Comcast: The Unregulated Broadband Monopoly

In 2006, the Legislature passed Senate Bill 120, also known as the “Competitive Emerging Communications Technologies Act of 2006,” which was then promptly signed by Governor Perdue. The bill states that, “The Public Service Commission shall not have any jurisdiction, right, power, authority, or duty to impose any requirement or regulation relating to the setting of rates or terms and conditions for the offering of broadband service, VoIP, or wireless service.”

Because the free market. Or something.

In any event, SB 120 completely precludes the Public Service Commission from any oversight of broadband, VOIP, and wireless.

Or does it?

It is clear that the Commission’s authority was limited by SB 120, but its authority was limited only with respect to “rates or terms and conditions” of the services.

So what does that leave?

Well, for starters, it arguably allows the Commission to grant or deny certificates to provide service.

Once you cross that bridge, presumably the PSC would have the ability to handle complaints and potentially even to issue fines.

Why do we need more government regulation?

Because Comcast. Because Windstream. Because AT&T. Let’s take Comcast for example. Have you seen the Comcast ads for their free wireless hotspots? They are an inducement to sell their home cable and broadband services right now but they are essentially a way to compete with traditional telecom going forward. Comcast saw an opportunity to compete with cellular carriers such as AT&T and Verizon – while the Company does not have an infrastructure of cellular towers, it does have millions of residential customers dispersed across the United States who already pay Comcast to supply Internet access to their homes (“Xfinity Internet Service”). As part of that service, Comcast leases to its customers wireless routers that create home Wi-Fi networks. These households, Comcast realized, could be used as infrastructure for a national Wi-Fi network.

Within the past several years, Comcast began supplying its residential customers with new wireless routers, equipped to broadcast not only its customers’ home Wi-Fi network signal, but also an additional Wi-Fi network signal that was available to the public. Comcast then began selectively activating these routers to broadcast the secondary network – the public “Xfinity Wi-Fi Hotspot” – in various markets across the country, with the goal of enabling 8 million Xfinity Wi-Fi Hotspots by the end of 2014.

Comcast does not, however, obtain the customer’s authorization prior to engaging in this use of the customer’s equipment and Internet service for public, non-household use. Indeed, without obtaining its customers’ authorization for this additional use of their equipment and resources, over which the customer has no control, Comcast has externalized the costs of its national Wi-Fi network onto its customers. The new wireless routers the Company issues consume vastly more electricity than regular routers, and the consumer’s unwittingly supplied public wireless degrades their own wireless bandwidth by giving it away to others.

That’s probably a violation of the Computer Fraud and Abuse Act, but it is difficult to tell since there is so much opacity in what product Comcast actually promises to deliver.

Case in point, my own Comcast experience: We upgraded our package to “Blast” upon the advice of Comcast to fix our internet speed issues months ago. Turns out those speeds could not be fixed because the Comcast equipment (the local tap) needed replacement. Comcast knew that the problem was noise in the line outside of spec and thus could not deliver the speeds requested regardless of package. So inducing us (and our neighbors) to pay for internet speeds that Comcast was not capable of delivering borders on fraudulent.

When I called to try to have that problem fixed, I checked my bill and I am currently renting a modem from Comcast that I purchased two years ago from NewEgg. Yes, you read that correctly, Comcast is charging me to rent a modem to myself. This happens so often that there is a menu choice on Comcast’s website to fix the problem. Careful clicking on things though, if you click on the link “How do I get a replacement modem?” in one of their emails, it automatically orders one for you and charges you $160 for installation and $11/month.

Recently, Comcast has begun turning off our entire neighborhood because of its own equipment’s shortcomings. They provide no notice when doing so.

The above is exactly how you would expect an unregulated monopoly to behave. It’s no surprise cable providers dominate the list of most-disliked companies. Senate Bill 120 seems to give the PSC the power to deal with customer complaints and bring Comcast and its broadcast brethren to heel. Everyone (even Comcast) would benefit, and that would be Comcastic.

