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Content Tagged with Verizon + Comcast

Cable beat the telco carriers two to one for broadband adds in the third quarter of 2008, according to data out today from Leichtman Research Group. Of the 1.3 million total broadband adds in the quarter, 873,745 went to cable, as opposed to 425,868 who signed up for DSL service. We’ve pointed out that cable is gaining over DSL during the last few quarters, and even wondered what the telcos would do as DSL lines fell. Before we credit cable’s fast speeds compared with DSL for its advantage, however, Bruce Leichtman, president and principal analyst for Leichtman Research Group said, “It is more a function of the telcos’ shift in focus towards higher value subscribers while cable has been consistent in marketing broadband as part of its nearly ubiquitously available Triple Play bundles.”

Basically, decent cable broadband is everywhere, but telco broadband worth having isn’t. Leichtman Research also found that that the 20 largest cable and telephone providers in the U.S. — representing about 94 percent of the market — now account for nearly 66.7 million subscribers, 36.5 million for cable and 30.2 million for telcos. With a recession here, I wonder if pricey speed boosts from carriers will have much effect on the telcos’ broadband decline.

I promised I wouldn’t do more than two posts a day, but this one is such a doozy and so anti-consumer that I just couldn’t resist. Phone companies led by AT&T (same old company whose wireless network is breaking because of too many iPhones) wants FCC to allow them to send less information to the commission when it comes to things like customer complaints, network breakdowns and infrastructure-related investments. What’s weirder is that the great champion of phone companies, Kevin Martin, chairman of hte FCC, can’t wait to get this order out of the door and give a parting gift to his long-time friends.

“We need to update this for a level playing field with the marketplace of today,” Martin told The Washington Post. “On quality of service, for example, if that data is relevant for one carrier, then it should be relevant for all platforms.” In other words, instead of forcing cable companies to report this information and making them more accountable, too, he just wants to do away with any accountability for phone companies.

The order to remove all accountability is going to be passed today, according to The Washington Post, and with that we would have yet another proof that Federal Communications Commission doesn’t have consumer interests at heart. Its job should be to keep a tight leash on the carriers, spanking them with a wet bamboo cane every single time they do anything anti-consumer. Instead we have a toothless organization that serves everyone but the people. What do you guys think?

Comcast is out defending its bandwidth caps and how they are not bad. And how 250 GB transfer is plenty and enough to do whatever we want to do. Of course, in today’s terms that is more than enough, but what happens in the future? Nevertheless, if they are going to put caps, then they need to give us what I think is an acceptable expectation: a meter.

Metered billing needs a meter we can see, use and monitor any time we desire to do so. Water and electric utilities provide that meter (regardless of whether we use it or not), so why not Comcast?

If a customer surpasses 250 GB and is one of the top users of the service for a second time within a six-month timeframe, his or her service will be subject to termination for one year. After the one year period expires, the customer may resume service by subscribing to a service plan appropriate to his or her needs.

Figure out a way to tell us what our monthly usage is, and let us know if we are running up against a 250 GB cap, so that we know when to stop and not pay overage. I want to know at every single minute how much bandwidth I have used.

After all, if someone crosses the 250 GB twice in six months, they are going to get tossed out. The burden of proof lies with Comcast to prove, measure and meter to the most accurate byte of data transferred.

Another Question For Comcast: If you’re going to meter, then please let us know how you are factoring in the overhead associated with TCP/IP. Will this be included or excluded in the cap? After all, overhead includes control messages (session control, packet headers) and this can be as high as 40 percent.

This is where FCC Chairman Kevin Martin has to step up and do something. If he is going to allow Comcast to put caps in place, then the FCC needs a firm bond from Comcast saying that they wouldn’t lower the caps to, say, 150 GB or 100 GB using the same lame excuse of 1 percent people degrading the network.

You want to know why I think they are going to obfuscate the issue and fudge the numbers sooner or later using some Enron math? Just go to the FAQ page that explains their 250 GB cap decision. You will consume 250 GB in a month if you do any of the following:

* Sending 20,000 high-resolution photos,
* Sending 40 million emails;
* Downloading 50,000 songs; or
* Viewing 8,000 movie trailers.

…but then lower down on the same page, they say:

* Send 50 million emails (at 0.05 KB/email)
* Download 62,500 4 MB songs (at 4 MB/song)
* Download 125 standard-definition movies (at 2 GB/movie)
* Upload 25,000 hi-resolution digital photos (at 10 MB/photo)

What is it with you guys? Can’t do the math? Forget that…how about answering a simple question: How many HD movies can you download with 250 GB cap? That’s the only answer I need.

