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Verizon FiOS TV/Broadband Arrives in Suburban Syracuse: Incumbent Time Warner Cable Says “No Price War” Coming

Phillip Dampier October 6, 2009 Competition, Verizon, Video 3 Comments

fiosVerizon FiOS today adds television to its lineup of services in several suburban towns in the Syracuse area, as competition heats up in central New York for cable, telephone, and broadband service.  But the incumbent cable operator, Time Warner Cable, says it’s not worried by Verizon’s arrival, and a company spokesman predicts no price war will result.

Eight communities in the Syracuse area will now be able to choose Verizon FiOS television service in addition to broadband and phone service: Camillus, Clay, Cicero, DeWitt and Salina, and the villages of East Syracuse and North Syracuse in Onondaga County, and the town of Fleming in Cayuga County.

The arrival of television service is important for Verizon, because it lets them compete head-on with incumbent cable operator Time Warner Cable that already offers bundled packages of services, typically known as a “triple play” in the industry — telephone, cable-TV, and broadband.

Chris Creager, Verizon’s president of Northeast operations, claims competition for cable television in central New York will result in better service at lower prices.

“When we enter a market, customers win,” Creager said. “Usually, cable companies are more receptive to looking at prices.”

Time Warner Cable downplayed the competitive threat Verizon could pose to their operations in the region.

In a statement echoing the sentiment Time Warner Cable has expressed in most of the communities where FiOS competes with them, spokesman Jeff Unaitis said Time Warner Cable already has an advanced cable network and has experience delivering cable television service to Syracuse-area residents that Verizon lacks.  Competition is nothing new to Time Warner Cable, he said, noting the company has faced satellite television competition for years.  Unaitis also predicts no significant price cuts as a result of Verizon’s all-fiber FiOS system arriving in town.

Indeed, evidence suggests that Verizon’s FiOS service does not result in dramatic savings for consumers, with one significant exception.

New customer promotions often offer significant price savings, particularly for customers who sign contracts to remain with providers for one or two years, and choose bundled packages of multiple services.  Central New York customers signing up for Verizon FiOS for at least two services can receive a $150 gift card.  Customers choosing their “triple play” will receive $30 off their monthly bill for six months.

Once the promotional offers expire, so do most of the savings, unless a customer threatens to switch providers.  That often brings a renewal of their promotional package price for an extended period, although some providers limit the number of times a customer can take advantage of a promotion.  For consumers trying to optimize savings, that can start a ping-pong relationship with providers, as customers sign up for a promotion and then cancel service when it expires, taking their business to the other player in town.

Competition does often bring improved service, even when savings are elusive.  Broadband service in particular often benefits, as consumers enjoy faster speeds with fewer limitations in communities with FiOS as one of the competitors.

In Syracuse, Time Warner Cable has adjusted speeds upwards for its Road Runner service, in advance of Verizon FiOS’ arrival.  In contrast, speeds in Rochester, a city with no prospect for Verizon FiOS competition, has not seen a speed increase for standard service in several years.  In New York City, a system upgrade to DOCSIS 3 technology has allowed the cable company to offer a premium 50Mbps service tier.  The Syracuse Post-Standard explored the competition angle, and what central New York residents might expect to come from it:

Competition from FiOS, which offers Internet download speeds of up to 50 megabits per second, may push Time Warner Cable to deploy available technology to match those speeds, said Thomas W. Hazlett, a law and economics professor at George Mason University and former chief economist of the Federal Communications Commission. Time Warner Cable recently upgraded its New York City network to offer a 50-megabit option, compared with the maximum 15-megabit speed in Syracuse.

“If it’s like elsewhere, you’re going to see Time Warner respond,” Hazlett said. “They will increase speeds.”

Likewise, Verizon and Time Warner Cable will push each other to offer better channel lineups, better picture quality, on-demand programming and novel services, said Jeffrey Kagan, an independent telecommunications analyst in Atlanta. Prices also will be lower that they would be without competition, but don’t expect a big drop, he said.

