Aereo, the Barry Diller startup that was delivering local over-the-air TV programming to online and mobile app users, has been deemed illegal by the United States Supreme Court. The Court’s majority opinion was that Aereo is similar to cable TV, and is therefore subject to the same copyright obligations. We should have seen it coming: Chief Justice John Roberts had earlier said that Aereo’s entire model was to circumvent copyright law.
- TV broadcast networks
- Local TV stations owned and operated by the TV broadcast networks
- Local independent broadcast stations
- Consumers, who now lose the option to access local programming online unless they subscribe to an operator, or receive programming over the air
- Aereo, which would have to pay retransmission fees and presumably pass the cost on to consumers, be shut down, or devise some other work-around that keeps it in service
Aereo rents dedicated over-the-air TV antennas to each end user, and converts the live TV signal from each antenna to IP video for unicast (which, Aereo argued, constitutes ‘private performance’ that is not subject to copyright rules). Aereo also hosts a cloud-DVR service that stores recorded programming for later unicast access by subscribers.
If Aereo had won this case, the power of content owner to charge retransmission fees would have diminished, reducing pressure on operators to raise prices to the consumer. Aereo would have continued its expansion toward national coverage. With this decision, retransmission fees are likely to increase, supplementing existing revenue streams from TV advertising.
Aereo’s loss also opens the door for Dyle.tv, a joint venture of NBC, Fox, Pearl Mobile DTV and Ion; which currently offers over-the-air receivers to mobile device owners. Dyle’s Web site states that the company intends to offer “…encrypted broadcasts … to authenticated MVPD (pay TV) subscribers through a variety of apps, possibly those developed by TV networks, stations or cable/satellite companies.”
Online TV certainly isn’t going away. Earlier this month, Leightman Research Group said that almost half of U.S. households already subscribe to an online premium video service, such as Hulu, Netflix or Amazon Prime. The TV networks simply want to boost revenue by participating in the same opportunity. Adding to what they already make from advertising.
Also, the range of available TV programming continues to expand on all the major streaming video device platforms. No question that the content world sees online video as a viable channel of distribution. It just has to be on its terms, and subject to copyright law (agree or not about the Aereo decision).
Over the weekend, AT&T announced its intentions to acquire satellite TV operator DirecTV. Should the deal pass regulatory muster and go through, it will create an operator with about 26 million pay TV subscribers, plus 17 million broadband subs, 11 million phone subscribers and 100 million wireless customers. As a merged entity, AT&T becomes a national pay TV provider, with immediate access to TV subscribers outside its fixed-line (U-verse) territory. That’s just in North America. DirecTV has about 18 million TV subs in Latin America as well. All told, this would make AT&T the largest pay TV provider in the US (and in the Western Hemisphere).
Of course, DirecTV is a high-value target for content reasons as well: particularly its exclusivity for NFL Sunday Ticket. Some major AT&T suppliers must also be taking notice. For one, AT&T has based its TV service on Microsoft Mediaroom, which Ericsson bought last year. DirecTV uses NDS TV security and middleware, and NDS is now owned by Cisco. So, two TV infrastructure leaders that also both happen to be incumbent network suppliers to AT&T.
But there’s also a bigger picture: while a combined Comcast-TWC results in a triple-play provider, DirecTV adds to AT&T’s existing quad-play advantage. Without offerings that compete against AT&T wireless and DirecTV, Comcast will remain a local carrier within its own cable TV service territory; even with Time Warner Cable. To serve any devices – mobile or fixed – outside of its territory, Comcast will remain an OTT player. (Note: TWC is partnered with Verizon Wireless – but it’s anyone’s guess as to how Verizon might treat ‘foreign’ video providers over its mobile network in the future).
The expiration of Net Neutrality was certainly a strategic consideration for both AT&T and Comcast. One of AT&T’s terms in the proposed DirecTV acquisition is to place a three-year expiration date on its commitment to the FCC’s current version of Net Neutrality. This is interesting, given that DirecTV is a satellite operator with no Internet access network of its own. My own guess is that this is really a pre-emptive move to keep Comcast from having (or making Comcast pay for) equal access to AT&T mobile subscribers; for video delivered to smartphones, tablets or the Connected Car.
