TIME Internet

Here’s the Latest City Getting Google Fiber

Google Begins Installing Ultrafast Broadband Network
Bloomberg—Bloomberg via Getty Images Boxes of equipment needed to install Google Fiber broadband network sit on a couch at the home of customer Becki Sherwood in Kansas City, Kansas, U.S., on Tuesday, Nov. 27, 2012.

High-speed Internet service continues to expand

Google’s high-speed Internet service is headed to San Antonio.

The search giant announced Wednesday that Google Fiber will soon begin development in the Texas city. With 1.4 million residents, San Antonio will be the largest city to get Google Fiber so far, according to a company blog post.

Google’s Internet service offers speeds of up to 1,000 Mbps, significantly higher than what competing Internet companies typically offer for high-speed broadband. Since launching in Kansas City in 2012, Google Fiber has expanded to Provo, Utah and Austin, Texas. San Antonio joins a growing list of cities where Fiber development is underway, including Atlanta, Nashville and Charlotte.

As Google Fiber’s popularity has grown, competitors like AT&T have boosted their speeds and now offer Gigabit service in certain markets as well.

MONEY

Why 15% of Americans Still Don’t Have the Internet

typewriter
Getty Images/iStockphoto

Age is a big factor, but so is cost.

For many of us Internet service is a fact of modern life. While we may not like the monthly bills, like our phones and electricity, we can’t imagine living without it.

But, according to a new Pew Research Center survey, there is a small minority of Americans—about 15%—who still aren’t online. While that’s down from roughly half in 2000, the rate has changed little in the past three years, according to Pew.

Just who are the holdouts? As you might expect they skew older. About 40% of people 65 and older aren’t online, compared to just 3% in their 20s, according to another recent Pew survey.

But cost is a big factor too. About 14% of people who earned $30,000 to $50,000 weren’t online, and that’s three times the rate for those making $75,000 or more. And when Pew asked non-Internet users why they weren’t logging on, about a fifth cited costs.

While lots of the technology people use to get on the Internet has been getting cheaper, consumers pay an average of $50 a month for broadband, which is $10 more than they did a decade ago, according to Reuters.

Even if you can’t imagine staying offline, there are ways to make the pinch less painful. Among the potential strategies: buying rather than renting a router; avoiding paying extra for higher speeds which you may not need; and asking your service provider for a “basic” Internet package, typically priced at $15 a month.

 

MONEY Tech

Comcast Now Has More Internet Customers Than Cable Customers

Comcast might have more broadband subscribers than television subscribers, but it still wrings money out of TV watchers.

MONEY Internet

Get Ready for Your Internet Bill to Soar

Broadband cable
Shaun Wilkinson—Alamy

True competition among Internet providers remains a dream for consumers.

“Infrastructure deployment requires the expectation of a healthy return on capital.”

In a nutshell, this jargon-laden statement explains why there isn’t much in the way of genuine competition among Internet providers, and why most Americans have only one or (if lucky) two options for service. The real bummer is that this concept also means that consumers shouldn’t expect all that much more real broadband competition going forward—and that there’s good reason to expect the price of Internet service to soar in the near future.

The statement comes from Craig Moffett, an industry analyst for MoffettNathanson who testified before Congress’s Energy & Commerce Committee this week in a meeting about “Promoting Broadband Infrastructure Investment” (HT: Consumerist).

What Moffett was getting at is that businesses like Comcast, Verizon, AT&T, and Time Warner Cable are highly unlikely to spend big bucks to lay fiber and expand or upgrade their networks unless they’re all but assured of making even bigger bucks as a result. “It is not a matter of whether a business is or isn’t profitable, it is instead a matter of whether it is sufficiently profitable to warrant the high levels of capital investment required for the deployment of infrastructure,” Moffett said.

Spending money to expand into new markets is especially not worth it for an Internet provider when it will have to compete with another service that’s already entrenched in the area. “The returns to be had from overbuilding—that is, being the second or third broadband provider in a given market—are generally poor,” said Moffett. “Let that sink in for a moment. Stated simply, it means that market forces are unlikely to yield a competitive broadband market.”

In other words, there is no robust competition because broadband providers find it not worthwhile to compete. As for the prospect of installing regulations and incentives that would boost competition, Moffett said, “there is a not unreasonable assumption that any attempts to foster competition will ultimately be unsuccessful.” In yet another honest-yet-depressing bit of insight, Moffett offered, “There are no easy answers.”

