Sunday, December 30, 2012

Google Fiber expansion unlikely to solve America's incomplete infrastructure problem

As I recently blogged, market failure dogging the U.S. telecom infrastructure that continues to leave millions off the Internet grid calls for new business models.  Nearly six years ago, I speculated big Internet content amalgamators flush with cash (i.e. Google, Yahoo!) could might acquire legacy telcos and cablecos and upgrade their incomplete and inadequate infrastructure with their own.  That post wasn't fully on the mark because it didn't include the possibility that the content players' "big play for the pipes" as I termed it would be to overbuild the incumbents with their own infrastructure as Google recently did in a single American city: Kansas City. 

This Wired piece is sparking speculation that Google might in fact be planning an effort to expand its proprietary fiber to customer premises infrastructure supported not just by customer service charges but also by its own content, similar to the incumbent cableco business model.  "If it turns out Google Fiber helps Google sell more (and more valuable) ads and content," the Wired article notes, then building out more fiber would support Google's business model.  However, the article notes that the cost of doing so would strain even Google's vast economic resources, leaving the U.S. with what President Barack Obama described in his 2012 State of the Union Address as an "incomplete high-speed broadband network."

Another recent article posted at ZDNet points to the same conclusion.


Thursday, December 27, 2012

Europe Hurting Telecom Industry: Alcatel-Lucent CEO

Europe Hurting Telecom Industry: Alcatel-Lucent CEO: European regulations are stifling innovation within the telecom industry and preventing its growth, Ben Verwaayen, CEO of Paris-based telecom equipment maker Alcatel-Lucent has told CNBC.

"It's not just a French problem it's a European problem. If you look to why it is that the U.S. is so much [more] ahead than Europe it's because of the business environment and what you're allowed to do because this is a regulated business. The situation in Europe is very unfortunate," Verwaayen said in an interview telecast on Thursday.
U.S. ahead of Europe?  With about 20 million Americans lacking facilities-based Internet service?  Clarification, please.

Sunday, December 23, 2012

BellLabs: Soaring VOD, OTT Video Usage Shaking Up the IP Edge

BellLabs: Soaring VOD, OTT Video Usage Shaking Up the IP Edge: Bell Labs researchers make their forecasts in a report titled “Video Shakes Up the IP Edge,” in which they predict that by 2020, U.S. video consumers will access a whopping seven hours of video each day, up from 4.8 today. Consumers also will turn increasingly to tablets to watch videos whether at home or on the go, says BellLabs.

This trend will be accompanied by “a dramatic shift in viewing habits,” as viewers switch from watching broadcast content to video-on-demand (VoD) services, demand for which will grow to 70% of daily consumption from 33% today, the report says. The researchers also note that cloud services, news sites and social networking applications will become more video-based and be accessible anywhere, anytime via tablets, which suggests Internet video content will increase 12 times.

These trends, according to Bell Labs’ predictions, “will stretch the capabilities [of] the residential broadband networks many service providers use today. As the delivery of video content rapidly moves from traditional broadcast TV to the ‘unicast’ delivery of personalized content to individuals, disproportionate pressure will be placed on the ‘IP edge’ of these networks,” where most of the network ‘intelligence’ needed to deliver personalized content on-demand resides.

In case anyone was wondering why fast fiber to the premises Internet infrastructure is now an imperative.  And consider the additional demand should personal video communications take off as a new (not so new, actually) app.

Mississippi map malarkey

A fundamental purpose of a map is to plan a route to an end point – a destination.  But when it comes to what’s called “broadband mapping,” the goal isn’t the destination.  In fact, this wasteful activity has resulted in a circular journey to nowhere, diverting precious resources that could otherwise be invested in building out Internet telecommunications infrastructure as this boondoggle out of Mississippi painfully illustrates. 

It’s a good thing the United States chose not to remedy the market failure that produced large gaps in electric power and telephone service availability in the early part of the 20th Century by engaging in folly such as drawing up maps of existing electrical and telephone service and promoting electricity and telephone adoption where there was no service.  If that had been the policy, many areas of the nation might not have had power or telephone service until well into the 1950s and 1960s.

Saturday, December 08, 2012

Telecom coops offer much needed alternative to build out U.S. Internet infrastructure

This Wall Street Journal article explores the Faustian bargain AT&T, America's largest wireline telecom provider, struck with the U.S. Federal Communications Commission to begin winding down its obsolete copper Publicly Switched Telephone Network (PSTN):
Mr. Stephenson himself has made it clear that AT&T would rather just sell off its regulated phone territories the way rival Verizon has done. But those sales haven't worked out swimmingly for the buyers, so now buyers can't be found, and neither would regulators likely bless further sales.  AT&T's plan, then, amounts to a compromise: AT&T will spend several billion dollars making undesirable investments if Washington will relieve it of the unsustainable regulatory burdens associated with the old copper voice network.
This is not an optimal solution for either AT&T's shareholders or for the many Americans who despite AT&T's expansion plans would remain disconnected from the Internet and the Voice Over Internet Protocol (VOIP) service it could provide to replace voice telephone service delivered over the nation's aging copper Publicly Switched Telephone Network (PSTN).  An alternative is clearly needed.

The good news is one exists as does its funding mechanism: cooperatives.  In the 1930s, the U.S. Department of Agriculture's Rural Utilities Service (RUS) made funding available to coops to build the needed infrastructure to deliver electric power and phone service.  The RUS remains in place today.  Given the problems investor-owned telcos like AT&T face deploying needed Internet infrastructure as shown in the WSJ story, the RUS should be given a higher profile and adequately funded to facilitate the much needed telecom coop alternative for the construction and operation of Internet infrastructure.

Sunday, December 02, 2012

Telecom infrastructure demands competing business models

The Salt Lake Tribune has published a set of articles on UTOPIA, a public open access fiber network.  For other publicly owned and operated telecommunications infrastructure, the take away is they are like building and financing toll highway systems over a period of many years.  A prudent, long term financial plan is essential and their success can't be measured in isolation over the short term.

That's why investor owned incumbent telco and cable providers haven't built out fiber to the premise infrastructure. Their shareholders expect a certain return on investment within five years or less as well as hefty dividends.  Infrastructure projects have long term time horizons that aren't compatible with their business models.

Some of those interviewed in the articles assert that UTOPIA and other publicly operated telecommunications networks shouldn't be competing with incumbent, investor owned telcos and cablecos.  I disagree.  The challenges of constructing and operating telecommunications infrastructure demand competition to produce the best business models demonstrating the greatest potential for long term viability.  It's not an easy task.  The incumbent providers been unable to produce one.  That has led to extensive market failure in wireline telecommunications services, leaving millions of Americans without premises Internet access.  UTOPIA and other non-incumbent operators despite their shortcomings are to be commended for making the effort to develop alternatives to build and construct this essential infrastructure for the 21st Century.

