All posts by Darrell Smith

Robert Benefield, project manager for digital migration at Comcast, holds one of the boxes that some customers will need for the company’s expansion of its digital channels.

The conversion to a digital world marches on.

Comcast, the largest cable TV provider in the Sacramento area, will stop providing about 50 channels in analog format by the end of March. The move lets the company increase its digital offerings, including coveted high-definition channels, but means thousands of customers will have to install new equipment to maintain their current level of service.

“The whole world has been swept along in this digital tsunami,” said Comcast spokesman Bryan Byrd. “The customer continues to want faster Internet speeds and more channels.”

Those who subscribe to the lowest level of cable TV service – known as limited basic – don’t have to do anything; they will continue to receive the same service without new equipment. Nor is any change necessary for TVs that already receive digital service.

But new set-top boxes will be required for subscribers who want to continue receiving mid-level service – known as expanded basic – on all or some of their TVs. Those who don’t add the new equipment before Comcast shuts off the analog spigot will be able to receive only the 30 or so channels offered in the limited basic package, losing such offerings as CNN, Disney Channel and Lifetime.

The new boxes – a large one for a main TV and smaller ones for additional sets – will be available starting next Friday. Comcast will hook them up for $15.99, or customers can pick them up at a Comcast office and do it on their own. Rates will not increase as part of the “digital migration,” though an extra monthly charge could come if more than three TVs require boxes.

To get the word out, Comcast will mail letters, call customers and roll out TV screen crawls notifying viewers of the switch, Byrd said. Some 60,000 boxes are stowed at a Natomas warehouse ready to go, he said. If supplies run low, more shipments will arrive until the project is completed.

Comcast is confident subscribers will consider the changeover worth the trouble.

In addition to improved picture and sound quality, the company said, expanded basic customers will get 30 new channels, including Comcast SportsNet Plus, Country Music Television, MSNBC and Style. On the TV with the main box, they will gain access to on-demand and pay-per-view content, as well as digital music channels.

The conversion is unrelated to last June’s nationwide Digital Broadcast Transition that switched network programming to digital.

Comcast officials said the switch can be accomplished with minimum disruption.

“We’ve tried to make it easy and simple for people,” Byrd said.

But conversion efforts in other Comcast cities have had their share of headaches.

In Atlanta, which Comcast converted last summer, news reports quoted subscribers complaining of poor service and problems melding existing equipment with the new technology.

Atlanta-based telecommunications analyst Jeff Kagan said he saw that frustration up close. One of the biggest problems is that Comcast is moving too fast, he said.

“I think it’s the right move, but they should stagger it, allow customers to get used to the idea,” he said.

Kagan predicts a repeat of what he saw in Georgia.

“Some customers hook up their systems easily, others don’t have the ability to do that. All of a sudden, they have no TV signal and they’re standing in a long line to get their boxes,” he said. “When you rush it, many customers get ticked off.”

Deborah Legan, a Comcast subscriber in suburban Atlanta, said getting her VCR to work with the new equipment was a “nightmare.”

She said she spent 10 hours on a Sunday and two more on a Monday – much of it connected by phone to a Comcast technician – getting everything to work together. Her VCR still can’t do some of the things it used to do.

“If I could get my old service back, I would be the first in line,” she said.

Even with the possibility of customer backlash, the Comcast move makes sense in an evolving market increasingly focused on digital services, Kagan said.

The Sacramento-Stockton-Modesto television market has more than 1.4 million households, according to Nielsen Media Research. Cable has about 53 percent of the market. Comcast is the largest cable provider, claiming about 350,000 customers in the Sacramento area alone.

But the company is beset by competition from satellite services like DirecTV and Dish Network, Internet-based services offered by AT&T and Verizon, and other cable carriers.

The battle is focusing on capturing customers with a bundle of digital services that includes telephone, Internet access and high-definition TV. Companies routinely tout their large number of high-definition channels and fast Internet speeds in ad campaigns.

“Companies are fighting the bundle battle in major markets,” Kagan said. “It’s a battle that’s shaping up over the next several years and more customers are going to see it.”

Dropping analog channels allows Comcast to free up bandwidth to offer more digital services and high-definition options. Each analog signal dropped makes room for 12 digital channels or three high-definition channels, Byrd said.

A number of other Comcast systems will be converted by June, including those in Chico, Fresno, Grass Valley, Marysville-Yuba City, Merced, Modesto, Stockton, Tracy, Tulare and Visalia.

