cable

Content tagged with "cable"

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Mediacom Says it Will Not Sue Lake County, Minnesota

In Star Tribune coverage of Mediacom's war against real broadband in rural Minnesota, we learn that Mediacom will not sue Lake County to disrupt its plan to serve thousands of unserved residents and local businesses.
And for all its accusations, Larsen says Mediacom will not sue. Spending millions of dollars on a lawsuit in a place where the company serves so few homes, he said, "is not a great business decision."
We have previously covered the many false and disproved accusations Mediacom have leveled against Lake County. The Strib article reiterates that these charges have been found to have no merit. The article also reiterates that the County has a real need that private companies have failed to meet:
The conflict that ensued is part of a national struggle. Public officials and some of their constituents argue that rural broadband is like rural electrification: It's a lifeline for small-town America that the free market will not extend. "We've been ridiculously underserved in this area for years," said Andy Fisher, who owns a Lake County bed-and-breakfast and a rural cross-country skiing lodge. The cable companies "are working in the interest of their profits. But if they're not going to serve this area, what are we going to do?"
And yet, Mediacom sees itself as the underdog!
"Lake County wants to make this into a David and Goliath story, where Mediacom is Goliath and poor little Lake County is David," said Tom Larsen, Mediacom's group vice president of legal and public affairs. "The truth is we're David because we're fighting [the government]. It's just the same story repeated all over the country."
Fascinating. Mediacom has billions in revenues whereas the County deals with budgets in the millions. Sure Mediacom is between 100 and 1000 times bigger than Lake County, it still wants to stop a project serving thousands of unserved people (that it believes is doomed to fail) because it is too disadvantaged.

Wall Street: Lack of Competition Allows Comcast to Raise Prices Whenever It Wants

A major difference between Main Street and Wall Street is that we view Comcast's lack of competition as a major problem. The prospect of Comcast increasing our rates year after year makes us want to scream. Prepare to scream. Or throw things.

The Lafayette Pro-Fiber Blog alerted us to a piercingly honest analysis from Wall Street. The article on SeekingAlpha.com, titled We-re Big Fans Of Comcast's Cash-Flow Generation captures one of the major policy failures of our time:

Comcast's traditional Cable Communications continues to grow and generate copious cash flow. Video revenue, Xfinity and other cable TV products, grew 2.8% to $5 billion, while High-Speed Internet revenue grew 8.9% to $2.4 billion. We're big fans of the firm's Video and High-Speed Internet businesses because both are either monopolies or duopolies in their respective markets. Further, we believe that both services have become so sticky and important to consumers that Comcast will be able to effectively raise prices year after year without seeing too much volume-related weakness.

Wow.

SeekingAlpha.com, describes itself as "…the premier website for actionable stock market opinion and analysis, and vibrant, intelligent finance discussion."

We want to empower local businesses and communities to control their own destiny. Monopolistic telecommunications companies, with their Goliath market share, Wall Street priorities, and armies of lobbyists continue to attack local control and self-reliance. They are extracting assets from Main Street and shipping it to Wall Street.

Yet we see the FCC, Congress, and many states pretending that the public interest is best served by giving more power to these massive companies. And we will continue to hear industry-funded think tanks claiming that broadband has robust competition and should be subject to less public oversight. Coming soon to an op-ed page near you.

Photo courtesy of JSquish via Wikipedia Commons

Harold Feld Examines The Meaning Behind The Verizon/SpectrumCo/Cox Deal

Several months ago, we wrote this post but it got lost in the system. We think it still worthwhile, so here it is.

The word "cartel" drums up many negative annotations - drug cartels, oil cartels. Never anything positive, such as bunny cartels or chocolate cartels. Harold Feld (of Public Knowledge) explains the emergence of another cartel in My Insanely Long Field Guide To The Verizon/SpectrumCo/Cox Deal, on his Tales of the Sausage Factory blog. This is  great tutorial on how the deal came about and what it can mean for the future of broadband.

Rather than chocolate, drugs, oil, or bunnies, the product in question is telecommunications services. At the heart of the cartel are the familiar names: Verizon, Cox, and SpectrumCo. The latter being a consortium of Comcast, Time Warner Cable, and Bright House. All the big hitters in telecom are involved in a way that is veiled, secretive, and not good for competition.

"It's almost as if your companies got in a room together, and you agreed to throw in the towel and stop competing against each other," Sen. Al Franken to representatives from Verizon and the cable companies at the Senate Judiciary Subcommittee on Antitrust, Competition Policy, and Consumer Rights, March 21, 2012.

Feld's investigation begins with the licensing and collecting of spectrum by SpectrumCo but ends with a more practical look at how these big hitters have decided that it is better to join forces than to compete. Side agreements, secretive multi-layered entities, and threaded loopholes keep the FCC at bay. This begins as an article about telecommunications, but quickly expands into an antitrust primer. The most alarming facet of this situation is that the product in question is information.

