FCC Might Finally Start Policing Broadband Usage Caps, Unreliable Usage Meters

from the that-will-be-extra dept

Wed, May 13th 2015 2:44pm — Karl Bode

For years, we've noted how regulators have paid empty lip service toward the problems with broadband usage caps, historically buying into the ISP narrative that they're just "creative pricing exploration." There are two problems with that: one, they can be (and have been) used to hurt internet video competitors and protect legacy TV revenues. Two, nobody is checking to ensure that meters are accurate, meaning there have been numerous instances where users are overcharged, or hit with usage overage fees when the power was out or their modems were off, with absolutely no repercussion.

Since they're just glorified rate hikes, usage caps are just another symptom of a lack of competition in the broadband space. With the FCC on a bit of a consumer-friendly tear of late and finally addressing the issues with limited competition, there are indications that usage caps may finally become part of the conversation. FCC insiders now say the agency might start policing caps if Comcast begins to expand its usage meter ambitions:

"An operator the size of Comcast absolutely will draw scrutiny,” said our source. “If Comcast decides to impose its currently tested market trial plans on Comcast customers nationwide, the FCC will take a closer look. Under Title II, the agency is empowered to watch for attempts to circumvent Net Neutrality policies. Usage caps and charging additional fees to customers looking for an alternative to the cable television package will qualify, especially if Comcast continues to try to exempt itself."

Right now, Comcast only imposes usage caps in a key number of less competitive Southern markets, but has shown every indication it would like to expand caps and overages nationally. As more and more users drop cable TV for internet video, and drop internet voice service for wireless only, ISPs will inevitably look to extract their pound of flesh through broadband rate hikes. Those rate hikes are easier to impose when you claim they're necessary due to "fairness" or congestion (even though the cable industry itself admitted this was a bogus excuse back in 2013).

Of course, this is a nightmare scenario for ISPs, and they'll be quick to suggest the agency is scrambling down the slippery slope of rate regulation, despite repeatedly stating it wouldn't be using Title II in that capacity. Of course, preventing ISPs from using bogus congestion as a revenue generator is a key part of the agency's net neutrality policies, and the agency has already been warning wireless carriers about using throttling and network management to drive unlimited users to more expensive plans. The FCC can correctly argue that caps are more about competition and net neutrality than rate regulation, and it would be right.

Having an FCC that actually cares about these kinds of issues is entirely new territory, since the agency has turned a blind eye to competition problems (and all of the residual symptoms of that disease) for the better part of fifteen years. Of course, an anonymous source promising to "take a closer look" doesn't automatically equate to action, and even this new, more consumer-friendly FCC has remained largely mute on most pricing issues. Millions of DSL and cable customers currently face usage caps, per gigabyte overages and unreliable meters (not to mention obnoxious below-the-line stealth fees) every day thanks to no competition.

You can eliminate these symptoms by curing the disease that is a lack of competition, but with entrenched duopolies and regulatory capture making that a multi-decade effort, it might be nice if somebody, somewhere could protect broadband consumers from getting screwed in the interim.

Filed Under: broadband caps, consumer protection, fcc, usage meters

14 Comments

Verizon Wireless Tells 'Price Sensitive' Customers It Doesn't Want Them, Declares It Doesn't Need To Truly Compete

Wireless

from the nah-nah-I-can't-hear-you dept

Mon, May 11th 2015 8:09am — Karl Bode

We've noted how AT&T and Verizon investors and executives have been terrified for some time that they would have to (gasp) compete on price as T-Mobile continues to disrupt the market with its consumer-friendly, faux-punk rock behavior. Ever since the AT&T deal was blocked by regulators, T-Mobile has been mercilessly (but entertainingly) mocking both companies, offering a bevy of promotions while eliminating a lot of "pain points" for consumers (like overage fees). It's working: T-Mobile's now signing up more subscribers each quarter than Sprint, AT&T or Verizon -- just by treating consumers well.

