Comcast's two-tier pricing angers broadband-only customers

Mercury news/Yahoo ^ | 6/11/03 | Michael Bazeley,

[Pro-Bush]

Comcast's two-tier pricing angers broadband-only customers

Bay Area Web surfers who use Comcast for their Internet connection are finding they have to pay a premium if they do not also take the company's cable-television service.

Internet-only customers have seen their monthly bills jump from $46 a month to $60 recently. By contrast, cable modem (news - web sites) users who also buy cable-television service pay just $43 a month for Internet access.

Comcast says it is simply rewarding customers who bundle services. But Internet-only customers say they are being punished for not wanting or needing cable television.

"I feel taken advantage of," said Jill Singleton of Fremont, whose family does not own a TV. "Being able to have broadband is important to us, and it's not like we really have another choice."

Comcast announced the rate increase in December, shortly after the Philadelphia company acquired AT&T Broadband. Company spokesman Andrew Johnson said the company gave its customers ample notice about the rate change.

The new prices began to appear in customers' bills April 1; the specific date varies with their billing cycle.

"We're rewarding people who take more services from us," Johnson said. "Just like other companies. It's a tried-and-true concept."

Johnson would not say how many Bay Area customers take only cable-modem service, but the number is "very, very, very small," he said.

Natalie Munn of Fremont said she never heard about the increase and did not notice any change until Comcast debited her checking account in May.

Happy with satellite

Munn said she switched from cable TV to satellite years ago because of problems with her former cable provider, Viacom. She is happy with the satellite service, she said, and has no plans to switch back to cable.

"It's blatantly unfair," Munn said. "They're using their monopoly position to force people to subscribe to cable."

Johnson said that even with the price increase, broadband-only customers are still getting a good deal. He said Comcast's pricing is competitive with the only broadband alternative, digital subscriber line, or DSL.

Comcast's $60 cable-modem service, with download speeds of up to 1.5 megabytes per second, is comparable with an SBC Yahoo DSL package offered at $59.95, Johnson said. Comcast customers can save $3 a month if they provide their own cable modem.

"We still believe we have a superior product in value," Johnson said.

The two-tier pricing structure, which Comcast uses nationwide, has attracted the ire of consumer groups.

Consumers Union and the Consumer Federation of America have asked the Federal Trade Commission to investigate what they called "anti-competitive" behavior. They are taking aim not at the higher-priced cable-modem service, but at the low-priced TV-Internet bundle.

Bundled pricing

The groups argue that Comcast's bundled pricing is so low -- less than $60 for both Internet access and basic cable TV -- that it amounts to giving away the cable-TV service for free. The goal, they said, is to "shrink the market" for DirecTV satellite television, Comcast's only real competitor in most markets.

"What they're doing, in my view, constitutes predatory pricing," said Chris Murray, legislative counsel for Consumers Union.

Murray said the bundle could be considered anti-consumer.

"If you're looking for a bundle, it's a great deal," he said. "But what about the person who only wants one service? For some people, this is the difference between being able to get broadband and not being able to get broadband."

[PBRSTREETGANG]

...they made it so sattelite with cable internet was more than just cable and internet.

How about satellite with satellite internet? (I have no idea about relative costs or speed of satellite internet. Just asking. ie. DirecTV with Direcway satellite internet service.)

[tje]

I have a firewall/router thing hooked up to my cable modem and from there to a wireless access point and one computer. I have 4 notebooks that connect wirelessly. I don't see how the cable company could tell how many computers I have hooked up. DHCP is all handled by the router and AP and the router only obtains one IP from the cable modem.

[MineralMan]

"Aaah! a business account. Sure beats paying a metered rate on a POTS line for dial up!"

Especially if you have three lines to cope with the three PCs that were on the net most of the time. The phone bills were horrendous!

If cable's available in your office or building, I can't think of any reason not to use it for the 'net.

Funny thing: When I called SBC to disconnect those three lines, they asked me why. I told them I no longer needed them since I had a cable modem and router. The woman said that I should get SBC DSL service. What she didn't know was that I had been trying to do that for two years...only to be put off again and again.

The cable? I called one morning to order it. That same day, a crew came in, ran the cable, and helped me set up the router I had bought when I decided to go cable. By 4PM that day, my three PCs were all continuously online. Dynamite!

[Chad Fairbanks]

Chad, quit yelling. I am perfectly happy with Comcast...much better service once they converted from AT&T Broadband I have both data & video service.

I'm not yelling - I just put emphasis on a few (i.e two) words. I have ComCast Cable, but use Verizon DSL - ComCast sent me something asking if I wanted their Broadband Service at a discounted rate - however, reading the fine print, I noted that the reduced rate was good for a few months, and then would be HIGHER than my current service. Since my cable bill went up when Comcast took over, I decided that they would NOT be getting any more of my money...

[brianl703]

Per FCC rules (Telecommunications Act of 1996), cable companies can only charge a "nominal monthly fee" for extra TV outlets. Most don't bother to charge that fee, and the ones that do, it's less than a dollar or so.

They can charge time and materials for the installation of those outlets, of course. But nothing prevents you from installing them yourself (and you'll probably do less damage to your house than the installer would).