And Comcast doesn’t really have an answer to that. Even if Comcast were to let its own Net Neutrality commitment expire in 2018 (which is the year specified in the terms for its NBC Universal acquisition), that will only be within Comcast’s own network. Comcast would have little power over mobile carriers which, by then, will be perfectly able to parachute right into the thick of Comcast territory, to deliver high quality pay TV over LTE mobile access. This places Comcast at the ultimate disadvantage, even with TWC, because it can’t do the same in a U-verse territory. All the more reason to keep Net Neutrality principles in place.
By missing out on DirecTV now, and by not bidding for Sprint last year, Comcast missed two strategic opportunities to reach subscribers that don’t depend on fixed lines, at a time when mobility arguably represents the biggest single opportunity in telecom. Not quite so much to see here after all.
But the competition will really get interesting when DISH finally launches a national LTE service, using all that spectrum that they’ve acquired in recent years. Or, even more interesting if DISH were to acquire T-Mobile as well.
In the wake of my long debacle to get new voice and broadband services from CenturyLink, detailed in my five-part article, I was reminded that many consumers in the US are still served by what, in effect, are telecommunications monopolies.
Even though large operators (often backed by legal disclaimers) say that there is plenty of competition in local markets, my own reality was to have no viable alternative for fixed voice and data communications services. With no competitor looking over CenturyLink’s shoulder, I was virtually forced to beg for service for more than a week. And I must settle for 3 megabit broadband access.
It isn’t this bad for most consumers
Fortunately, the competitive landscape is different for most consumers. In most local markets, at least in metropolitan areas, they can choose from among at least two fixed-line providers: their local phone company and the local cable operator. In some cases, there are additional alternative private – and even public (municipality- and public utility-based) – broadband providers. Rather than pleading, those lucky consumers can simply change providers without too much sacrifice.
As for pay TV, even though most areas have only one cable operator, all of them face competition from two strong satellite TV competitors: DISH and DirecTV. Plus now, Telco IPTV is a full-fledged competitor to cable and satellite, and direct-to-consumer (OTT) distribution brings a steadily-increasing range pay TV and local broadcast programming. I’m sure that this level of competition motivates at least most of them to improve continually.
On the mobile side, the US has four national cellular carriers – AT&T, Verizon, Sprint and T-Mobile - and the healthy competitive battle among those ensures that, if one of them provides doesn’t reach or provides inadequate services, there are others to choose from.
Stay tuned for the next battlegrounds
So, the battle among service providers in the physical world is well engaged. Now, all eyes should turn to the FCC, as it fights to reassert authority over the ongoing consolidation of the media industry, and Net Neutrality. Whether or not operators like Comcast and Verizon are purposely degrading service for content that they don’t originate or profit from themselves are two sides of the same coin.
But those are stories for a different day. (Ed: As it turned out, it was a story for the next day.)
Furthermore, Centurylink wasn’t done with me either.
This is the last part of a 5-part article that contrasted two very different customer service experiences; one with TV provider DISH Network, and the other with the local incumbent Telco, CenturyLink. The DISH experience was one of the best customer service experiences I have had in some time. CenturyLink was a nightmare. The story starts here. Part 2 is here, Part 3 is here, and Part 4 is here.
Somebody up there must have decided that I had had enough
While I was waiting for Emily from CenturyLink to call back (who never did), I decided to call the number from the “customer satisfaction” message that had been left for me on Sunday. True to form, it landed in the Philippines. But instead of going through the previous pattern, I immediately asked the agent to transfer me to an agent in the United States, which she did.
This time, the call was answered by an agent named Lori, who, after I asked, revealed that she in fact was able to read my history of support attempts on her console. I told her that I expected resolution during this call, and since there must have been a lot for her to read, I gave her a short summary of the procedings to date anyway. After two times on hold, she told me that Internet service was now associated with both my residential and business lines, and asked me to switch the jacks outside.
Of course, to switch jacks, I realized I would lose this call, so I asked her to give me her direct line. She did so, and assured me that she would answer the phone. So I switched the jacks outside and prayed. First I called the residential line from the business line, and it rang on the right phone. I called the business line from the residential phone, and the right phone rang. I had Internet service in my office. In short, everything was finally right. I then called Lori to tell her that everything was finally in order, and thanked her for whatever she may have done.
