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Summary:

There are few companies that evoke such strong emotions as Comcast, and the company’s most recent spat with Level 3 hasn’t really helped its image either. So why does everyone hate Comcast? A look back at a number of strategic missteps that shaped the company’s image.

Comcast Tower

How is this for bad timing? Just as Comcast is gearing up to finalize a closely scrutinized merger with NBC Universal, it’s dragged into yet another net neutrality debate, this time focusing on allegations it tried to impose extra tolls on Netflix video traffic.

Level 3 is alleging that Comcast is trying to do away with the open Internet by demanding Level 3 pay it for transit. Comcast, on the other hand, is taking the stance that this is just business as usual. Even without taking sides, one has to wonder: Why is Comcast always the one that’s getting in trouble?

The answer, in short: Comcast has become the quintessential broadband bully — an image that is part outside perception, part self-fulfilling prophecy. Here’s the list of missteps and allegations that shaped Comcast’s image:

Sabotaging P2P. Comcast’s first major brush with net neutrality advocates happened when the company decided to block its customers’ P2P file transfers in the summer of 2007. The company eventually changed its network management practices under pressure from the FCC, which nonetheless proceeded to impose restrictions on Comcast’s handling of P2P traffic. The proceedings included memorable moments like an FCC hearing that was packed with people paid by Comcast to “save seats.”

Killing net neutrality and neutering the FCC. Comcast went to court to fight the FCC order even though it had already implemented much of it before the commission had issued its demands — and won. The court ruling effectively crippled the FCC by restricting its authority over the Internet, and efforts to implement strong net neutrality protection in the U.S. haven’t been successful since.

Spying on its customers. It may have been just one of those ideas that would never see the light of day, but Comcast’s plans to use cameras to figure out who was watching TV at any given time didn’t exactly help the company’s image.

Capping customers’ bandwidth. Comcast was one of the first ISPs to institute a bandwidth cap in the summer of 2008, threatening customers who repeatedly use more than 250GB a month with account terminations. The step was followed by a public uproar. Guess what happened when Charter (chtr) introduced even lower caps half a year later? That’s right: Nothing.

Blocking Hulu. Wait, did they really do that? No, they didn’t. Hulu itself recently did, acting on behalf of Fox, as part of its retransmission fee dispute with Cablevision. In fact, the incident, which briefly prevented Cablevision customers from accessing videos on Hulu, didn’t have anything to do with Comcast. Except maybe for the fact that a merged Comcast-NBC would be able to have Hulu institute similar measures at any time. Which kind of makes you wonder: Was Fox really just out to get more money from Cablevision, or did it try to influence the regulatory merger review of one of its biggest competitors?

Peddling cable modems. Lost in the uproar about Level 3’s allegations was another FCC complaint filed against Comcast yesterday: Cable modem maker Zoom is alleging that Comcast is trying to force its customers to lease or buy Comcast-provided cable modems by shutting out competing products though unnecessary tests and standards. From Zoom’s press release:

“These new standards, among other things, address a modem’s weight, labeling, and packaging as well as its physical appearance following the application of various substances, such as waxes. They also require a cable modem to suffer no degradation in performance at temperatures far in excess of those generally found in the United States and well above the requirement for electronics equipment such as an iPad or a personal computer.”

Merging with NBC. No one really doubts at this point that the merger of Comcast and NBC Universal will go through. Still up in the air, though, is the question of whether Comcast will have to agree to any stipulations regarding its online offerings. These could range from requirements to license NBC content to competitors to a forced divestiture from Hulu, of which NBC currently owns 32 percent.

The current conflict with Level 3 is only adding to the pressure, especially since Level 3 is busy using this to pit Comcast’s Xfinity online offering against Netflix, stating that “the fundamental issue is whether Comcast… has the right to unilaterally set a ‘price’ for access that effectively discriminates against competitors of Comcast’s cable and Xfinity content.”

It’s unclear what exactly the fall-out of the Level 3 dispute will look like — but it’s becoming more and more clear that Comcast’s ability to evoke strong emotions and influence consumers and regulators to action is phenomenal.

Image of the Comcast tower courtesy (CC-BY-SA) of Flickr user Kevin Burkett.

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  1. Just get red of Comcast. I have Netflix and an amplified HDTV antenna from localtv4free and I get more programing as well as local news and major networks. More than cable offers at $9 per month. Local stations for free.

  2. James Waldrop – HostMyCalls Hosted PBX Service Tuesday, November 30, 2010

    Comcast has created its own bad press. A few years ago, they threatened to block or rate limit any VoIP that was not their own. We never encountered any problems with our VoIP service over their network, but restrictive announcements of this nature has created a public image of restrictive practices.

  3. I’m really surprised to see their notoriously poor customer service not mentioned in this list. Their apathetic, incompetent, and sometimes negligent customer service is the stuff that legends are made of. A simple google search will bear this out. (And a fun read too.) You don’t get to the bottom of the list without being something special….

  4. Abysmally poor customer service. Crap, expensive cable packages. Arrogant management. Plenty of reason to hate Comcast and hope, pray, clamor for options to cut the cord forever.

  5. Cable providers (and all ISPs) need to be re-classified as common carriers.

  6. You forgot decades of local monopoly abuse and bad customer service.

  7. Part of their problem is their network is inferior to those with switched fiber to the home networks like FiOS, so Comcast has to use nook and crook tactics to maintain its eroding market share and establish precedent for future monetization (like charging tolls). They’re getting killed in head-to-head FiOS neighborhoods, mainly due to people are smart and want faster/cheaper, and so expect more of this to come as they’re networks will remain inferior despite efforts like DOCSIS 3/channel bonding and marketing spin like Xfinity.

  8. Janko, you said “Why is Comcast always the one that’s getting in trouble?” Perhaps it’s testing the nation’s laws and the will of the American government to uphold them.

    Apparently, when a dominant U.S. service provider attempts to leverage its position in the marketplace then the U.S. DOJ eventually takes acts. See the Carterphone decision
    http://en.wikipedia.org/wiki/Carterphone and the AT&T MFJ case http://en.wikipedia.org/wiki/Modification_of_Final_Judgment for the historical perspective.

  9. Janko, you said “Why is Comcast always the one that’s getting in trouble?” Perhaps it’s testing the nation’s laws and the will of the American government to uphold them.

    Apparently, when a dominant U.S. service provider attempts to leverage its position in the marketplace then the U.S. DOJ eventually takes acts. See the Carterphone decision and the AT&T MFJ case for the historical perspective.

  10. Comcast has terrible customer service; they are poorly trained, arrogant and not given the knowledge to actually fix anything.

    They act like a regulated old-school utility.

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