Some Comcast customers – mainly those with expanded basic cable – will need to get a set-up kit like this one to make the changeover. They’ll be available starting Friday.

Event guests play with the new Apple iPad during an Apple Special Event at Yerba Buena Center for the Arts January 27, 2010 in San Francisco, California. CEO Steve Jobs and Apple Inc. introduced its latest creation, the iPad, a mobile tablet browsing device that is a cross between the iPhone and a MacBook laptop.

Hello and welcome to iPad.

Welcome to what?

iPod? iPhone?

Nope, iPad, Apple’s latest device, the digital tablet that made its debut in San Francisco on Wednesday.

Some in Sacramento were just learning about the new item – cloaked in secrecy save for several pre-launch leaks – Wednesday afternoon.

“I just heard about it on the news. I don’t know anything about it,” said Bob Morales of Vacaville, standing outside the Apple Store at Arden Fair mall while his wife, Lucia, waited for her Mac Pro to be repaired. “But everyone was speculating on it. I guess that’s what gets all the excitement up.”

Apple’s previous unveilings of the iPod and iPhone were widely anticipated events, and buzz should follow the new tablet – think iPhone but bigger and with no call function – to store shelves.

It’s a half-inch thick and weighs a pound and a half with a 9.7-inch touch screen display that could catch the attention of those who use electronic reader devices like the Amazon Kindle. It has a 10-hour battery life and can run games.

The cost will range from $499 to $829, depending on storage capacity and 3G wireless connectivity.

David Lee of Fremont is “one of those crazy people who waited in line for an iPhone” in 2007, he said. But the accountant knew little about Apple’s latest device.

“I haven’t had time to keep up to date with Apple. I’ve been too busy,” he said, walking out of the Apple Store. “It might be a little too pricey for some. But after a couple of months, the price may come down.”

New product or not, Vaughan Ramon of Boston was not interested. In Northern California to visit her mother in Winters, Ramon said she is happy with her Mac Pro, thank you.

“I know nothing about the iPad, but I can’t see a need unless Apple creates a need – which they’re good at doing,” she said.

But when Lucia Morales emerged from the Apple Store, she said she expected it to do big business when the tablets reach store shelves.

Morales said customers were asking for the devices while she waited. She wondered aloud how Microsoft Corp. would respond.

Microsoft was expected to present a tablet earlier this month at the Consumer Electronics Show in Las Vegas but did not.

“You’re not going to be able to get through the doors when (the iPads) come in. It’s going to be unbelievable,” she said. “Given this, what’s Microsoft going to do?”

Officials for AT&T and the Communications Workers of America both confirmed this week that a portion of the company’s service center employees in Sacramento are being offered a choice to move or lose their jobs.

Beyond the fact that it’s happening, though, there’s little common ground between the union and the company.

AT&T officials say the service centers are a casualty of a land-line telephone business that is quickly becoming a relic of a bygone era as cell phone usage increases. The company has lost 25 percent of its wired consumer lines in recent years, AT&T spokesman Marty Richter said.

“We’re working to match employees with the customer load,” Richter said. “As the number of access lines decline, we have fewer calls for service. We have an ongoing need to consolidate.”

But union officials say the company’s offer is being made at a time and in a manner designed to discourage employees from actually moving.

“They still have plenty of work for people. The workload is still there,” said Lupe Mercado, president of CWA Local 9421. “This is a creative way to get people off of the payroll.”

Company officials declined to say how many employees are affected, what cities they would have to choose among and when they must decide.

The union says 249 of its members have been told they will lose their jobs unless they relocate by Feb. 1 to centers in Oakland, Reno, Rohnert Park, San Diego or Van Nuys.

AT&T says the employees will come from one center, but union officials say employees will come from each of the four Sacramento service centers on El Camino Avenue, Kings Way, Watt Avenue and T Street.

AT&T’s Richter said guaranteed job offers will be extended to employees who move. Severance packages and other benefits will be available to those who decline.

“They have an opportunity to follow the work,” Richter said.

The union suggests a different solution: Consolidate the local offices, offer early retirement and buyouts, and give employees who choose to move more time.

“These people have made AT&T very successful,” said Mercado. “AT&T’s not in dire straits. There’s no financial reason to do this.”

She cited a similar relocation last year that affected nearly 200 AT&T employees at a T Street repair site. They were offered moves to Texas and the Los Angeles area.