The newspaper explored what each company offers customers:

$110 per month: Includes unlimited phone calls in North America; Internet at 15 megabits per second for downloads, 5 megabits for uploads; 255 standard-definition TV channels and seven high-definition channels.

$120 per month: unlimited phone calls in North America; Internet at 25 MBPS for downloads, 15 MBPS for uploads; free Wi-Fi access on nationwide network of hotspots; 275 standard-definition TV channels and 70 high-def channels.

$130 per month: Same package as $120, but with Showtime, 16 more standard-def channels and eight more high-def channels.

Creager said Verizon will lock in the price for two years.

Time Warner Cable’s regular rate for its “All the Best” triple play is $135.50. But new customers can get an introductory rate of $115 for a year, including free use of a digital video recorder for six months, according to the company’s Web site. The service includes unlimited phone calls in North America; Internet downloads at 10 megabits per second, uploads at 1 MBPS; 214 standard-def TV channels and 70 high-def channels.

Time Warner also offers a $100-per-month introductory package that includes fewer TV channels — 154 standard-def and seven high-def.

Several TV news video reports, and a Verizon video press release can be found below the page break.

… Continue Reading

“The Verizon FiOS of Hong Kong”: Fiber to the Home 100Mbps Service $35/Month

Phillip Dampier September 27, 2009 Broadband Speed, Competition, Recent Headlines, Video 3 Comments
HK Broadband offers 100% Fiber Optic service to residents of Hong Kong

HK Broadband offers 100% Fiber Optic service to residents of Hong Kong

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 Kong” for its dramatically faster broadband speeds.

Hongkongers have had several choices for broadband service over the years, most offering traditional DSL service throughout the Hong Kong Special Administrative Region (Hong Kong is a territory of the People’s Republic of China). Priced around $32 a month, the most popular service choice offers residents 6Mbps downstream speeds and 0.6Mbps upstream. Some modern residential multi-dwelling units have a more advanced from of DSL service offering up to 18Mbps downstream and 1Mbps upstream.

HK Broadband represents a major competitive threat for traditional DSL service in Hong Kong, because the fiber optic network provides customers with faster speeds ranging from 25Mbps-1000Mbps.  The company also offers a bundle including broadband, a Voice Over IP telephone service, and IPTV (cable television) service with 80+ channels. HK Broadband offers symmetrical speeds on their network, which means your upload speed is as fast as your download speed. The company has pummeled its telephone network-reliant competitors with humorous ads that call out DSL’s slower speeds, particularly for uploads.

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p style=”text-align: center;”>[flv width=”450″ height=”360″]http://www.phillipdampier.com/video/HKBN Ad – Ants.flv[/flv]
HK Broadband “Ants” Advertisement: Ten Kung-Fu-Fighting-Ants, representing the downstream speed of a traditional DSL broadband connection, are shown ganging up on a single helpless ant, who represents the weaker upstream speed, demonstrating how traditional DSL services typically offer upload bandwidth that is only a 10th of the download speed.

HK Broadband offers 100Mbps service for $35 per month, just a few dollars more than DSL. But there is an interesting catch. HK Broadband, like other providers in Hong Kong, cope with inadequate international broadband connections. Instead of engaging in Internet Overcharging schemes like usage caps, such as those found in Australia and New Zealand, the company has instead capped the speed for websites located abroad at 20Mbps for both uploads and downloads. The 100Mbps speed is reserved for domestic websites. Some subscribers note they couldn’t get speeds much faster than that when accessing overseas sites regardless of the cap, so it has not presented a major problem. As connectivity improves, so should the speeds, according to company officials.

The company also has a unique residential service guarantee — they promise that you will receive at least 80% of the speed you subscribe to, or they refund double your money back. Of course, this applies only to connections made to websites within Hong Kong.

When you’ve got it, flaunt it, and HK Broadband’s fiber speeds are the hallmark of their marketing campaigns.