Joel Kelsey of Free Press testified at that same committee, warning how this deal will compromise access, quality, and affordability to broadband in America and how drive us further behind the rest of the world.

Update:

On August 16, 2012, the Department of Justice announced that it approved the deal with changes. Citing:

Google Fiber Unveiled in Kansas City

Google Fiber is unveiled. And it sucks to be Time Warner Cable right now. But they already knew that. Google is offering 3 packages in Kansas City - a gigabit Internet connection for $70/month, a TV + Gigabit Internet connection for $120/month, and a free Internet tier of 5/1Mbps (subject to a one time $300 connect cost). The first two packages also have the $300 connect fee but it is waived with a contract. The details are available via DSL Reports and The Verge. There are several interesting enticements along with the connectivity. Plans and pricing is here. I'm surprised at the number of television channels that are available on that package. Notable channels missing include Disney and ESPN, probably because ABC was trying to rake Google over the coals on pricing. Neighborhoods will be competing to get enough presubscriptions to get connected (at $10 per potential subscriber). It will be interesting to see how this goes - the approach makes sense from a business perspective but could result in a patchwork of neighborhoods lacking access. Google Fiber In short, this will be interesting to watch. How will Time Warner Cable respond? How enthusiastic will ordinary people be? Google's marketing talent is considerably more advanced than that of the local governments and small companies (Sonic.net) that first blazed this trail. Speaking of which, I have not yet seen how other service providers will be able to use this network, if at all. The free 5/1 connection is interesting. For a massive company like Google, providing hundreds or thousands of 5/1 connections essentially has zero cost. This is also true of Comcast and CenturyLink, which is why they are profitable on those $10/month low-income packages. This is not a Google experiment. Those running this project are expected to earn a profit.

Usage Based Billing - Time Warner Cable Latest Attempt to Increase Prices

Time Warner Cable's announced intention to expand its usage based billing for broadband has recently received a little media attention. The company currently uses tiers for customers in parts of Texas, allowing customers to sign on to a plan which limits the amount of usage per month. If they come in under the plan amount (currently 5 gigabytes), they get a $5 dscount. If they go over, they are charged $1 per gigabyte over the tier limit.

One commentary we find particularly insightful is from Susan Crawford, "The Sledgehammer of usage-based billing." Crawford not only addresses TWC's billing change, but critiques New York Times' "Sweeping Effects as Bradband Moves To Meters" by Brian Stelter.

Crawford points out several statements in Stelter's article that sound rational on paper, but are actually "holes" in the fabric of reality. Based on what we have seen from companies like Time Warner Cable, we concur.

Stelter justifies Time Warner's decision to shift to usage-based billing based on the fact that its competitors are doing it. Crawford points out that:

Time Warner does not have competitors among cable companies – if by competition you mean a cable distributor that could constrain Time Warner’s pricing or ability to manage its pipe for its own purposes. Time Warner’s DOCSIS 3.0 services do compete with Verizon’s FiOS, but FiOS is available in just a tiny part of Time Warner’s footprint. The major cable distributors long ago divided up the country among themselves.

The Stelter article raises the issue of high usage and congestion, their connections to the usage tier billing model, and claims that there is no other way to handle high usage. Crawford calls out this error as it relates to the new billing plan:

Cable distributors have a choice: They could maintain the 90+ % margins they enjoy for data services and the astonishing levels of dividends and buybacks their stock produces, or they could rearchitect their networks to serve obvious consumer demand. But they are in harvesting mode, not expansion mode. And no competitor is pressuring them to expand.

Cable Access Gets Slammed, Time Porner Gets the Land

This is a guest post, authored by Jay April. Jay is a strong supporter of local authority and community media. He is a documentary filmmaker, video journalist, and new media innovator who now happens to find himself running a community TV and radio station in Maui, Hawaii. There is a new land grab in Hawaii whereby the government is giving away valuable public land to private business without getting anything in return for the people. Sound familiar? It has happened before in Hawaii – with agriculture, with beaches, with water and now, with the public airwaves. This time the difference is that the land in question is in the form of public electronic real estate, the electromagnetic spectrum. These are the frequencies you pay for to watch cable TV, use the internet or talk on the phone. Most people don’t know this, but in exchange for using public rights of way - airwaves, telephone poles, electric wires and underground conduits - cable monopolies like Oceanic Time Warner have to pay “rent” in the form of community access channels like Olelo on Oahu, Akaku on Maui, Na Leo on Big Island and Hoike on Kauai. Now, because of new technology, the frequencies or space these channels occupy have suddenly become extremely profitable to cable companies. (Not unlike how lands once granted to indigenous people by treaty became more valuable once minerals were discovered.) That is why Time Warner wants to take over this public property and move these channels to inferior locations while vastly reducing the amount of non-commercial electronic real estate. That is why, if you are an Oceanic Time Warner Cable subscriber, channels are disappearing from your channel line-up altogether, or re-appearing someplace else. So far, instead of holding your land in public trust, the state is falling for the Time Warner plan - hook, line and sinker. Maybe that is not such a bad thing after all. Oceanic says this techy move will free up more space on the cable for them to bring us all kinds of goodies like High Definition (HD) channels, video on demand channels, enhanced services and the holy grail of faster, better and more affordable internet for all. That’s a good thing, right? We all want to believe. We really do.

