Jon Brodkin

There’s no bigger Internet service provider in the United States than Comcast, and perhaps none is more controversial. Comcast has built a network that is a huge part of the Internet backbone in the United States.

Barry Tishgart, the vice president of Comcast Wholesale network services, argued that Comcast’s opponents are distorting the facts when they say Netflix’s payment to Comcast was unprecedented and when they claim that Comcast shouldn’t receive such payments because it doesn’t operate a “global” network that connects to every part of the Internet.

It was “frustrating” that “people made the deal between Comcast and Netflix out to be unprecedented or new, that a content company -- Netflix is an aggregation of a lot of content -- would have a deal with a Comcast, but in fact that's been going on for a long time, and it's also been widely reported,” Tishgart said.

The Federal Communications Commission had a $450 million budget in fiscal 2014, which ends September 30. Among other things, the FCC's 2015 budget request includes $9.2 million for "modernization of aging IT systems."

"About 40% of the FCC's application portfolio is more than 10 years old, and 70% of the IT portfolio depends on [deprecated], legacy technologies," the budget request states. The FCC also requested an extra $625,000 for Enforcement Bureau equipment.

The FCC is funded entirely by regulatory fees and auction revenue, but Congress and the President decide how much the commission can spend.

Rep Marsha Blackburn (R-TN) wants to make sure the Federal Communications Commission never interferes with "states' rights" to protect private Internet service providers from having to compete against municipal broadband networks.

She proposed an amendment to a general government appropriations bill that would prohibit taxpayer funds from being used by the FCC to preempt state laws governing municipal broadband.

Verizon Internet customers who want to watch Netflix at high quality and without interruption just can't catch a break. While Comcast subscribers saw near-immediate speed improvements after Netflix paid for a direct connection to the Comcast network, Netflix performance on Verizon remains poor -- and it's getting worse.

Comcast spent months preparing network connections with Netflix -- Verizon didn't. Netflix's latest ISP speed rankings show that the average prime time streaming speed on Verizon FiOS dropped from 1.9Mbps in May to 1.58Mbps in June, a decline of 17 percent. Verizon DSL dropped from 1.05Mbps to 0.91Mbps, a decrease of 13 percent.

Dozens of lawmakers, municipal officials, and consumer advocacy groups want a thorough investigation of New York's phone system, accusing Verizon of raising prices substantially while allowing landline service to deteriorate throughout the state.

Rate deregulation has harmed customers, the lawmakers and groups wrote in a petition to the New York Public Service Commission (PSC). Verizon has been shifting wireline service from copper to fiber and building out its cellular network, but in the process it's leaving many consumers behind, the petition claims.

The letter quotes New York Attorney General Eric Schneiderman and previous PSC documents that say Verizon failed to meet quality standards. The petition was signed by 49 State Assembly members (out of 150), seven State Senate members (out of 63), and a member of Congress, US Rep Tim Bishop (D-NY).

Mayors and other officials representing a dozen cities, towns, and counties signed the letter, as did consumer advocacy groups including the AARP and Common Cause New York. The letter was also signed by the New York State AFL-CIO and a Communications Workers of America representative.

New York is shaping up as a major battleground for Comcast's proposed acquisition of Time Warner Cable.

While the $45.2 billion merger will be scrutinized by federal officials, it also needs approval at the state level.

TWC has 2.2 million cable TV, Internet, and phone customers in 1,150 New York communities, and hundreds of them have called on the New York Public Service Commission (PSC) to block the sale to Comcast. Comcast doesn't compete against TWC for subscribers, and its territory in New York is limited but includes a VoIP phone service offered to residential and business customers in 10 communities.

"Both Time Warner Cable and Comcast already have monopolies in each and every territory in which they do business today, and combining the companies will reinforce those individual territorial monopolies under a single corporate umbrella, with NBC-Universal thrown in to boot," resident Frank Brice argued in a comment to the PSC posted. Brice complained that "The constant, yearly rate increases imposed on us by Time Warner Cable are and continue to be outrageous, outsized, and unwarranted. "Given where I live in the mid-Hudson valley, 100 miles from New York City and 50 miles from Albany, I cannot get over-the-air TV broadcasts, and I have no choice in my cable-TV provider unless I choose a satellite provider." Brice is "so unhappy with Time Warner Cable" that he buys DSL Internet and phone service from Verizon, which hasn't built FiOS in his area.

