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Cable Companies Won't Let Cord Cutters Go Without A Fight


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Cable Companies Won't Let Cord Cutters Go Without A Fight

Your options for how to watch TV continue to grow, but cable companies could make you pay dearly if you want to “cut the cord.”

Sony and Dish have recently launched services that allow you to watch live TV streamed over the Internet without subscribing to a cable or satellite package, and Apple is rumored to be working on its own live TV product that will be available this fall. HBO and Showtime will offer standalone streaming services later this year that will allow people to subscribe to the premium networks without paying for TV packages.

The slew of new offerings could prompt some of the millions of households that don’t pay for traditional TV to start buying subscriptions to new services. The new options could also spur others to cut the cord -- that is, to ditch their expensive set top boxes in favor of paying Sony, Dish or even Apple, instead of their cable provider, to watch TV.

But try as they might, most people will still be tethered to their cable company.

The majority of Americans who have a wired high-speed Internet connection get it through cable, meaning they pay a cable company each month for their Internet connection.

And because there’s even less competition for broadband than there is for TV -- according to the Federal Communications Commission, 74.7 percent of American homes have one or fewer options for broadband -- cable companies could simply raise the prices of their standalone Internet packages as an increasing number of people choose to cut the cord.

"I expect that as the market continues to shift towards the faster broadband speeds that only cable companies can offer, these providers will continue to raise broadband prices in order to offset their declining pay TV revenues," Derek Turner, research director at the advocacy group Free Press, told The Huffington Post.

Some Internet service providers have also been experimenting with so-called “usage based pricing,” similar to the way most wireless carriers charge for data. If your broadband plan has one of these data caps, you could be charged for exceeding an allotted number of gigabytes of data during a billing cycle. So the more you watch, the more you’ll have to pay.

Comcast, the largest cable company in the country (and currently in the process of merging with Time Warner Cable, the second largest), is testing data caps of 300 gigabytes per month in cities in seven states.

According to a page on Comcast’s website outlining the program, customers are notified when they’ve gone over their data allotment during a billing period, and they’re given “three courtesy months” during which they can go over their data usage plans without being penalized. After that, they’re charged $10 for each additional package of 50 gigabytes.

This type of plan could get expensive very quickly for people who PIRATED VIDEO IS ILLEGAL a lot, or who plan to get their TV from a streaming service instead of a traditional pay TV provider. The average amount of data used when streaming high-definition video is about 1.6 gigabytes per hour, according to the networking company Cisco, and streaming Netflix in HD can use as much as 3 gigabytes an hour, according to Netflix's own figures. If someone were to PIRATED VIDEO IS ILLEGAL the nearly five hours of live TV per day that the average American watches, then based on the 1.6 GB-per-hour figure, that person alone would consume about 233 gigabytes per month.

When you add other people in the household who may also be streaming, that figure can rise even more quickly.

At this point, such data caps are experimental, said Dan Cryan, the senior director of media and content at IHS. But they could become more widespread as cable companies try to keep people from giving up their TV service.

“There [is] such little competition that from a market forces perspective they're pretty free to do what they want,” Cryan said of cable companies.

According to the FCC, the new net neutrality rules adopted last month will not regulate retail broadband rates. But, said Turner, the commission “does have the authority to respond to complaints about price gouging or other unreasonable practices.” Still, that’s unlikely to happen, he said, as the commission has acted only once since 1991 on a complaint about retail rates being unreasonable.

Some broadband customers have even found that it’s cheaper to subscribe to a TV package and Internet than just Internet alone.

Cable companies want to keep customers subscribing to the bundle for a number of reasons, said Turner. Companies make money from those customers; they don’t want their investors to see subscriber loss; they’ve found that it’s easier to keep you subscribing if you subscribe to more than one service (and there’s competition); and it makes it easier to upsell customers on new and additional services.

Chris Buecheler, a 37-year-old Web developer in Providence, Rhode Island, is considering signing up for TV service through Verizon just to drop the price of his Internet package.

For the last two years, Buecheler has paid Verizon $89.99 per month for a broadband connection, and he and his wife watch TV shows through Netflix and Amazon’s Prime video service. But Verizon recently increased the price of his Internet plan to $94.99 per month. If he signs a two-year contract with Verizon for an HDTV package, his combined bill for TV and Internet will once again be just $89.99 per month, and he’ll save $60 a year.

Buecheler said he plans to call Verizon and try to get a discount on his Internet service. But if the company isn’t willing to do that, he said, he and his wife will get the TV package even though they don't really want it.

"There's no reason not to save the money," he said.

Damned if you do, damned if you don't. Cut your TV package, they will raise the price you pay for internet.

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The story at the end is where we are currently with Comcast. We have basic TV and Internet bundled because it's cheaper to do so at $55/mo than getting comparable Internet alone at $85/mo. We never even hooked up the cable box because we have an antenna for the local channels (free HD) and use Netflix and Prime for about 90% of our viewing.

On a side note, do Americans really watch on average 5 hours of TV a day? Yikes. My wife and I get in maybe 1 hour every other day.. but our boy is closer to 2 or 3 hours a day. Ugh.

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The datacaps are the real problem. They do not solve any problems for Comcast other than forcing people to not switch to internet based tv services for fear of paying overages. This is why they(Att/Verizon/etc) are now suing the FCC via USTelecom to get rid of the recently made Net Neutrality. They also have Tennessee suing the FCC for repealing laws that prevent municipal ISPs from existing or expanding.