Speedtests, SamKnows, and Fantasy vs. Reality at the FCC

Far too many people seem to think that when they go to Speedtest.net to test their connection, they get a number that has any bearing on reality. For most of us, it simply doesn't. This is true of other large tools for measuring connections. And it has important policy implications because the FCC contracted with a company called Sam Knows to measure wireline speeds available to Americans (I'm a volunteer in that project). Sam Knows explains :
SamKnows has been awarded a ground breaking contract by the Federal Communications Commission (FCC) to begin a new project researching and collecting data on American fixed-line broadband speeds delivered by Internet Service Providers (ISP's) - until now, something that has never been undertaken in the USA. The project will see SamKnows recruit a team of Broadband Community members who will, by adding a small 'White Box'’ to their home internet set up, automatically monitor their own connection speeds throughout the period of the project.
Unfortunately, SamKnows appears to be documenting fantasy, not reality. To explain, let's start with a question Steve Gibson recently answered on his amazing netcast, Security Now (available via the TWiT network). A listener asked why he gets such large variation in repeated visits to Speedtest.net. Security Now Logo Steve answers the question as an engineer with a technical explanation involving the TCP/IP protocol and dropped packets. But he missed the much larger issue. Packets are dropped because the "pipes" are massively oversubscribed at various places within the network (from the wires outside you house to those closer to the central office or head end). What this means is that the cable company (and DSL company, to a lesser extent) takes 100Mbps of capacity and sells hundreds of people 20Mbps or 30 Mbps or whatever. Hence the "up to" hedge in their advertisements. The actual capacity you have available to you depends on what your neighbors (cable) or others in the network (DSL) are doing. Dropped packets in TCP result often result from the congestion of high oversubscription ratios. This gets us into why Speedtest.net and Sam Knows deliver fantasy numbers.

Five Cities Denounce Verizon/Comcast Spectrum Deal

If you live in Boston, Baltimore, Albany, Syracuse, or Buffalo, you won't be getting FiOS from Verizon. Absent any public investment, you will likely be stuck with DSL and cable... like 80% of the rest of us.

Not long after Verizon announced it would cease expanding FiOS, we learned that Verizon was coming to an arrangement with the cable companies that would essentially divide the broadband market. Verizon won't challenge cable companies with FiOS and the cable companies won't challenge Verizon's "Rule the Air" wireless domain.

For a while now, the FCC has reviewed a potential deal for a Verizon purchase of Comcast's wireless spectrum. The possible deal involves multi-layered questions of anti-competitive behavior, collusion, and corporate responsibility. 

Along with many other interested parties, such as the Communications Workers of America, Free Press, Public Knowledge, and  the five towns are publicly opposing the deal. They have expressed their derision to the FCC but whether or not they will influence the result remains to be seen.

From a FierceTelecom article by Sean Buckley:

Curt Anderson, chair of the Baltimore City Delegation to the Maryland House of Delegates, expressed...outrage on the agreement the telco made.

"Under this transaction, Baltimore will never get a fiber-optic network, and the city will be at a disadvantage," he said. "The direct job loss will be the hundreds of technicians that would be employed building, installing and maintaining FiOS in the area. The indirect costs of this deal are even higher: the lack of competition in telecommunications will raise prices and reduce service quality.

And:

The deal, said Albany Common Council President Carolyn McLaughlin, "is not in the best interest of those who need to get and stay connected the most and is "a step backwards in bridging the digital divide."

Susan Crawford Presentation at Freedom to Connect

Susan Crawford was one of the featured presenters at Freedom to Connect 2012 and her presentation was noted by Tech Dirt:
To support her thesis, Crawford presented some stunning numbers. In the last two years, Comcast market share has grown from 16.3 million subscribers to 18.5, a 14 percent growth. Time Warner Cable has grown 10 percent, from 9.2 to 10.7 million customers. Meanwhile, DSL subscribers have plummeted: AT&T and Verizon market share is down 22 and 21 percent respectively. So, while it's good to be Comcast, it's not good to be an American citizen. Without competition, there's no drive to improve the service. The average speed of an Internet connection in the United States is around 5Mbit/s. An astoundingly low number if you look at other western countries. South Korea, for example, has an average of 50Mbit/s. And faster connections are starting to be implemented around the world.