So far, outside of a few very time-limited promotions, Verizon's been unwilling to compete on price, insisting the company's high prices are justified by a "premium network experience." Verizon also recently tried to shoot down the appeal of T-Mobile's unlimited data offerings by insisting that nobody really wants unlimited data plans, they're just being driven by "gut feelings." With T-Mobile just having one of its most successful quarters ever, Verizon's increasingly under pressure to compete on price, yet the telco continues to proclaim it doesn't have to:

The company reported on Tuesday that it had lost 138,000 postpaid customers in the last three months. Francis Shammo, Verizon’s chief financial officer, apparently won't be missing customers who, he says, value price over quality. "If the customer who is just price-sensitive and does not care about the quality of the network—or is sufficient with just paying a lower price—that’s probably the customer we’re not going to be able to keep," he said in the company’s quarterly earnings call."

It shows you just what kind of competition Verizon's historically used to if the company honestly believes you have a choice of when you get to compete on price. And while the company is busy telling investors that it's not feeling any heat from T-Mobile, the growing, magenta-hued (TM) threat has Verizon simultaneously testing a number of new price promotions it hopes will help tip the subscriber scales back in its favor. Smelling blood, T-Mobile this week launched a new promotion that specifically takes aim at these "price sensitive" customers Verizon apparently doesn't want any more:

1/ #NeverSettle for @VerizonWireless’ ridiculous, costly, slower-than-@TMobile LTE network! Higher price does not equal faster network.
— John Legere (@JohnLegere) May 5, 2015

Of course Verizon's not entirely wrong. The company does come in first place pretty consistently in most customer service and network performance studies. Verizon's also well aware it enjoys an 80+% retail market share with AT&T, and an 85% market share of the special access (cell tower backhaul) market. The two companies also enjoy an estimated $171 billion in combined spectrum holdings, which certainly helps keep other competitors from market. Still, this belief that the company doesn't have to compete on price in the face of increased price competition seems like a pipe dream narrative they'll only be able to push for so long, especially if Sprint can manage to get out of its own way, fix its lagging network, and become a viable fourth wireless competitor.

Filed Under: competition, mobile phones, price sensitive, pricing, value shopping
Companies: at&t, sprint, t-mobile, verizon, verizon wireless

46 Comments

Verizon Picks The Worst Possible Person To Try To Bullshit Into Unnecessary Upgrade

Broadband

from the smooth-move-exlax dept

Fri, May 8th 2015 6:21am — Karl Bode

It's no secret that ISP support reps will consistently tell you whatever you'd like to hear when trying to sell you on more expensive packages, even if the claims are miles from reality. Sometimes that's just a support rep going rogue to meet numbers and try to make a sale, and sometimes it's part of a consistent, scripted effort to mislead the consumer. Frost and Sullivan analyst Dan Rayburn says he ran into the latter recently when he called to renegotiate his FiOS triple play bundle rate with the telco, and was informed, repeatedly, that he needed to upgrade his speed from 50 Mbps to 75 Mbps if he wanted Netflix to stream properly.

That wasn't the brightest move on Verizon's part, since Rayburn covers the streaming video sector for a living. Rayburn was quick to highlight that Ookla data shows that the average bitrate delivered to a Verizon customer last month was around 3.5 Mbps. Even in a household full of streaming video fanatics, there's really not much that 75 Mbps will provide that 50 Mbps won't. And while Rayburn warns that uninformed users can easily fall into Verizon's trap, it should only take the average consumer about five minutes of Google use to avoid this pitfall.

Netflix's website informs users the company's standard definition streaming service eats about 1 GB of data per hour per stream of standard def video, and Netflix recommends roughly 3 Mbps for standard def content. High definition video meanwhile consumes around 3 GB per hour, per stream, with Netflix recommending 5 Mbps for HD video. Even if you're part of the tiny number of people with a 4K set looking to stream Ultra HD, you'll only need a connection of around 25 Mbps, according to Netflix. Of course this requires the average consumer to know what a gigabyte is, which is no safe bet.

Rayburn proceeds to document that this wasn't just a one-off situation, but that Verizon lied about his need for 75 Mbps to obtain "smoother" Netflix streaming numerous times:

"While some might want to chalk this us to an isolated incident, or an over zealous sales rep, that’s not the case at all. I called in three times and spoke to three different reps, plus one online and got the same pitch. Clearly this sales tactic is being driven by those higher up in the company and isn’t something a sales rep made up on their own. And two years ago, Verizon tried to pitch me the exact same story, promising better quality Netflix streaming if I upgraded my Internet package."

