Broadband

by Karl Bode


Filed Under:
broadband, competition, mergers, price hike

Companies:
charter



Charter Spectrum Celebrates Megamerger One-Year Anniversary With Blanket Price Hikes For 'Mispriced' Customers

from the synergies! dept

You may recall that when Charter proposed spending $79 billion to acquire Time Warner Cable and Bright House Networks last year, the usual promises of job creation, lower prices, better broadband, and improved customer service came along for the ride. The problem: none of those things have materialized under the new company (Spectrum). In fact, like so many telecom mergers, many customers of the nation's now second-largest cable provider say Charter's prices have gotten higher and the company's customer service (already ranked among the worst in any industry) has somehow managed to get worse.

With this week being the one-year anniversary of this mega-deal, customers in acquired territories say the company is engaged in yet another round of blanket rate hikes. In Lexington, Kentucky, for example, Spectrum customers say they're being forced to pay $20-$40 more (plus assorted fees to swap out their cable boxes) for effectively the same service. And when they call in to complain, they're discovering that part of the new Spectrum experience involves a company that's no longer willing to haggle on promotions (because it doesn't have to):

"Fitzgerald tried to haggle — Time Warner usually cut you some slack on price increases in order to keep your business, he said — but the representative stopped him. This is Spectrum’s deal. Take it or leave it.

“It was bull crap,” Fitzgerald said. “They don’t give us any notice, they just spring it on us in the middle of the month. And then they tell us we’re getting an 'upgrade.' This isn’t an upgrade, it’s the same channels we already had!"

Spectrum's latest rate hikes are part of a sweep of customer accounts to identify customers that company executives claim are "mispriced" (read: aren't paying enough). Like Comcast, Charter benefits from a dwindling amount of broadband competition with the telcos, who have simply refused to upgrade their aging DSL networks at any real scale. As a result, customers looking for ISPs that can actually provide the base FCC definition of 25 Mbps usually have only one option to go to: cable. And when they arrive, they're usually forced to bundle TV service they may or may not even want in order to get the best price.

As a result, Charter added 350,000 broadband subscribers last quarter. But even then, Charter managed to lose 47,000 pay TV subscribers last quarter, the majority of them former Time Warner Cable customers that have used the price hikes as an opportunity to cut the cable cord. Customers clearly aren't happy with the way the merger is going, but Charter CEO Tom Rutledge is positively giddy at the "value proposition" he's presenting these customers:

"It’s a difficult thing to model,” said Rutledge, whose 2016 pay package was $98.5 million. “But we’re coming at it both ways, both from creating a value proposition in the pricing and packaging we have, and doing those smart things that you can do with an existing customer base that’s been mispriced to move them in the right direction."

While the former Obama administration approved what is clearly an awful deal, they did affix a few conditions to the merger. Namely that Charter has to adhere to the FCC's net neutrality rules (even if thrown out by the FCC), needs to expand broadband to 2 million additional locations, and can't impose usage caps and overage fees for a period of seven years from the date of the deal's signing. But the current FCC has been busy trying to roll back many of those conditions, making an already awful merger even worse.

Good news though: if you really adore higher rates, bogus promises, and historically-abysmal customer service, there appears to be many more telecom mergers like this one headed your direction.


Reader Comments

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  • icon
    Jeffrey Nonken (profile), 26 May 2017 @ 12:27pm

    If there's only one, it's not an option.

    reply to this | link to this | view in chronology ]

    • identicon
      Andy, 26 May 2017 @ 4:03pm

      Re:

      I love it , this just encourages more and more people to cut the cable and more and more people to look for alternatives...If there really is Tesla/google satellite internet access coming soon I can guarantee that the majority of customers will convert, especially if it is cheaper and faster than what the big three internet providers offer.

      And yes they have resolved the high ping issues and it should be faster than most all comcast connections.

      I actually have the ability to get basic internet access for less than a cup of coffee from Starbucks, yes with a small one off installation cost but no equipment rentals just plain old internet access at about 16mb download and 1mb upload, enough to view two or three netflix streams at once.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 26 May 2017 @ 12:51pm

    aw yisss

    Business as usual, regardless of who is in power!

    Some like to whisper sweet nothings in your ear while you get fucked and others just bitch slap you and go to pound town...