Wednesday, November 28, 2012

Broadband delayed again� - News - The Charleston Gazette - West Virginia News and Sports -

Broadband delayed again� - News - The Charleston Gazette - West Virginia News and Sports -

This sickening story highlights the pathetic, on the cheap state of today's U.S. telecommunications infrastructure. Providers battle over subsidies that would be better invested in fiber to the premise infrastructure rather than stopgap, obsolescence-prone DSL and terrestrial wireless.

And the DSL provider (Frontier) has the temerity to suggest since it offers its West Virginia customers satellite Internet service -- a national disgrace that should only be serving locales north of the Arctic Circle -- it is therefore providing sufficient service.

Wednesday, November 07, 2012

AT&T forced to invest in wireline plant to stem residential cord cutting

This item from Bloomberg/Businessweek helps explain why AT&T is opting to invest $6 billion in its wireline infrastructure.  The telco has been bleeding residential connections for years as these customers have dropped landline service and migrated to mobile wireless.  This is particularly true for those residential customers not offered wireline Internet service and thus had no reason to keep their landline account active.

AT&T is apparently now hoping to win those customers back and retain those thinking of cutting the cord by providing them Internet service via its proprietary, VDSL-based U-verse IPDSLAM service.  According to an AT&T news release today announcing its 3-year, $14 billion CAPex plan, U-verse IPDSLAM will provide Internet access and Voice Over Internet Protocol (VoIP) to 24 million customer premises in AT&T's wireline service area by year-end 2013.

Friday, November 02, 2012

California PUC rectifies its mischaracterization of Internet infrastructure subsidy fund


Several months ago, this blog called out the California Public Utilities Commission (CPUC) for incorrectly asserting the public policy goal of its program to subsidize the build out of Internet infrastructure in the Golden State was instead to encourage “the adoption of broadband.”

To its credit, the CPUC has rectified its gross misstatement of the law authorizing its $100 million plus California Advanced Service Fund (CASF). It did so this week, buried 18 pages deep into a proposed order that would loosen eligibility for CASF infrastructure loan and grant funding to include entities not holding a Certificate of Public Convenience and Necessity (CPCN) or a Wireless Identification Registration (WIR):

“We wish to make clear that although we propose to modify the CASF eligibility requirements to include both for profit and nonprofit broadband infrastructure providers, it is not our intent to change the focus of the CASF program. The CASF was created to fund the deployment of broadband infrastructure in unserved and underserved areas of the state, rather than the adoption of broadband services.” (Emphasis added)

The CPUC should also make it easier for consumer owned, community-based providers such as telecom cooperatives to access CASF funding for last mile (to the premises) Internet infrastructure construction – a critical infrastructure link singled out for attention in the proposed order. A key need of these providers is technical assistance grant funding to retain engineers and expert consultants to develop preliminary network designs and business case analyses. These deliverables would help ensure that the contemplated projects pencil out and would generate sufficient revenues to justify the prudent investment of CASF funds.

The CPUC should also revisit its unworkable, hair splitting exercise in futility of attempting to map out what neighborhoods are considered “unserved” and “underserved” based on throughput speed and census block groups. The inherent variation of legacy telco infrastructure Internet service from one address to the next doesn’t lend itself to these broad brush delineations. Internet service available at a given premise can be entirely different from another one just a quarter mile or a half block away.  Some overlap or "overbuilding" as it is called by incumbent providers will the inevitable consequence of progress.  But it must occur if the United States is to remedy what President Barack Obama decried in his State of the Union speech at the beginning of this year as the nation's "incomplete" Internet telecommunications infrastructure.  A network filled with holes does not a network make.

Sunday, October 21, 2012

Increased adoption of telework offers low cost means of alleviating California's transportation congestion

Dan Walters: Study of exodus from California doesn't prove its point - Dan Walters - The Sacramento Bee: [t]here are legitimate doubts about California's ability to attract the job-creating investment capital we need to emerge from recession because of the aforementioned regulatory climate, high taxes and other factors, such as poor-performing schools and congested transportation. (Emphasis added)
California's transportation congestion problem has a low cost means of mitigation: increased adoption of working from a home office -- known as telework -- that eliminates commute trips and peak hour traffic.  A U.S. Census Bureau report issued earlier this month suggests that's the trend.  According to the Survey of Income and Program Participation, the number of people who worked at home at least one day per week increased from 9.5 million in 1999 to 13.4 million in 2010, increasing from 7.0 percent to 9.5 percent of all workers. The largest increase occurred between 2005 and 2010, when the share grew from 7.8 percent to 9.5 percent of all workers, an increase of more than 2 million.

As home to Silicon Valley and companies that have innovated telecommunications and information technologies that make remote work and virtual organizations possible, the Golden State should lead the way on telework adoption. Especially since raising billions to maintain its aging, decades-old system of roads and highways is proving fiscally challenging.

AT&T likely to upgrade only small portion of residential wireline plant, analyst predicts

AT&T is likely to upgrade only a fraction of its residential wireline plant to deliver premises Internet to residences that it doesn't currently provide Internet service, according to an analysis by George Notter of Jefferies & Company discussed in this Telecompetitor article.  The telco's strategy is stated to be unveiled next month.

Notter's analysis predicts AT&T will upgrade only about 15 percent of its wireline plant to support its hybrid fiber/copper U-Verse triple play offering.  Some of the remaining premises may be offered AT&T's version of Verizon's LTE-based HomeFusion product, according to Notter. 

Sunday, October 14, 2012

DSL turbocharging schemes remain just that

DSL Renaissance Underway?: Zero Touch Vectoring
Vectoring technology is a relatively new innovation for DSL which basically is a noise cancelling technology which reduces cross talk in copper pairs, allowing DSL to achieve much faster bandwidth throughput as a result. Some vendors are claiming they can squeeze 100 Mbps out of VDSL2 vectoring, albeit at rather short distances. It’s very much a FTTN technology, where VDSL2 connects to the home from a fiber fed cabinet.
These stories continue to appear year after year as vendors hope telcos will adopt their latest sooper dooper DSL turbocharging scheme.  Problem is while telcos aren't investing FTTH CAPex, they aren't investing CAPex or OPex in their aging legacy copper cable plants either and are instead concentrating on the mobile wireless space where more rapid ROIs are to be had.

And the above reference to "Zero Touch" for many telco customers has an entirely different meaning: DSL won't touch their premises because the DSL signal can't propagate far enough over old copper to reach them. Zero Touch=Zero Service.

Friday, October 12, 2012

Wipro Launches Prepaid Broadband Solution for US Cable Market - Yahoo! Finance

Wipro Launches Prepaid Broadband Solution for US Cable Market - Yahoo! Finance

I'm not so sure that adopting a pre-paid pricing scheme like that of the personal wireless market will provide sufficient incentive and ARPU for cable companies to build out their infrastructures to capture new customers.  But from a consumer perspective, it's far better than the current practice of asking would-be customers to come up with $65,000 per mile (with no equity in return) to build out to their neighborhoods under so-called "self help" provisions of cable franchise agreements.

