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By Robert Howden, Texans for Economic Progress
They were lucky it was three o’clock in the morning. Time Warner cable, that is, was lucky that so few of its customers in the Rio Grande Valley were tuned into ESPNU, which features college sports, at a bit after three on Saturday, May 2nd.
That’s because for a few moments the channel switched from showing hard working athletes to heavy breathing porn stars.
The company apologized and blamed it on a technical foul up.
While some might have found this horrific and others, hilarious, it’s an example of the kind of shoddy cable service the residents of many of Texas’ small towns and rural communities get.
Although folks in the state’s larger cities enjoy the fruits of competition, where a choice of providers keeps prices down and service quality up, small town and rural Texans are often forced to accept a cable monopoly.
It’s clear the cable companies know this and take advantage of it. According to a recent report from the Federal Communications Commission, when customers have a choice of TV providers their bills are at least 20 percent lower, if not more.
The cable companies, of course, offer excuses.
That FCC report points out that cable company package rates have gone up more than 122 percent between 1995 and 2008. The cable companies often say they need to raise rates like this to cover the cost of “network upgrades.” It’s getting old, however.
Despite years of claiming that they’re upgrading their networks, many cable companies still provide programming to rural customers in the old-fashioned analog format instead of sending a crisper cleaner digital signal and many still refuse to offer those customers broadband Internet service.
The other excuse is that the poor old cable companies are victims of higher programming costs, which they have to pass along to their customers in order to survive. This excuse ignores the fact that many of these companies either own their own cable networks or they own the companies that provide the programming.
And, when programming disappears, as recently happened in Wichita Falls when the TV Guide channel simply went away, rates don’t go down. Happy to pass along higher costs, the cable companies become quite stingy when it comes to passing along savings.
As Executive Director of Texans for Economic Progress, I meet with citizens all across our state in what we call our Power of Connectivity meetings. At these meetings, high prices and bad service are a constant lament. Customers are willing to pay, but they want to pay a fair price for a decent product.
They also say they’ll pay more if they get more. Broadband Internet service, for example, is taken for granted in places like Houston, Austin, Dallas and San Antonio but in small communities people are forced to continue living with the buzz, click and tortoise-like speed of dial up.
Unfortunately, these days this is more than just annoying, it’s an artificial constraint on economic progress. Business owners, today, need the advantages brought by lightning fast communications in order to remain competitive. Students need a fast Internet as an educational resource. Doctors need it to keep up with the latest in medical science. It’s not a luxury and rural cable monopolies should stop treating it as such.
Small town Texans, just like their big city brethren, deserve the forward thinking solutions that have brought competition and innovation in television entertainment and Internet services.
It is far past time for the costly cable monopolies to start caring about their customers and stop standing in the way of progress.
By Sandie Haverlah, Texas Consumer Association and TEP Board Member
During the summer of 2008 an important consumer issue came to light as the Commission on State Emergency Communications (CSEC) considered adopting a new service fee to be charged when consumers purchase a prepaid cellular phone.
The Texas Consumer Association along with the Gray Panthers of Texas registered their strong concerns that any increase in cost, in these difficult economic times, may adversely affect prepaid users.
The fee would be used to fund improvements to the 9-1-1 system. A 1997 state law requires wireless cell phone users in Texas to pay a monthly 50-cent tax that funds Texas’ 9-1-1 emergency operating costs.
“Because the relevant statute was passed by the Texas Legislature before the advent of prepaid cellular phones, there is no provision in the law which allows the 9-1-1 fee to be paid by customers of prepaid phones,” said Sandra Haverlah, president of the Texas Consumer Association (TCA).
Prepaid cellular phones are phones that do not involve a billing arrangement with the customer, unlike “postpaid” cellular phones sold on a more expensive long-term agreement basis. For Texas’ pre-paid population, which includes two million older, low-income and disabled consumers, cost is a paramount issue.
While consumer groups don’t disagree that 9-1-1 may be a worthy project, they believe that the agency can find the resources to make such improvements without adding to the burden of those who use prepaid cell phones.
On June 20 the CSEC approved the tax to be charged on prepaid cellular phones.
State Rep. Eddie Rodriguez of Austin and State Rep. Rafael Anchia of Dallas joined the grassroots groups in opposition to the new tax., Public Citizen of Texas also signaled in July that it opposed the controversial CSEC action.
In addition, the groups asked why this action was taken when the CSEC appeared to be running a surplus of $100 million at the end of FY 2007, according to the Texas Comptroller’s Annual Cash Report.
“Why harm hundreds of thousands of the state’s most vulnerable consumers when the agency didn’t even need the money, and is sitting on more than it knows what to do with?” asked Tom “Smitty” Smith, Director of Public Citizen, Texas Office.
“We are very concerned that the agency took this action in the face of what appears to be a sizable reserve in the fund, which means that our state’s most vulnerable consumers are being zapped for no good reason whatsoever,” said Haverlah.
On July 25, CSEC voted to accept additional comments regarding the 9-1-1 tax.
“We are glad that the CSEC responded to our calls for action. We will be eager to see if a fair alternative can be found,” said Haverlah. “If an equitable solution cannot be developed, we believe that Legislative action will be needed to address the inequities in the method of charging the 9-1-1 tax to prepaid cell phone users in Texas.”