[flv width=”480″ height=”284″]http://www.phillipdampier.com/video/HKBN 100Mbps Ad.flv[/flv]

HK Broadband “Fat Pipe” Advertisement: Real life characters representing Internet content force themselves into a tiny pipeline, representing DSL, but are later liberated by a wide open fiber optic pipeline they can run through with room to spare.

The investment by City Telecom in their fiber optic broadband network has brought impressive financial results to the company, with customers taking more of their telecommunications business in HK Broadband.  That increases the average revenue per subscriber.  The company has also aggressively increased the level of investment to build out its network, producing an economy of scale that has reduced the costs to wire new subscribers.

Traditional Wall Street investors have often been unimpressed with expensive technology upgrades undertaken by telecommunications companies.  Notably, Verizon Wireless’ FiOS fiber to the home network was pummeled by several investor groups who complained Verizon was spending too much on their fiber network, even though their costs to wire each new customer has dramatically decreased with time.  City Telecom has turned that criticism on its head.  Among many of its competitors, City Telecom is the second most profitable, earning an 11% profit margin.

China Securities has showcased the company, noting it enjoys subscriber growth at levels greater than industry growth, is positioned with technology that assures it of long term stability in revenue and income growth, and despite all of the investments the company has made, retains a strong free cash flow.  Most of all, it has very happy subscribers who enjoy a well regarded broadband service, available at fast speeds and a reasonable price.

The incumbent telephone company’s network of copper wire, supporting lower speed DSL service, is not in the same position.  HK Broadband brought Alexander Graham Bell back to life to chastise the notion that a network more than 100 years old is appropriate for 21st century broadband.

[flv width=”480″ height=”360″]http://www.phillipdampier.com/video/HK Broadband Bell Ad.flv[/flv]

HK Broadband “Alexander Graham Bell” Advertisement: The inventor of the telephone makes a “special-guest” appearance pointing out the fact that the 100 year old telephone network wasn’t designed for today’s broadband connections. This is set in a traditional Chinese Hell-like environment to imply the hellish experience of surfing the Internet with a slow connection.

<

p style=”text-align: left;”>HK Broadband has not escaped the attention of its competitors, of course.  PCCW Limited, Hong Kong’s dominant telephone company, has been aggressively marketing its own fiber, DSL, and wireless broadband products, not allowing HK Broadband to win without a fight. PCCW has had to play catch-up with HK Broadband’s aggressive fiber deployment, which focused on residential and business customers from the outset.  PCCW’s fiber network was primarily intended for business customers, and now the company has been rapidly expanding their fiber network to residential customers.  Today, where PCCW fiber is available, customers can choose from 18Mbps, 30Mbps, 100Mbps, or 1000Mbps service plans.  Many PCCW customers will also be aggressively marketed a wireless mobile Netvigator add-on, one of PCCW’s more successful product lines.

[flv width=”294″ height=”240″]http://www.phillipdampier.com/video/PCCW Fiber Optics Ad.flv[/flv]

PCCW “Fiber Optics” Advertisement: Lampooning HK Broadband’s fiber optic network, PCCW says it had their own extensive fiber optic network laid before HK Broadband came around.  Its tagline, “…the real fiber optics broadband.”

A detailed presentation of HK Broadband and its potential attractiveness to investors was produced by China Securities and features an interview with NiQ Lai, the Chief Financial Officer of City Telecom.

[flv width=”640″ height=”480″]http://www.phillipdampier.com/video/Chinasecurities-City Telecom Presentation September.flv[/flv]

[13 minutes]

Time Warner Cable-Verizon FiOS Price War Likely In Syracuse

Phillip Dampier September 7, 2009 Competition, Verizon, Video 2 Comments

Competition does occasionally bring lower prices, but only to those who threaten to abandon their current provider to take their business elsewhere.

Residents in several suburbs of Syracuse, New York have learned that trick as Verizon nears the launch of FiOS service in their area, and the result is significant savings of more than $240 a year, just for the asking.

