Sunday, December 22, 2013

Possible alternative to capitalize U.S. FTTP build out emerges in Utah

Building infrastructure of any kind is a costly undertaking, including fiber optic to the premise (FTTP) telecommunications networks. Those high capital costs have crimped FTTP build out in the United States, challenging existing telephone and cable companies as well as newcomers like Google Fiber.

In Utah, a new strategy is emerging involving a global firm that with patient capital that specializes in big dollar infrastructure projects. The Salt Lake City Tribune reports Macquarie Capital Group, an Australian firm that advises and invests in public projects around the world, will launch an engineering and feasibility study to operate Utah's 11-city UTOPIA FTTP network in a public-private partnership: 

Macquarie’s investors — including pension funds, large insurance firms and private endowments — were seeking to develop stable, long-term investment opportunities and were drawn to technology-based projects, Hann said. 

If the feasibility study proves fruitful and Macquarie agrees to take over the network, it likely will entail a deal in which the firm would assume management of the network for 30 years and invest in building out and upgrading the rest of the lines to neighborhood homes, Hann said. 

The network would remain an open-access network and Macquarie would partner with third-party Internet service providers, he said.

Tuesday, December 17, 2013

First indication of AT&T withdrawal from residential wireline market

Sensing AT&T's lukewarm commitment to its residential wireline business segment, in 2008 I predicted that AT&T would abandon the segment in the first half of 2010. The telco is still in the residential wireline business as 2013 draws to a close. But a slow withdrawal could now be underway, one state at a time starting with Connecticut.

Bloomberg reports today that AT&T will spin off its Connecticut residential landline unit, including Internet and TV services to Frontier Communications for $2 billion.

AT&T relies on copper cable plant to deliver premises Internet service, scotching plans dating back to the late 1980s developed by regional bell operating companies AT&T absorbed in the 1990s to replace the last mile copper network with fiber optic cable. That reliance has technologically limited the reach of AT&T's Internet-based service offerings since copper was designed to carry analog voice service and not digital Internet signals that can be reliably delivered over only short distances using copper.

AT&T's relationship with Connecticut hasn't been a copacetic one. In 2007, then-Attorney General Richard Blumenthal pressured the telco to make its U-Verse product offering available to all residences in the state. Blumenthal, now a U.S. senator, said this week the deal should be reviewed to ensure it is in the interest of consumers.

Monday, December 16, 2013

Verizon CEO hints at fiber partnerships with local providers

Verizon, which halted build out of its FiOS fiber to the premise (FTTP) infrastructure last year, will stay that course Verizon CEO and Chairman Lowell McAdam said at last week's UBS Global Media and Communications Conference.  McAdam said some "fringe" deployment may occur, but that "deploying fiber in a lot of new markets isn't in the cards."

However, "I think there are more opportunities to partner out of market with companies that are there versus us going in and deploying FiOS," McAdam added.

McAdam's remarks were reported by Fierce Telecom

Verizon spokesman Bob Varettoni declined to elaborate on McAdam's comments when asked specifically with whom Verizon might partner to build FTTP infrastructure beyond its current footprint.

Monday, October 28, 2013

Who needs a Gig at home? Half of U.S. businesses | Technology Futures

Who needs a Gig at home? Half of U.S. businesses | Technology Futures

Andrew Cohill makes the excellent point that with the emergence of Fiber to the Home (FTTH) telecommunications infrastructure, the past focus on Internet throughput speeds that was relevant to legacy telephone and cable companies is becoming increasingly less so. Since incumbent telephone and cable companies have to compress data to transport it over metal wire cable plant not originally designed to carry Internet protocol-based signals, from their perspective bandwidth is a limited commodity. This also limits their ability to serve all premises in their service areas. Even more so in the case of mobile wireless technology which provides far less capacity and range. Hence, their business and pricing models treat bandwidth like a metered utility such as water or electricity.

With FTTH, that entire paradigm of bandwidth as a finite commodity goes out the window and with it the incumbents' outmoded business models. This also has implications for now outdated government subsidy programs based on rules written nearly a decade ago when DSL deployed by telephone companies was state of the art Internet technology. Those programs now need to be updated to scrap obsolete references to the speed of available Internet technology and treat any area lacking FTTH infrastructure as eligible for subsidies if incumbent or other providers aren't constructing it or opt not to.