I asked Lori to send me a customer service feedback form, told her that she was my hero for the day, and told her I would give her top marks for resolving all of this. However, the promised feedback form never came. Who knows whether the “right” services were a result of my calls with Emily on Thursday, or Lori on Monday. Also, I’m half expecting to be billed double for Internet access, since it was now associated with both of my voice lines. But after a week of drama, I was thankful to have my services.
Not only that, but my broadband access has gone from 700-something kilobits per second to the three megabits that (in fairness) the CenturyLink rep I spoke with on January 14 had said my line tested for. Still, it’s far cry from the 40mbps that CenturyLink advertises in my local market.
Why did this have to be so expensive, to CenturyLink and to me?
In the aftermath of this debacle, I could only sit in wonderment. Why, in 2014, couldn’t this have been better managed? I was not CenturyLink’s first broadband customer. Why a major Telco can’t seem to provide a consistent single view of their customer through any service rep’s console puzzles me. Some reps saw my history and some did not. Also, why could some customer service agents see what other parts of their operation were doing, while others could not – forcing them to place the customer on hold to call around the company manually? Since the agents in the Philippines couldn’t help, why weren’t they better trained? Why did so many people have to be involved? And all of this just to resolve what might even have been an order-entry mistake!
If you’re a Telco, you know that call-center support costs just a fraction of the $250-$500 per incident for a site visit. Accordingly, it’s easy to see why CenturyLink doesn’t send technicians onsite to activate new services. But they should darn well better make sure that their internal support, troubleshooting and escalation processes work flawlessly before confounding innocent consumers. They also should make sure that nobody tries to sell wiring that isn’t necessary (the home was wired just fine two weeks ago before we moved in), and make sure that the instructions that arrive with the DSL modem don’t reference a defunct company or a CD-ROM that isn’t in the package. It all takes relentless attention to detail and frequent process testing, neither of which were evident to me.
My other observation was of how utterly unconcerned most of the CenturyLink reps were, about providing an acceptable customer experience. They just worked there. Nearly all of the burden to resolve this issue was placed on me, and I had to do all the critical thinking. I was fortunate to finally reach two people – Emily and Lori, probably by the luck of the draw – that were actually able to help. But to get to them, I had to bypass CenturyLink’s first line of defense: their outsourced call center. I also had to bypass a representative that was hoping to book an $85/hour home wiring appointment which, in retrospect, and as common sense dictated, was never necessary.
One can’t fault that a company the size of CenturyLink must put a huge focus on cost-reduction, but my own experience showed how cost-cutting can backfire. My many (many) calls, without resolution, were probably more costly than CenturyLink’s model would hope for. And in addition to the poor use of my time, it put me out of business for several days – which was very expensive to me.
CenturyLink must and can do better.
I promised a number of people at CenturyLink that I would publish this series of articles, which hopefully speak for themselves. Meanwhile, I’m looking forward to reviewing DISH’s new Hopper with Sling and its other associated new product offerings.
By the way, another DSL modem arrived from CenturyLink yesterday. I’m not exactly sure what to do with it, and fear the consequences of calling them to find out.
On to my closing thoughts
I thought that the fourth time was a charm. It had occurred to me that I should get the phone number specifically for the business department, should I be disconnected again; which I got. I asked for an assurance that the next person I spoke with would be in the United States. Then the call was transferred, to Emily in the business department in Logan, Utah. Whew!
I thought I was getting somewhere
Emily understood my explanation, and after several brief times on hold, told me that she would be able to arrange a site visit on February 12. But by this time, I had decided that the person who originally took my order on January 14 must have associated my broadband service with the wrong voice line (I wanted it associated with my office phone, because about 95% of its usage is for my business). I suggested to Emily that she simply change the association. She said she would investigate and then call me back “in a little while.” Then we ended the call.
True to her word, Emily did call back about 10 minutes later to tell me that she was successful in finding a way to re-provision the lines in my home so the right phones would ring in the right rooms, and that Internet access would be via the right jack – from their end. Thank goodness, because the alternative would have been for me to wait almost another week for the house call.
