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Charter Eyeing 'Consumption Based Billing'
Though management, debt are the real problem...
10:00AM Thursday Nov 19 2009 by Karl Bode
After his company won approval of its bankruptcy plan this week, Charter Communications CEO Neil Smit
tells Bloomberg that upon exiting from bankruptcy, the company will raise prices and consider consumption-based billing. Charter Communications hasn't been profitable since the company went public in 1999, posted a $2.45 billion loss last year, constantly ranks at the bottom of most customer satisfaction surveys, is swimming in debt, and was just
forced into bankruptcy and reorganization. Of course these problems were caused by poor management, not flat-rate broadband pricing -- a model that's been perfectly profitable for most ISPs. Despite Charter's constant failings, Smit himself was paid $7.4 million in cash compensation for 2008, and remains one of the highest paid executives in St. Louis. Perhaps he'll volunteer a fresh pay cut in addition to socking his customers with higher prices? For the team?
34 comments
Verizon Again Hints At Metered Billing
And again tries to suggest that 'it's only fair...'
10:01AM Wednesday Nov 18 2009 by Karl Bode
Back in September we noted how it seems like only a matter of time before
Verizon engaged in metered broadband billing. After Time Warner Cable's
PR implosion, most ISPs are in a holding pattern on the idea until they can sell consumers on it, something they haven't done a good job of so far. Verizon also continues to face competition from Cablevision, who has publicly stated they think metered billing
confuses customers and they "think broadband is a pretty powerful drug and we want people to consume more of it." But Verizon continues to dream, telling
Stacey Higginbotham at GigaOM they still dream of a metered future:
Ultimately this is the fairest cost recovery model, and with a tiering plan or a meter everyone is paying their fair shares to finance the network," Whitton said. Unlike other ISPs, Verizon doesnt view heavy bandwidth users as hogs, but it does view them as potentially high-end customers.
Again though, the kind of metered billing models carriers propose
have nothing to do with fairness.
story continues..
115 comments
Own Your Own Fiber
Utopia tinkers with a slightly different model
09:07AM Wednesday Nov 18 2009 by Karl Bode
Given the high costs of deploying fiber to the home, we're starting to see new models emerge whereby if customers really want it, they can share the cost of having it installed (one Norwegian ISP gives a $400 rebate if you
dig your own fiber trench). Now
Utopia, the nation's largest municipal fiber deployment, is testing a new model whereby communities who want the fiber deployed can
share the cost of installation. As more Utah cities look to connect to Utopia but debate how they should pay for it, Brigham City has decided that if users want fiber they can pay for it themselves. 1,600 local residents have already ponied up $3,000 a piece, helping the city install a $5.5 million network while the city itself only puts up about $700,000 of the required cost.
48 comments
Verizon Offers Six Months Free DSL Promo
To help counter the company's continued DSL losses
10:33AM Tuesday Nov 17 2009 by Karl Bode
Verizon suffered from quite a bloody third quarter when it came to DSL numbers, the company
losing 135,000 DSL customers -- and only a portion of those having upgraded to the company's FiOS service. To help counter these DSL losses Verizon keeps tinkering with their DSL promotions, and yesterday rolled out a new one. According to a Verizon
press release, new Verizon 1 Mbps, 3 Mbps or 7 Mbps DSL customers can get service free for six months if they're willing to sign a one year contract with the company. FiOS customers should note the company has
also slightly tweaked their FiOS promotions depending on where you live.
24 comments
Wireless Industry Pricing Plans Confuse Economists, Too
Trying to unwravel the logic behind buckets o' minutes
09:08AM Monday Nov 16 2009 by Karl Bode
Whether it comes to triple play broadband or wireless service, pricing plans are often designed to give the illusion of value -- instead of the real thing. Bundle plans are often designed to
prevent direct comparisons with a competitor's service, and plans are almost always designed to get you to pay more money than you'd like. It's of course all based on mountains of data collected exploring what consumer's will pay. Saul Hansell at the
New York Times explores in particular the wireless industry's pricing plan magic -- which apparently even occasionally dumbfounds economists:
"The whole pricing thing is weird," said Barry Nalebuff, an economics professor at the Yale School of Management.
story continues..
32 comments
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