Tuesday, October 09, 2012

Software solution touted as way to help cable companies ration, monetize bandwidth

Active Broadband Networks Ensures Accuracy of Internet Usage Data in DOCSIS Networks - Yahoo! Finance: FRAMINGHAM, MA--(Marketwire - Oct 9, 2012) - Active Broadband Networks, an innovative supplier of next-generation operation support systems (OSS) for broadband providers, today announced enhancements to its software that improve operator visibility into the integrity of Internet protocol detail record (IPDR) data collected from Cable Modem Termination Systems (CMTSs) in DOCSIS networks. Cable operators rely on IPDR data to compute subscriber Internet usage for usage metering and usage-based pricing as well as a variety of broadband service management applications, so accuracy is a critical requirement as they seek to measure, manage and monetize increasing Internet usage.

When the business model is based on getting more out of existing customers rather than expanding to get new ones, this makes perfect sense.  A key component is commoditizing Internet bandwidth so it can be segmented into discrete unit prices. The company issuing the above news release is selling a tool to cable companies to help them do just that.

Saturday, September 29, 2012

Google's Kansas City fiber build doesn't change underlying infrastructure economics

This Kansas City Star article discusses the implications of Google's rollout of fiber to the premise (FTTP) infrastructure in Kansas City.

The newspaper interviewed Josh Olson, a technology industry analyst for Edward Jones & Co.  Olson sees the Google fiber deployment as a template to boost user demand for higher bandwidth and speeds.  If new applications that can run on this gigabit speed capable infrastructure emerge, it would increase pressure for incumbent cable and telephone companies in other markets to upgrade their networks. However, Olson goes on to dismiss that notion, noting incumbent telcos and cablecos can make money off their existing services.  Of course they can when these are the only wireline services available to most U.S. homes and small businesses unless their communities build their own fiber networks operated by local governments or consumer cooperatives.

And as industry analyst Dave Burstein points out, Google's fiber deployment in a single U.S. city cannot change the underlying economics for incumbent providers that must earn a rapid return on investment to keep their shareholders happy -- a business model that directly conflicts with the long term ROI associated with high cost infrastructure projects.  Plus telecommunications company shareholders are accustomed to receiving high dividends -- money that can't be directed toward CAPex.

“The problem is it costs a lot of money to climb all those poles and dig all those trenches to make it happen,” Burstein told the Star. “You don’t make money in three years, but you make money in 10 years."

Read more here: http://www.kansascity.com/2012/09/24/3832330/google-fibers-gigabit-gamble-has.html#storylink=cpy

Verizon Won’t Expand FiOS Beyond Current Franchise Obligations, CFO Tells Investors | Stop the Cap!

Verizon Won’t Expand FiOS Beyond Current Franchise Obligations, CFO Tells Investors | Stop the Cap!

This development makes it eminently clear that for those communities in Verizon's wireline service area that don't now have its FiOS fiber to the premises service, they will have to build their own community owned infrastructure.  Verizon is getting a better ROI on wireless, but wireless can't provide the bandwidth and headroom homes and businesses require.

Saturday, September 22, 2012

AT&T may invest in rural lines rather than divest, CEO says

AT&T may invest in rural lines rather than divest, CEO says: AT&T has said it would consider selling its rural access line unit, but Mr. Stephenson hinted earlier this year that such a sale could prove complex. The difficulty comes from the lines spanning multiple states and therefore needing several regulatory approvals that would likely take significant time.

On Wednesday, he said finding an internal solution for the business would avoid having to go through that process.
---------------
There is also a simple business fact at play.  Who wants to buy obsolete copper cable plant?

He also noted that AT&T's wireless service could ultimately prove to be a solution for fixed-line broadband connections in less-dense markets as its next-generation LTE network rolls out.

"LTE can become a fixed-line replacement or even better than what you get from fixed line," he said.
---------------
If Mr. Stephenson is talking about first generation ADSL, he would be right.  But wireless cannot equal or exceed wireline fiber to the premise.

Sunday, September 16, 2012

Public utility district Internet as alternative to Google fiber

Most rural communities lag in the type of broadband Internet service available in urban areas. But northeast of Spokane, in Newport and the surrounding hills and valleys, around 5,000 homes and businesses have the chance to connect soon to a fiber-optic system with lightning-fast speed.


The network being built by the Pend Oreille Public Utility District will allow users to download and upload data all the way up to 1,000 megabits, or 1 gigabit, per second - far faster than the 10 to 20 megabits that is a popular consumer choice today.


It will rival the Google Fiber system rolling out in the Kansas City area and is fast enough to download a movie in seconds, conduct video conferencing at home, and watch multiple high-definition TV programs simultaneously online.


“We believe it’s kind of the footprint for the future of rural communities,” said Joe Onley, manager of the Community Network System for the Pend Oreille PUD

I expect PUDs like this one and consumer cooperatives will take the lead in building out fiber. The key reason is the time to return on investment is too long for private sector players, whether they be AT&T, Verizon, or Google.  And that applies in all areas -- not just rural locations.

Tuesday, September 04, 2012

The great paradox of Silicon Valley traffic

This item from Silicon Valley's Mercury News reporting on increased traffic congestion as a propitious sign the economy is picking up speed is thick with irony. An excerpt:

Santa Clara County's busiest bottleneck -- where Highway 101 splits Interstates 280 and 680 -- featured more vehicles in 2011 than ever during an average day, according to Caltrans data. The most heavily traveled stretch on the Peninsula, Highway 101 in San Mateo, set a record last year for rush hour vehicle counts after an extra traffic lane was added to meet the demand.
The irony?  Over the past three decades, Silicon Valley companies revolutionized information technology that makes it possible to work and conduct most business remotely from most anywhere and at any time without the need to commute to a central office during set time schedules, feeding the burgeoning "rush hour" traffic.  Yet thousands of people are working as if none of it ever happened and it's still 1975. 

Authors William A. Draves and Julie Coats provide an explanation in their 2004 book Nine Shift.  Silicon Valley invented what they term the Internet Age.  But that invention was produced by Industrial Age companies.  They predict suburbs and commuting -- vestiges of the Industrial Age -- will go into decline during the first two decades of the 21st century, mirroring a two-decade-long shift from a primarily agrarian society to an industrial one during the first 20 years of the 20th century.

Sunday, September 02, 2012

My Turn: A critical look at the state's broadband policy | Burlington Free Press | burlingtonfreepress.com

My Turn: A critical look at the state's broadband policy | Burlington Free Press | burlingtonfreepress.com: What is happening now and why is that a problem? Much federal money has been coming into the state in support of broadband and the state has allocated some of its own. Some of the federal money is going into fiber optic networks to be built by Waitsfield/Champlain Valley and by VTel in its home territory.