Oh, and in all likelihood, Moffett sees that the result of cord cutting becoming more common is that “video will become unprofitable and broadband will be left to carry the entire burden” of covering growth costs and bringing in revenues for TV-Internet providers. What this means for the Comcasts and Charters of the world is this, in Moffett’s analysis: “They will simply have to sharply raise broadband prices.”

TIME AT&T

AT&T’s $49 Billion Acquisition of DirecTV to Get Regulatory Approval

It would be the year’s biggest media deal, report says

Step aside, Verizon and AOL.

If AT&T succeeds in its $49 billion dollar bid to acquire DirecTV, the match will be the year’s biggest media deal—an order of magnitude larger than the $4.4 billion Verizon agreed to shell out for AOL earlier this year. Even in the parallel universe where Comcast’s botched $45 billion Time Warner Cable takeover was a triumph, this deal is still bigger.

What’s more: the match—originally proposed in May 2014—seems very likely to go through. The deal is all but inked, reports The Wall Street Journal, citing unnamed sources.

Regulators from the Federal Communications Commissions are apparently in the midst of wrapping up their review of AT&T’s potential purchase. The company already has clearance from the Department of Justice. All that’s left is for the FCC’s five commissioners, including chairman Tom Wheeler, to formally submit their approval.

As Journal reporter Thomas Gryta notes:

The transaction will make AT&T the nation’s largest pay television provider in addition to the second biggest wireless carrier at a time when companies are trying to figure out how best to handle the massive shifts among media companies as video consumption moves online. The combination will pair AT&T’s regional U-verse pay TV business with DirecTV’s satellite operation, which is nationwide but lacks a robust broad band offering.

Previously, AT&T lost $4 billion and failed to win approval for an attempted T-Mobile takeover in 2011. This time round? Apparently things are going much more smoothly.

TIME mergers

Charter Promises To Play by the Government’s Internet Rules

Charter Communications Buys Time Warner Cable In $79 Billion Deal
Yvonne Hemsey—Getty Images Charter Communications's office in Newtown, Connecticut is seen May 30, 2015.

If it's allowed to merge with Time Warner Cable

Charter is ready to go above and beyond the government’s requirements for maintaining a free and open Internet, as long as it gets to merge with Time Warner Cable. The cable and Internet giant submitted a statement to the Federal Communications Commission Thursday explaining why the proposed merger between the two companies, along with Bright House Networks, is in the public interest.

If the merger is approved, Charter said that it would not block or throttle certain types of Internet traffic or prioritize certain content in paid “fast lanes.” These are central tenets of net neutrality rules which the FCC recently reenacted, but Charter is agreeing to adhere to these standards even if the new regulations are later ruled illegal (it’s happened before).

Charter also said it would submit disputes over interconnection agreements to the FCC. Interconnection is how ISPs like Charter transfer traffic from content services such as Netflix into people’s homes. The agreements have come under increased public scrutiny over the last year due to drawn-out debates between Netflix and Internet companies like Comcast and Verizon.

Even with these promises, there’s no guarantee that the FCC will approve the merger, which would give Charter about 19 million broadband customers and 17 million TV customers. Comcast dropped a bid to acquire Time Warner Cable earlier this year after it became clear that the FCC was unlikely to approve the deal.

TIME Innovation

Why It’s Time to Kill the Performance Review

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

These are today's best ideas

1. It’s time to kill the performance review.

By Melissa Dahl in the Science of Us

2. Give communities a valuable summertime resource: Open school grounds for play.

By the editorial board of the Fresno Bee

3. Could we outlaw street harassment?

By Daniel Serrano in Vice

4. We should be able to answer this simple question: How many people die in police custody?

By the editorial board of Bloomberg View

5. Here’s an Internet roadmap for a more equal society. (Hint: it’s got broadband and free wifi everywhere.)

By Ron Klain in Democracy

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

TIME Ideas hosts the world's leading voices, providing commentary and expertise on the most compelling events in news, society, and culture. We welcome outside contributions. To submit a piece, email ideas@time.com.

TIME Media

Showtime Announces Subscription-Free Streaming Plan

Private Reception And Screening Of Homeland Season 4
Stephen Lovekin—Getty Images for Showtime Actors Mandy Patinkin and Claire Danes attend a Private Reception And Screening Of Homeland Season 4 on September 4, 2014 in New York City.

After HBO made a similar move

Just one month from now, you’ll be able to watch Homeland, Shameless, The Affair, and other Showtime hits without cable.

