27 Oct 2015

New York’s attorney general investigating whether Internet providers are ripping off customers

New York state's attorney general is probing whether three major Internet providers could be shortchanging consumers by charging them for faster broadband speeds and failing to deliver the speeds being advertised, according to documents seen by Reuters.
The letters, sent on Friday to executives at Verizon Communications Inc (VZ.N), Cablevision Systems Corp (CVC.N) and Time Warner Cable Inc (TWC.N), ask each company to provide copies of all disclosures they have made to customers, as well as copies of any testing they may have done of their Internet speeds.
"New Yorkers deserve the Internet speeds they pay for. But, it turns out, many of us may be paying for one thing, and getting another," Attorney General Eric Schneiderman said in a statement.
In statements, spokesmen for the three companies expressed confidence in the speeds of their Internet services.
“We’re confident that we provide our customers the speeds and services we promise them and look forward to working with the AG to resolve this matter,” Time Warner Cable spokesman Bobby Amirshahi said.
Cablevision spokesman Charlie Schueler said the company's Optimum Online service "consistently surpasses advertised broadband speeds, including in FCC (Federal Communications Commission) and internal tests. We are happy to provide any necessary performance information to the Attorney General as we do to our customers.”
A Verizon spokesman said the company would cooperate with Schneiderman's office. "Verizon is confident in the robust and reliable Internet speeds it delivers to subscribers," the spokesman said.
The attorney general's investigation is particularly focused on so-called interconnection arrangements, or contractual deals that Internet service providers strike with other networks for the mutual exchange of data.
In the letters, Schneiderman's office says it is concerned that customers paying a premium for higher speeds may be experiencing a disruption in their service due to technical problems and business disputes over interconnection agreements.
A 2014 study by the Measurement Lab Consortium, or M-Lab, found that customers' Internet service tended to suffer at points where their broadband providers connected with long-haul Internet traffic carriers, including Cogent Communications Group Inc (CCOI.O).
"Internet service provider interconnection has a substantial impact on consumer Internet performance - sometimes a severely negative impact," the study said, adding that business relationships rather than technical issues were often at the root of the problem.

A spokesman for the attorney general's office said the 2014 study's findings, coupled with consumer complaints and internal analysis, prompted the inquiry into Internet speeds.

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