Friday, October 25, 2013

Cheaper equipment to give fast copper broadband a boost | PCWorld

Cheaper equipment to give fast copper broadband a boost | PCWorld: G.fast promises up to 1G bps over existing copper telephone wires, but only over distances up to about 100 meters. The technology is now being designed to work at distances up to 250 meters, and it looks like ITU will have a full set of standards by early next year, according to Johnson.
Here we go again with the nutty idea that copper isn't obsolete for IP-based telecommunications. No matter how much throughput one can achieve with this decades-old POTS (Plain Old Telephone Service) infrastructure, as this story shows it will always be limited by distance.  The faster the speed, the shorter the distance -- not a good trend as customers expect faster connections.  With such short distances of 1 gigabit connections over copper, it has to be fed by fiber connections so close to customer premises that it makes more sense simply to run fiber all the way to the premise. 

Wednesday, October 16, 2013

Getting to a gig: How CenturyLink is building out its network and why. — Tech News and Analysis

Getting to a gig: How CenturyLink is building out its network and why. — Tech News and Analysis: “But because of densities and scale economics, we as a country are potentially creating regional digital divides that our economy will struggle to tolerate. What’s always been a key enabler for us is that we have always had a fairly broad equal opportunity infrastructure as we did with the highway system, and we as a country must place a high value on the ability to communicate seamlessly. I don’t think we want to place ourselves in the position that we might miss out on the next Google simply because we as a country didn’t want to have a conversation about access and cost. We are going to have to figure that out and no private company can do that.”
So said Matt Beal, the CTO of CenturyLink, an an interview with GigaOM.  And he's right. Either private providers have to find business models that significantly reduce the cost of labor to deploy fiber to the premise and/or do so with some form of government subsidy or tax incentive. As I've blogged in recent months, even companies with pockets and fiber to the premise ambitions as deep as Google's aren't up to the challenge facing the United States.

Saturday, October 12, 2013

Poor internet connections in the countryside are hitting rural property market, estate agents warn - Telegraph

One agent who helps customers buy homes worth more than £1 million told The Daily Telegraph yesterday he was advising all of his clients against looking at properties that have slow internet speeds.
It came as reports in Scotland claimed people dubbed "digital refugees" were now moving from the countryside in search of faster internet speeds in the country's towns and cities. Frank Speir, director at Prime Purchase said: "Slow broadband speeds are having a definite effect on the market. It's becoming a much bigger issue." 

This is bound to become a much bigger issue in America as well.  Notwithstanding some high profile limited 1 Gigabit closed fiber to the premise networks in metro areas, much of the countryside remains without modern Internet connectivity, still served with dial up technology that was state of the art when Bill Clinton was beginning his first term as US president.

Conversely, a property having a fast fiber Internet pipe is more desirable, according to a 2009 study of U.S. broadband consumers, finding 82 percent of homebuyers with fiber to the home ranked it as the leading real estate development amenity.

Wednesday, October 09, 2013

Telcos engage in nonsensical, circular argument over regulation designed for POTS

IIA Report: Time To Begin Full IP Transition - 2013-10-08 14:53:14 | Broadcasting & Cable: Only 5% of U.S. households rely solely on traditional home phones and that means the current regulatory framework is lagging the marketplace and siphoning off investment from new infrastructure.

That is according to a just-released report from the Internet Innovation Alliance, a broadband adoption and deployment advocacy group whose 175 members include AT&T and fiber-maker Corning.
The report, from analyst Anna-Maria Kovacks, finds a "plethora of choices" for voice, video and data including from wireless devices, cell phones, wired Internet VoIP and Internet applications (Skype), and that 99% of communications traffic is now IP-delivered. She said that despite the speed differentials between wired and wireless — wired is faster — wireless was a legitimate competitor and could deliver even a competitive video service.

From the end users perspective, she said, it would be possible to make them happy with LTE as well as fixed wired broadband.

The legacy telcos are engaged in a disingenuous circular argument.  Their business models don't allow them to revamp their legacy copper cable plants -- over which they offer only outdated dialup Internet access for many premises -- to fiber to the premise (FTTP).  Oddly, however, they wonder why they remain subject to a regulatory scheme designed for POTS (Plain Old Telephone Service) delivered over Public Switched Telephone Networks (PSTN).  The answer is pretty self evident. They only have to look at their own networks and service territories for the answer. If they deployed FTTP networks to all of their customers, then their question would be relevant.