The biggest irony here, unmentioned by Rayburn, is that he's consistently been one of only a few analysts on Verizon's side during the company's recent interconnection scuffle with Netflix, blaming Netflix, not giant ISPs, for most of the congestion issues that magically started popping up over the last year or so as ISPs like Verizon started pushing Netflix for direct interconnection fees. In other words, Verizon not only tried to bullshit someone who spends their life discussing streaming issues, but it managed to annoy one of the company's few allies on the net neutrality and interconnection front. That's quite a double play.

Filed Under: bandwidth, dan rayburn, upgrades
Companies: netflix, verizon

75 Comments

After FTC, FCC Pressure, AT&T Backs Off Arbitrary Throttling Of 'Unlimited' LTE Users

Wireless

from the you-may-need-a-dictionary dept

Thu, May 7th 2015 1:40pm — Karl Bode

Back when AT&T stopped offering unlimited wireless data, it grandfathered many of the unlimited users it had at the time. Unfortunately for those users, AT&T immediately started waging a quiet war on these customers as part of a concerted effort to drive them like cattle to more expensive plans. That included at one point blocking Facetime from working at all unless users switched to metered plans (but net neutrality is a "solution in search of a problem," am I right?) and throttling these "unlimited" LTE users after they'd consumed as little as three gigabytes of data.

Then, just about a year ago, the FCC (like it has on a number of consumer telecom issues like telco accounting fraud or municipal broadband) miraculously awoke from a deep, fifteen-year slumber and decided to do something about this kind of behavior. FCC boss Tom Wheeler started warning telcos that they can't use congestion as a bogeyman to justify cash grabs, and that network management should be used to actually manage network congestion -- not as a weapon to herd users to more expensive options. The FTC also filed suit against AT&T for false advertising over its "unlimited" claims.

While AT&T tried to unsuccessfully tap dance around the lawsuit (ironically claiming it was protected by Title II classification), this regulatory pressure appears to have worked. AT&T this week updated the company's policy for grandfathered unlimited data customers suggesting the company has modified its network management practices. Back in March, the company's policy looked like this:

"As a result of the AT&T network management process, customers on a 3G or 4G smartphone with an unlimited data plan who have exceeded 3 gigabytes of data in a billing period may experience reduced speeds when using data services at times and in areas that are experiencing network congestion. Customers on a 4G LTE smartphone will experience reduced speeds once their usage in a billing cycle exceeds 5 gigabytes of data. All such customers can still use unlimited data without incurring overage charges, and their speeds will be restored with the start of the next billing cycle."

As of this week, the policy now looks like this:

"As a result of AT&T’s network management process, customers on a 3G or 4G smartphone or on a 4G LTE smartphone with an unlimited data plan who have exceeded 3 gigabytes (3G/4G) or 5 gigabytes (4G LTE) of data in a billing period may experience reduced speeds when using data services at times and in areas that are experiencing network congestion. All such customers can still use unlimited data without incurring overage charges, and their speeds will be restored with the start of the next billing cycle."

In other words, gone are the references to throttling unlimited LTE users just because they hit a totally arbitrary threshold, and the company is now using network management to manage the damn network, not to make an extra buck. AT&T will of course find other, clever ways to annoy these users until they switch to more expensive plans, but it's at least good to see that the network congestion bogeyman (fear the exaflood!) isn't quite as effective as it used to be when it comes to justifying high rates, misleading consumers or conning regulators.

Filed Under: fcc, ftc, lte, throttling, title ii, unlimited
Companies: at&t

12 Comments

The Mere Threat Of Real Neutrality Rules Appears To Have Helped Calm Verizon, Level 3, Cogent Interconnection Feud

Broadband

from the funny-how-that-works dept

Wed, May 6th 2015 10:33am — Karl Bode

A little over a year ago, Level 3 was busy accusing Verizon of intentionally letting its peering points get congested in order to degrade Netflix streaming performance, by proxy forcing Netflix to pay Verizon for direct interconnection if it wanted to remedy the situation. According to arguments by Netflix, Level3 and Cogent, big ISPs like Verizon, Comcast and AT&T decided to move the net neutrality debate out to the edge of the network, obtaining their pound of flesh by eliminating settlement-free peering and demanding new charges just to access last mile customers.

To hear AT&T, Verizon, and Comcast tell it, the fight was all just a big misunderstanding, and what was occurring was just run of the mill peering disputes. Meanwhile, their army of fauxcademics, astroturfers, lobbyists, consultants and think tankers were busy telling anyone who'd listen that Netflix was trying to destroy the Internet.