It is really sad how deep in the pocket some of our politicians are. They are screwing over their constituents so Comcast can make bigger profits.

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Details?

When the FCC passed Net Neutrality, they also passed a ruling that voided any state laws that prevented local governments from building and expanding their own ISP, so long as the state did not outright ban the practice, which was all but 6 states. This means that in Tennessee, Chattanooga Fiber can expand beyond its current boarders into new counties. Tennessee having politicians in the pocket of guys like Comcast and ATT means that they are going to fight the ruling, so Att/Comcast do not have new competition.

http://www.engadget.com/2015/03/25/tennessee-sues-fcc-over-municipal-broadband/

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This is one of the very few areas where I support outright nationalization of an industry. At some point, the big companies are going to get so obnoxious that it incentivizes government to just provide free internet nationwide. As I understand it, the fees charged by the companies are almost pure profit at this point. They're pricing it not based on their costs, but based on trying to manipulate user behavior.

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This is one of the very few areas where I support outright nationalization of an industry. At some point, the big companies are going to get so obnoxious that it incentivizes government to just provide free internet nationwide. As I understand it, the fees charged by the companies are almost pure profit at this point. They're pricing it not based on their costs, but based on trying to manipulate user behavior.

The last time I saw, I believe it was around 97% profit margin. Last I checked, it cost them on average 1-2 dollars to provide the service and that 97% profit margin is at a price of 40-50 dollars. The crazy part to me is that people would be more than happy to pay 40-50 dollars for broadband(25-50Mbps) service, but they still continue to gouge the customer. The data caps are only there to protect their cable/tv offerings, which have a very similar profit margin.

I am for a national broadband network that wholesales to the likes of ISPs, but we have to get an internet bill of rights and stop the NSA from infringing on our privacy first. I think the current admin FCC has done a good job of fostering competition, but think about Netflix as an ISP or even Amazon as an ISP. Amazon Prime + ISP would be crazy. They could offer 60 per month 50-100Mbps speeds + Prime Video + 2 day shipping + unlimited cloud storage. Sprint/Tmobile could offer their business customers a total solution for one price.

That of course assumes that the government could run it correctly, but I think we know that some corruption to ruin that.

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It's pretty disgusting really. The telecoms feel that they are entitled to your money even if you choose not to use one of their services. They can't even justify it with supply and demand or overhead costs. They are saying outright "We are accustomed to getting X amount from you and even if you decide to discontinue one of our services, we are going to get it from you one way or another"

I need one of you lawyers to explain to me how this doesn't violate anti-trust laws.

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That tends to happen in the absence of competition.

The problem is that competition is not an easy thing to foster, because the incumbents do not want to expand into each others territory and it is very cost prohibitive for smaller companies to break into the ISP industry. Even Google with its huge warchest is expanding very slowly. That is why I support the NBN, but I do think the the FCC has been trying its best while not going into government takeover mode to foster competition. The new Net Neutrality rules make ISPs into common carriers, which means that in areas like Austin, Att can no longer gouge Google for access to telephone poles and Municipal governments can either partner or build their own fiber network. Comcast/Att/Verizon could have easily covered much of the us with fiber, since we have a ton of dark fiber that was laid down years ago, but they do not want to invest unless someone forces them. It is really sad. I am just glad that Att was not able to buy Tmobile, because they have kicked the industry into high gear.

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I hate our comcast cap of 300gb. I pay more for the 100mbps speed yet I have the same cap as someone on the 6mbps plan. I can literally run through my monthly cap in about 8 hrs if I wanted to.

The kicker is my only other choice is att dsl which maxes at 12mbps and that would not work for me working from home at times. It's also funny since the feds reclassified broadband to 25mbps or more comcast literally has a monopoly in my area for broadband internet.

Can't wait for google fiber to hit the ATL suburbs.

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When the FCC passed Net Neutrality, they also passed a ruling that voided any state laws that prevented local governments from building and expanding their own ISP, so long as the state did not outright ban the practice, which was all but 6 states. This means that in Tennessee, Chattanooga Fiber can expand beyond its current boarders into new counties. Tennessee having politicians in the pocket of guys like Comcast and ATT means that they are going to fight the ruling, so Att/Comcast do not have new competition.

http://www.engadget.com/2015/03/25/tennessee-sues-fcc-over-municipal-broadband/

102645.jpg

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Caps suck no matter where you live, but ****, 10gb?!? What they don't think rural people PIRATED VIDEO IS ILLEGAL\download ****?

It's sattelite. The same price as comcast with pathetic caps and ping rates nearing 1000ms. The only thing they're capable of doing online is visiting webpages.

Want the 4g lte experience with a 20gb cap? Try Verizon for only $120 dollars a month since they own the towers.

I've had the 300gb comcast cap and the 10gb cap both costing the same per month and I'd take the 300 without a whisper. Those are the people really being screwed by the companies unwillingness to expand and the monopolies.

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It;s 1 GB download AND upload

for i think 70? a month

and no data caps also i believe

Yep, 1Gb up and Down and no caps for $70 a month. Yhey also offer TV services as well as phone. so you could replace all your comcast services with Google. The day it hits my area I'm going to call comcast in glee to cancel.

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