“Where we find the competition really paying off is for those consumers who might already be with Time Warner,” Doug Williams, a Cambridge-based analyst with Forrester Research told the Syracuse Post-Standard.  “People whose promotional deals are ending are often able to get a sweet deal with nothing more than a phone call and a mention of the word “FiOS.”

It worked for Doug himself up in Boston, where his mother is served by Comcast:

Doug Williams had a fool-proof plan for his mother-in-law to get at least $20 knocked off her cable bill: Call the cable company and tell them Verizon FiOS television was in her neighborhood.

It worked without a hitch. The operator looked up her address, then gave her a discount without any hesitation. Williams’ family lives in the Boston area, where Verizon’s fiber optic television service is the first real competition to the area’s entrenched cable provider, Comcast.

The Syracuse suburbs of Clay, Cicero, East Syracuse, North Syracuse and Fleming already have, or will soon have access to FiOS.  The towns of DeWitt and Salina last week approved franchise agreements with Verizon to provide the service, and Camillus approved the franchise agreement on August 25.

The addition of the Camillus television franchises brings to 161 the total number of New York municipalities that have authorized Verizon to provide FiOS TV service.

The company is in the process of building and installing the necessary video equipment in local central offices in the central New York region, and anticipates that FiOS TV service will be turned on for new customers in
municipalities there in the fall.

[flv width=”296″ height=”222″]http://www.phillipdampier.com/video/WSYR Syracuse FiOS Coming to CNY.flv[/flv]

WSYR-TV Syracuse covers the announcement by Clay officials of Verizon’s first franchise agreement in the area. (3/16/2009)

Time Warner Cable has been preparing for Verizon for at least a year, starting with complaints about how the franchise agreement was handled in Clay, where Time Warner officials claimed they were given insufficient notice to review the franchise proposal.  That claim was brushed aside by the New York Public Service Commission, which has a history of rubber stamping franchise proposals anyway.  Time Warner has had little to say about other franchise agreement negotiations since.

The cable company has also been wringing its hands about fears Verizon’s construction crews will be digging up their customers’ lawns, making a mess, and accidentally interrupting service for their customers.  Time Warner’s concerns may have come in part from a WSYR-TV report back in June highlighting the frustrations of Clay residents who have been inconvenienced by Verizon’s slow work in their area.  But most consumers welcome the competition.

[flv width=”296″ height=”222″]http://www.phillipdampier.com/video/WSYR Syracuse Preparing for FiOS.flv[/flv]

WSYR-TV Syracuse highlights the plight of Clay residents running out of patience as Verizon wires their community for FiOS. (6/4/09)

“People are excited. It looks like there will be an opportunity for choice,” Cicero town supervisor Chet Dudzinski told the newspaper.

Verizon FiOS installation crews start to wear out welcome in Clay, N.Y.

Verizon FiOS installation crews start to wear out welcome in Clay, N.Y.

Time Warner claims it’s not worried by the competition, noting it successfully competes in many other FiOS-wired communities.  But Time Warner’s marketing efforts have changed with the looming threat of competition.  First, the company brought a “price protection agreement” to the area, trying to lock in existing customers to a lengthy contract before the competition arrived, limiting their chances to switch providers.  Then the company embarked on a major HD channel expansion, quickly bringing Syracuse residents more than 100 HD channels.  Time Warner promoted their heavy emphasis on local sports programming, touting Syracuse University football and basketball games, and local high school sports coverage.

Verizon shot back they will feature more than 115 HD channels, and 70% of their 15,000 videos on demand are available for free.  Verizon also will carry many Syracuse sports events, and will also bring NFL Network and ESPN 360 to the area, services Time Warner has refused to carry.

Consumers enjoy the competitive choice, and with the possibility walking their cable and broadband service to the “other guy” across town, will be able to leverage some additional savings off their service.