[sharktrager]

Much slower, lots of equipment to buy, uplink is over phone and the companies want out of the field.

[Ready4Freddy]

Am surprised that this is a 'new' thing to cable users - thought most cable companies already gave a price break to their video customers (though the non-video customers consider it a surcharge, of course! :).

I guess the cable companies just can't allow a natural price advantage work in their favor - with DSL, you have to have a phone line in service, so it's going to cost you at least $16-17 for the basic line in addition to the DSL charge.

I had a house in Old East Dallas (renting it out, now) that has had SBC DSL for ~3.5 years. TCI / AT&T / Comcast have never made cable internet available in most of Dallas, being content to wire all the 'burbs who had separate cable systems prior to the TCI / AT&T buyout, and only wiring a few very large apartment areas & 1 or 2 affluent neighborhoods in Dallas proper.

To this day you can't get any info out of Comcast regarding possible availability dates. Methinks it has something to do with Dallas' cable infrastructure - has to be the last burg in the universe with dual-coax cable. Gonna cost a lotta $$$ to pull the fiber-o, and SBC already has a significant portion of the city covered with DSL, having concentrated their Project Pronto in Dallas a few years ago.

I'd have probably gone with cable in Dallas, had I had the opportunity - the speed dfference is just too great to ignore, for essentially the same price. Gotta admit, tho, wondered many times as my cable TV went down (on a very regular basis) if my inet would have been down as well. Fiber-o would probably help that, but it's gonna be a long time coming in Dallas.

One $$$ savings tip not mentioned yet - if you have cable, and are not married to your land line, ditch the Telco phone line (assuming you can use cellular instead, like so many ppl are doing these days). Little known factoid of the cell phone number portability issue is that it will allow you to change your old home number over to your cellphone......

[js1138]

I won't use comcast for internet because they won't charge me just for the connection. They want to charge me for every computer I have that I connect to my home network.

How do they know?

The only way they can know is by the NIC address of the first network device connected to the cable modem. Routers can be told to clone the address of the computer that used to be connected to the modem.

I suppose I got Earthlink DSL because they don't play that game. Their tech support even helped me set their modem to an undocumented configuration designed to work with a router.

[PBRSTREETGANG]

Thanks much for the info.

[Ready4Freddy]

"The only way they can know is by the NIC address ..."

I suspect that you mean MAC address??

[kevkrom]

Comcast really does try to get people to "bundle". Around my parts, they'll charge you $20/month more for a cable modem with no cable service than if you have cable. Since we have DirecTV, we don't want cable, but we subscribe anyway because basic cable is only $17 -- so it costs us $3/month less to add on a service we don't use.

Of course, Comcast gets to use this to inflate their "number of subscribers" count for advertisers...

[js1138]

MAC address of the NIC (or router). Brain spasm.

[Space Wrangler]

I fired our cable company a year ago and went with DirecTV. Why I waited so long to do it, I'll never know. Satellite is so much more superior than cable, that I don't have any idea why anyone would continue on with the antiquated cable service. The sattelite companies also offer broadband internet via sattelite at a very competetive price. Cable is taking advantage of the ignorance of it's customers and charging exorbitant fees for an inferior service. Cable will be dead in 10 years.

[Ready4Freddy]

Hey, it's all alphabet soup anyway, right? ;>)

BTW, one should note that the cloning of a MAC address (done via the router) is only necessary if you have a box on the inet side of the router, aka DMZ. Seems to be far more common for cable folks to need to clone the MAC.

[Publius6961]

BUMP

[Ready4Freddy]

R4F repeats to his own bad self:

"Seems to be far more common for cable folks to need to clone the MAC."

I guess that's because the cable co's record the MAC of the NIC they give you, and build that into your profile? The NIC MAC must then be cloned to the router to allow you to obtain an IP?

[Ready4Freddy]

R4F repeats himself once again....

"BTW, one should note that the cloning of a MAC address (done via the router) is only necessary if you have a box on the inet side of the router, aka DMZ."

So this would be wrong - if the approved MAC is outside the router, no need to clone. It's only if approved MAC is behind the router where cloning becomes necessary.

[js1138]

I've had satellite TV for about four years. We have a lot of thunderstorms this time of year, so it's out for perhaps 10 minutes at a time several times a week. We also have a Naval Air Station nearby with planes circling 24 hours a day. Sometimes when the wind is just right the planes pass between us and the satellite. Then we have glitches every few minutes.

[js1138]

I guess that's because the cable co's record the MAC of the NIC they give you...

This gets complicated and depends on who you get the service from. Earthlink gives you a logon/password screen the firs time you connect. Then it remembers your MAC address. If you switch computers or install a router, you have to log on again.

Bellsouth DSL records your MAC address when you call them to set up the service. They do not have a logon screen, and you have to call them if you change cards. Bellsouth also tried for a long time to prevent sharing by giving customers the option of an internal modem or a USB modem, so you couldn't use a router. This became kind of futile when Windows provided internet sharing as a standard feature. My sister has a second network installed, attached to a wireless access point. The computer acts as the router.

[Space Wrangler]

We get the glitches with the storms, but it's still better than cable. We had digital cable before going to satellite, and our signal was constantly being degraded. I'll take satellite hands-down every single time.