But most of the money supports two technologies: DSL and fixed wireless. The problem with this is that neither of these technologies can deliver the broadband service that will soon be required.

Vermonter Henry Swayze couldn't be more correct in his criticism that federal telecom subsidies should not be directed toward stopgap technologies that can't offer adequate reach, throughput and future network demand capacity.  It's an inefficient, wasteful use of public money.  It would be like subsidizing a high speed transcontinental railroad system that's a patchwork of metro streetcar systems that end at the edge of towns, forcing people to walk to the next town to continue their journey. 

Silicon Valley professionals head to the Sierra Nevada foothills

The Sacramento Bee reports Silicon Valley transplants are moving to Loomis in Placer County for a better real state values and an enhanced quality of life outside the bustle of the Bay Area.  A key driver of the shift: staying connected to Silicon Valley by working remotely from home.  

But that raises questions not addressed in the Bee article.  First, is the telecommunications infrastructure sufficient in some of these semi-rural areas to support remote work?  Many Sierra Nevada foothill locales are still on dialup Internet connections or have spotty, slow legacy DSL service.  Second, how does this trend jibe with the predominant Silicon Valley work culture based on collegial beehiving in open office architecture at massive corporate "campuses?"  Or does this workshifting 150 miles away from Silicon Valley campuses represent a counter trend?

Wednesday, August 22, 2012

FCC report finds broadband deployments still too slow | Politics and Law - CNET News

Roughly 19 million Americans still don't have broadband Internet, according to a report released Tuesday by the Federal Communications Commission.

This is the eighth year that the FCC has issued the report, which is a requirement of the 1996 Telecommunications Act. And for the third year in a row, the agency has found that broadband service is not being rolled out in a "reasonable and timely fashion." Still, the report sees an improvement over the year before, when the FCC found that 26 million Americans lacked broadband.

About 14.5 million of the 19 million Americans without broadband live in rural areas, according to the report. The FCC has been working to remedy the issue. Earlier this year, the FCC converted a $4.5 billion fund for rural telephone service into a fund that will subsidize expansion of broadband access.

And this doesn't just apply to rural areas.  There are plenty of people living in metro areas of the U.S. and exurbs lacking fast, dependable wireline Internet connectivity.

After eight years of these reports that basically say the same thing, one might conclude that rural Americans are getting the message that the incumbents aren't going to serve their needs and they'll have to form telecom cooperatives just as their predecessors did several decades ago.  As Christopher Mitchell of the Institute for Local Self Reliance so aptly put it, "Help is NOT on the way."  Not unless you and your neighbors help themselves.


Monday, August 13, 2012

Phone cos. lose broadband subscribers for 1st time - Yahoo! News

Phone cos. lose broadband subscribers for 1st time - Yahoo! News

And the telcos won't be able to catch up to the cablecos either.  Not when replacement of obsolete telco copper cable plant with fiber to the premise doesn't reach ROI fast enough and needed revenues to pay fat dividends are growing on the mobile wireless side of the house.

Sunday, August 05, 2012

Big Bandwidth Can Unlock a New Competitive Advantage - Blair Levin - Voices - AllThingsD

Big Bandwidth Can Unlock a New Competitive Advantage - Blair Levin - Voices - AllThingsD

I haven't always seen eye to eye with Blair Levin, lead author of the Federal Communications Commission's National Broadband Plan issued in 2010 shortly before he joined the Aspen Institute think tank that year.  However, the above linked opinion article by Levin recently published in All Things D includes a number of statements with which I heartily agree.

First, Levin seems to be abandoning his prior stance that the private sector alone must invest in the massive, multi-billion dollar build of the necessary telecommunications infrastructure America needs to be competitive in an information based economy.  Levin now shares my view that incumbent, investor owned incumbent providers aren't in a position to do so because of their need to pay large dividends in the case of telcos and service high debt loads in the case of cable companies. "When it comes to wireline access to the Internet, instead of discussing upgrades, we are discussing bandwidth caps, tiers and rising prices. Instead of witnessing investment for growth, we are witnessing harvesting for dividends," Levin observes.
 
Levin also appears to have had an epiphany on what premises telecommunications service should be capable of delivering. Two years ago, Levin advocated for the subsidization of infrastructure than could deliver the FCC's minimum throughput standard of 4 Mbs down and 1 Mbs up to nearly all premises by 2020.  Levin now advocates what Andrew Cohill and others have dubbed "big broadband" (I prefer Levin's term, "big bandwidth"), perhaps not surprisingly since Levin also recently founded Gig U, an organization that Levin writes will build "gigabit hubs in nearly a dozen communities across the country, as well as a project to bring a 25X+ upgrade to hundreds of communities in rural America."  As to the latter project, this is the first I've heard of it and will be watching closely since it is these communities and not the university towns prioritized by Gig U that have the greatest need, being effectively disconnected from the Internet and relegated to substandard dialup and satellite connections.

I also found myself in strong agreement with Levin's call for a massive attitudinal shift away from the current mindset of bandwidth poverty fostered by incumbent providers who want to create the impression that more bandwidth cannot be created and therefore must be rationed and assessed a price premium.  Levin instead calls for a  “psychology of bandwidth abundance:” 
This psychology is what has fueled the uniquely American spirit of experimentation and innovation — from the first wave of European immigrants to the post-World War II America that helped rebuild Europe and Asia and created our modern economy and unleashed huge new industries from transportation to telecommunications. Unfortunately, however, the current environment suggests that we aren’t building that foundation. International studies on wireline bandwidth use differ, but all suggest we are mid-tier at best, and declining. 
Lest anyone doubt that the United States stands at a policy crossroads when it comes to upgrading its outdated telecommunications infrastructure, Levin notes that "[f]or the first time since American ingenuity birthed the commercial Internet, we do not have a single national wireline provider with plans to deploy a better network. For most Americans, five years from now, the best network available to them will be the same network they have today."  Levin's absolutely right on this point.

Finally, Levin notes this dismal state of affairs where accessing the Internet in 2017 will for many Americans be much like it was three decades before is not inevitable.  Levin is correct when he suggests that we must find ways to lower the cost of building needed infrastructure rather than shrugging and claiming it is simply out of reach:
We can regain leadership by improving the math for wireline investment through policy choices that have the effect of lowering capital or operating expenses or by raising the potential revenues or competitive threat to incumbents or new entrants. We have done this before. In fact, every new communications network deployment or upgrade has been preceded by a policy change that had one or more of these impacts. 

Saturday, August 04, 2012

Large WISP bites the dust; Satellites swarm for former customers

Main Street Broadband shuts down | JCFLORIDAN

According its LinkedIn profile, Atlanta-based Main Street Broadband, LLC is a privately held wireless broadband service provider "committed to bringing affordable high speed internet access and digital phone service to the un-served and underserved markets in the southeast" using "the latest in wireless broadband technology for both residential and business services."