For Syracuse city residents, the wait will be somewhat longer.  City officials are wrangling over the kinds of public access programming and service policies Verizon will be required to provide before they will negotiate a franchise agreement with them.  The foot dragging may last a year or longer, as the city will vote Monday on whether to spend $30,000 of taxpayers’ money just to ascertain what the city needs from Verizon when negotiations begin.  City residents who want competition now may want to inform their elected officials spending $30,000 to “study” the issue is just a tad excessive, especially considering The Google provides ample information, for free, about what other communities across the northeast have accomplished as part of their negotiations with the dominant phone company in the region.

Verizon’s complete list of franchises in New York state is below the jump.

… Continue Reading

Verizon FiOS Wins Franchise in Easton, Mass. – Marks 100th FiOS TV Franchise Agreement in the State

Phillip Dampier September 1, 2009 Comcast/Xfinity, Competition, Verizon 1 Comment

Easton,_MA_SealVerizon today announced the 100th franchise agreement in the state of Massachusetts for FiOS TV. The Easton Board of Selectmen on Monday granted a cable franchise to Verizon to begin wiring the town of 23,000 with fiber optic service. Residents will receive visits from Verizon employees to explain and market the service, which will compete directly with incumbent cable provider Comcast.

Verizon’s growth in the state has already put them in second place behind Comcast as the largest provider of wired television and broadband service.  That position was formerly held by RCN, a cable overbuilder providing service in the Boston area.

Verizon celebrated the 100th franchise agreement by donating $1,000 to the Easton Area Public Library to purchase 100 new books.

“As a result of this new franchise, consumers in Easton will be able to choose their cable provider as easily as they choose their phone company,” said Cupelo. “Competition drives innovation, value and service quality, and it puts the consumer in control.”

Easton, Massachusetts

Easton (in dark red), part of Bristol County, Massachusetts

Verizon research indicates 87 percent of Massachusetts residents favor more competition and choice for video services.  Independent studies suggest competition in the video market can bring reduced prices, better packages and improved service, although experiences in many communities indicate providers are more apt to compete on services and packaging, and not as much on price.

Verizon’s license agreement with the city of Easton is for 10 years.  The agreement contains provisions for the network’s future growth; financial support and capacity for educational and government access channels; cable service to government buildings; and other important benefits to the city, including insurance, indemnification and enforcement protections.

“Verizon will compete aggressively for subscribers in Easton with our FiOS services, which are fueled by our lightning-fast fiber-optic network,” Cupelo said. Verizon soon will begin its door-to-door sales campaign in Easton, explaining the many advantages of FiOS TV to local consumers.

For some local residents, the competition can’t arrive soon enough.

Comcast has alienated many Easton residents by not carrying all of the HD signals from Boston area television stations.  Easton, although essentially halfway between Boston and Providence, Rhode Island, has been defined by the Federal Communications Commission as being in the “Providence DMA” (an area of significant influence.)  That’s because parts of Bristol County have towns that are considered suburbs of Providence.  Easton’s allegiance, in the minds of many who live there, is to Boston, and residents are upset that the majority of HD broadcast stations on Comcast Cable are from Providence.

The town is actually part of a regional effort to redefine their part of Bristol County to be in the “Boston DMA” so they can petition the FCC to make a change.

The Easton Cable Commission has gotten an earful from annoyed residents, who have faced an intransigent Comcast.  They have even prepared an FAQ for residents on the matter:

Why can’t I get some Boston based HD channels on Comcast?
This is an important issue to many Easton cable subscribers. We want to take some time to explain the relevant issues just so you understand why most believe Easton residents are not getting the channels they want and the channels that they believe serve them best.

The starting point is the DMA that Easton is in.  What is a DMA?  Well, that is our problem.  DMA is short for Neilsen Media Research Designated Television Market Area. DMA’s are generally split up according to county.  Easton is in Bristol County.  A good part of Bristol County is actually considered part of suburban Providence.  Therefore, Easton, although not a suburb of Providence, is in the Providence DMA.  All cable providers must carry the primary channels that serve a DMA.   At present, Comcast must carry Providence DMA stations.  There is an effort underway to move towns inside of Route 495 into the Boston DMA.  We will petition the FCC for this change.