But in a series of blog posts from last year, Level 3 content and media VP Mark Taylor continued to argue that there was a major anti-competitive cabal afoot, with only the biggest ISPs holding network performance (and their own users) for ransom in a quest for more revenue:

"All of the networks have ample capacity and congestion only occurs in a small number of locations, locations where networks interconnect with some last mile ISPs like Verizon. The cost of removing that congestion is absolutely trivial. It takes two parties to remove congestion at an interconnect point. I can confirm that Level 3 is not the party refusing to add that capacity. In fact, Level 3 has asked Verizon for a long time to add interconnection capacity and to deliver the traffic its customers are requesting from our customers, but Verizon refuses."

The problem, as we noted at the time, is that with peering arrangements entirely confidential, it was impossible for any researcher to fully prove incumbent ISPs were up to no good, even if the context of thirty years of anti-competitive behavior -- and scattered glimpses of limited data sets -- suggested the Netflix and Level 3 narrative might just be true. As such, the FCC announced it would begin collecting internal company data on interconnection to determine who, exactly, was telling the truth.

Fast forward a year, and all the companies involved in this fight now face being governed by new net neutrality rules that include a mechanism for complaints over interconnection shenanigans. With this new threat of regulatory intervention looming, lo and behold Verizon and Level 3 quickly appear to have struck a new interconnection deal. Verizon and Cogent also say they've managed to strike a new deal that appears to make both sides happy. Gone completely is the hostile rhetoric from all companies involved.

Even Cogent founder and CEO Dave Schaeffer, one of the most vocal executives in regards to these interconnection feuds, seems happy to have struck a no-payment deal with Verizon. According to Schaeffer, the FCC's new neutrality rules helped bring Verizon to the table, since Level 3 and Cogent had hinted they might complain to the FCC:

"Schaeffer told Ars that it did not have to pay Verizon to get the deal signed. "We have never paid for peering, and we continue to never pay for peering," he said today. Schaeffer said the FCC's rules "probably influenced the timing" of the agreement. He believes Verizon was also motivated to settle because Verizon's own EdgeCast content delivery network will benefit from distributing traffic through Cogent's network. But there is still work to do to make sure performance improves. "The degradation exists right now, the ports are massively oversubscribed and our initial fix is going to dramatically increase the connectivity," Schaeffer said. "The parties agreed to make sure this doesn’t become a problem going forward."

While the net neutrality rules don't technically take effect until June 13, apparently the mere threat of a regulator actually doing its job was enough to bring Verizon to the negotiations table. That's not to say there won't be problems going forward; there needs to be much more transparency surrounding interconnection agreements to protect consumers and competitors alike. Schaeffer is quick to highlight continued problems with AT&T, Time Warner Cable and CenturyLink (though he also points out that Comcast has suddenly become more amicable as well). Meanwhile, the FCC's neutrality rules obviously will need to withstand the full frontal legal assault of the entire broadband industry to remain useful.

Still, if you were paying attention, you might actually start to doubt the claims on several fronts that Title II will destroy the internet as we know it. Comcast's busy deploying two gigabit fiber to 18 million homes despite claiming Title II would demolish sector investment. Executives from Frontier, Cablevision, Sprint, Sonic and even Verizon have all publicly admitted Title II doesn't really hurt them in the slightest. And now Verizon, Level 3 and Cogent appear to have settled their differences thanks, in part, to the mere threat of actual FCC anti-competitive policing. Yeah, so far our new net neutrality rules seem like a real disaster for consumers and internet health alike.

Filed Under: bargaining, interconnection, net neutrality, peering, title ii
Companies: cogent, level 3, netflix, verizon

7 Comments

Would You Order Broadband From A Company That Can't Even Figure Out How To Let You Sign Up Online?

Broadband

from the figuring-out-the-basics... dept

Wed, May 6th 2015 6:18am — Mike Masnick

Frontier Communications has been growing rapidly as other large broadband providers offload their unwanted DSL customers on the company that seems happy to gobble them up. The company doesn't have a particularly good reputation wherever it goes -- especially on the customer service front -- but it's quite astounding to see that it has now, apparently, stopped offering a way to sign up for service online, forcing anyone who wants service to call or do live chat:

Frontier is so out there on the... frontier of the internet, that apparently it can't even figure out how to use the web for ordering service, as noted by a source who shared this info with StopTheCap:

“This company can’t manage to figure out how to build a website that supports ordering of products, so they are just going to kill that function,” the source added. “Customers will be able to see what products they can get within a specific zip code, but that’s it. If they want to order, they are going to be forced into the already overloaded call center.”