The reason for the shutdown of the WISP according to the linked newspaper story is loan funding from the U.S. Department of Agriculture's Rural Utilities Service was terminated.

Fixed wireless premise service like Main Street's plays an important interim role until communities and alternative business models emerge to construct fiber to the premises infrastructure needed for today and tomorrow's Internet protocol-based services.

Now satellite Internet providers are swarming to scoop up the defunct WISP's former customers.  Unfortunately for them, they now like all too many Americans face the lousy choice of sucking a satellite and its punitive bandwidth caps and poor connection quality or turning back the calendar to 1992 and dialugging over obsolete legacy telco copper cable.  But it doesn't have to be that way.  Communities can and should invest the necessary time, money and energy to build their own fiber infrastructure and operate it prudently and sustainably as a community and economic development asset.

Saturday, July 28, 2012

Verizon, AT&T Decline Broadband Connect America Funding

Verizon, AT&T Decline Broadband Connect America Funding: Two of those carriers – AT&T and Verizon – yesterday declined all of the funding they had been offered. In a letter to the FCC shared with Telecompetitor, AT&T — which was offered $47.8 million — said it is “optimistic” about its ability to get more broadband into rural areas, “particularly as the technology continues to advance.” But the company said it could not commit to participate in the program until it finalizes that strategy.

One year ago, the big incumbent telcos urged the FCC to reform the Universal Service Fund with standards that would effectively subsidize deployment of first generation DSL service introduced more than a decade ago.  Now that the USF has been reformed into the Connect America Fund along the lines of what they wanted, they're saying thanks but no thanks to the subsidies.  Most likely because the legacy DSL standards the telcos proposed last year were already outdated by a decade or more -- and now look even more obsolete and unable to keep up with burgeoning bandwidth needs.

The Man from Glad meets Ma Bell

The plastic helps muffle the dying cries of obsolete legacy copper POTS cable plant.

Thursday, July 26, 2012

Google Unveils Superfast Internet in Kansas City, Mo. - NYTimes.com

Google Unveils Superfast Internet in Kansas City, Mo. - NYTimes.com: Milo Medin, the company’s vice president of access services, said the technology and technical capacity were available to create this product on a global scale, but economics, such as the cost of constructing the fiber network in communities, presented a barrier.

Google's demonstration project does nothing to alter the cost and business model constraints that require communities to build their own fiber networks rather than investor owned providers.  While everything may be up to date in Kansas City, unfortunately for much of the United States it is not when it comes to premises Internet access.

It also starkly illustrates the dismal state of Internet capable premises telecommunications infrastructure in America -- accurately described as "incomplete" by President Barack Obama in his January State of the Union address -- where many must still rely on obsolete dialup modem technology that was state of the art when Obama's predecessor Bill Clinton was starting his first term two decades ago.  One city does not a network make.

Saturday, July 14, 2012

Rural U.S. mired on Internet dirt road

The Calix U.S. Rural Broadband Report not surprisingly found rural United States remains a copper-paved dirt road of Internet access where it has remain mired for years: 

The rumored slow pace of life in rural America may be
giving way to faster broadband speeds, but rural areas
clearly started from farther behind. The most common
peak downstream broadband rate consumed by endpoints
in rural America was between 1.5 Mbps to 3 Mbps in
Q1 2012. During the quarter, 60% of rural broadband
subscribers received a maximum downstream broadband
speed of 3 Mbps or less – approximately one-eighth of the
U.S. peak downstream average published by Akamai in its
most recent published ”State of the Internet” report. In fact,
71% of rural subscribers received a downstream broadband
speed that was slower than the target for the Connect
America Fund (CAF) of 4 Mbps, and approximately 90%
fell below the CAF upstream target of 1 Mbps. Upstream
rates remained slow as well, with 95% receiving 1.5 Mbps
or less.

Saturday, June 30, 2012

Why wireless premise Internet won't cut it -- and only fiber will

Why you will need a 300 Mbps broadband connection — Broadband News and Analysis: There are several reasons for this, but it boils down to the presence of more devices in the home and streaming video. Other dynamics such as whether or not folks are gamers or work from home also comes into play, but across the board it’s the rise in Netflix subscriptions, YouTube videos and family members toting smart phones, tablets, perhaps while watching content on a connected TV. If there are four people consuming media with a tablet in one hand and their eye on the TV, your home requires a fat connection.
Back in October 2010, I observed bandwidth demand emulating Moore's Law.
This item explains what's driving the demand, which slows no sign of slowing and also makes clear that only fiber to the premise infrastructure will be able to keep up.

Telemedicine market to reach $2.5B by 2018 | Healthcare IT News

Telemedicine market to reach $2.5B by 2018 | Healthcare IT News: Moreover, telemedicine has been seen to be beneficial for individuals living in isolated communities and rural regions. Telemedicine technology allows patients who live in these rural areas to be seen by a doctor or specialist, who can provide an accurate and complete examination, without the patient to traveling away from their families to far-off medical centers.
The problem is these communities typically lack the necessary telecommunications infrastructure to support telemedicine.  This infrastructure gap will be more keenly felt in the near future as the U.S. Patient Protection and Affordable Care significantly increases the number of people in these areas covered by public and private health insurance.

Wednesday, June 27, 2012

Internet Providers Testing Metered Plans for Broadband - NYTimes.com

There’s a clash between what users expect from broadband service and what is actually delivered to them, said Chris Balfe, the president of Glenn Beck’s media company, which created an online TV channel nearly a year ago. He has noticed sluggishness at home when trying to view YouTube videos. “As a broadband video provider it’s frustrating, but as a user it’s absolutely infuriating,” he said.
This New York Times piece makes the case for community owned fiber to avoid incumbent cableco and telco manipulation of their natural duopoly (or monopoly in some cases) to create bandwidth scarcity.  It's important to create a perception of bandwidth scarcity in order to preserve bandwidth rationing and the unit-based billing of their decades-old business models.  Communities can and should disrupt that business model and build their own fiber to the premises networks.  Enough is enough.

Magazine - Why Women Still Can’t Have It All - The Atlantic

Being able to work from home—in the evening after children are put to bed, or during their sick days or snow days, and at least some of the time on weekends—can be the key, for mothers, to carrying your full load versus letting a team down at crucial moments. State-of-the-art videoconferencing facilities can dramatically reduce the need for long business trips. These technologies are making inroads, and allowing easier integration of work and family life. According to the Women’s Business Center, 61 percent of women business owners use technology to “integrate the responsibilities of work and home”; 44 percent use technology to allow employees “to work off-site or to have flexible work schedules.” Yet our work culture still remains more office-centered than it needs to be, especially in light of technological advances.  (Emphasis added)

Indeed it does.  Anne-Marie Slaughter's piece in the July/August issue of The Atlantic points up how the Internet is making the office as we know it obsolete. But the Internet notwithstanding, the 1950s office culture still predominates, forcing women into the unfortunate and now unnecessary circumstance of having to choose between their professional lives and parenthood.