PS: If you believe the 0.05 kb/email then you also believe in the Tooth Fairy.

As earnings season continues, it’s clear that some in the U.S. have had their fill of broadband. Within the past week AT&T and Verizon reported slowing broadband growth, and today Comcast saw its high-speed Internet access customers grow by 278,000 new subscribers, but added 18 percent fewer customers than it did during the second quarter of last year.

It appears that messing with P2P traffic, the likely enforcement order from the FCC and worries over tiered broadband have done little to dissuade people from moving to cable Internet, perhaps because it’s simply faster than DSL in most areas. During their second quarters, AT&T added only 46,000 DSL broadband subscribers and Verizon added 54,000.

We’ll know more when Time Warner Cable and Charter Communications report earnings next week, but as broadband growth slows, it’s time to tweak the service. Comcast CEO Brian Roberts said on the conference call this morning that the company plans to upgrade its network in 20 percent of its market to DOCSIS 3.0 later this year (Comcast said this last year, too). AT&T is pushing U-verse and Verizon is relying on FiOS. Can the former Baby Bells can lay fiber fast enough to keep their customers for the long-term, or might they nickel and dime them with tiered service to goose revenue in the short term?

Comcast, the largest cable company in the US announced today that it is going to start selling a 50 megabits per second (down) connection in Minnesota’s Twin Cities region. The connection with 5 megabits/second upstream capability is based on DOCSIS 3.0 technology and will cost $150 a month. Cablevision, Surewest and Verizon have been offering similar high-speed yet very expensive connections for a while now.

The so-called Wideband connection is getting a lot of attention today, though the service is unavailable in larger Comcast markets like San Francisco, where 16 Mbps is as fast as you can go. Comcast promises that it will make Wideband available in 20% of the market it serves by 2009 and rest of the country in 2010. Talk is cheap! Since we are still waiting for TiVo on Comcast and instead suffering through a painful DVR experience, I am not holding my breath about WideBand showing up on my doorstep anytime soon.

Just a random observation: these expensive Wideband connections are attractive for a demographic that Comcast may label “bandwidth hogs” who might see their connections throttled.

Slower subscriber growth, worries about competition from phone companies and a management crazy enough to make a bold move — all this has Wall Street worried about Comcast (CMCSA), the Philadelphia-based broadband and cable provider.

The Nervous Nellies of Manhattan’s nether regions have pushed the stock down almost 30 percent so far this year. Of course, these very same worrywarts were sweating about Verizon’s (VZ) bold bet on fiber to the home technologies.

The divergent fortunes of Verizon and Comcast are very clearly reflected in this chart.

Verizon has done a better job of winning the hearts and minds of Wall Street, and that is why Comcast stock is moving south, while Verizon stock keeps moving up. Never mind the fact that Comcast has a much bigger footprint compared to say, Verizon. That said, one can’t deny that Comcast has challenges, and Verizon FiOS is not to be taken lightly. Here are some of the issues facing Comcast.

• More HD channels to compete with satellite broadcasters.
• Show that it can offer even higher-speed broadband connections, not just talk about it.
• Make its web services strategy pay off.
• Overcome the “managed” traffic scandal.
• Better Customer Service. Again, Better Customer Service.

Even with those issues, Comcast can put its rivals on the defensive by making a few aggressive moves.

• Get more people signed up to its phone service, and if that means discounts. It is a move that hits at the heart of phone companies’ core money machine: voice.
• Get serious about wireless — both cellular and WiFi. Connections everywhere will help the company get sticky with its customers.
• Boost speeds to 20 megabits and lower prices.
• Offer $15 a month broadband plan for a basic, 3-megabits-per-second broadband connection. This will take pricing power away from their phone company rivals.
• Bring to market a very compelling online video offering.
• CEO Brian Roberts should make a public pledge for better customer service, and start with making TiVo-powered Comcast DVRs available everywhere, especially in downtown San Francisco. ;-)

Ignore Wall Street is the final thing I wanted to say — but it looks like management knows that all too well.

“Our job is to keep our heads down and continue to put good operating results on the board,” said Steve Burke, chief operating officer of Comcast, in an interview (with the Wall Street Journal). “If we continue to do that the stock will take care of itself.”