First cable companies insisted that people canceling TV service weren’t real. Then, as companies began noticing the last two quarters that people were actually canceling TV service due to cost, they began insisting those consumers really don’t matter all that much (which is only true when looking at the relatively massive size of some companies). The reality is that you can’t continue to impose rate hikes twice a year and not see some consumer response; the cable industry just doesn’t care because they feel these consumers are little more than a statistical blip.

The seriousness with which cable companies take consumer concerns about high prices is reflected in the way they continue to gleefully impose rate hikes on not only cable TV but DVR rentals and other services. When they do try their hand at the unfamiliar idea of lowering prices, the end result is often somewhat insulting, like Time Warner Cable’s new entry level cable tiers that offer no consumer value and are loaded with restrictions like the inability to bundle it with additional services, or even use a DVR.

Following in Time Warner Cable’s footsteps, Charter is illustrating what they think about cord cutters and those struggling financially, by sending out notices saying they’ll be hiking the price of, well, everything:

effective with your January Statement pricing will be adjusted for TV Install fees: New Primary Outlet Installation and Reconnection will be adjusted from $29.99 to $39.00; Change of Service Special Trip from $23.62 to $30.00; Additional Outlet with Initial Install from $9.87 to $9.99; Additional Outlet with Special Trip from $29.86 to $39.00; Labor Charge (formerly Hourly Service Charge) from $34.85 to $39.00; Inside Wire Service Call from $35.00 to $45.00; Ancillary Equipment Install with Initial Install from $5.99 to $9.99 and Ancillary Equipment Install with Special Trip from $27.15 to $35.00.

Public Access Fee will change from $0.52 to $0.55, Franchise Fee will change from $1. 13 to $1.17. Basic Service Tier from $12. 85 to $16.21 an increase of $3.36; Expanded Service Tier from $48.14 to $44.78 a decrease of (-$3.36). Customers in a promotion will not see this immediate price change; however, new pricing will apply at the end of your promotional period.

While Charter jacked up the price of essentially everything, they did reduce the price of their “Expanded Service” tier from $48.14 to $44.78. However, they actually increased the price of their entry-level “Basic” service tier $12.85 to $16.21. Why? As Charter customers in our forums correctly note, Charter was seeing more customers downgrading to their cheapest TV tier due to the economy, so they raised the price and lowered the price of the next level tier in the hopes they’d upgrade. Cable’s borderline disdain for cash-strapped customers couldn’t be any more clear, and it will be a historical cornerstone when the story of the inevitable (but glacial) Internet video (r)evolution is told.

Link to the original article…

As already noted, the FCC announced they were ceasing all closed-door negotiations with carriers and Google after reports surfaced that Verizon and Google had been hashing out their own private neutrality arrangement. The Associated Press has now offered their breakdown of this week’s events, speaking to an anonymous source (perhaps the same one that spoke to Bloomberg and the NY Times) who says Verizon and Google will unveil their agreement in “days”:

Verizon and Google expect to unveil their proposal within days and hope it will provide a framework for net neutrality legislation in Congress, said several people briefed on the negotiations between the companies. They spoke on condition of anonymity because the agreement is still not final.

Again, the goal here is to preempt tougher FCC neutrality rules by crafting either a voluntary group of largely meaningless, self-regulatory principles, or by laying the framework for new Verizon-written laws the telco’s massive lobbyist army can then ram through Congress with the help of loyal politicians. Said laws of course would have oodles of loopholes, and would not apply to wireless in order to protect Google and Verizon’s Android love affair.

While this tactic of preempting real consumer protections with lobbyist-written fluff is Verizon’s usual modus operandi, it’s an interesting shift for Google (at least in terms of neutrality).

It’s clear the search giant is now willing to shelve their previous principles in order to protect their lucrative Android relationship with Verizon. According to an AP source, the secret Google/Verizon agreement was in fact partially responsible for the FCC scuttling this round of talks:

But according to one person close to the FCC talks, the deal also undermined the discussions taking place at the FCC and progress that had been made toward an industry-wide compromise. This person said FCC officials fear that the proposal from Google and Verizon would not do enough to prevent phone and cable companies from using their control over broadband connections to become online gatekeepers.

Obviously rules written by Google and Verizon aimed at protecting Google and Verizon revenues would do little to protect consumers from bad behavior on either company’s part. For months AT&T and Verizon (and we’d guess now Google) have been busily crafting a similar alliance aimed at trying to pre-empt real privacy consumer protection laws (like mandatory opt-in) that could constrict their behavioral advertising ambitions.

We should get a closer look at the fruit of these labors in the weeks to come, but amidst the muddled news coverage on this issue it’s important to note one thing: Google is now officially fighting real network neutrality protections.

Link to the original article…

As the battle heats up over the FCC’s push to partially reclassify broadband ISPs under Title II of the Communications Act, carriers (and their army of lobbying groups have been trotting out some familiar arguments. Namely, that if the FCC takes any action (no matter how wimpy), the result will be stifled investment and lost jobs. Art Brodsky at Public Knowledge takes a look at claims that Title II reclassification will result in lost jobs and stifled investment, and notes that both AT&T and Verizon are doing a good job on that front all by themselves with no real change in the regulatory environment:

Let’s talk jobs. Between March 31, 2009 and June 30 this year, Verizon cut 26,455 jobs. During the same period of time, AT&T cut 22,350 jobs. That’s 48,805 jobs cut by two companies during a period in which the regulatory regime did not change.