    Some people adore the ones that whisper sweet nothings in your ear before hand and other at least appreciate the direct fuck over with a different set of lies, but in the end... nothing has changed.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 26 May 2017 @ 12:54pm

    Without states stepping in with their own price controls where the FCC has utterly failed, this will continue to get worse till someone figures out the FCC isn't supposed to be in bed with the industry they regulate. It certainly won't be under this current administration or Congress.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 26 May 2017 @ 1:26pm

    Better news

    Soon real competition in the guise of satellite internet will make all of these monopolies implode. SpaceX is going to do more good for the world, then the cable companies ever have.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 26 May 2017 @ 6:42pm

      Re: Better news

      They've had satellite internet for about 15 years. It's great if you're in the sticks but the latency is terrible.

      reply to this | link to this | view in chronology ]

      • icon
        Aaron Walkhouse (profile), 27 May 2017 @ 7:00am

        Re: Re: Better news

        Existing satellite internet relays are parked in the Clarke Belt
        [geostationary orbit - precisely 35,786 km] where round-trip
        transmission latencies are about a half second.

        https://en.wikipedia.org/wiki/Geostationary_orbit#Communications


        SpaceX plans a massive constellation of small satellites at only
        1,110-1,325 kilometers; less than a thirtieth the distance
        thus far less latency. ‌ It should be competitive with fiber
        over long distances because lightspeed through fiber is about
        33% lower than through air and vacuum. ‌‌ The SpaceX system
        effectively leapfrogs those long fiber links, with a greater
        advantage for greater distances.

        https://en.wikipedia.org/wiki/SpaceX_satellite_constellation

        reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 27 May 2017 @ 8:37am

          Re: Re: Re: Better news

          Satellite, even with low orbit constellations does not provide a very high total data capacity.Total capacity is a product of the bandwidth of the technology, and how many times that the same bandwidth can be re-used.

          A constellation of satellites is not a means of delivering significantly increased capacity, but rather a means of delivering a reliable service to places with restricted view of the sky, like deep valleys, and the flanks of mountains, or even places with lots of skyscrapers.

          reply to this | link to this | view in chronology ]

          • icon
            Aaron Walkhouse (profile), 27 May 2017 @ 11:55am

            With such huge numbers of satellites you get parallelism by
            connecting with many at once, like GPS. ‌ That, plus the much
            shorter range from ground to sky, gets you a major boost in
            bandwidth with no need for heavy power consumption.

            reply to this | link to this | view in chronology ]

            • identicon
              Anonymous Coward, 27 May 2017 @ 4:25pm

              Re:

              Low Earth Orbit, and affordable bound stations means omni-directional aerials. That mean that all the Satellites that can be above the theoretical (assuming a perfect sphere) horizon for any point on the Earths surface have to share the assigned bandwidth. Also, while an optimum location may have a dozen or so satellites above the horizon, they will cover something like half the globe split between them

              A satellite constellation is a mans of providing service into remote areas with reticules horizons, including those in high northern and southern latitudes.

              ,

              reply to this | link to this | view in chronology ]

              • icon
                Aaron Walkhouse (profile), 27 May 2017 @ 11:07pm

                Don't forget you're not sharing a single frequency or even band.
                Cellphone systems are a good example, with lots of frequencies
                and rapid frequency-hopping all being used at once, and that's
                90s technology. ‌ Musk is planning to do something like that;
                but newer, with much more capacity and more uplinks at once.

                Certainly, it will get better coverage, but don't forget he
                plans to compete with cable in every way. ‌ Go ask him. ‌ ‌ ;]

                reply to this | link to this | view in chronology ]

                • icon
                  Aaron Walkhouse (profile), 27 May 2017 @ 11:36pm

                  The first wave alone is 4,425 satellites in Ka- and Ku-bands,
                  so already you're connecting well over a dozen at once on two
                  widely separate high speed bands with well proven technology.]

                  Second wave is 7,518 satellites in the new V-band, which is
                  multi-gigabit per link and more direct than horizon-to-horizon. ‌

                  https://en.wikipedia.org/wiki/V_band

                  Even with the first wave alone early adopters will be getting better
                  than 25 megabits on average. ‌ Add the V-band and streaming
                  4K should be easy for millions of customers at once.