18 comments

  1. seenbetrdayz says:

    Well, I’m definitely glad to have Cox. My father used to complain to me quite often about Comcast’s antics when he lived in Jacksonville, FL.

  2. greencracker says:

    Never ever “enroll in autopay.”

    It’s true, nobody’s happy with their Internet provider. I hate Comcast marginally less than ATT, so that’s why I use it.

    Does PSC handle consumer complaints for its regulated companies?

  3. DunwoodyModerate says:

    When we moved into our new home and considering Comcast versus att for Internet service I found myself at one point looking at the wifi hotspots Comcast had near my home. I was shocked to see several of those residential based hotspots you are describing are listed on comcast’s website by the homeowners name freely available to the public and display a map showing where they live. I went with att needless to say

  4. androidguybill says:

    Even better: I believe that the state passed a very dumb, knee-jerk law that would prohibit cities and counties from being Internet service providers. It was meant to fight off the imminent dangers posed by a command economy in the same nation where public gas, electricity, water, transportation, health care, education, mail delivery, housing, retirement plans etc. (and until as late as the 1990s even telephone service) are commonplace.

    Keep in mind: AT&T was granted a near-monopoly in return for their promise to provide gigabit internet, which they immediately turned around and reneged on at no cost to them whatsoever. Comcast CLAIMS that they will offer gigabit internet this year, but has been making similar claims for at least the last 3 years as well as claiming that no one really wants or needs it (AT&T has done the same). And Google Fiber is taking their own sweet time. They have delayed even deciding whether to provide gigabit ethernet to the metro Atlanta area for a year, and even after that decision is made it will be at least 2 years before anyone actually gets it.

    As far as the Comcast “XFinity Network” thing, it is actually not a bad idea. I recall the “metro Internet” idea that was popular a few years back where an entire city was supposed to be a hotspot for computers and cell phones. Your cell calls would be over Wi-Fi and the ISP would hand the calls off to the telephone network. But Comcast needs to NOTIFY and COMPENSATE the people whose routers they are hi-jacking for this purpose. (And they also need to implement the call over Wi-Fi feature … they haven’t).

    Or better yet still, let the city of Atlanta (or Norcross, Duluth, Gwinnett, Stockbridge) implement it. The whole “private enterprise” thing ignores the reason why it hasn’t been done already. It isn’t that there is no profit in it. It is that Comcast, AT&T etc. are making plenty of profits as it is and there is no incentive to pursue it. (You know, which is the same reason why an oil/natural gas company will pursue alternative energy. Why bother when they are making billions on oil and natural gas without half trying?)

    • skbl17 says:

      If you’re talking about the two bills that would have restricted cities’ ability to start up their own networks, Georgia didn’t pass either of them, so municipal broadband is still mostly unrestricted in this state, unlike our neighbors who have their cities jump through hoops.

      HB282 would have restricted municipal broadband based on census tracts (if one person in a census tract had “high speed” internet service, municipal broadband would have been banned in the entire municipality). That bill failed on a 74-90 vote when a coalition of Democrats and rural Republicans voted against it.

      There was a similar state Senate bill back in 2012, but it was never voted on or even debated.

  5. Harry says:

    Stefan, I agree. We have a quasi-market albeit one with monopolistic tendencies. The best consumer defense is to carefully study and compare your utility bills every month and periodically to check with the competition. I patiently listened to the Uuverse sales reps hard-sell the other night in which I agreed to be “upgraded” on their bandwidth and cable services along with an “offsetting credit” for three(!) months; I agreed just to be rid of him; and then I went online and changed my services to exactly what I really need at a price I can afford, and I don’t have to bother to kvetch with them again in 3 months. They take advantage of naive consumers, but there’s still some degree of competition, and they know it.

  6. georgiahack says:

    I have been in battle with Comcast many times. They are horrible, but for many folks they are the only game in town. ATT does not go everywhere and from what I know from folks who have it, the bandwidth promises never pan out. It’s just not as reliable or fast as cable internet (which has its own host of problems.)