Sunday, June 24, 2012

Don't study broadband black holes -- fill them with fiber to the premise

Counties plan study on broadband Internet access - Niagara County - The Buffalo News: LOCKPORT — Niagara and Orleans counties are planning a study to zero in on which roads and households lack broadband Internet access.

Evhen Tupis, former information technology director of the Medina Central School District, told the Niagara County Legislature on Tuesday that he has already done that sort of study in the Town of Wilson.

Tupis said he also has surveyed much of Orleans County and has determined that the official state and federal statistics, which claim 97 percent broadband penetration in the two counties, are bogus.
Of course they are.  But rather than waste time drawing maps and conducting studies to refute the dubious data  -- sourced from incumbent telcos and cablecos looking to downplay gaps in their last mile networks -- communities would be better served by building their own fiber to the premises networks.  And they shouldn't worry about overbuilding the incumbents because fiber to the premise telecommunications infrastructure is superior to most any last mile cable plant they have on the poles and in the ground.  Fiber provides sufficient capacity as bandwidth demand explodes -- both now and for the future.

Sunday, June 17, 2012

Connected company muscled state agency out of Internet contract - Florida - MiamiHerald.com

Connected company muscled state agency out of Internet contract - Florida - MiamiHerald.com: TALLAHASSEE -- In 2009, with more than a quarter of all Floridians without broadband access to the Internet at home, state officials lined up to get some of the $7 billion in federal stimulus money to finance state-based programs to increase access.

Enter Connected Nation, a little known but well connected Washington-based company. It won the Florida contract to use $2.5 million to map the broadband gaps for use by policy makers and telecommunications companies.

A year later, when the state won a second grant for $6.3 million to extend the broadband efforts, Connected Nation, a non-profit company, believed it had signed up to be part of a public-private partnership with the state that entitled the firm to a no-bid shot at that money too. But the Department of Management Services, the state agency that housed the project, disagreed.

DMS said the grant requires it to use some of the money to pay for three more years of broadband mapping and the rest to expand broadband access in libraries and schools.
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The real story here is the tragic policy failure of the American Recovery and Reinvestment Act of 2009 to provide technical assistance funding to communities interested in building their own open access fiber to the premises networks instead of dubious "broadband mapping" projects.  It would have been a far more productive use of money to fill in the gaps with actual infrastructure instead of wasting it creating maps that won't connect homes in Florida and other states that remain disconnected from the Internet.

Friday, June 15, 2012

It's still 1985: California state offices stuck in pre-Internet management mode

While riding in a cab in downtown Sacramento this week — the daily commute destination of thousands of State of California employees — the usual topics of weather and traffic came up.  The driver offered his solution to traffic congestion: rather than commute to work, state employees should stay off the roads and work remotely from home offices.  After all, the cabbie pointed out, the technology allowing them to do so has been in place for many years.  They can get their work done on a computer from home just as easily as their office.  So why aren’t more state employees teleworking, he asked?

The explanation appears in a January 2008 white paper prepared by a group of state employees, the Statewide Work Anywhere Team (SWAT).  The paper notes use of information technology “is uniquely positioned to further the state’s ‘Green initiatives’ by contributing solutions for larger issues facing California: traffic congestion, dependence on oil, air pollution, and quality of life to name a few. It is possible to perform work from virtually anywhere. We can do business better. Work Anywhere provides one viable option that we should fully explore.”  It adds, “[w]orking from anywhere and using virtual teams are integral to the success of today’s workforce” and recommends “the State of California initiate a statewide standard for expanding the concept into its work environment.”
So why hasn’t the state more widely adopted telework four years after the paper was issued?  Despite the bulk of the work being white collar, information and knowledge work, a blue collar shop floor management by observation culture dominates.  The paper explains:
Many program area managers and executives are hesitant to implement Work Anywhere strategies/policies due to concerns regarding monitoring staff productivity and the staff’s ability to perform their duties effectively from a remote site (usually their home) without immediate access to other workers. Additionally, there is concern on monitoring staff that under-perform. The main challenges mentioned by all contacted in the study were the importance of determining the types of duties that are easily measurable and candidate selection requirements for performing tasks that could be part of a Work Anywhere plan. The most often stated concern was how to quickly manage employees that are out of sight. Some of the examples of telecommuting floundered because they lacked executive sponsorship, clear performance measurements or procedures for implementation of the policies. Additionally, some of the managers indicated an interest in receiving additional training for developing skills to better manage employees who work away from the main office.
That remains the case today.  In September 2011, the then head of the Telework Advisory Group of California’s Department of General Services, Geoff McLennan, reported only about five percent out of a state workforce of about 240,000 telework.  More recent data would put the number even lower.  As older state workers retire in large numbers and as the economy slowly recovers, younger workers accustomed to being connected to the Internet from anywhere aren’t likely going to find state employment and its pre-Internet, 1980s office culture an attractive option.   

Tuesday, June 12, 2012

Broken Promises: The Telecommunications Trust That Doesn’t Deliver | Stop the Cap!

Broken Promises: The Telecommunications Trust That Doesn’t Deliver | Stop the Cap!: In Kushnick’s view, phone companies like AT&T and Verizon are breaking their promises to regulators and consumers.

“Illinois Bell was supposed to rewire the state (with fiber-optic cable), starting in 1993 at an initial cost of $4 billion,” Kushnick said.

Instead, AT&T moved in and bought out the phone company and has dragged its feet on fiber deployment, along with most other big phone companies.

Kushnick told the Journal Star phone companies are going cheap avoiding fiber optic infrastructure while still ringing up huge profits

Saturday, June 09, 2012

Calling wireless Internet service "fiber grade" disingenuous and misleading

Broadband network expansion set for Dayton, other Ohio cities - Dayton Business Journal: A Canton-based company announced plans Thursday to build statewide network for wireless broadband services, bringing high-speed Internet access to 3 million Ohio address points, including 100,000 that currently have no service.

“It’s an exciting thing for the industry across the board,” said Kyle Quillen, chief technology officer of Agile Network Builders. “We’re going to enable anybody to get that last-mile connectivity with a fiber-grade connection anywhere in the state of Ohio. That’s a big deal.”

Calling terrestrial wireless Internet service "fiber grade" is disingenuous and misleading.  It cannot emulate fiber or its carrying capacity, particularly for the delivery of high definition video.