And, of course, the end result is that already over-burdened customer service is even more over-burdened:

“I’m sure our former Verizon and AT&T customers as well as our future Verizon customers will enjoy going back to the Stone Age when they couldn’t do what they needed to do online and would have to pick up the phone to call into a Contact Center,” the source said. “We might as well just have a Frontier Wikipedia page for crying out loud.”

That same article notes that Frontier's disclaimer about how you won't see the speeds you're being promised takes such ridiculous disclaimers to new heights of ridiculousness. Traditionally, it was the slimey "up to" notation for speeds that you'd never see. But many broadband companies have gotten much better about actually living up to promised speeds. But Frontier flat out tells you there's no way in hell you're getting the speeds they promote:

“Actual speeds may vary and are not guaranteed. Performance metrics based on Frontier lab validation under ideal network environment simulating “best case scenario” without network congestion, other factors cause by consumer behavior, or factors caused by third-party providers’ behaviors. Consumers may not be able to replicate the performance shown in the performance metrics.”

Isn't it great that as AT&T and Verizon are looking to shed their DSL customers, they're handing them off to such a tech-savvy and customer-focused company?

Filed Under: broadband, customer service, e-commerce, online signups
Companies: frontier communications

29 Comments

After Blowing $336 Million On Failed Merger, Comcast Again Proves New Neutrality Rules Won't Harm Broadband Investment

Broadband

from the watch-what-we-do,-not-what-we-say dept

Tue, May 5th 2015 9:33am — Karl Bode

Comcast's earnings this week indicate that the cable giant everybody loves to hate spent $99 million on trying to get its $45 billion merger with Time Warner Cable approved last quarter. All told, Comcast spent $336 million on trying to sell the deal before it was ultimately squashed by regulators for being just too big and ugly. And that's likely not including all of the costs of the deal, like the money thrown at minority and other groups to create the illusion of diversity of support for the deal. That's money that could have been spent on Comcast's historically abysmal customer service, which contributed to the negative public sentiment surrounding the deal.

Neither the failed merger nor the FCC's new net neutrality rules appear to have stopped the company from its plan to deploy still-unpriced, 2 gigabit service to 18 million homes by the end of the year (including to some cities it had previously sued, threatened, and otherwise manhandled to try and stop precisely these kinds of services from being deployed). Speaking to investors and analysts, Comcast cable CEO Neil Smit proclaimed that the FCC's reclassification of ISPs as common carriers hasn't impacted the way Comcast does business in the slightest:

"On Title II, it really hasn't affected the way we have been doing our business or will do our business. We believe on Open Internet and while we don't necessarily agree with the Title II implementation, we conduct our business the same we always have, transparency and nonpaid peering and things like that. I think how it will emerge remains to be seen. We have been flexible in our packaging with HSD. We have invested significantly in our capacity and will continue to do so and that includes both the -- we launched a 2 gigabit speed, 2 gigabit symmetrical speed recently. We are rolling that out across 18 million homes by the end of the year..."

Which, again, is odd given the fact that Comcast's participating in a lawsuit where the primary argument is the FCC's new rules are so "arbitrary and capricious," they'll demolish sector investment. If you're playing along at home, Smit's only the latest broadband industry executive to admit that the FCC's rules really won't hurt the sector. Frontier, Cablevision, Sprint, Sonic and even Verizon executives have all said, at one point or another, that the FCC's new neutrality rules aren't going to even dent sector investment.

And while some of these executives have claimed their comments have been taken out of context. They keep making the same statements. Time Warner Cable CEO Rob Marcus this week also proclaimed that nothing really changes under Title II:

"At this point in time no changes to our overall philosophy. Obviously, we're going to be watching closely how things unfold on the Title II front. We have said [in] the past that [our] normal business practices comply entirely with the notion of the open Internet. No blocking, no discrimination, no throttling, and transparency are fundamental parts of the way we do business. So to the extent that's the full scope of what gets implemented under Title II, I think you won't see a change in the way we do business. To the extent that something more comes from this, as we would describe it, excessively broad granted authority, then we will have to revisit the way we are approaching investment and pricing.