“They want to force them to the unemployment lines. Last year, we lost 188 employees in Sacramento,” Mercada said. “Very few were able to (relocate). Very few were able to follow the work.”

The jobs at stake are well-paid, about $28.25 per hour, Mercado said.

Across Sacramento, AT&T customer support employees and their families are mulling over their choices.

“It’s devastating. I’m scared. Following jobs is not an option,” said Devan Ivaska of Carmichael, a nine-year AT&T employee.

She and her husband, Kyle, are parents of three young children, ages 6, 4 and 1. If she moved, her husband would have to give up his job at a local school.

“With the way the economy is right now, it’s scary because of that,” she said.

Shelley Schwartz, an 11-year customer support employee from Rio Linda, said she’s going to try to follow the work. She has a 14-year-old son, and her husband was hurt on the job and now can’t work.

Schwartz, like other AT&T employees, found out about the relocation plan in the days before Thanksgiving.

“It’s the hardest conversation you could have,” she said. “It’s a difficult thing to talk about two days before Thanksgiving: ‘OK, at the first of the year, our whole world’s going to be turned upside down.’ “

She’s hoping she’ll be able to relocate to Reno and plans to rent out the family home if she has to call in the moving trucks.

“You’ve got to think of what’s best for the family. Reno’s the best option,” she said. “With Reno or Sparks, there are places with a lower cost of living.”

First, we didn’t need to visit the bank teller anymore. Then we were able to stick our checks right into the ATM without an envelope. Now we won’t have to leave the house to make deposits.

Earlier this month, Sacramento-based Schools Financial Credit Union became the latest bank to allow customers to scan checks at home and deposit them over the Internet. Golden 1 Credit Union introduced scanner-based check deposits in July.

“Banking’s not the way it was five or 10 years ago,” said Nathan Schmidt, a vice president at Schools Financial. “With any type of technology, it becomes more convenient to self-service.”

Another lender, USAA Federal Savings Bank, has gone even further down the convenience road. It allows customers to deposit checks with their iPhones by taking pictures of both sides of the check with the phone’s camera.

According to an Oct. 6 article in American Banker, USAA customers have deposited more than 100,000 checks totaling $61 million with their iPhones since the service became available in August.

The article went on to say that giant Bank of America is expected to start testing mobile phone deposits soon.

Even with the widespread use of direct deposit and online banking, Americans still write and receive millions of paper checks each year.

A 2008 press release from the U.S. Treasury Department said that one in three Americans don’t use direct deposit, including 10.5 million Social Security recipients.

And for the most part, when we have to deposit a paper check, we still need to go to an ATM to do it.

Businesses have been making deposits over the Internet for longer, ever since the passage in 2004 of the federal Check 21 Act.

Crafted in response to the banking system’s paralysis in the wake of the terror attacks of September 2001, the act made a digital image of a check legally acceptable for payment.

Wednesday marks the act’s fifth anniversary.

Businesses quickly saw the benefits of the new law. Sending checks as digital images eliminated courier costs and paperwork.

More than 60 percent of U.S. banks now offer merchant remote deposit – up from 50 percent in 2008, according to a June study by the Washington, D.C.-based Independent Community Bankers of America. Some 78 percent of banks plan to adopt the technology by 2011, the study found.

The extension of the service to consumers has come much more slowly. Cary Whaley, a director at the bankers group, said financial institutions have been wary about potential fraud.

“For many banks, it remains a business application,” Whaley said. “The next step is the consumer side, but a lot of community banks are a little wary. When you’re getting into thousands of consumers, the challenge for banks and credit unions is not only monitoring risk, but monitoring for changes in transactions and transaction amounts.”

But some bankers said consumers are increasingly demanding the same convenience given to their business counterparts, and it’s simply a matter of time before remote deposits become much more widespread.

Fewer than 1 million residential bank customers currently make deposits remotely over the Internet. But that number is expected to explode as more consumers catch on, and more banks make it available.

“It’s clearly on the upswing,” said John Leekley, founder and chief executive officer of the Georgia-based industry Web site RemoteDepositCapture.com. “The question is not whether we’re going to reach 5 million, it’s when. It’s a matter of convenience and efficiency. I don’t know anyone who enjoys going to a bank branch.

“If you can just scan a check on a phone or a home computer, it’s really about getting that check sooner so you can get your money sooner.”

When Schools Financial Credit Union decided to take the plunge, it included safeguards to prevent abuse. Customers must use their existing secure online banking log-in, and can’t transmit items more than twice a day.