Sunday, June 03, 2012

AT&T struggles with burden of legacy copper wireline plant

This Bloomberg item shows how the nation's largest wireline telecom player continues to struggle under the burden of its outdated legacy infrastructure.  According to the article, AT&T is trying to decide whether to sell off wireline plant where it does not offer its DSL-based U-Verse triple play product.

At issue is whether to upgrade field distribution equipment to extend the reach of U-Verse to more premises.  But doing so still relies on AT&T's decades-old, legacy copper cable plant to bring the service to residential premises.  That plant is less than optimal for transporting the higher frequency and more interference-prone VDSL protocol utilized by U-Verse, boosting the volume of customer service calls and increasing operating expenses.  The technical limitations of the copper plant also bar AT&T from reaching about 5 million residential premises that remain disconnected from the Internet, as noted in the article by Barclay Capital analyst James Ratcliffe.

Thursday, May 10, 2012

It's time to halt the "digital literacy" baloney and build fiber

With many areas of the United States lacking adequate fiber optic infrastructure to deliver premise Internet service, there continues to be an unfortunate effort to shift the focus away from that fact.

For example, this Texas Broadband Summit "designed to engage, educate, and equip technology providers and Texas communities with the resources and partnerships necessary to improve broadband access, adoption, and use," noting that "lack of digital literacy and the digital divide remain real issues in Texas."

What does "digital literacy" have to do with getting IPTV, VOIP and other Internet protocol-based services over fiber?   Nothing, because people have been watching TV and making phone calls for decades.  In that regard, they are already digitally literate.  And the web and email have been around for two decades and most people currently use these common services.

It's time to stop the PR baloney and work on alternative ways of building fiber to the premise -- such as community cooperatives and municipal fiber -- to fill in the gaps that investor owned telco and cable TV providers are unable to fill.

Saturday, May 05, 2012

Demand aggregation won't attract investor-owned providers

Broadband Internet service for rural communities eyed - The Daily News Online: News:

A consultant asked Genesee County lawmakers Wednesday if they wanted to join a regional coalition to try to get broadband Internet service to rural communities and homes.
Evhen Tupis of Clarendon said he’s been working on getting high-speed broadband for unserved areas of Orleans County and Niagara County. The sparsely populated parts of the two counties don’t have a provider because it isn’t financially feasible for companies such as Time Warner and Verizon.


The coalition would issue a request for proposals to broadband service providers “with 100 percent coverage,” he said.
Tupis’ proposed Inclusive Internet Initiative would pool together the region’s counties to make it more attractive to communications companies. He estimated the cost to provide broadband to most or all of Genesee County at $150,000, the same as it would in Niagara.

Yet another misguided notion that investor-owned telecommunications infrastructure providers can be convinced to serve an area that is insufficiently profitable for them by aggregating demand.  Demand aggregation does not solve the underlying economics that make deployment impractical for these providers.  If businesses and residents want modern Internet access, they will have to provide it themselves with municipal fiber or a consumer cooperative.

Copper culprits hasten obsolescence of twisted pair

The obsolescence of twisted pair copper cable is being hastened by thieves who want to quickly resign it to the scrap heap in order to recycle the valuable metal and put money in their pockets.  By comparison, the tiny glass strands of the modern standard for telecommunications -- fiber optic cable -- offer no such market incentive to copper culprits.

Check out this Fresno Bee story that reports that the crooks have gotten so brazen they are toppling utility poles in order to get at AT&T's cables.

Saturday, April 21, 2012

SB 1161 doesn't touch California's real telecom problem

There was a fair amount of mainstream media coverage this week of pending California legislation that would state public policy that the state's Public Utilities Commission does not have regulatory jurisdiction over Internet protocol (IP) services.  As this Sacramento Bee story reports, consumer groups fear SB 1161 would give monopoly incumbent telcos too much free reign as they migrate away from plain old telephone service (POTS) delivered over twisted pair copper.  The telcos and the bill's author, Sen. Alex Padilla, support the policy to remove regulatory uncertainty and allow unfettered expansion of the Internet and IP-delivered telecommunications services to homes, businesses and institutions.

SB 1161 would neither help nor hinder that goal.  California's real problem is incomplete Internet infrastructure that leaves millions of Californians disconnected from the Internet.  Since telecommunications services tend to be a natural monopoly market, the fears of consumer groups of any form of reduced regulatory oversight are understandable.  However, their concerns would make more sense if all Californians had fiber connections to the Internet via a monopolistic provider.  They don't.  California's telecommunications market suffers from market failure because the high cost business models of the incumbent telcos (and cable companies) don't allow them to achieve that level of service.  Accordingly, the CPUC should do a better job of assisting alternative, lower cost business models emerge -- such as consumer-owned telecom cooperatives -- take root and thrive.  So far, the CPUC has failed to do so.

Saturday, April 07, 2012

Drop DSL and go suck our sooper dooper satellite!

Satellite Internet providers that serve a captive market of those who are off the Internet grid because of a lack of terrestrial infrastructure now hope to attract DSL subscribers by offering higher speeds. But as this USA Today article points out, converting DSL customers won't be easy since they have to buy the dish and installation. Not to mention they'd be getting much higher latency, hardly worth the trade off for higher speeds.

Satellite providers are a national embarrassment that point up how just how much of the United States remains a backward Internet backwater. The service should only be available in the Alaskan wilderness and places like Buford, Wyoming (Pop. 1).

Sunday, April 01, 2012

Why America needs lower cost, coop business models to complete Internet infrastructure

The excerpt below from Timothy B. Lee's discussion in the current issue of National Affairs of what ails America's regulation of Internet infrastructure states a strong case for alternative, lower cost business models such as telecommunications cooperatives to bring fiber connections to nearly all premises and to keep cable companies from gaining near total market dominance:

FiOS is Verizon's attempt to solve this problem by replacing its slow telephone cables with fiber-optic connections capable of offering speed that can compete with Comcast's. But in 2010, Verizon announced that it was winding down its FiOS installation efforts. Verizon plans for the network to reach around 18 million households, but not in some major metropolitan areas, including a few (like Boston) at the heart of its service area. News reports cited the high costs of the project as a reason why it was not being extended to all homes in Verizon's territory. Meanwhile, AT&T's project to partially replace its copper network with fiber, "U-Verse," is also being hampered by high costs. U-Verse service is faster than a traditional DSL line, but it is significantly slower than Verizon's and Comcast's high-speed networks, and it will not reach all households in AT&T's service territory. This might explain why, in the third quarter of 2011, Comcast added more than twice as many subscribers as did the seven largest telephone incumbents combined.

Saturday, March 31, 2012

Bell wireline monopoly stymies wireless Internet

The physics of radio spectrum place a natural limit on wireless Internet capacity. That limit is exacerbated by the wireline telco monopolies who restrict wireline backhaul connections to cell sites, writes Level 3 Communications CEO James Q. Crowe in this Forbes article.

