to force independent providers to abandon unlimited, flat rate pricing in favor of ubiquitous UBB.  The provocation brought a half million Canadians to sign a petition against metering broadband.

For eastern Canada, thus far little has changed as Bell, Rogers, and Videotron continue with business as usual.

The U.S. Cattlemen’s Association this week took some time out to go all out for AT&T’s proposed merger with T-Mobile.  In addition to successfully navigating the FCC’s arcane comment filing system to submit their comments in favor of the merger, the group also penned a lengthy, favorable guest blog for Washington, D.C. inside-the-beltway-favorite, The Hill newspaper:

The expansion of next-generation wireless broadband envisioned by the T-Mobile and AT&T merger, for example, is critical for the next stage of rural America’s evolution and success. It will allow ranchers, farmers, and all rural residents who have been traditionally underserved to finally gain access to the best that mobile broadband has to offer, including faster and more reliable connections. We strongly encourage the Federal Communications Commission to support these developments as an investment in both the current and future generations of agricultural producers and small communities across rural America.

The cattlemen’s group has had a lot to say about telecommunications issues, especially mergers and acquisitions.  It was cited by Verizon as a supporter of its merger with Alltel in 2008, signed a joint letter in 2008 from industry-connected Connected Nation for a broadband plan compatible with the interests of the nation’s largest cable and phone companies, wrote a letter to the FCC opposing Net Neutrality in 2009, and submitted two pages of comments in May favoring the merger between AT&T and T-Mobile.

Apparently there is plenty of free time on the ranch to ponder billion dollar telecommunications mergers.

The argument from the group is that permitting mergers and blocking open net policies like Net Neutrality will convince carriers to provide enhanced service in rural areas where cattle ranches predominate.  But facts in evidence illustrate how wrong-headed that argument is:

• Verizon’s merger with Alltel has done nothing to bring its LTE network to rural America.  Verizon is focusing LTE upgrades on the markets where it makes the most business sense, and that does not include rural Texas or Oklahoma;
• The National Broadband Plan has directed stimulus funding for rural projects that are most likely to reach their ranch members — wireless ISPs and rural DSL.  The cattlemen’s group has nothing to say about either provider;
• Net Neutrality and the policies of an open and free Internet have no real impact on rural broadband deployment.  The same companies refusing to provide service yesterday are still refusing to provide service today, and that includes completely exempted wireless providers;
• T-Mobile’s urban-suburban focus is a mainstay of its business plan.  T-Mobile has never prioritized rural America as a viable service area, relying on roaming agreements to fill in service gaps.  Combining its urban-focused wireless infrastructure with AT&T will add nothing to the rural wireless experience.

The Washington Post finds financial connections between AT&T and the cattlemen group.

Advocating for a merger with T-Mobile makes about as much sense as the group advocating for a T-Mobile merger with Leap Wireless’ Cricket or MetroPCS.  All have a record of indifference about providing service in rural areas themselves.

So why does the group persist in fronting for AT&T’s public policy agenda?  Cecilia Kang at the Washington Post tweeted the obvious answer — they receive support from AT&T.

The piece for The Hill was penned by Jess Peterson, the cattlemen group’s executive vice president.  But Peterson has a second career: president of Washington, D.C.-based Western Skies Strategies, a lobbying firm that promises “success and profitability to our valued clients every time.”

The concept of dollar-a-holler public advocacy is not new, but AT&T is the Master of the Astroturf Universe.  The Center for Responsive Politics notes that from 1989 to 2010, no single company spent more on campaign contributions than AT&T.  Since 2008, more than $1.25 million has been “donated” to politically-connected charities and those willing to lend their name and reputation to back the company’s public policy agenda.