As for mobile wireless, it is not a substitute for premise service (can you spell M-O-B-I-L-E?) since it can't offer sufficient bandwidth capacity to serve various IP devices in the home ranging from video, voice service and personal devices like tablets.  It comes with bandwidth caps for good reason since compared to FTTP, mobile wireless can't even come close in carrying capacity.

Sunday, October 06, 2013

UK Internet infrastructure subsidization policy reveals split between citizens and incumbent telco BT

BBC News - Rural broadband: How to reach the broadband notspots

This BBC article goes into good detail on the Internet infrastructure deployment difficulties in the UK. As in America with AT&T, the incumbent telco, BT, prefers to deploy slowly over a period of many years, employing FTTN (Fiber to the Node) network architecture (or FTTC as it's called in Britain -- Fiber To The Cabinet). AT&T's analogue is its U-Verse product, which feeds neighborhood nodes with fiber and uses existing copper twisted pair cable designed decades ago for voice service to bridge the final link to customer premises. However, unlike BT, AT&T limits U-Verse to urban and suburban areas.

British households and small businesses left of the Internet are running short of patience with the slow BT rollout after having waiting about a decade to get some form of wireline Internet connections. Some communities see the passage of time and burgeoning bandwidth demand as having technologically obsoleted FTTC and want Fiber to the Home (FTTH) infrastructure.

Government subsidies are available.  As the article notes, a big question is whether they continue to go toward older but less costly FTTC infrastructure favored by BT or FTTH preferred by the locals who don't want to spend more years waiting for modern Internet connectivity and want a greater degree of control over infrastructure deployment in their communities.

Monday, August 26, 2013

Pew Internet survey flawed by badly outdated, retro perspective

With the relentless pace of Internet bandwidth demand growth to support multiple services including video, voice and Web-based services as well as a portable devices used in the home, there is near consensus that only fiber to the premises infrastructure will be able to accommodate the demand going forward.

That’s why I’m taken aback to continue to see surveys such as this one issued today by the Pew Research Center’s Internet & American Life Project that take a decidedly retrospective view of telecommunications services with their late 1990s distinction between narrowband (dialup) Internet connectivity and “high speed” broadband connections. 

Dialup service is obsolete and can no longer be considered a useful form of premises Internet connectivity. Had this survey been done in 2000 when the distinction between narrowband and broadband was still relevant, the distinction might have meant something. In 2013, it is a distinction without a difference. 

The other major contextual problem with a survey like this is it concentrates only on computer-based services such as Web browsing and email. That’s also a major flaw in the survey. The Internet now delivers video and voice services including applications such as online learning, videoconferencing and telemedicine – none of which are truly usable via a dialup service.

Wednesday, August 21, 2013

Why We Should Build a National Internet System Under the National Highway System - Eric Jaffe - The Atlantic Cities

Why We Should Build a National Internet System Under the National Highway System - Eric Jaffe - The Atlantic Cities: The National Broadband Plan of 2009, for instance, was mostly limited to policy recommendations and failed to encourage competition (which explains why incumbent providers like it so much). Proposed legislation requiring highway projects to install broadband conduit hasn't made it too far. The Obama Administration did issue an executive order last year calling for a "dig once" [PDF] policy to help promote broadband-highway coupling, but that still relies on private enterprise to do what it hasn't done to date: lay fiber everywhere.

So why not make the whole national internet system a public one, like the national highway system before it? At a time when elected officials are struggling to find a truly federal transportation goal, the concept might serve as a welcome rallying point. The government could sell some of its broadcast spectrum to foot the bill, but the user-pay model could probably work well, too — especially since people don't suffer the illusion that Internet access is free, unlike they do with roads.

"There is a really interesting parallel between transportation and broadband," says Lennett. "In the 20th century we needed to move cars, and in the 21st century we need to move bits.

Governments Should Focus on Infrastructure Despite False Statistics Peddled by NY Times and Others | community broadband networks

Governments Should Focus on Infrastructure Despite False Statistics Peddled by NY Times and Others | community broadband networks

Excellent commentary by Christopher Mitchell. A must read.

Friday, August 16, 2013

Satellite broadband: can it light up the UK's broadband blackspots? | News | TechRadar

Satellite broadband: can it light up the UK's broadband blackspots? | News | TechRadar: Due to the distance the signal travels, latencies never dropped below 700ms and hovered around the 800ms mark. Even with predictive caching that makes web browsing speedy, there's always that near-second delay traversing pages. It's not annoying enough to stop you browsing, but it just doesn't feel as snappy as a landline internet connection.
Despite new sooper dooper "Surfbeam" technology, latency remains sub par as this story shows and bandwidth is costly and rationed. This item appeared the same day as this ridiculous story on Google's O3b satellite venture that will supposedly provide 1 gigabit speeds via medium orbit satellites. And at latencies of less than 150 milliseconds, according to this IDG News Service account.