She said that the service change would take place some time before 5pm on Thursday. At which time, I am instructed to switch the jacks on the side of my house again, then pray. I told her she would hear from me one way or the other. On Friday, I found that my lines still reversed, but decided that I had simply put enough time into this mess and went back to my “real” work. In the afternoon, I went out to run some errands and noticed a message waiting on my mobile phone (which had been out of range for more than a day). It was a representative from CenturyLink, saying that a technician would show up at my home on Friday Feb 7th. I didn’t know whether this was a reminder of the visit that I was informed of on Wednesday, or was in response to someone I had spoken with on Thursday.
In any case, nobody showed up at any time on Friday before I went out. After returning from my Friday afternoon errands, there were no notes on my door to say I missed a visit from CenturyLink, but three emails from CenturyLink were waiting in my inbox. The first was that a service order had been completed for my residential line, with data service. The second was that a service order had been completed for my office line, voice only. The third said that my equipment had shipped. (Great, except that I already had my DSL modem, and it was working, albeit slowly and on the wrong line).
If, as Emily had said on Thursday, my service had actually been corrected by Friday, I would not have seen Internet service until I switched jacks outside. But throughout the weekend and into Monday, Internet service had not been interrupted, and the two voice lines were still reversed.
On Monday morning, February 10 (CenturyLink Day Eight), I played a voice message that was left on my office line on Sunday at 1:01pm:
“This is a message from CenturyLink to let you know that your recent request for products or services is completed, and that service is available for your use. At CenturyLink, customer satisfaction is important to us. If your service is not working properly, or you have any questions, please call us at 1 800 573 1311. Thank you for calling CenturyLink.”
Since she had given me her phone number, I left a message for Emily – just in case she could help – and then called the number that was left in my voicemail on Sunday.
On to Part 5
I made my third call to CenturyLink technical support. But this time, it was to a different number: the one printed on the instructions that came with my modem. After making my way through a new set of voice menus, I reached an agent who quickly put me on hold.
While I was waiting for the support rep to come back, I noticed that the ActionTec had its own 802.11n wireless radio, which I didn’t need because the AirPort Extreme has one as well. Thank goodness I knew about 192.168.0.1, which many Internet CPE makers use as the admin port, accessed it with my browser, and deactivated the ActionTec’s radio.
Then I went nosing around the other menus, deactivating the log of URLs that I visit, and putting the ActionTec into stealth mode (so it doesn’t respond to pings from the Internet). I also noticed that it had pre-set configurations for CenturyLink’s Prism IPTV service, including QoS pre-sets – even though CenturyLink doesn’t offer that service in my area. But it’s smart of them to pre-set it that way.
A few minutes later, the agent came back on the line, walked me through a couple of steps to re-set the modem again. Whatever she did in the meantime finally had given me access to the open Internet. Unfortunately my “greater than 3mbps” Internet access was 768 kilobits downstream and a few hundred kbps up. I ended February 5th about one-quarter satisfied: I had broadband Internet service but it was glacially slow, and my voice lines were still reversed.
Back to square one
Before my last tech support call ended, the technician suggested that I go outside in the morning, find the network termination box on the side of my house, and reverse the two voice line inputs from there. Which I did. As a result, the two phone numbers were associated with the right voice lines, but my Internet service was out. Switching my phone and DSL modem cables between jacks made no difference. Either I had the wrong voice numbers with Internet service, or the right voice numbers with no Internet.
Making my first support call of February 6, the technical support representative who answered was very polite but also clearly reading a series of questions from a script. After I answered her questions, she read me the questions again, which again I answered. Again I was placed on hold for about 10 minutes. And then again. After two of these exchanges, I asked her where she was (not that it really mattered, but I was curious). “Thank you sir for asking. We are in the Philippines, sir.” She said that she could not resolve my issue and would have to transfer me to the “business department,” which she assured me was located in the United States. Then I was immediately disconnected.
Calling back, and after going through the same triage again, the next tech support agent also said she was “in Asia.” She transferred me to the business department, and after telling about half of my story yet again (I was told that neither my account record nor the record of my conversation came across with my call), that call was also disconnected. On my third call, I had the presence of mind to ask for a phone number in case I was disconnected again: 1 800 244 1111, which is the customer service number for CenturyLink. In other words, if disconnected again, I would have to start all over. This was how I spent the first two-thirds of my day on Day Four of my CenturyLink experience, Thursday, February 6.
On to Part 4
This article continues a story that starts here.