Facts have a hard time penetrating piles of cash, but here are some anyway:

1. T-Mobile’s combination with AT&T may create additional capacity for the combined company, but almost entirely in urban and suburban areas that will do nothing to help rural wireless.
2. No telecommunications company has a track record of providing service in areas unprofitable to serve or fail return on investment demands.  No merger will change that.
3. Promises for network upgrades already committed in long-range business plans do not sweeten a bitter deal for Americans concerned about competition in the wireless marketplace.
4. T-Mobile’s track record as being the most market-disruptive in pricing and innovation will be eliminated in a merger with America’s lowest rated wireless carrier.
5. Any excitement for rural wireless broadband from AT&T is tempered when would-be customers realize the company enforces a 2GB usage cap with an overlimit fee on their smartphone data plans — an Internet Overcharging scheme more punishing than either Verizon or Sprint.

Phillip Dampier

This week, the tech community has been buzzing over new entrants in the world of cloud computing.  Apple’s iCloud in particular has sparked enormous media coverage as the company plans to encourage customers to access all of their favorite content over their broadband connection.  Apple is also moving towards online distribution of many of its software products, including the forthcoming OS X Lion operating system, suggesting consumers can pass up traditional physical media like CD-ROMs or DVDs.

Cloud storage theoretically allows you to store your entire music, video and photo collection online for easy access from any device.  Watching the 20-somethings buzz about 100GB+ secure file lockers and the end of traditional file storage as we know it has been amusing, but these people need to get their heads out of the clouds.  Unless they become politically involved in America’s broadband debate, it is not going to happen the way they hope it will.

Tech entrepreneur?  Meet broadband provider reality check: the Internet Overcharging usage cap and “excessive use” pricing scheme.

While Steve Jobs was introducing iCloud, broadband providers and their industry friends have been ruminating over the impact all of this new traffic will have on their broadband networks.  In an homage to former AT&T CEO Ed Whitacre’s “you can’t use my pipes for free,” the drumbeat for implementing “control measures” for cloud computing and video traffic has been amplified several times over by certain providers, Wall Street analysts, and their trade press and equipment supplier lackeys.

One alarmed provider pondered the impact of iCloud in terms of their past experience with iTunes, which also spiked traffic when it was first released.  Others balk at the notion of consumers using broadband platforms to move entire libraries of content back and forth, especially on wireless networks.  The only sigh of relief detected?  Apple won’t start iCloud with video content — just music, at least at first.

The enemies list

The biggest targets — the companies that get a lot of pushback from providers for using “their networks” to earn millions for themselves are Google, Netflix, Amazon and Apple.  Each of them are rapidly moving into the online entertainment business, threatening to provoke more cable TV cord-cutting.  Netflix is now responsible for 30 percent of online traffic during primetime hours, a fact that some use as an accusation — as if Netflix should be held to account for its own success. Amazon has opened its own cloud based music storage and is also increasingly getting into online video content streaming.  Apple has a novel approach at handling its forthcoming iCloud music feature which should save hours in uploading, but the company is also moving towards online distribution of a growing proportion of its software, including the huge bug fixes and upgrades that will easily exceed a gigabyte if you own several Apple products.

Google is a frequent Washington target and honestly delivers the only truly effective corporate pushback to anti-consumer broadband pricing some providers have contemplated.  In fact, Google is putting its money where its mouth is building a gigabit network larger providers repeatedly scoff at as unnecessary, too costly, and too complicated.

While millions in venture capital funds new online innovations, only a miniscule amount of money is being spent to counter the lobbying major providers are doing in Washington to redefine the broadband revolution in their terms, complete with usage pricing that bears no relation to cost, arbitrary usage limits, and ongoing lack of true competition.

Online innovation is grand, but allowing providers to strangle it with Internet Overcharging schemes guarantees to end the party real fast.

Individually, none of the new cloud services are likely to blow out usage caps in excess of 100GB, but in combination they certainly could.  Anyone using online file backup, cloud storage of video and large music collections, uses Netflix or other online streaming services, and spends lots of time on the web will easily approach the limits some providers have established.  That doesn’t even include large software updates.  Unless you have an unlimited usage plan on the wireless side, don’t even think about using most of these services with AT&T’s 2GB monthly wireless usage cap.