    The newest thing that Comcast is doing is telling everyone that they have to upgrade to a new modem with better technology(docsis 2 vs docsis3). As part of this they are trying to get you to rent one of their modems, which then allows them to put up a wifi hotspot and use your electricity to do so (they also say this does not slow down your own internet, but with all the problems with noise, static, interference, or whatever on their lines I can’t imagine that being true) While the new modems do offer higher speeds they do not NEED to be upgraded. The real purpose of the upgrade is to allow them to have more capacity on their network without doing upgrades and trick you into renting a modem.
    A tech who came out to my home said that they were intentionally causing problems with people who had docsis 2 modems so they would be forced to upgrade. This is what happened to me. Our internet went out, and Comcast said it was our modem. We bought a new one with the new technology. Called comcast and verified new modem. Internet back. On a whim I put old one back on, that had not worked twenty minutes earlier, and it worked just fine again. I then called and asked for a technician to come out and when I showed him that is when he let it slip that he suspects that is what was happening.

    Problem: Have a need for more capacity but don’t want to pay to upgrade system. Solution: Make customers spend their own money for technology they don’t have to have right now and trick some of them into renting a modem that costs more than buying one and then use their resources to blast out a wifi hotspot we can then use to claim in advertisements we have the biggest hotspot network even though most of them are in neighborhoods where you don’t need hotspots. Pure genius.

  7. AlanPainter says:

    You can try to get into Comcast’s Concierge service. Teaching in public schools for many years my wife’s former student got a job with Comcast. I just hope to the good Lord they don’t change jobs or quit taking our calls…. 🙂

  8. NoTeabagging says:

    AT&T is very deceptive in our neighborhood. I had to drop them years ago because they cannot deliver a reliable signal thru all the switchboxes, etc. to my house. That does not stop them from sending intrusive, deceptive third-party door-to-door salespeople to out ‘hood.
    Tactic one: Ask lots of invasive questions about your home electronics inventory. Red Flag, they are casing your joint for future burglary.
    Tactic Two Lie, Big Time LIE – that your neighborhood just got fiber optic lines installed. and AT&T now has the fastest Internet service available in your ‘hood. No Schmucks, that was gas and water line upgrades. You fell off the turnip truck yesterday, not me.

    So yes, we really do need regulation and enforcement from these deceptive practices. Sorry (Party Politicians), I know you make big campaign bucks and sweet consulting deals of these scum, but stop giving me that ‘less government, less regulation’ BS so your cronies can make a buck and $(RE* over consumers.

  9. Dave Bearse says:

    “Comcast knew that the problem was noise in the line outside of spec and thus could not deliver the speeds requested regardless of package.”

    Yet they sold it to you on the premise of speed.

    “borders on fraudulent?”

    That sounds like lawyer-talk.

  10. jiminga says:

    We’re blessed to have three internet providers in our community, AT&T, Comcast and NuLink. Since AT&T over-promises and Comcast can’t figure out how to migrate a phone number, we use NuLink which has continued to be responsive to its customers. Perhaps the solution is for local governments to license more providers instead of permitting monopolies, thereby fostering competition.

  11. PoliticalJoe says:

    Complaints against Comcast’s service would most likely be addressed by the PSC. Complaints on alleged false advertisement on rates and terms would probably be more under the jurisdiction of the Office of Consumer Protection or the FCC or FTC or a civil matter or or or or or or… Just a thought

    • Stefan says:

      Except the PSC cannot take complaints because they think SB 120 limits their authority to do so. I think they’ve read it wrong.

  12. jbsimpson81 says:

    Stefan,

    I would encourage you to register your concerns with the FCC. Seeing as Comcast is in the process of purchasing Time Warner Cable, they are especially sensitive to customer complaints to enforcement agencies from whom they are seeking approval. You simply need to email your thoughts about their monopoly to [email protected]

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