On the same day that I contacted DISH to schedule the service move, I also called CenturyLink to schedule new service activation with them. Because there is no phone number portability for land-lines in the US, CenturyLink assigned us two new voice numbers: one for my home office and the other for residential service; to be activated on January 31.
The struggle begins
As I was arranging new voice services, I was also informed that CenturyLink could not activate broadband on the same day. Still hopeful, beginning on January 25, I began calling CenturyLink every couple of days anyway, to see whether they could align voice and broadband installations. The agent said ‘she would try’ and gave me her contact number – which was a voicemail, not a live connection. After an hour or so, each time, she would leave me a voicemail back, to say that she was trying. On January 30, the day before the activation, she left another message saying she thought that it could (not ‘would’) be done.
Soon afterward, I received an email saying that broadband would be activated on Wednesday February 5, meaning that I would have to go to the local coffee-and-donut shop for connectivity on Monday and Tuesday, and then be out of touch altogether on Wednesday while I was waiting at home for the broadband activation. Not an auspicious start.
The phones were backwards
On Monday, February 3rd, I plugged phones into the office and the kitchen. The office phone got dial tone. The kitchen phone had the fast-beep that indicated I had voicemail. When I called to retrieve my messages, it was my business voicemail. Somehow, CenturyLink was able to transfer my old business voicemail (including existing messages) to my new numbers – but the voicemail was associated with the wrong line. Then I called my office from the kitchen, and instead of ringing, it went right to voicemail, where the nice recorded lady informed me that my voice mailbox ‘had not been set up.’ This led me to conclude that both lines were provisioned backward – and that the voicemail I reached at my office number must have been the new voicemail for our residential phone. Not only that, but when I called the office line from the residential phone, the incoming caller-ID was the office phone’s and a call from the office phone to the residential phone showed caller-ID for the residential phone.
On Tuesday, a box from CenturyLink arrived at my doorstep, so I had no reason not to expect broadband installation on Wednesday. I also assumed (although CenturyLink’s email wasn’t explicit about this) that a technician would visit my site. I was also anxious to get the phone number reversal resolved.
By 3pm on Wednesday, I started to get nervous that nobody had yet shown up to connect my broadband service, so I called CenturyLink. The agent said that she had no way of knowing the status, and put me on hold to call a dispatcher. When she came back, she said that someone was in my neighborhood at the switch, so I assumed that the tech would be at the house shortly.
At 4:40pm, it was still a no-show, so I called again, only to be told that nobody would be coming that day. The agent also informed me that I was now scheduled to be installed on Friday 2/7, and that the house would need to be re-wired at a cost of $85 per hour. At which point, I lost my patience and ended the call.
Taking matters into my own hands
Suddenly I remembered the box that had shown up the previous day and decided that I could try to take matters into my own hands. Inside were an ActionTec C1000A DSL modem, an Ethernet cable and an RJ-11 cable, along with a sheet of step-by-step instructions that said that I should connect my “PC” to one of the Ethernet ports on the modem (although my home, like many others, connects to the Internet via a separate WiFi router; which in my case is an Apple AirPort Extreme).
I plugged the Ethernet cable between the ActionTec and the AirPort Extreme and turned everything on. Because nobody had ever visited or spoken with me, not only did I have any idea as to which of the wall jacks in my office would be active with which voice lines, but also, didn’t know which one was meant for broadband. After some trial-and-error, the lights went green on the Actiontec: one of the jacks worked.
The AirPort Extreme found my home network but not the ActionTec. Fortunately, Apple’s AirPort Utility software identified that the AirPort needed to be put into ‘Bridge Mode,’ which I did, which worked. The ActionTec found the DSL line but not the Internet, but that was remedied by cycling the power on the ActionTec. A browser window appeared on my screen, saying “Welcome to Qwest High Speed Internet! Please insert the QuickConnect! CD-ROM…”
Except that Qwest was acquired by CenturyLink more than a year ago, and no longer exists. And except that there was no CD-ROM in the package with the modem. Entering a different URL resulted in the same greeting.
On to Part 3
During the past week, my spouse and I moved to a new home – or as the British would say, “moved house” - about 12 miles from our previous one. Accordingly, we had to move our pay TV service, and obtain new fixed-line phone and broadband access from the phone company. The two experiences could not have been more different.