Crowe details uncompetitive market practices aimed at creating artificial market scarcity of wireless backhaul and calls for action from Washington to break up the big telcos' wireline cartel.

Tuesday, March 20, 2012

“Broadband adoption” is an irrelevant non sequitur

More than a decade after the term “broadband adoption” was relevant, studies such as this one issued today by TechNet continue to use the phrase as if the United States was on the eve of the new millennium and Y2K was a topic of concern. In 2000, discussing “broadband adoption” was pertinent since “broadband” Internet connections were relatively new and distinct from the then commonplace dialup “narrowband” service delivered over legacy copper cable telephone networks.

In 2012, broadband adoption is a non sequitur since both the term “broadband” and the notion that people are migrating in large numbers from “narrowband” are badly outdated. Nowadays, the Internet can deliver voice telephone and TV video in addition to websites and email that was relatively novel for many in 2000.

People adopted voice telephone and TV decades ago. What has changed is the means over which these services are provided. Internet protocol technology and fiber optic connections allow voice, video, websites, email and many yet to be popularized applications to be delivered to peoples’ homes.

TechNet is talking about the wrong subject. The real issue isn’t “broadband adoption.” The real issue is lack of adequate Internet infrastructure. President Obama so in his January State of the Union speech in which he spotlighted America’s "incomplete high-speed broadband network.” While the president’s choice of terminology — “broadband network” — is technologically obsolete from this writer’s perspective, he is clearly on the right track in identifying the problem as one of infrastructure.

It’s time to retire the term “broadband adoption” to the history books and get on with modernizing the nation’s telecommunications infrastructure to provide all American homes fiber optic connections and the many Internet-based services they can provide.

Tuesday, March 06, 2012

Verizon's residential LTE "HomeFusion" likely to serve only fringes of small number of metro areas

Verizon's announcement today of its HomeFusion wireless residential Internet service offering based on its nascent 4G cellular LTE service appears aimed at picking up marginal residential market share in suburban and exurban fringes of U.S metro areas where wireline connectivity from incumbent telcos and cable providers is sketchy. These are also areas where Verizon might otherwise deploy its FiOS fiber to the premise residential wireline product but will not because the company has called a halt to further FiOS expansion.

It's not likely HomeFusion will be broadly deployed in predominantly rural and quasi-rural areas. Like Verizon's mobile wireless offerings, it's bandwidth metered and can't offer the ample headroom for bandwidth demand growth -- much of it driven by video -- that fiber does. In order to improve Internet deployment and access in these areas, these communities will have to build their own fiber to the premises networks constructed by local governments or telecom cooperatives.

AT&T has effectively thrown in the towel in serving these areas. HomeFusion represents Verizon's last ditch effort to pick up some limited revenues in these underserved markets.

Wednesday, February 29, 2012

Protecting investor-owned Internet providers from market failure is bad public policy

This USA Today profile of Lafayette, Louisiana's municipally-operated fiber to the premise network raises significant policy questions as to the proper role of the private and public sectors in providing premise Internet connectivity. It notes Lafayette like other community fiber projects faced significant resistance from private sector telco and cable providers bent on preserving their territorial hegemony even when their business models don't permit them to upgrade their networks to provide robust Internet connections to homes and businesses. The push back comes in the form of lawsuits, public information (or disinformation campaigns, depending on one's perspective) and state legislation barring local governments from building publicly owned and operated telecommunications infrastructure.

It's understandable the incumbent telco and cable companies would want to protect their service territories from competition given that telecommunications infrastructure -- like roads and highways -- tends to be a naturally monopolistic (or at best, duopolistic) market. That kind of market creates a winner takes all situation in which the winners in turn pick winners (those who are provided good Internet service) and losers (premises deemed too costly to serve and left off the Internet grid). Their problem, however, is the losers are naturally getting restless and petitioning for relief such as recently proposed Colorado legislation designed to lay the groundwork for the state to directly serve areas lacking connectivity.

The incumbent telco and cable companies may wish to rethink their current strategy of locking down failed markets and barring the door to public providers. The courts could well cast a jaundiced eye toward such uncompetitive market conduct and state laws designed to preserve what in many areas of the nation have become telecommunications backwaters due to what President Obama described in his January State of the Union address as "incomplete" Internet infrastructure.

I'm not sure those state laws could survive judicial scrutiny in the federal courts as they effectively create a state sanctioned monopoly in telecommunications. But unlike other nations, the state doesn't actually provide the service. Instead, their function is to protect private investor owned providers from the consequences of market failure. That's poor public policy because it leaves too many effectively disconnected from the Internet and the economic, educational and other benefits it affords.

Incumbent providers may also want to considering partnering with communities instead of fighting them. As the USA Today article notes, businesses approached Lafayette about expanding the network throughout the city as a way of drawing businesses. City leaders asked BellSouth and Cox representatives to partner on the project. But they spurned a private-public partnership that could have allowed them to share in the revenues, instead opting for a short sighted win/lose strategy.

Colorado bill first step in state investment in Internet infrastructure

Government Technology has an article today on legislation introduced in the Colorado Legislature that the author, Gail Schwartz, D-Snowmass Village, describes as a first step toward the state investment in Internet telecom infrastructure shunned by private sector providers:

Schwartz said the intent of the Rural Broadband Jobs Act is to help Colorado improve access to broadband so that businesses throughout the state have opportunities to be competitive and successful.

“I am looking for a definitive assessment of underserved and unserved areas in our state that lack broadband access,” Schwartz said in an interview with Government Technology. After those areas are defined and as funding becomes available, she’d like the state to invest in the infrastructure needed to bring broadband to those underserved locations.

Click here to read Colorado Senate Bill 12-129, CONCERNING ACCESS TO AFFORDABLE BROADBAND INTERNET CONNECTIVITY IN NONCOMPETITIVE RURAL AREAS.

Tuesday, February 21, 2012

Emergence of Internet TV reinforces end of “broadband” era

The emergence of the Internet ready or “smart” TV marks the graduation of the Internet to a full featured, multiple service telecommunications service. It also marks the beginning of the end of siloed, single purpose video programming providers such as cable TV and satellite. Now that HD video content of all varieties is available via the Internet, the medium is the message in the words of mass communications theorist Marshall McLuhan and the medium is the Internet.

The Internet or “smart” TV also marks the end of the “broadband” Internet era, where the Internet was mostly used for viewing web pages and email — and later Voice Over Internet Protocol (VOIP). It’s notable that TV manufacturers aren’t marketing the latest sets as “broadband” TVs. That reinforces a point I made in December 2010 when I declared distinguishing “broadband” from dialup “narrowband” was growing increasingly irrelevant since dialup was becoming technologically obsolete. Consumers either have functional Internet infrastructure connected to their premises, or they don’t. And if that infrastructure can’t deliver HD video while simultaneously allowing them to browse the web, download email and make a voice call, they’re effectively disconnected from the Internet.

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