The Texas Consumer Association, the Gray Panthers of Texas, and Public Citizen of Texas plan to continue to oppose the new tax on prepaid cell phone users at both the CSEC and at the Texas Legislature when it meets in January 2009.
Sandie Haverlah is a founding Board Member of Texans for Economic Progress and is the President of the Texas Consumer Association.
Texans for Economic Progres is in the news all over Texas. Our op-ed describing the dangers of copper theft has appeared from Austin to Fort Worth to Gilmer, Texas. Check it out:
Austin American-Statesman
Howden: Put the eyes of Texas on copper theft
Gilmer Mirror
TEP on Copper theft
Dallas Business Journal
Stopping copper theft, June 27, 2008
To the Editor:
In cities across the nation, copper thieves are pulling down utility lines, gutting air conditioning units, raiding homes under construction and ultimately threatening lives.
The spike in copper theft is a response to the rising price of copper worldwide. With copper selling for more than $3 a pound, thieves are taking the extraordinary risk of shimming utility poles and literally ripping down phone and electrical lines for the copper inside.
To tackle this mounting problem, the City of Dallas passed one of the most aggressive anti-copper theft ordinances in the nation. Metal recyclers are required to take photographs of metal sellers, their vehicles and the metal they’re selling. The buyers must scan the sellers’ government-issued ID and take their thumbprint.
People selling metal have to provide the make, model and license plate number of the vehicle used to deliver their metal. At least in Dallas, gone are the days when a seller could roll a grocery cart of copper into a recycling station without explaining how and where they got the metal.
Expanded law enforcement and strict city ordinances are a necessary and laudable step in the right direction; but they can only go so far. Police and city officials can’t be everywhere at once. Every resident of Texas can help law enforcement to crack down on copper theft. We are the eyes of Texas and it’s our duty to watch for and report copper thieves in action. As the price of copper continues to rise, it’s likely only a matter of time before this crisis comes to a neighborhood near you.
Robert Howden, Texans for Economic Progress
So-called ‘net neutrality’ an excuse for federal regulation
May 22, 2008
If you head down to the post office and drop a letter in the slot with a — wait while we check our calendar, here — 42-cent stamp on it, the post office will generally deliver that “first class” letter anywhere in the country in less than a week.
If you’re willing to pay considerably more for “Priority” or “Express” delivery, you can get your missive there considerably faster. Does this “discriminate” against the lowly first-class or bulk-mailed letter? Sure. The carriers treat the different classes of letter differently, as instructed.
Do we need a new government bureaucracy to stop this from happening? Um … no. In fact, the current postal rate structure was developed by a quasi-government body in the first place, though in response to free-market competitors such as FedEx and UPS.
Now, as the Internet matures, it has occurred to some Internet Service Providers that they, too, could finance the provision of faster delivery for some services by offering special “express” connections to Web sites whose hosts are willing to pay extra to have customers “delivered to their door” without the time delays common in today’s lower-capacity networks.
We don’t need to ask how congressional nanny-staters — who believe anything that’s not mandatory should be regulated or banned — have responded. Once the catchy phrase — “net neutrality” — was found, the rest was second nature.
Several bills — described as “good net neutrality bills” by The New York Times — now circulate in Congress. “One in the House … would give the job of preserving net neutrality to the Federal Communications Commission,” the Timesmen enthused in an editorial Monday. “A Senate bill … takes a similar approach. This month, John Conyers, Democrat of Michigan, and Zoe Lofgren, Democrat of California, introduced a bill that would allow the Justice Department to bring antitrust actions against ISPs that violate net neutrality.”
Wow! Not enough criminals? Make up new crimes!
In fact, such “net neutrality” regulation would be both unnecessary and harmful, warns James L. Gattuso of the Heritage Foundation. Read More.
Wise County Messenger, Thursday, August 16, 2007
By Sandra Haverlah, Texas Consumer Association
Many of us spent July 4 reveling in our nation’s independence, the product of a hard-fought revolution and our founding fathers’ commitment to freedom.
In the 231 years hence, a modern-day transformation – a technology revolution in fact – has swept our nation and spawned new freedoms the founding fathers could never have imagined.
High-speed Internet, or broadband, is perhaps the most important change agent of the 21st century, delivering a new notion of freedom and independence. Even at the dawn of the broadband revolution, few could imagine a working mother, conducting a training seminar through two-way video conferencing for her colleagues in Shanghais – from the comforts of her office at home. Just 10 years ago, this scenario was an impossibility for most American consumers who were hindered by slow dial-up connections and simplistic online applications. Today’s working mother is free to work with flexibility because of broadband.
Read more.
Abilene Reporter News, July 17, 2007
Shame on cable companies’ reaction to FCC rules aimed at prying open Big Cable’s lock on the TV set-top box market (“Cable operators get ready to raise rates,” July 5). Cable’s reaction – raising rates for the set-top boxes that consumers need to change channels and for digital programming, is not surprising given cable companies’ history of saddling consumers with rates hikes regularly over the years. But it is disappointing. Still, just as cable companies have the right to hit consumers with yet another fee hike, consumers now have the right to shop around for their TV set-top boxes, and their cable service itself. Read more.
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