I called the AT&T representative they got me in touch with. I told them about how what they are doing is illegal and they can't limit me to use this etc.
They backed down. Gave me free cable, 50% off, waived the installation fee and came and installed it in a day. Their previous estimate for an installation was two to three weeks.
Now, I understand that in real life, it's not an easy, abstract choice - you have "only human" issues playing part, like being tired and wanting to get the Internet situation sorted out ASAP. So to be clear - I'm not blaming the poster for choosing this way. But it was a suboptimal decision - and the kind of decision that lets schemes like this exist in the first place, so I wouldn't call it "beating lock-in".
If the FCC and PUCs could do marketing, that'd be awesome, but I'm sure some corporate crony politician (or even judge) would shut that down...
That said, I'm having a hard time understanding this obsession over social media. I'm pretty sure that if most companies simply ignored complaints made over Twitter or Facebook, it wouldn't hurt them in any way.
My landlord told me about his exclusive deal that will give me cheap AT&T connection. I simply called up Comcast and they gave me an internet connection that was cheaper.
Repeat every few weeks until number of customers drops under number of available ports in router/switch/gizmo.
Incorporated Owners/Building Management:
"(a) should not impose any fees, deposit, access charge, administrative charge, escort charge or rental charge on the Operators for the access of the building, the use of the common parts of the building or the use of the in-building telecommunications system of the building for the provision of services to residents or occupiers of the building
(b) should not enter into any commercial contract which will unreasonably restrict the right of a resident or occupier or deprives a resident or occupier of the right, to have access to the public telecommunications services of his choice. Any such agreement is void to the extent that it imposes such restriction;"
Would be nice to see similar legislation adopted in the USA.
I think many landlords around here signed away rights on telecom services without knowing better, or set up exclusive agreements like this and those mentioned in the article, but this was the worst offender I've ever encountered.
Several apartments here in Austin, TX do this. In my search, I found the biggest offenders were Greystar and Camden properties. They lock you in to these silly "Entertainment" packages. Exclusively Time Warner, Grande, or AT&T depending on the property.
If you're already in a contract with a provider, you'd have to break your contract just to move in? That's ridiculous.
It's really unfortunate, as some of these properties are located in very desirable locations. I couldn't come to terms with being forced to use a certain provider. So I found a property in a less desirable location that offered full competition among utilities.
The company that was given exclusive rights to provide service was plainly advertising a kickback program on their website before, but it looks like they've cleaned that up since.
Compare this `live` page:
With this, from 2004:
As property owners, managers and business people, you have a captive audience of resident consumers... we consider it our mission to continue to offer more profitable ways to maximize ancillary income from your residents and customers. Consolidated is your proven resource to increase ancillary profit with:
- Coin Laundry Systems
- Smart Card Systems
- Satellite Television
- High Speed Internet
- Domestic Appliances
Turning customers into captives? Kickbacks? Sounds like the kind of work that would violate Sherman Antitrust or RICO Act provisions.
Even if they offer the installation for free, I want their barely-trained technicians to drill holes in my property as much as a fisherman wants them to drill holes in his boat.
We've done this rule about attaching things to the building/railing because the building is actually two buildings one is a heritage building so nothing is allowed to be attached without prior approval of the heritage committee of the city. Since that building can't do it, we made the decision to do it for the new building.
We had to get permission to use a new type of metal shingle that looks like a traditional shingle but it has a 50 year warranty. Since that roof can only be serviced by one company in town (it has a steep roof like a church so only that company is actually able to do it) we wanted it done once and not have to worry about it. Even the method we used to clean the outside of the building had to be approved.
"OTARD rules do not apply to common areas that are owned by a landlord, a community association or jointly by condominium owners. These common areas may include the roof or exterior walls of a multiple dwelling unit."
Apparently you haven't seen this yet, but if you got a lucrative offer from an ISP to go exclusive, would you take it?
Has anyone done this before?
then the real trick is getting the ISP you want to play ball. I know of a few instances where Comcast just won't entertain the setup whatsoever. Unfortunately, in telecommunications, largess is the name of the game...
There is at least one other ISP that doesn't have access to the property plus in theory Google Fiber should be coming to town (PDX) so I expect this issue is going to become more pressing.
