Level 3 'Clarifies' Position On Comcast Fees - Consumer Affairs

Mark Huffman
ConsumerAffairs.com

December 6, 2010
In case there was any confusion about its position on Comcast's new fees, Level 3 Communications has issued another statement on the controversy.

The issue first surfaced last week when Level 3 complained that Comcast has announced its intention to levy ongoing fees for delivering content to Comcast, such as movies, that Comcast's subscribers have requested. Level 3 is a major supplier of streaming technology for NetFlix, which delivers video content via the Internet.

Comcast has countered that Level 3 is trying to gain an unfair advantage over competitors by using Comcast's network to deliver content without paying for it.

"Comcast's characterization could not be more misleading," Level 3 said in a statement.  "What is truly at stake is whether consumers should have unfettered access to all the content on the Internet without regard to whether that content happens to be owned or packaged by Comcast."

Supporters of the concept of Net neutrality have seized on the controversy as an illustration of why the policy is needed. They say consumers will end up paying more for some content if network providers are able to discriminate among content providers. Opponents, on the other hand, say it perfectly illustrates why Net neutrality is unfair to network operators.

Level 3 says the disagreement is not a "peering dispute,†as Comcast has characterized it.

"At issue is a fundamental interconnection disagreement between Comcast, as a provider of local high speed Internet access to consumers who pay Comcast for access to content, and Level 3, which delivers content to residential broadband access providers like Comcast in response to consumer requests,†the company said.

Unlike "peering" in the Internet backbone, where competition abounds and prices have been declining steadily, Level 3 said, Internet carriers that have content requested by Comcast subscribers have no choice but to exchange traffic with Comcast.

"Comcast is using this dominant position to demand payment for traffic delivered at its customers' requests. You simply cannot "route around" Comcast to provide requested content to Comcast's subscribers," Level 3 said.

Comcast says the fees it charges are commonplace and standard within the industry. Level 3 says that's not the case.

"No other broadband access provider in the U.S. is now charging Level 3 the type of fees that Comcast is charging," the company said. "It is Comcast that seeks to change the common approach, changing the rules of the game in an unreasonable and discriminatory manner."

The controversy began last month with NetFlix retained Level 3 to provide the bulk of the streaming services needed to send movies to subscribers. Level 3 asked Comcast and other Internet Service Providers to give it more access to their networks so they could handled the expected increase in traffic from NetFlix.

When Level 3 asked Comcast for new interconnection ports to its network, it didn't expect to pay anything for that since it said it was providing content requested by Comcast customers. Comcast, while also sells video content to its subscribers, views it as unfair competition, and says paying a fee to deliver content over its network is reasonable.

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Consumer Reports Says AT&T 'Worst-Rated' US Carrier - Wall Street Journal

Consumer Reports, the influential product review publication, says AT&T Inc. is again the country's worst-rated mobile service provider, a blow to the carrier's effort to rehabilitate its network and reputation.

The conclusion, based on a survey of 58,000 readers, shows subscribers continue to hold AT&T's service in low regard even after the carrier boosted its wireless spending by $2 billion this year in an effort to correct what it has acknowledged were weaknesses in its network.

The results bode poorly for AT&T as it faces possible competition for Apple Inc.'s iPhone, a phone it carries exclusively now and relies on for much of its subscriber growth. In fact, Consumer Reports found "iPhone owners were, by far, the least satisfied with their carrier."

"We take this seriously, and we continually look for new ways to improve the customer experience," AT&T said in an emailed statement. The carrier pointed to its success attracting customers and claimed its dropped-call rate is only slightly worse than the best in the industry.

One company to come out well from the survey was Sprint Nextel Corp. Its overall satisfaction rating pulled nearly even with Verizon Wireless's, an indication the company's effort to improve service and build up its device lineup is getting through to customers.

Write to Andrew Dowell at andrew.dowell@dowjones.com

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Analyst says iPad is fastest adopted consumer electronic device ever - BetaNews

Derided by some at its launch as a device with no market, Apple's iPad has now proven to be one of the most successful consumer electronic device launches ever, according to Bernstein Research retail analyst Colin McGranahan. He expects the device to have a sell through rate to be about 4.5 million units per quarter.

This is far faster than the iPhone, which sold one million units in its initial launch quarter, and far ahead of the 350,000 DVD players sold in its first year, CNBC reported Tuesday. Repeating the statements of some analysts that the iPad would not be a runaway hit, he mused "by any account, the iPad is a runaway success of unprecedented proportion."

Bernstein is extremely bullish on the device, saying in 2011 it should become the fourth biggest consumer electronics category with sales of $9 billion in the US next year. This would put it ahead of the game console and cellular phones, a stunning number considering the initial uncertainty.

McGranahan went further to say that the iPad is not only hurting PC sales -- notebooks notably have taken a hit according to most analysts -- but the TV and digital camera sectors may also be affected. Essentially, it's all an issue of disposable income.

"It is the rare American household that would spend $600-plus dollars on an iPad and buy a TV or a PC or a digital camera in the same month, or the same quarter, or maybe even the same year," he wrote in a research note to clients.

Seeing that Apple has been so successful, it should not be a surprise that Microsoft is eager to compete. CEO Steve Ballmer told attendees of a talk at the London School of Electronics that its partners would have slate PCs available by the holidays.

That's the question we ask Betanews readers to answer. But, please, be specific about what you want, or don't, from Windows Phone.

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Apple's iPad has now proven to be one of the most successful consumer electronic device launches ever, according to Bernstein Research retail analyst Colin McGranahan.

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hile Skype is one of the most popular VoIP clients, bringing it to the Android platform has been quite problematic. With this release, we see those problems have persisted.

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