Charter CEO Tom Rutdledge offered a similar sentiment:

"Well, look on the regulatory side, I mean I think every situation is different. Title II was a -- it's actually a longstanding issue. The issue of net neutrality has been around for a long time and companies have been agitating. It's been part of the President's agenda all along, and he campaigned on it initially. So it's not surprising that the forces that prevailed there did. Although I wish it were structured differently and I thought that the outcome was less than ideal, I don't think that is particularly related to being friendly or not friendly to cable in general."

And here again we have Comcast not only saying that Title II doesn't hurt them, but proving as much by continuing with an 18 million home fiber deployment that wasn't supposed to be possible under the "innovation chilling" new neutrality regime. So yeah, perhaps cable executives can sit down with their lawyers currently suing the government and compare notes. Because the network investment bogeyman just isn't scary when you consistently admit he's just not real.

Filed Under: broadband investment, fcc, merger, net neutrality
Companies: charter, comcast, time warner cable

17 Comments

Tone Deaf Zuckerberg Declares Opposition To Zero Rated Apps An 'Extremist' Position That Hurts The Poor

Broadband

from the new-AOL,-brought-to-you-by-Mother-Teresa dept

Tue, May 5th 2015 6:16am — Karl Bode

Last month we noted how Facebook CEO Mark Zuckerberg has been getting a crash course in net neutrality over in India, while the government fields public comment over new neutrality rules. The debate has been particularly heated in regards to Facebook's Internet.org initiative, which offers free, walled-garden access to some content and services (namely Facebook and its deep pocketed partners). Companies have been vocally dropping out of the effort, complaining they don't like the idea of Facebook and its partner ISPs getting to decide what content gets to be cap exempt (aka: zero rating).

Zuckerberg has proven to be rather tone deaf to the criticism so far, the CEO arguing repeatedly that creating walled gardens and breaking the very principles of the open Internet is OK -- provided you claim to have good intentions (in this case, aiding the poor by marketing to them in a Facebook walled garden). To hear Zuckerberg tell it, what Internet.org is doing can't possibly violate net neutrality because he's providing poor families a fractured, Facebook-dominated version of AOL. He's repeatedly implied that if you oppose Facebook's vision (and what it will turn into for generations to come), you're hurting the poor.

With that defense not working, the CEO has taken to the Internet.org website to post a video to try again, announcing that Internet.org is being opened to to a broader selection of websites. And that's great, until you start reading the massive number of restrictions "approved" content must adhere to. Namely, the websites can't integrate "VoIP, video, file transfers, high resolution photos, or high volume of photos." They can't integrate Flash, Javascript or Java applets. They also can't use encryption, something that's increasingly important in developing and developed nations alike.

Now again, Zuckerberg really may have noble intentions here, but the list of restrictions combined with some of the rhetoric from the video suggests an ongoing tone deafness to his critics. After telling a few anecdotes about how Facebook is helping "local fishermen" and "chicken farmers in Zimbabwe," Zuckerberg wades into the meat of his argument, declaring that those opposed to zero rating apps hold an "extreme" definition of net neutrality:

"Some may argue for an extreme definition of net neutrality that says that it’s somehow wrong to offer any more services to support the unconnected, but a reasonable definition of net neutrality is more inclusive. Access equals opportunity. Net neutrality should not prevent access."

Except declaring zero rating to be a core net neutrality violation is far from extreme. The governments of Canada, The Netherlands, Norway, Chile, Slovenia, Estonia, Japan, Finland and now potentially India have all passed neutrality rules banning zero rating of apps. Realizing that zero rating makes life more difficult for smaller companies, independents and non-profits isn't extreme, it's common sense. Even with Internet.org's new, wider walled garden gateway, you've still got Facebook declaring what is or what isn't "acceptable content," which by its very nature runs in stark contrast to the definition of net neutrality.

It's already insulting to declare opposition to neutrality a position that's held by "extremists," but Zuckerberg takes things one step further by declaring these folks are engaged in a form of "intellectual purity" that's hurting the poor:

"Are we a community that values people and improving people’s lives above all else, or are we a community that puts the intellectual purity of technology above people’s needs?"

