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Philly Forces Comcast to Broaden $10 Broadband Offer
After Promising it as Condition of NBC Merger
by Karl Bode 09:25AM Monday Sep 24 2012
To get the NBC acquisition approved, Comcast last year proposed a condition requiring they offer $10, 1.5 Mbps broadband tier (dubbed "Internet Essentials") to low income homes. As we pointed out last summer, however, actually getting the offer wasn't so simple. Program applicants have to qualify for the National School Lunch Program (NSLP), can't owe Comcast money or equipment, can't currently have any Comcast broadband service, and can't have had service in the last ninety days.

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As you might expect, most low-income homes live in debt, and much of that debt is for a very common service (TV). A Comcast insider informed us last year that many applicants were getting rejected as a result. Things then got a little ugly, with people in Philadelphia going so far as to protest Comcast's program for having intentionally cumbersome restrictions, which obviously wasn't the kind of PR Comcast wanted.

To their credit Comcast keeps slowly widening the net, last January ramping up eligibility to include families that qualify for reduced price school lunches (not just the NSLP), and increasing the offered speed from from 1.5 Mbps to 3 Mbps downstream and up to 768 Kbps upstream, more in line with the minimum definition of broadband. Comcast now says they have 100,000 families signed up for the service nationwide, while adoption of the tier in Philly has tripled since late last year.

It is however interesting to see Comcast blame everybody but Comcast for the program's rocky start. Speaking to the Philadelphia Inquirer, Cohen first blames the problem on Philly residents being paranoid, then blames the school system:
"They think it may be used for Comcast or the government to spy on them," said David Cohen, the program's chief booster and an executive vice president at Comcast...Comcast said earlier this year that only 463 families in Philadelphia were participating in the program and attributed the low number to the leadership turmoil in the Philadelphia School District, which failed to order sufficient brochures and other literature for its students. "Nobody was happy," Cohen said. "We weren't happy. The mayor wasn't happy. The school district wasn't happy."
Of course it's fairly standard practice to agree to a loophole-riddled merger condition then under-promote it in the hope nobody notices. You might recall the $10 DSL AT&T promised as part of their BellSouth merger which the company then hid and refused to advertise. To their credit the people in Philadelphia noticed, and Comcast has adjusted accordingly.

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Binghamton, NY

2 recommendations

reply to pnh102

Re: Fight On Comcast

Well, I'd concur on the merger, this type of vertical integration is disconcerting to say the least. Time Warner spun off Time Warner Cable to separate the production and delivery aspects of its business, which is what should be happening in this business. On an unrelated note, as a GE shareholder, I think it was a boneheaded move on their part to sell NBC, but that's a different discussion altogether.

I do think they should be compelled to offer a basic tier of internet service, alongside the basic tier of cable (e.g., broadcast only) service they've always had to offer. Heck, they should also have to offer a basic tier (e.g., local calling only, no special features like call waiting or caller id) of phone service, since they are well on their way to driving the ILECs out of the landline market.

These basic services should be available to everyone, regardless of income or other special circumstances. For the internet and phone service they should have to accept a reasonable (say three months) payment plan for customers in arrears, these are essential 'utility' services that shouldn't be outright denied to anyone, so long as the customer is willing to make a good faith effort to repay what they owe. Heck, you could even allow them to ask for a deposit, as the phone and power companies can, repayable in full with interest after 12 months of timely payments.