CBS Corporation, which owns Showtime, has unveiled a streaming-only Showtime offering, according to Variety. Also known as an “OTT” (over-the-top) product, the application will let even those who do not pay to receive Showtime through a cable package watch the network’s programming over the Internet, on a desktop computer or connected device.

The service launches on July 12, coinciding with the season premieres of Ray Donovan and Masters of Sex. It will cost $11 a month, four dollars cheaper than rival HBO’s similar offering.

Like HBO, Showtime previously had an app, called ShoGo, that only allowed TV subscribers to access Showtime on a tablet. Now Showtime is following in the footsteps of HBO, which launched HBO Now this year, offering non-cable subscribers access to HBO for $15 a month. HBO has not yet publicly released numbers on the paying subscribers for HBO Now, but it has indicated that the company sees the launch as a success.

As Variety points out, CBS already moved into OTT last year with CBS All Access, a $6-per-month product with all of CBS’s primary programs as well as the ability to stream CBS affiliate channels signals in local markets.

The move by CBS is considered another step in the burgeoning cord-cutting revolution that is bringing more digital video options for those who no longer wish to pay for traditional television. This week, the National Football League also announced it will stream a regular-season game for the first time exclusively through Yahoo, only showing it on television in the local markets of the two teams.

MONEY TV

Even for Cable TV, These Customer Satisfaction Ratings are Horrible

Time Warner Cable retail store in New York
Richard Levine—Alamy Time Warner Cable retail store in New York

Nearly all providers earned the lowest scores possible for value.

It seems like every customer satisfaction survey about pay TV and Internet providers has become, de facto, a study in dissatisfaction. High, consistently rising monthly bills, combined with poor customer service and little flexibility in packages, have resulted in abysmal satisfaction ratings for Comcast, Time Warner Cable, and the rest of the field.

So it shouldn’t come as a surprise that these services scored poorly in the new Consumer Reports survey. But man, this is bad!

“Along with death and taxes, lousy cable service seems to be one of life’s certainties,” the report states. The survey asked consumers to rate TV, Internet, and phone services, as well as bundled packages including two or all three of the above. Ratings for the value provided in the TV and Internet components were especially awful: 38 out of the 39 Internet services, and 20 out of the 24 TV providers, received the lowest scores possible. What’s more, 19 out of the 20 bundles rated in the survey earned poor scores as well in terms of value.

Time Warner Cable and Charter Communications—which are in the process of merging—were near the bottom of ratings for TV service and bundles. Comcast, which until very recently looked like it was going to buy Time Warner Cable, was also rated among the worst of the worst. As for whether such loathed services will improve or get even worse by expanding via mergers and acquisitions, it’s anyone’s guess. Let’s just say it’s unwise to get your hopes up.

The one clear-cut practical takeaway from the survey is that it’s absolutely in your best interest to call your provider and complain. The business model of pay TV-Internet providers is one in which new customers are drawn in with low introductory rates, which escalate higher and higher the longer you’re a subscriber. It’s a much-criticized system that puts subscribers at odds with the “retention specialists” whose job it is to keep customers from canceling. These customer service agents might otherwise be providing, you know, actual customer service, but instead they focus on negotiating with subscribers who call to complain about rising monthly bills. As the CR report shows, there are rewards for customers who take the time to hound their providers for better terms:

Among the 42 percent who said they tried to negotiate a better deal, 45 percent reported that the provider dropped the bundle price by up to $50 per month, 30 percent got a new promotional rate, and 26 percent received additional premium channels.

Based on results like this, pay TV and Internet providers should anticipate the continued steady stream of subscribers calling up with gripes about monthly rates. After all, instead of tweaking the structure to eliminate complaints about pricing, the system all but encourages subscribers to complain, haggle, and threaten to drop the service in order to be treated fairly.

What emerges is two categories of subscribers. One routinely complains and, amid lengthy, frustrating phone calls, is rewarded with monthly rates that are lower than they otherwise would have been. The other sits back and pays whatever bills arrive each month, without complaint. Essentially, if you don’t want to deal with hassles, you’ll be ripped off.

It’s no surprise, then, that both of these categories of subscribers would give their providers extremely low satisfaction ratings and say that they are poor values.

MONEY The Economy

Internet Subsidy Means More Jobs for Poorer Americans, Says FCC

FCC Chairman Tom Wheeler wants broadband Internet for low-income families.

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