                  I think it's safe to say Elon Musk has thought this through
                  before committing his money. ‌ ‌ ;]

                  reply to this | link to this | view in chronology ]

                  • identicon
                    Anonymous Coward, 28 May 2017 @ 4:24am

                    Re:

                    I don't doubt that Elon has a market for such an extensive system, as there are millions of people living in remote areas who currently cannot get decent Internet Access. A system that can serve even a hundred million people spread around the globe, will fall apart if it tries to serve thousands of cities with tens or hundreds of millions of people.

                    Also, remember there is another part to this system, connecting the satellites to the Internet, by providing ground stations that they can see, or reach by relaying through one other satellite. Those ground stations are going to need a high capacity fiber connection to the Internet backbone. Two problems will arise, some ground stations will be required in remote areas, and the system will allow some citizens of some countries to totally bypass the countries firewall.

                    reply to this | link to this | view in chronology ]

                    • icon
                      Aaron Walkhouse (profile), 31 May 2017 @ 1:25pm

                      Are you sure about all of that? ‌ It seems like you're
                      guessing now, based on what you know of older systems. ‌ ‌ ;]

                      Such a web can easily outpace fiber by skipping it for the
                      most part, only downlinking to the most powerful peering points.
                      They don't need to be nearby at all, and in fact, the farther
                      the better due to the much higher speed of light in that web.

                      As for cities, such systems are already in development [5G, E-band]
                      and it appears the satellite systems (SpaceX and a couple of others)
                      will be building enough capacity to rival even those, with Musk's
                      two-layer three-band approach still leading in overall capacity.
                      The thing is designed to serve billions. ‌ Everywhere. ‌ All at once.

                      As for bypassing firewalls I'd call that a nice feature, wouldn't you? ‌ ‌ ;D

                      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 26 May 2017 @ 1:58pm

    and dont forget to give a round of applause to all the politicians, senators and congress critters for rushing this along, thanks to their 'encouragements' from all of these companies!! not only do they not want any competition in any industry in the USA, these people (and i use the term VERY lightly!) they do anything and everything in their power and position to actively stop it!! all for self profit!!

    reply to this | link to this | view in chronology ]

  • icon
    slowgreenturtle (profile), 26 May 2017 @ 2:02pm

    Political Pull

    If you think running to the government is the solution, then don't be surprised when the next person or company does the same thing.

    Free up the market, let the cable companies raise their rates (not only do you not have a right to a good or service, they don't have a right to force you through government exclusivity laws), you can then start your own company to compete with them. Since you'd now be working on an equal political field (no special favors for anyone), they would have to compete properly (on economic grounds).

    reply to this | link to this | view in chronology ]

    • identicon
      Thad, 26 May 2017 @ 2:08pm

      Re: Political Pull

      Sure.

      So for your suggestion, are we going to rip up all the fiber and confiscate all the money and subscriber lists from the existing providers, or travel back in time to before the fiber was put in in the first place?

      reply to this | link to this | view in chronology ]

      • icon
        slowgreenturtle (profile), 26 May 2017 @ 2:17pm

        Re: Re: Political Pull

        Sorry, not sure I'm following your point.

        What I'm suggesting is we remove our politician's ability to make special deals with companies. This way no one gets special favors or monopolies. This way there's unfettered competition. As for existing infrastructure, it remains private property in the hands of the current owners. No time travel needed since laws and policies can be changed for the better and what is an ideal situation.

        reply to this | link to this | view in chronology ]

        • icon
          scotts13 (profile), 26 May 2017 @ 2:31pm

          Re: Re: Re: Political Pull

          "...laws and policies can be changed for the better..."

          I'm sorry, you've used correct english words in a nonsense arrangement. Norman, co-ordinate! If you want that to happen, you WILL need time travel - at least 3.7 years worth.

          reply to this | link to this | view in chronology ]

        • identicon
          Thad, 26 May 2017 @ 2:43pm

          Re: Re: Re: Political Pull

          This way no one gets special favors or monopolies.

          Except that there are already monopolies. Removing regulations from the entrenched monopolies will not result in increased competition. It will result in deregulated entrenched monopolies.

          Your proposal is this:

          1. Deregulate monopolies.
          2. ????
          3. Competition!

          What's step 2?

          As for existing infrastructure, it remains private property in the hands of the current owners.