Users have a time limit to scan and deposit the check online and checks must meet specific requirements before they are deposited. Post-dated, damaged or lightly printed checks, for instance, will not scan properly and cannot be deposited.

Schools is rolling the program out over time. It will be available to all 40,000 members who bank online by mid-November.

All it requires to make a deposit is a digital scanner and a computer with an Internet connection.

In Sacramento, Golden 1 rolled out its Z@piT online deposit service in July to a customer base comfortable with doing business online. About 200 members are enrolled.

“So many people prefer to do self-service. They choose to go online – maybe they’re parents with small kids, or they might not want to go to an ATM at 3 a.m.,” said Golden One’s chief executive officer, Teresa Halleck.

“People are already online,” she said. “They’re comfortable with electronic delivery and they’re looking for more.”

A computer loaded with Windows 7 software gets a tryout at a Best Buy store in Miami. Microsoft hopes to win back computer users who disliked the Vista system.

The big day was hours away, and Joshua Griffith was taking no chances.

The supervisor of Best Buy’s Geek Squad in Natomas carted the stack of bright lime-green boxes to a wood cabinet on the sales floor, then stowed them under lock and key, safe and sound until today.

Microsoft Windows 7, the computer giant’s newest operating system, launches today and retailers were preparing for a busy day.

“Our customers were telling us that they weren’t buying new computers until Windows 7 came out,” Griffith said. “We’re expecting it to be a mini-Black Friday for computers.”

The optimistic outlook is based on two main factors: First, Windows 7 is receiving widespread critical acceptance as a top-notch operating system; second, it’s not Vista.

The problem-filled Vista operating system frustrated users and was panned by critics for, among other issues, sluggish startup speeds.

With the Windows 7 launch, Microsoft hopes to win back PC users like Tommie Ingram. The Sacramento furniture installer said he didn’t put the much-maligned Vista on any of the three desktop computers and a laptop he owns.

“If you want to make money, you’re going to have to improve,” Ingram said. “If you want my money, you’re going to have to improve.”

Microsoft is listening to such customers, industry watchers say.

“It’s the Vista that should’ve been,” Steve Fox, editorial director of San Francisco-based industry journal PC World, said of Windows 7. “They’ve basically fixed it. … It’s their first simplified release. They’re exchanging flash for practicality. The best operating system is not obtrusive. It should be invisible.”

Blue-shirted employees were gearing up Wednesday at Best Buy on North Freeway Road in Natomas, stowing away not only boxes of software, but dozens of preordered computers loaded with the new operating system that customers can pick up starting today.

“You get a new operating system every four years,” said computer sales associate Westley Warren. “This is a big thing.”

The chief improvements over Vista, say experts, are Windows 7’s usability and a focus on function.

“The core engine is the same (as Vista), but they’ve greatly improved some of the features,” said Milt Hull, president and self-described technical guru of Sacramento PC Users Group.

Hull, who works as a network engineer, said he is particularly pleased with features that make the new system operate faster and give easier access to files, music and applications.

The buzz over Windows 7 as an antidote to Vista could shake loose more sales, said Fox of PC World.

“I think there’s a good bit of pent-up demand from people who want to get new systems,” he said.

Though Fox doesn’t anticipate a lines-around-the-store shopping frenzy, he said a stripped-down version of Windows 7 aboard netbooks could boost sales of the inexpensive, Web-browsing mini-laptop computers.

“I think you’d see a lot of people buying those because it’s a great impulse buy,” Fox said.

At Best Buy, Griffith is hoping the sales match the hype, especially in a retail sector hit hard by the economy.

“It’s exciting. We’re waiting to sell them. It’s like Christmas,” he said.

Joshua Griffith, supervisor of Best Buy’s Geek Squad in Natomas, carts boxes of Microsoft’s Windows 7 operating system to a locked storage area. “Our customers were telling us that they weren’t buying new computers until Windows 7 came out,” Griffith said.

AT&T is offering free telephone services to its residential customers affected by wildfires.

Customers can receive voice mail and call forwarding services and AT&T will also establish new phone service at a temporary or permanent location without installation charges.

Residential customers can get information on the free services by calling AT&T’s relief hotline at (888) 338-3291 from 7 a.m. to 6:30 p.m. Monday through Friday and 8 a.m. to 4:30 p.m. on Saturdays.