Brice's comment is similar to many others submitted by residents to the PSC's merger proceeding.

Since 2013, Comcast's wireless gateways have by default broadcast a second signal that turns each customer's modem and router into a public Wi-Fi hotspot.

It's all part of Comcast's plan to create a nationwide Wi-Fi network of more than 1 million hotspots that the cable company can sell access to. Routers broadcast public Wi-Fi signals, unless you ask Comcast to turn it off.

Comcast deflected criticism by arguing that the hotspot's bandwidth is separate from the bandwidth subscribers pay for, so it won't reduce the customer's Internet speeds. But what about electricity? Alex Gizis, CEO of Speedify, which makes software that bonds Internet connections to combine bandwidth, decided to investigate.

To test the effect of people using the hotspot, Gizis plugged the Comcast modem and router into a power strip that was being monitored by a "Kill A Watt" meter. After testing the devices while idle, "we then connected two Windows laptops to the Xfinity hotspot, one watching Netflix and the other downloading files," he wrote. "You could immediately see the difference in the power meter, as the devices jumped from 0.14 Amps when idle, up to 0.22 Amps when actually being used. To translate this into dollars and cents, we used the average cost of power here in the Mid-Atlantic, which is $0.162 per KWh."

Comcast spokesperson Joel Shadle told Ars that the Speedify test relied on Comcast's business equipment, rather than the equipment that's used for the residential hotspot program, and that the equipment was outdated.

With Verizon struggling to bring FiOS to every corner of New York City as promised, the company has been arguing with landlords about gaining access to buildings where tenants might want to buy Verizon's fiber-based Internet, phone, and TV service.

Verizon's fiber now passes buildings in "90 percent of the Bronx, 89 percent of Brooklyn, 94 percent of Manhattan, 90 percent of Queens and virtually the entirety of Staten Island," the company says. That's short of the 100 percent Verizon was supposed to achieve by June 30, 2014 according to its franchise agreement. And the percentage of buildings where residents can actually buy FiOS is lower.

Verizon now blames Sandy but claimed it was "ahead of schedule" after the storm.

"The various percentages refer to the amount of fiber in the streets and avenues, our obligation. The numbers have nothing to do with building penetration," Verizon spokesperson John Bonomo said.

Verizon has been filing petitions with the State Public Service Commission to gain access to several hundred buildings in order to conduct pre-installation surveys and then wire up the buildings. In some cases these petitions have allowed Verizon access, but other attempts were plagued by miscommunications and mistakes.

When Netflix agreed to pay Comcast for a direct connection to the ISP's network, video performance improved immediately. Verizon subscribers aren't so lucky.

Although Netflix and Verizon confirmed on April 28 that they had struck a paid peering deal, performance continued to drop in May and could remain poor for months while the companies upgrade infrastructure.

"Verizon FiOS is down two slots and now ranks behind DSL providers Frontier and Windstream," Netflix wrote after releasing its monthly speed index.

In the US, Netflix performance on Verizon FiOS dropped from 1.99Mbps in April to 1.90Mbps in May, and performance on Verizon DSL dropped from 1.08Mbps to 1.05Mbps. This is the average performance of all Netflix streams on each ISP's network. The drops are small, but they show that the paid peering deal didn't make any immediate impact.

In April 2008, Verizon signed a franchise agreement in which it promised the New York City Department of Information Technology and Telecommunications (DoITT) that it would build its "state-of-the-art fiber-optic network throughout the entire City by mid-year 2014."

The June 30, 2014 deadline is about to pass without Verizon meeting the requirement. The company is blaming Hurricane Sandy from October 2012 -- even though Verizon was still claiming to be "ahead of schedule" in April 2013.