This begins a multi-part article to recount my experience, and highlights how differently a service provider will treat consumers, which I believe is based on whether or not they think they have to compete for your business. Much of this is a swashbuckling tale of outsourcing and lack-of-coordination, complete with the blow-by-blow minutiae, but we’ll get back ’round to the real point before the end.
First, the good: DISH Network’s new Hopper with Sling
On January 14, two weeks in advance of our move, I called DISH Network to request the move of their services to our new place, which we scheduled for Tuesday February 4. Also, I was anxious to evaluate DISH’s new Hopper with Sling home media gateway and whole-home DVR, after having seen it demonstrated at CES. Unlike the original Hopper, the Hopper with Sling’s Broadcom BCM7425 processor incorporates the capabilities of the previously separate Slingbox right into the set-top box itself.
A couple of days ahead of the actual installation date, a DISH Network representative called me to confirm the appointment, and also asked me to take my existing set-top boxes from the old home. At 8:10am on Tuesday morning, Roman (the technician) arrived at our new home, took down the existing satellite dish, put the new one in place, and then asked where I wanted the set-top boxes installed.
The new Hopper with Sling went into the family room, and our existing Joey (client set-top box) went into one of the bedrooms. Roman had to replace the coaxial cables, as they were old and had an insufficient electrical rating. Since he was in the crawl space under the house anyway, he also offered to run wiring for my home audio system (which I didn’t request but was grateful for). Then he showed me how to transfer the DVR recordings from the original Hopper, onto the new Hopper with Sling. After about 90 minutes, Roman was gone, and everything worked great.
In summary, the DISH customer service experience exceeded my expectations. Stay tuned to this blog for an extended review of the new Hopper with Sling, Super Joey and Wireless Joey set-top boxes, as well as the “Best of CES” Virtual Joey and the other new DISH apps that go with them. My 2012 review of the original DISH Hopper is here.
New phone and broadband service options were limited
We also needed to arrange new phone and broadband services. My new neighborhood is served by two broadband providers. One is CenturyLink, the incumbent Telco, and the other is a small independent broadband provider that uses digital terrestrial microwave delivery. The microwave provider had speeds of <2.5mbps, whereas Centurylink told me their DSL lines qualified at “better than 3mbps” in our neighborhood. I opted for CenturyLink because they offered a phones-plus-broadband package at a reduced price. In any case, because we are in an outlying area, there is no local cable operator, so we will miss the 20-plus megabit speeds we got from Comcast, let alone the 40mbps promised by CenturyLink themselves.
Also because we are in an outlying area, T-Mobile’s cellular signal doesn’t reach. One of our sons is now on Verizon, which does reach, so I checked into that. Years ago, I had switched from Verizon to T-Mobile because Verizon’s CDMA phones didn’t work in Europe – you had to rent a “special” (GSM) phone from them if you wanted to travel outside of their US footprint – and unfortunately, this is still the case. Verizon’s network upgrade to LTE is supposed to resolve this later in 2014, in that subscribers will be have the option to use multi-band LTE phones which work elsewhere, but AT&T’s network reaches us today, and that’s the way we went.
On to Part 2 of this story.
Microsoft CEO Steve Ballmer announced his retirement last week, leading to two immediate questions: “What happens next?” and “Who will succeed him?” In answer to the first question, the company would do well to quickly re-evaluate and re-rationalize its entire product strategy and portfolio. Microsoft has the ingredients for greatness but execution hasn’t been great in recent years. As for who should succeed him, Microsoft needs someone with the mind of a Jeff Bezos or a Ralph de la Vega, not a Meg Whitman or a John Sculley.
The FCC has issued the Fifteenth Report on Video Competition, as mandated by the Telecommunications Act of 1996. Although it had been issued annually in the past, this is the FCC’s first such report since 2010.
Needless to say, a lot has changed since then:
- Cable has lost more than 2.5 million subscribers
- Between them, AT&T and Verizon have achieved 10 million subscribers
- IP delivery and “the Cloud” have transformed TV service infrastructure
- TV programmers are now online via “TV Everywhere”
- Over-the-Top and multiscreen services have become mainstream
- The next round of competitors looms large: Google, Apple, Intel…
It’s interesting to compare this report to the 14th Report, which remains available. My bet is that the 16th Report will make mention of connected cars, home control, and home automation – all of them being on the radar screens of the pay TV service providers.