Oakes Ames Memorial Hall and Ames Free Library (North Easton, MA)

Oakes Ames Memorial Hall and Ames Free Library (North Easton, MA)

But the greater issue here is whether Comcast chose to eliminate Boston channels in High Definition or whether they had no choice.  For the most part, this is a Comcast choice.  The Town of Easton and our Cable Committee, unfortunately, cannot force Comcast to provide Boston channels in High Definition.  Along with the concept of DMA, there is also the concept of “Significantly Viewed” channels in an area.  This is another FCC concept which relates to stations not in the local DMA which may be referred to as “distant signals”.  A “distant signal” is one that originates outside of a satellite (or cable) subscriber’s local television market, the DMA. In addition to stations in their DMA, satellite (cable) subscribers who receive local-into-local service may, under certain circumstances, receive individual stations from markets outside their DMA that are deemed “significantly viewed” in their community. It is up to the satellite carrier whether or not to offer significantly viewed stations and a subscriber must be subscribing to local-into-local service in his or her DMA to be eligible to receive significantly viewed stations. The determination of whether or not a station is significantly viewed in a community depends on several statutory factors.  The FCC has posted the list of stations that are eligible for carriage as significantly viewed signals and the communities in which they are significantly viewed.
The following is the list for Bristol County:

Bristol
WLNE-TV, 6, Providence, RI (formerly WTEV)
WJAR, 10, Providence, RI
WPRI-TV, 12, Providence, RI
+WNAC-TV, 64, Providence, RI
WBZ-TV, 4, Boston, MA
WCVB-TV, 5, Boston, MA (formerly WHDH)
WHDH-TV, 7, Boston, MA (formerly WNAC)
WSBK-TV, 38, Boston, MA
WLVI-TV, 56, Cambridge, MA (formerly WKBG)

So, Comcast has every right to provide the above channels (which include 4,5, and 7) in High Definition.  It is their choice not to do so.  You may ask why Channel 25 is not on the above list and that is a great question.  But the answer is that the determinations for this list were made a long time ago when Channel 25 was owned by religious broadcasters.  That is how outdated all of these rules are.  It is also the reason that Comcast is forced to black out FOX 25 network programming.

There may be an alternative to Comcast in Easton by the end of the year.  We are going through a licensing process with Verizon.  They want to offer Fios tv, internet, and phone in Easton by December.  It is all of our hopes that Verizon will provide the channels that you are looking for and that competition will benefit all cable tv subscribers in Easton.

For further information please contact the Comcast Customer Care line at 1-800-COMCAST (1-800-266-2278).

In Massachusetts, FiOS TV is available in Abington, Acton, Andover, Arlington, Ashland, Bedford, Bellingham, Belmont, Boxborough, Boxford, Braintree, Burlington, Canton, Danvers, Dedham, Dover, Dunstable, Framingham, Franklin, Georgetown, Grafton, Groton, Hamilton, Hanover, Hingham, Holliston, Hopkinton, Hudson, Hull, Ipswich, Kingston, Lakeville, Lawrence, Leominster, Lexington, Lincoln, Littleton, Lynn, Lynnfield, Malden, Mansfield, Marion, Marlborough, Marblehead, Marshfield, Mattapoisett, Maynard, Medfield, Medway, Melrose, Mendon, Methuen, Middleborough, Middleton, Millbury, Nahant, Natick, Needham, Newton, Norfolk, North Andover, North Reading, Northborough, Norwood, Norwell, Plymouth, Reading, Rochester, Rockland, Rowley, Sherborn, Southborough, Stoneham, Stoughton, Stow, Sudbury, Sutton, Swampscott, Taunton, Tewksbury, Topsfield, Tyngsborough, Wakefield, Walpole, Waltham, Wareham, Wayland, Wellesley, Wenham, West Newbury, Westborough, Weston, Westwood,  Wilmington, Winchester, Wrentham and Woburn, and will soon be available in Chelmsford, Easton and North Attleborough.