Shortest contract I could sign to get the advertised pricing was 3 years from the incumbent telco provider here. They offered me the "blazing" package that had a whole 10mbit upstream.
Does anyone have experience dealing with properties who claim to have exclusivity contracts? I talked to people at Webpass, and they've stated it is available in my area. They'd come in and set everything up free of charge. I don't see the downside for my building to allow Webpass to come in.
I'd like to see that change.
just like wifi ratings for hotels have become a "thing", so must exclusivity agreements and broadband providers when it comes to apartment/housing hunting.
it would be extremely difficult bordering on impossible, in my opinion, for a law in the US to prohibit property owner rights in a fashion that prevents these kind of agreements. only a "market" solution would work here. and of course, that's very difficult on its own.
More likely, "free WiFi" managed by the landlord would be included in your rent, and they'd decline to let an ISP run any cable because "What do you need that for? We're already giving you free WiFi!"
ISP competition is important, but I see this as a symptom, not a cause. Fix the root problem, and people might start caring about ISP choice. Once renters care about ISP choice, big landlords will fall into line.
Depends on where you live. In NYC, Verizon promised to provide fiber to the entire city several years back (and there is currently a massive legal dispute with the city because they've fallen incredibly short of delivering on that). It's particularly apalling because Verizon didn't even have to build out most of the fiber - the city already had a dark fiber network covering large portions of the city.
I'm one of the unlucky ones. Verizon has fiber running right in front of my building - other buildings on the block already have Fios. However, Verizon refuses to provide Internet to my building unless they can also provide TV service as well. The landlord has given Time Warner Cable the exclusive rights to provide TV service in my building, so that means that I'm stuck with only one choice, even though it's technically a "competitive" market.
So, this issue is both a symptom and an exacerbating cause pf ISP non-competition. At least in NYC, exclusivity agreements make it much easier for the local monopolies to pretend that they aren't blocking competition, when in reality they've carefully drawn lines around their territories and have a "gentleman's agreement" not to encroach on each others'.
If landlords didn't (or couldn't) receive kickbacks like these, it'd be much harder for them to maintain this illusion.
 This is not hypothetical; I've called up their offices more than once and confirmed that this is the blocking step before they schedule a date to hook up the building.
 TWC, Comcast, and Optimum have exclusivity rights to buildings all across the city.
I can't speak to Baltimore, but in NYC, it's the landlord that's responsible for this, not the city.
> The economics of FiOS don't really work out without TV service
I can sort of buy that argument in areas where they have to do all the buildout themselves, but in New York, Verizon was handed the existing fiber network that already ran past people's doors. Then Verizon has the gall to claim that they've fulfilled their obligations of wiring the city because 'everyone has fiber running past their door', even where they did literally no work and simply sat on the fiber that others had already built for them.
Source? Verizon has stated it invested $3.5 billion and ran 15,000 miles of fiber in New York.
NY residents didn't invest anything in fiber. Verizon got rate hikes because it has been losing billions of dollars a year in NY. Nationwide, Verizon's wireline profit margin is in the low single digits--it's utterly ridiculous to say they're receiving a "subsidy" in the form of above-market monopoly prices.
As I mentioned in my original comment, New York already had fiber networks covering large parts of the city. Verizon was able to access these, which already "ran past" many buildings in the city (including mine), and still never bothered to hook up those buildings as they had already agreed to.
More generally, forcing companies to cross-subsidize from richer areas to poorer areas is destroying fiber rollout nationwide. It's a tax on fiber subscribers, and like any tax it discourages the thing being taxed. It's effectively a ban on the only sort of business model that could create competition with incumbents: deploying gradually to the areas offering the greatest return first. There is a reason why Google won't bring fiber to cities that impose build out requirements, and why it got rid of the free tier in Kansas City. The math simply doesn't work.
Municipalities incorrectly assume they have a choice whether to leave things up to the market. In reality, the market operates whether they like it or not, and simply adds the cost of serving unprofitable customers to the "cost" side of the equation when deciding whether to build service in an area. That's why even Google won't build in cities that impose build-out requirements.