Glenn Britt: The Internet is a utility which is why we can keep raising the price.

In the handful of countries with ubiquitous Internet Overcharging, little of this will pose a problem — companies won’t launch cloud computing services in markets where usage caps will effectively keep customers from using them.

That is why it is critical for some of America’s largest technology companies to get on board the fight against Internet Overcharging, and demand Washington recognize broadband as a utility service that should be wide open and usage cap free.  The evidence is right in front of you.  Time Warner Cable CEO Glenn Britt recognizes the fact broadband is an essential part of our lives today, which is why he is confident enough to keep raising the price and charging even more in the future.  It’s not about “network congestion,” “building the next generation of broadband,” or “pricing fairness.”  Stop the Cap! started at ground zero for Time Warner Cable’s 2009 version of “pricing fairness” — $150 a month for an unlimited use broadband account that likely cost major providers less than $10 a month to provide.  It’s about pure, naked profiteering, unchecked by free market competition in today’s broadband duopoly.

Unless a company like Google can vastly expand its own broadband rollouts, it is increasingly apparent to me (and many others), we may have to move towards an entirely different model for broadband in the United States — one built on the premise of the Interstate Highway System.  One advanced, publicly-owned fiber network open to all providers on which telecommunications services can travel to homes and businesses from coast to coast.

Nobody says private companies shouldn’t be able to compete, but every day more evidence arrives they will never be inclined to deliver the next generation of service that other countries around the world are starting to take for granted.  They will instead protect their current business models at all costs, even if that means throwing America’s broadband innovation revolution under the bus.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/CNN Will iCloud Measure Up 6-7-11.flv[/flv]

CNN takes a look at what makes Apple’s iCloud service different from competitors from Google and Amazon.  (5 minutes)

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/CNN Dropbox Cloud Computing 6-8-11.flv[/flv]

CNN talks with the folks at Dropbox about their cloud file storage system.  (3 minutes)

The more wireless carriers try to impose punitive usage caps on their customers, the more they will shop elsewhere for wireless service or turn to free Wi-Fi alternatives.  Those are the results of an important new report from Devicescape, a Wi-Fi advocate and software creator that allows for seamless Wi-Fi connections.

At the very top of the findings of the latest quarterly report: consumers overwhelmingly continue to despise usage caps and other Internet Overcharging schemes.  At least 73 percent suggest they will take their business elsewhere if their provider cancels their unlimited usage data plan, with 80 percent making changes in how they consume wireless data — especially moving usage to free Wi-Fi networks and off 3G/4G networks.

Almost 90 percent of smartphone users already connect to Wi-Fi at home and on the road, with 64 percent using Wi-Fi hotspots at work and in shops and restaurants at least once a day.

The report also makes it clear consumers want a hassle-free Wi-Fi experience.  It should be free and open access, with no annoying PIN codes or passwords.

Wi-Fi is quickly becoming an expectation more than a treat, and businesses and communities that don’t provide it will increasingly be judged negatively by some consumers.  An even greater negative reaction can be expected from those who treat Wi-Fi access as a profit center.  Customers don’t like paying extra for access at hotels, restaurants, or while browsing around shopping malls or business centers.  Forget about annoying login or customer agreement screens as well.

While many consumers claim they will switch wireless carriers over usage caps, in reality few are currently doing so for several reasons:

1. The alternative providers still offering unlimited use plans are perceived as having lower quality coverage areas (eg. Sprint);
2. Most major carriers have grandfathered their sizable base of “unlimited plan” devotees, allowing them to retain the popular plans even as they discontinue them for new customers;
3. Customers ultimately have few choices for unlimited service.

Where customers are stuck with a usage-capped data plan, they economize wherever possible.  In particular, many rely on Wi-Fi service instead of the wireless service provided by their wireless provider.

Ironically, that’s fine with many carriers, especially AT&T, which has been promoting efforts to offload as much 3G traffic as possible onto local Wi-Fi hotspots instead.