Cablevision-owned ‘Newsday’ Rejects Verizon FiOS Ads – Another Argument for Net Neutrality?

newsdayOpponents of Net Neutrality regularly dismiss concerns about providers blocking, interfering with, or rejecting content as little more than scare-mongering.  Even in the case of competitors, they assure us, no provider would ever consider getting between the customer and the services they choose to use.  Therefore, we don’t need Net Neutrality provisions enacted into law.

Wouldn’t you know, Cablevision-owned Newsday, a newspaper on Long Island, just unknowingly illustrated what happens when a company puts its own competitive and ownership interests ahead of not only the customer, but also newspaper common sense.

As any newspaper reader knows, the local cable and phone companies are not shy about advertising their products.  For years, Verizon has been spending several hundred thousand dollars a year to run full page ads touting its FiOS service on Long Island.  Such regular advertisers are hard to find these days in the ailing newspaper industry.  Last year, Newsday itself was put up for sale, acquired by Cablevision for $650 million dollars.

Now that the local cable company owns Newsday, they’ve decided to reject advertising from Verizon for its FiOS service. Verizon is now Cablevision’s biggest competitor, providing fiber optic service for television, broadband, and telephone service across Long Island.

The New York Times reports that Newsday has basically told Verizon “don’t call us, we’ll call you” when the phone company inquired about advertising space.

Newsday won’t comment about the reasons why Verizon’s ads were rejected, other than issuing a generic statement:

“We do not comment on specific ads except to say that Newsday, like every other media company, including The New York Times, accepts or rejects advertising at its own discretion,” said Deidra Parrish Williams, a Newsday spokeswoman.

Eric Rabe, a senior vice president of Verizon, told the Times that was fine with him, noting that’s money from Verizon’s pockets not going to feed Cablevision’s pervasive presence across Long Island.

The Dolan family, which runs Cablevision, dominates Long Island, running the cable system, a popular news channel – News 12, and is still the primary place consumers go to acquire broadband service.  Now they also own the biggest newspaper on Long Island as well.

This hasn’t been the first instance that Cablevision-owned Newsday has gotten embroiled in ethical controversy.  The Times notes:

In January, the top three editors at Newsday did not report for work for a few days amid reports that they had been fired or had resigned in a dispute with Cablevision over the paper’s coverage of the New York Knicks basketball team, which is also owned by the company. The editors returned to duty, and neither they nor the company offered a full explanation of what had happened.

Newsday also recently rejected advertising from the Tennis Channel, which is upset with Cablevision because it will not carry the channel.  The Tennis Channel was rebuffed by Newsday when it tried to buy ads inviting viewers to find the network on Verizon FiOS or satellite.

Kelly McBride, the ethics group leader at the journalism foundation Poynter Institute, was troubled by Newsday‘s antics.

“Newspapers accept ads at their own discretion, but they generally set the bar pretty high for rejecting advertising, because they don’t want to be seen as denying access to free speech,” she said. She added that appearing to deny an ad for competitive business reasons, rejecting an ad that is not obviously offensive or failing to explain the rejection, could undermine a paper’s credibility.

Could a company that considers it has the discretion to reject competitors’ access to its properties also extend that notion to its broadband service?  If a competing video provider used broadband to deliver access to its channel lineup, would a competitive threat like that be welcome on Cablevision’s Optimum Online?  How about criticisms of the company or its assets?

Newsday has chosen loyalty to its owner over lucrative advertising revenue to help sustain the paper.  That has disturbing implications for the broadband world as well.

Enacting Net Neutrality protections into law guarantees a company never finds itself in a quandary over where loyalties lie.  These protections guarantee that providers do not hamper, block, or interfere with the online services customers want to utilize.  No “competitive reasons” need ever be used as an excuse to block service from consumers.

Cablevision has not engaged in any online bad behavior to date, but why wait around to find out what the future holds?

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