Cities think they can wire up impoverished neighborhoods "for free" when in reality all they're really doing is creating a large tax on fiber deployment, and using the proceeds to serve lower-income neighborhoods. But when you tax something, you decrease demand for it (which is why we tax cigarettes). Taxing fiber is incompatible with the idea that you want to encourage fiber deployment.
 It's also a tax that's quite regressive. A middle class family with fiber pays the same amount of "tax" to subsidize fiber for low-income areas as a rich family. It'd be better to just increase the city income tax and pay for fiber directly.
To clarify, the alternative isn't really a free market approach either (since Verizon was seeking a de facto exclusive, monopoly status).
There is a free market approach to solving the problem you describe as well, but what Verizon seeking was almost the opposite of that.
As an aside, i've only got internet, I will never pay for a cable tv subscription again.
The problem is you can't get the standard Comcast or U-verse product in those buildings. The landlord signed a 10-year deal stating "10mb/s" per unit. Meanwhile your neighbor in a non-exclusive building gets 75mb/s easily for the same price or even less than you're paying under the exclusive agreement.
Worse, a lot of these buildings sign deals with no-name local fiber providers (or resellers) who pull the same crap, so its not a "big business won't let us compete" issue as much as it is lack of choice for residents due to existing contracts by the property owner.
According to this report, in 2013 only 28% of US households had three or more providers capable of giving 10Mbps service, and 24% only had one:
If you raise the bar to 25Mbps, then only 9% had three or more, and nearly half only had one choice. That's 2.5 years old, but I don't think it has changed all that much.
Maybe they offer even worse services in these buildings, but I bet that in areas where they have a monopoly simply because of no competition, I bet it's pretty bad too. It certainly was for me when I lived in such an area.
I think its important to keep that in mind when reading surveys like these. Just because some guy who chooses to live in the middle of nowhere gets only 1.5mbps DSL doesnt mean I can't get 100+mbs in urban areas. I'm currently on a 100mbps in Chicago with AT&T and Comcast soon releasing their consumer-level gigabit fiber product. Other cities have the same or better, like Kansas City's Google fiber.
Its dishonest to say that high-rise renters in urban areas should think 10mbps is competitive. Its not remotely so.
This also cuts both ways. I know a building serviced just by RCN and every tenant gets 100mbps and a bunch of channels for a good price. Its a mixed bag, but usually leans on less competitive products.
Units with no better than 10Mb/s service should let for significantly less than otherwise-equivalent units with 75Mb/s, significantly less given modern Internet usage.
There may be folks who are willing to give up some about of bandwidth in order to save on rent; it would be unfortunate if that choice were taken away from them.
If landlords believed these agreements cut the rent the landlords can charge by more than they are kicked-back, they'd never sign them.
I'm certainly not defending this sort of thing. But, given a competitive rental market, it's not something to worry overmuch about.
Since none of this fundamentally cuts costs, you end up with a zero-sum game. There are four basic possibilities: either the ISP miscalculates and loses more money on kickbacks than they gain from renters, the landlord miscalculates and loses more money in rent than they gain from kickbacks, the renters miscalculate and lose more money on their internet bill (or lose more value due to having crappy internet) than they gain in rent savings, or everything manages to balance out perfectly and this is just a bunch of wasted effort. Since the renters are by far the party with the least information and the least ability to analyze the situation, it's highly likely that they're the ones who end up being screwed.
Here in Seattle, whenever one of my intern friends would move in, we would first tell them to look for apartments with wave/condo internet. 60$ a month, no contract or installation fees for 100 Mbit per second internet. It hasn't gone down once in that past 4 months nor ever slowed from that speed (I can also spend an extra 20$ a month to get 1 gbit per second).
There are local providers such as Sonic who are rolling out Gigabit in certain parts of the Bay Area, and who insist "the more people in your neighborhood that sign up, the more likely we are to bring FTTH to your neighborhood!" but there's no way of judging which one is the more "likely" bet, which is frustrating.
I wish there was someone I could just throw a couple thousand dollars at to solve the problem, but no doubt it's vastly, vastly more expensive for them than that.
As will every attorney in the world for any contract. I don't think I've ever seen a contract without this.