Let’s talk investment. In 2008, AT&T spent $19.6 billion for capital expenditures in networks and other spending (capex in the parlance). In 2009, it was $16.6 billion a 15.7% decline during a period in which the regulatory regime did not change. Verizon spent $17.2 billion for capex in 2008. In 2009, it was $17 billion an 11.6% sic, should be 1.6% decline during a period in which the regulatory regime did not change.

Of course the “stifled investment” meme is the oldest telecom lobbyist talking point in the playbook, and no matter how many times it’s debunked (even by the companies own CFOs) it never goes away. Back in reality, network investment is far-more-frequently dictated by competition, which neither Verizon or AT&T see in many of their markets. Meanwhile in Verizon’s case, their job reductions have far more to do with the death of the landline and Verizon’s conscious decision to hang up on rural Americans than anything the FCC may or may not do.

Link to the original article…

Slashdot directs your attention to the fact that wireless carriers are just starting to realize they can monetize all matter of data collected from mobile users – specifically data that highlights their movement habits. According to MIT Technology Review, researchers and marketers are finding plenty of new uses for call detail records, or CDRs which allow them to study a mountain of user behavior data. That data can be used by researchers or city planners to study travel behavior – but it’s likely going to be a gold mine on the marketing behavioral front:

…cell phone networks are thinking about monetizing their data, says Jean Bolot, a researcher at network operator Sprint. This means a “two-sided” business model where they not only serve end users but also make money through relationships with other businesses. “This is new in the telco space but not in other areas–look at Google, for example,” he says. Since almost everyone has a cell phone, the scale of the data is immense compared to other sources. Mobility patterns might, for example, be used to adjust property or billboard advertising prices. “Just about every operator on the planet is probably thinking about this right now,” says Bolot.

Of course all of this raises a number of privacy concerns, and while much of this data is aggregate – it’s not particularly difficult for those who buy this data to identify individual user identities (most of us do stay in one place most nights). Keep in mind many ISPs sell user clickstream data (but deny it) with little or no acknowledgment of this fact to the end user, no oversight and no ability to opt out. It seems likely that privacy, consumer education and consumer controls will be an afterthought here as well.

Link to the original article…

Bernie Arnason over at Telecompetitor makes the argument that with DOCSIS 3.0 relatively inexpensive to quickly deploy (75 million Americans should have it by the end of the year) and many telcos clinging to aging copper last mile connectivity, the cable industry should have it pretty good competitively over the next few years. Comcast added more broadband customers (608K) in the last two quarters than AT&T, Verizon, and Qwest combined (401K), and cable’s triple play continues to gobble up fleeing copper landline customers. Cable also dominates more than 90% of the VoIP market.

Cable’s traditional weak spot – upstream bandwidth, looks to get some help later this year as cable operators perfect upstream channel bonding. Comcast recently noted that they’re seeing 75 to 100 Mbps upstream in tests. While Verizon’s decision to spend $23 billion on FTTH to the home puts them in a decent position for now, there’s a huge swath of America served by telcos using aging copper infrastructure that many of these companies can’t afford to upgrade to fiber. DOCSIS 3.0 means telcos will up their game somehow:

It all adds up to this perfect competitive storm analogy I referred to early on. This storm compels the telcos who haven’t already done so to respond, primarily with FTTH. Good customer service, local presence, and a solid DSL product are very admirable and noble. But these storm clouds may demand much more.

Can Qwest seriously compete with DOCSIS 3.0 with no money for serious upgrades? Marketing that pretends last mile copper is FTTH can only go so far. When does AT&T decide to stop waiting on VDSL bonding and pony up the cash for the move to FTTH? 3-7 Mbps is the fastest speed offered by Verizon in roughly half of its broadband territories. Luckily for most carriers, they’ll be sheltered from the “perfect competitive storm” Arnason mentions by the simple fact that many of their markets don’t see decent competition. When you’re the only game in town (be it cable, telco, satellite or carrier pigeon), you get to charge whatever you’d like for last-generation service.

Link to the original article…

While Verizon gets most of the attention with their $23 billion investment in fiber to the home deployment, a significant chunk of the fiber to the home deployments in this country is being accomplished by roughly 700 smaller rural telcos, co-ops, and municipal operations. According to a new study by the National Telecommunications Cooperative Association (NTCA), a growing number of rural telcos are moving toward fiber to the node (like AT&T’s U-Verse platform), while many others are moving directly to fiber to the home:

NTCA’s “2009 Broadband/Internet Availability Survey” found that nearly three-quarters (73%) of respondents with a fiber deployment strategy intend to offer FTTN to more than 75% of their customer base by 2011. Fifty-five percent plan to offer FTTH to more than half their customers in that same time frame – more than doubled from just 26% last year. The study says that rural areas are seeing significant gains in broadband speeds, primarily due to the increased fiber availability in their communities. Fifty-three percent of respondents indicated their customers can now receive broadband service of between 3 and 6 Mbps (up from 46% last year), and 39% can receive service in excess of 6 Mbps, which is an increase from just 25% a year ago.

According to the most recent data (pdf) from the Fiber To The Home Council, the total number of homes served by FTTH is now 4.4 million, or 4% of all homes. FTTH service now passes (no last mile drop) 15 million US homes, or 13% of all US Households.

The picture has nothing to do with the article.

Link to the original article…