SureWest Communications’ revenue rose slightly in the second quarter from the previous-year period as the Roseville-based telecom continues to focus on growing its broadband market share, according to results announced Thursday.

Total revenue increased 2 percent to $60.9 million from $59.86 million in the year-ago quarter.

Much of SureWest’s push has been to expand its broadband here and in its equally competitive Kansas City market. Broadband revenue, at $40.26 million, rose 14 percent from the previous year’s quarter, officials said.

The company recently completed its 2009 fiber network expansion and has jettisoned what it calls “non-core” assets, including sales of its wireless segment to Verizon in May 2008 and its wireless towers in February to a Florida company.

Net income fell to $959,000 from the $20.9 million posted in the second quarter of 2008. The 2008 income was largely due to the $69 million Verizon deal.

The quarterly report also reveals SureWest in a cost-saving mode as it works to pay down debt and increase cash reserves as a hedge in a challenging economy.

The company bought back more than 107,000 shares and paid down more than $3.5 million in debt, officials said.

Other savings have come from a combination of staff attrition, reducing office space (including vacating its historic Roseville Telephone offices), and upgrading equipment and technology, said Steve Oldham, SureWest’s president and chief executive officer.

SureWest’s debt now stands at nearly $227 million.

“Moving forward, we remain mindful of the challenges presented by the current economic environment, particularly in California, as we grow the business,” he said.

SureWest is looking at ways to increase income, Oldham said, by building on its broadband market and enticing new customers with voice-video-data offerings.

“Customers are value shopping and there’s fierce competition among subscribers, so we’re continuing to improve our platform,” he said.

Part of that strategy will roll out in December with the planned launch of Microsoft Mediaroom, which will offer video-on-demand, media-sharing and other features. The technology will be available to an additional 25,000 SureWest customers, Oldham said.

Shares of SureWest stock closed at $11.16 Thursday, off 80 cents in Nasdaq trading.

We Californians love our computers. We surf and tweet and friend and link. We have a need for (broadband) speed and can’t get enough fiber … optics.

A new statewide study this week confirms that, especially in today’s economy, we’re using our computers more than ever.

“At a time when people are cutting back on luxuries, we seem to be seeing the computer as a necessity,” said Mark Baldassare, president and CEO of the Public Policy Institute of California. “I find it remarkable that in these tough economic times Californians … are continuing to increase their use of Internet.”

In a PPIC statewide study released Wednesday, the number of California residents who own computers, have access to the Internet at home and use social networking sites like Twitter and Facebook is up from a year ago.

Overall Internet usage climbed to 76 percent, up from 70 percent a year ago, based on the June survey of more than 2,500 adult Californians.

Baldassare said computers have become increasingly indispensable for everything from looking for work to finding housing to consuming news.

Consider the numbers:

• Four percent more Californians have home Internet access than last year – 67 percent compared to 63 percent in 2008.

• Computer ownership is also up slightly. Today, 75 percent of Californians own a computer, compared to 72 percent in 2008.

• Use of social networking sites climbed 11 points to 37 percent.

The latter figure “really jumped out at us,” Baldassare said. “(Social networking) has certainly taken over the 18-34 age group, but we’re also seeing it used by those 35 and older,” he said. “In tough economic times, you can cut out the car. It’s an economical way to look for work.”

Not surprisingly, income was directly tied to computer usage. In households with incomes of $80,000 or more, 97 percent use computers or have access to the Internet. For those with annual incomes less than $40,000, just 65 percent used computers and 58 percent used the Internet.

Given Californians’ increasing computer usage and access, users should be vigilant against identity theft when online, said John Harrison with Symantec, a Cupertino-based Internet security firm.

In 2008, Californians filed more identity theft complaints – 51,140 – than any other state in the nation, according to a recent compilation of Federal Trade Commission data.

To prevent becoming an ID victim, Harrison recommended using more than one password for your online accounts, such as banking, shopping, Facebook or MySpace.

“If you use the same password in all of your accounts, that can lead to problems,” Harrison said.

He also advised regular updates of your computer’s operating system to protect against viruses and Web attacks.

“Your computer can be compromised and you’d have no idea,” he said.

And amid the growing popularity of social networking Web sites, discretion can go a long way in protecting vital personal and financial information.

“(Users) often put more information out there than they should,” Harrison said. “Be careful with the information you share. It’s going to more than just the people you’re communicating with.”

For more information, go to: www.privacy.ca.gov and click on “Identity Theft.”