Comcast does enough ridiculous and illegal stuff, we do not need to reframe standard practices as bad simply because it's Comcast that's doing it.
>TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, NEITHER VALVE, VALVE EU, THEIR LICENSORS, NOR THEIR AFFILIATES, NOR ANY OF VALVE’S OR VALVE EU’S SERVICE PROVIDERS, SHALL BE LIABLE IN ANY WAY FOR LOSS OR DAMAGE OF ANY KIND RESULTING [...]
Note the phrase "to the maximum extent permitted by applicable law" - that means that if a section is illegal, then it's not to the extent of including that section. It's pretty commonly used and it's actually pretty nifty, although I'd appreciate it more if companies didn't try to claim bloody everything with it attached.
However, for some reason, private cable companies do not need to share their infrastructure, so if you want faster Internet you are still stuck with the local cable company.
there is also BSA or bitstream access where, in the case of DSL, the ATM circuit is provisioned and carried by the incumbent and then handed off to the competitive provider in a central location. of course, this isn't all that useful since it's still the incumbent who has to provision the circuit, maintain the copper and equipment, and generally muck up the customer experience despite not being the labelled provider.
Sure easy fix. Just void existing contracts that were valid when written. And this is coming from a lawyer no less.
I don't want the government to interfere much at all in private affairs, and I don't think "there should be a law against" everything I don't like. I am not sure in this case, but conspiracies to prevent third parties (tenants and ISPs) from conducting business are pernicious. I would never enter into such an agreement myself.
My concern with having shared utilities is you'll have to wait for some underfunded bueracracy to fix things if they break, which is likely to take even longer than Time Warner. Currently, WOW! and AT&T are actually quite quick about this where I live.
In my opinion, if you were to regulate it, it should just be to prevent the price gouging.
There is no particular reason to limit this to multi-tenant buildings or wired broadband. The problem of monopoly last mile access comes up in different contexts. The same legal solution should work for most any situation.
The grander idea is to have apartment buildings with their own basement clouds, where tenants could off-load computational needs. Sounds like a much more energy-efficient solution than person having either an overpowered device or a low-power one in constant connection with clouds on the other side of the planet. Moreover, this idea was part of a general brainstorming about ways to dumb the cloud back down, so that it's distributed compute-on-demand infrastructure, and not the shitty third-party data silos it's now.
After reading the comments here I realized that while my friend and I would have the best of intentions, if ISPs in general were to be allowed to do such a thing, they'd fuck it up exactly in the way they do in this case.
Please bring back the map showing the buildings where Webpass is installed...I looked recently and couldn't find it. Or, if this is too confusing now that you have many more installed buildings, please provide a list.
When I selected my last apartment, I knew I wanted to try Webpass. So I started there, pulled up the map of buildings that had it installed and limited my search to those buildings. Given how much better the service is than Comcast/AT&T, I can see a lot of people who work out of a home office wanting to do something similar.
You could even try to work with the buildings that have allowed you in to post apartment listings on your site...seems like a win-win-win (more webpass customers, faster filling of vacancies in webpass buildings, residents get better internet.)
Still the renter lacks a choice right? Not so fast. If internet is so important to you, as OP tries to make the case with questionable statistics near the top, then choose a building with internet you like.
The world is not Burger King where everything is have it your way. There are a finite number of Oreo flavors and yet no one is writing blog posts demanding their congressman do something about it.
Sure, a landlord can’t enter into an exclusive agreement granting just one ISP the right to provide Internet access service to an MDU, but a landlord can refuse to sign agreements with anyone other than Big Company X, in exchange for payments labeled in any one of a zillion ways.
So we can either stop it now or not. It's our society. We can make the laws to help or hurt. Perhaps the landlords should be allowed to skim. And gas, electricity and water, as well. But I would vote against it.
Due to the very limited amount of rental space, and the difficulty of constructing more of it, rentals are a heavily regulated market. If you don't want to deal with regulation, perhaps you should pick a line of business with a lower barrier for entry.
Rent in some other area
Buy a place
I can't tell if the original article is legitimate journalism, a submarine piece for Webpass, or a bit of both.