          Okay. So you are proposing that there will be "competition" between a company that already owns fiber and is able to provide service, and a company that does not currently own fiber and is not currently able to provide service. What is your proposal for making company #2 competitive with company #1?

          laws and policies can be changed for the better

          Soooo then you're not advocating for deregulation, you're advocating for different regulations? Because I can get behind that, but it's a completely different thing than what you said.

          reply to this | link to this | view in chronology ]

          • identicon
            Anonymous Coward, 26 May 2017 @ 4:31pm

            Re: Re: Re: Re: Political Pull

            I have a different approach.

            follow what green turtle said, but the lines become public property "regulated" by government. Businesses can still build and maintain lines, but cannot control who access them.

            The last mile is owned by the property owner which will them be regulated by local municipalities easement rules and demarc's moved to the box on the street.

            Since the WWW is a state and national boundary in principal and reality Federal oversight is required, and should contain rules preventing local municipalities from entering into contracts of any kind with ISP's other than subsidy for attracting businesses with. No exclusive contracts, competition rigging, special favors or conflicts of interest.

            But, the problem with government is that it likes to break rules all of the time while people just keep asking them to do it more.

            reply to this | link to this | view in chronology ]

            • icon
              R.H. (profile), 26 May 2017 @ 5:39pm

              Re: Re: Re: Re: Re: Political Pull

              That idea for the last mile makes sense. In fact, it was the law until the early 00's until regulatory capture got a firm hold of the FCC. Then they were deregulated and we've ended up where we are now.

              reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 27 May 2017 @ 10:12am

          Re: Re: Re: Political Pull

          You really don't get it?

          So you want your utility poles to look like this? https://imgur.com/a/bvbXl

          You "slash all regulation!" types never fail to surprise me with your rampant ignorance.

          reply to this | link to this | view in chronology ]

  • icon
    orbitalinsertion (profile), 26 May 2017 @ 4:00pm

    So this must include everyone they keep sending mailers to, with super low prices. Including areas they don't serve.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 26 May 2017 @ 11:56pm

    Mentioning the CEOs pay makes ir clear that the source story is a hit piece and won't go near to getting both sides of the story.

    You may want to ask Mike what is the normal outcome of a free market system. Generally its a monopoly.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 27 May 2017 @ 12:36am

      Re:

      Which, in my opinion, is why the laws that allow inventors and artists to enforce patent and copyright are so important (contrary to what is said on this site). We need to support smart hard working inventive people, like the Inventor of Email. Take a look below. He's really running for Senate! It's fabulous to see. Patent and copyright laws allow inventors to disrupt the powers that be. That's a really good thing that challenges monopolies and drives innovation forward!

      http://vashiva.com/shiva-ayyadurais-speech-at-cape-cod-republican-club-annual-breakfast-meet ing/#utm _source=SM&utm_medium=Event&utm_campaign=01On26May2017

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 27 May 2017 @ 7:31am

      Re:

      Mentioning Mike in an article written by someone else makes it clear that your comment is trollish and won't go near to adding anything meaningful to the conversation.

      reply to this | link to this | view in chronology ]

      • This comment has been flagged by the community. Click here to show it
        identicon
        Anonymous Coward, 27 May 2017 @ 8:23am

        Re: Re:

        Your stupid comment, using the stupid word "trollish", added even less.

        reply to this | link to this | view in chronology ]

    • identicon
      Thad, 30 May 2017 @ 4:01pm

      Re:

      Mentioning the CEOs pay makes ir clear that the source story is a hit piece and won't go near to getting both sides of the story.

      What's the other side of the story, Mr. Coward?

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 31 May 2017 @ 11:30am

      Re:

      The normal outcome of a free market is competition, not a monopoly. Monopolies are the outcome of government interference. In the case of telecoms, its the useless-but-expensive regulations that make it prohibitive to compete for anyone but an already-established player.

      reply to this | link to this | view in chronology ]

  • identicon
    Agammamon, 27 May 2017 @ 10:49am

    Just finished looking at the Spectrum options in my area. Its nice that they're offering 60 mbs for internet (which is over double what was available here prior to the merger) - though half their marketing says *starts at* and the other half says *up to* - but the pricing is . . . just freaking crazy.

    Basic cable, internet, and phone service (who the feth needs land-line phone service in the age of mobile internet?) costs $95/mo and installation is free.

    Basic cable and internet (alone) cost $95/mo *and* there's a $35 installation fee.

    Still more transparent than any cellphone contract I've ever had.

    reply to this | link to this | view in chronology ]


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