That's numerous times over the last few months where Zuckerberg has implied that if you're opposed to zero rating and Facebook's vision of a new Compuserve for developing nations, you're opposed to helping the poor. That's simply disingenuous and obnoxious. Nothing about opposing zero rating "prevents access," and nobody is stopping Facebook or Internet.org from funding discounted access to the real Internet. Zuckerberg's basically cementing his company's gatekeeper authority over developing nations for generations to come under the bright banner of selfless altruism, then taking offense when told that these countries might just be better off with un-apertured, subsidized access to the real Internet.

Filed Under: internet.org, mark zuckerberg, net neutrality, poor, security, winners and losers, zero rating
Companies: facebook, internet.org

80 Comments

Connecticut Gets Tired Of Waiting For State's Regional Broadband Duopoly, Starts Pushing Gigabit Networks

Broadband

from the build-it-or-get-out-of-the-way dept

Fri, May 1st 2015 4:12pm — Karl Bode

Connecticut is one of numerous states where incumbent ISPs have all but given up on seriously competing or improving service, urban and rural customers alike. AT&T was so disinterested in Connecticut it recently sold all of its fixed-line networks in the state to Frontier Communications, throwing customers from the frying pan (a totally disinterested AT&T) into the fire (a marginally-interested but now debt-saddled Frontier). For years Frontier has claimed its customers don't need faster broadband access, and its CEO is on record claiming that gigabit service is "hype" that only acts to "confuse customers."

Pixelpusher220 writes in to note that numerous Connecticut cities are tired of waiting for Comcast and Frontier to give a damn, and have issued a RFP/RFQ (Request for Quotation) to begin examining the construction of gigabit networks. Roughly 46 of Connecticut's 169 towns and cities (accounting for 50% of the state's population) have signed up so far, with an eye on striking a privately-funded, public/private partnership. What started with a $4 million federal broadband expansion grant by the NTIA, quickly shifted toward Connecticut making it easier for companies to come in and compete using pole attachment reform:

"Connecticut is the one state in the country that has fixed the unbelievably difficult issue of attaching wires to poles. Rather than letting pole owners hold up every requestor by creating delays and making demands for special payments (seriously: pole-attachment scuffles are the long-running soap operas of telecom), Connecticut requires pole owners to obey a Single Pole Administrator, adhere to uniform pricing agreements, and act to make way for new wires in a set time. Dramatic stuff. And Connecticut already had passed a statute giving municipalities the right to use a part of a pole, or “gain,” for any purpose. These two elements made Connecticut an extremely attractive place to string a network."

Well, attractive if you're actually interested in offering cutting-edge service. Less attractive perhaps if you're a regional duopoly or monopoly trying desperately to maintain the status quo and spend as little money as possible on customer service or your network. ISPs, as is so frequently the case, have responded with the usual assortment of false claims that either gigabit speeds already exist (only if you're talking about the core network), or customers don't really want this kind of speed:

"The incumbent cable and telcos are not standing idly by. The New England Cable Television Association, NECTA (essentially speaking for Comcast) has fired at the plan, variously claiming that (a) the state already has adequate capacity, so no one needs a gig, (b) if gig networks are needed, they’ve already been built, (c) if new networks are built via the Connecticut plan (a plan supported by the four largest cities in the state as well as 42 other towns), taxpayers will have to pay for them. None of this is true."

Of course none of this would even be possible in the twenty states where incumbent ISPs have managed to write and lobby for laws restricting towns and cities from getting involved in the broadband market, even if the goal is public/private partnerships to deploy service to areas ISPs couldn't care less about. While Google Fiber is certainly great, its limited deployment can only accomplish so much. It's really from the local level up that we're going to improve the nation's stagnant broadband fortunes. And like net neutrality, while framed as a partisan issue by the usual assortment of Congressional marionettes, being able to dictate your own community's infrastructure future has broad, bipartisan public support.

Filed Under: broadband, competition, connecticut, muni broadband, municipal broadband

26 Comments

AT&T Fined Yet Again For Shady Behavior, This Time For Milking Low-Income Lifeline Program

Scams

from the are-we-sensing-a-pattern-yet dept

Fri, May 1st 2015 12:11pm — Karl Bode

After a fifteen-year slumber, regulators have apparently decided it might be a good idea to start cracking down on rampant fraud in the telecom market. Not long ago, we noted how AT&T was finally fined for abusing the IP Relay network for the hearing impaired, intentionally turning a blind eye to scammers on the network just to haul in the $1.50 per minute subsidies tied to the network. AT&T strung regulators along for years, implementing "solutions" that it knew wouldn't work but technically met flimsy FCC requirements. As a result, simply stopping AT&T from profiting off of defrauding the deaf (it's estimated that 95% of AT&T's IP Relay traffic at one point was credit card or other scammers) only took regulators the better part of two decades.