Ahh, the old, "No one forced someone to live there, so everything that happens is A OK."
That's not an argument, and that's not justification. That's just you admitting this is a shitty practice that needs to stop.
No, if less than half of Americans live in apartments then chances aren't good that that a random reader does.
> More people are renting these days than ever before.
Not true, according to http://www.bls.gov/opub/mlr/2016/article/the-life-of-america... (which was posted just today): 'If you were alive in 1915, chances are you rented your house or apartment; the ratio of renters to homeowners was about 4 to 1 in 1920. In contrast, by 2004, 69 percent of American families owned rather than rented their residence, although that proportion slipped to 64 percent by the fourth quarter of 2015.'
So far fewer Americans are renting than ever before.
I don't disagree that it's poor behaviour for landlords to grant monopolies to ISPs. But folks do have a choice in where they live, and it seems to me that monopoly-free units are likely to rent for more.
>So far fewer Americans are renting than ever before.
In 1915, there were ~100M people in the US. At 20% homeowners, that gives 80M renters. 36% of the current 300M+ population gives > 80M renters. Therefore, there are more renters today than there were in 1915.
In practice if an apartment makes money by way of this "kickback" it also offsets the rent that they have to charge the tenants of that building. Similar to airlines, assuming that if one charge is reduced or eliminated it won't show up in another area (baggage fees) or in the case of a building reduced maintenance or services doesn't take into account how real businesses operate. There is nothing wrong with a business making money and in fact a business that is profitable is also good for it's customers. A business that loses money is not. The "peanut gallery" (people who write blog posts and comment on this but don't actually even own their own business) aren't in a good position to know all the ins and outs.
That said, sure some businesses rip people off (if you want to call it that) but don't assume that is the default case.
Edit: Perhaps this attorney (at Harvard no less) could write an article about the 'legal tax' on society as a result of lack of competition in the legal market. The cost to consumers for that (since it's passed along in product costs) is almost certainly way greater than whatever the 'vig' is for higher priced cable television or internet service.
Even in a competitive market, specifically the ones you have mentioned, the rent charged is based on supply and demand and the competition. If not what prevents them from doubling the rent?
But that's a more complicated case to make than "kickbacks therefore bad".
You could say a similar thing about laundry room charges where there isn't any competition. And also no specific disclosure as well (unless you ask) therefore is that sneaky? What I am saying is non disclosure does not mean "sneaky".
But another point is this: If enough buildings are doing this, such that an article like the parent post is being written, it then becomes something that a careful apartment shopper should or would consider when pricing apartments "total cost of rental".
You know if you buy an expensive luxury car they don't specifically point out that you will have to pay fees to keep your warranty current (Porsche, Mercedes as two examples). So is that sneaky? After all BMW (as a high end competitor) includes all maintenance.
Because doubling the rent would be enough to get the people to desperately search for someone else. But getting them move in and then slowly raising the rent is a common practice.
Sure there is competition in this market, but given that a) demand is much bigger than supply, b) switching costs for tenants are extremely high, and c) it's not a competition in which a landlord can actually get out of business (even if they cut their rates by half, it would still be profitable to rent out the apartments), the competitiveness matters very little, and landlords are in no hurry to fight against each other - they're more likely to cooperate instead. The prices aren't set on the level competition demands - they're limited to what people can afford at all.
2) If you're going Econ 101 on this, ever heard of elasticity or switching costs?
2. I mentioned stickiness in https://news.ycombinator.com/item?id=11989391. But it makes the analysis more complicated, and the comments I was responding to were not at that level. Remember, I started by responding to a comment saying "There's no incentive for that profit to be passed on as reduced rates for the tenants.", which is a simplistic model.
The real problem is that the landlords are exploiting the cost of information. It's costly for new tenants to educate themselves and factor in the costs of potential ISP/TV in addition to rent. Landlords are exploiting that cost to profit for themselves.
Is it nearly as big as a problem as everyone here is making it out to be? No. It's like 50-100$ a month compare to 1000-4000$ a month rent for most people. That's 1/80 to 1/10 the cost of the rent.
You need some more complex notion of stickiness differing between imputed and sticker costs as I mentioned downthread for this to be harmful.