Last year, regulators finally cracked down on AT&T for helping scammers of a different sort: crammers. Crammers had been gouging AT&T customers for most of the last decade, charging them $10 a month for garbage "premium" text messaging, horoscopes and other un-asked-for detritus. There again, AT&T intentionally turned a blind eye to the criminal behavior, in large part because the company was netting around 35% of the proceeds from the scams. Worse perhaps, regulators found AT&T was actively making its bills harder to understand so the fraud would be more difficult to detect.

This month, the FCC has announced that it has struck a settlement with AT&T and former subsidiary SNET, over charges the companies were collecting undeserved subsidies under the agency's "Lifeline" program, a low-income community subsidy effort created by the Reagan administration in 1985 and expanded by Bush in 2005. According to the FCC's findings, AT&T apparently "forgot" to audit its Lifeline subscriber rolls and purge them of non-existent or no-longer-eligible customers, allowing it to continue taking taxpayer money from a fund intended to aid the poor:

"AT&T and SNET’s failure to remove ineligible Lifeline customers from their rolls was discovered in 2013 during an FCC audit of two AT&T Lifeline affiliates. The audit found that a number of Lifeline subscribers who no longer qualified for the program had not been de-enrolled following the annual recertification process for 2012 and 2013, a process in which consumers are required to certify their continued eligibility for Lifeline. These subscribers were given one extra month of Lifeline support, and AT&T improperly claimed reimbursement from the government for this extra month. Additionally, the Enforcement Bureau found other de-enrollment and recordkeeping violations."

The FCC announcement goes well out of its way to avoid calling this fraud, but unless you believe AT&T honestly forgot to purge its rolls (pretty difficult to do in full context of AT&T's historical behavior), it's hard to call it anything but. The FCC doesn't specify how great the discrepancy was, but given the speed at which AT&T has been backing away from unwanted DSL and phone markets, the revised differences likely aren't modest. This latest fine comes as AT&T is busy trying to convince the government that there's an endless parade of amazing benefits to be had by letting AT&T acquire DirecTV, effectively eliminating a competitor from the pay TV space.

Historically, telecom regulators love slam dunk cases against small scammers, but were willfully oblivious or too timid to acknowledge the larger players' culpability. With regulators no longer napping in regards to obvious fraud by bigger telecom players like AT&T, companies have unsurprisingly started grumbling that Travis LeBlanc, Chief of the FCC’s Enforcement Bureau, is being too hard on industry and therefore not actually curbing bad behavior:

"Two telecom-industry advocates complained that LeBlanc has been successful at grabbing headlines, but less effective at actually curbing bad behavior. By not being lenient on companies that self-report violations, he is discouraging future companies from coming forward, they said. "The FCC's new approach will discourage cooperation and self-disclosure, and it's going to force regulatees to beef up on litigation instead of compliance with the rules," one industry lobbyist said. "Ultimately, that's a poor use of resources for taxpayers, and it will lead to a worse result for consumers."

Yes, doing the bare minimum to prevent AT&T from ripping off taxpayers and consumers is just an atrocious affront to taxpayers and consumers.

While overreach is certainly possible, most of the stuff LeBlanc is cracking down on is either outright fraud, or the kind of enforcement that's hard to seriously cry foul about (like fining companies for failing to report 911 outages or airing porn during prime time). By and large, LeBlanc appears to be following the lead of FCC boss Tom Wheeler, breaking FCC tradition and actually standing up to large telecom companies. If there's a place LeBlanc (former aide to California AG Kamala Harris) may overreach, it's as the FCC begins using newfound Title II authority to re-examine broadband privacy rules.

For the moment, however, it's just interesting to see the FCC no longer turning a blind eye to scams and fraud when the country's biggest telecom campaign contributors are involved, even if the fines being levied are likely a small fraction of the total money AT&T has made off of a decade of very shady behavior.

Filed Under: fcc, fines, lifeline, scam, travis leblanc
Companies: at&t

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