I'm not buying it. Satellite Internet sucks, period. It cannot support reliable voice or real time video connections or provide a high quality Internet connectivity user experience. Google should scuttle this misadventure and instead partner with community fiber projects instead of perpetuating this substandard Internet connection scheme to as a poor substitute to badly needed fiber to the premise infrastructure. 

Tuesday, August 13, 2013

California unlikely to subsidize community fiber Internet infrastructure over near term

The California Public Utilities Commission’s (CPUC) construction subsidy fund for Internet infrastructure won’t likely help offset the cost of building community owned fiber to the premise networks.

The CPUC’s California Advanced Services Fund (CASF) limits grant and loan subsidies to infrastructure projects that would serve either an “unserved area,” defined in CPUC Decision 12-02-015 as not served by any form of wireline or wireless facilities-based broadband such that Internet connectivity is available only through dial-up service or an “underserved” area defined as an “where broadband is available, but no facilities-based provider offers service meeting the benchmark speeds of at least three megabits per second (mbps) download and at least one mbps upload.” The CPUC retroactively revised the definition in 2012 resolutions T-17362 and T-17369 as areas “where broadband is available, but no wireline or wireless facilities-based provider offers service at advertised speeds of at least 6 mbps download and 1.5 mbps upload.”

Under either definition, both fixed and mobile wireless providers could block CASF funding of a community fiber project. And under the definition adopted in the 2012 resolutions, they wouldn’t even have to actually provide service to an area. They could merely claim they advertised service there at the specified 6/1.5 Mbs speeds.

Senate Bill 740, legislation re-authorizing the CASF that’s making its way to the desk of Gov. Jerry Brown incorporates by reference the definitions of unserved and undeserved areas in Decision 12-02-015.

The bill would also give incumbent wireline providers that have not built out their networks to serve all premises effective veto power over any community-based project to reach underserved households -- typically those in areas out of reach of DSL or cable Internet service or having access to slow DSL in areas where aging, poor quality copper cable plant (illustrated in the photo below) cannot support higher speeds. The bill bars funding of these projects “until after any existing facilities-based provider has an opportunity to demonstrate to the commission that it will, within a reasonable timeframe, upgrade existing service.” 



"Reasonable timeframe" isn’t defined in the bill and thus would likely be defined by incumbent telcos that told regulators and consumers since the early 2000s that they were building out their DSL service to reach them. (They’re still waiting more than a decade later, providing an operative definition of what's reasonable). The bill would also give incumbent telcos and cablecos the ability to stymie community fiber projects built by local governments simply by applying for CASF funding.

Wednesday, August 07, 2013

The rural "digital divide" isn't the same in UK, US

Millions miss-out as Britain's broadband divide reaches record levels - Yahoo! Finance UK: Telecoms regulator Ofcom warned the difference between the 'haves' and 'have-nots' would also get worse before it gets better as telecom and pay-TV giants focus investment on next generation "superfast" fibre networks in Britain's biggest towns.

Figures revealed by Ofcom today showed the average internet connection speed in urban areas is now 26.4Mb per second. In rural areas it's just 9.9Mb. Rural speeds have more than doubled since 2011 but households in the countryside now trail city dwellers by an unprecedented 16.5Mb per second.
Americans living in rural, quasi-rural and exurban locales and stuck with dialup or satellite or forced to make do with costly, data capped mobile broadband for their premises Internet service would find this account puzzling. For them, having access to nearly 10Mbs throughput would hardly be considered deprivation at the present time.

Monday, July 29, 2013

Mobile isn't premise service

AT&T’s latest home broadband service isn’t DSL or fiber. It’s LTE — Tech News and Analysis: The idea of using a mobile network to connect homes that have either no or slow broadband access is definitely an admirable idea, but it has its limitations. Today’s mobile networks simply aren’t designed for the intense data demands of are increasingly hungry home broadband appliances — they have limited capacity and that capacity must be shared with all of the other users on the network. That’s why the per-gigabyte costs of mobile broadband are so much higher.

An excellent point in this GigaOM article that puts this service in the proper perspective.  It's designed for mobile and not premises services. Offering a mobile service to a premises does not make it a premises service.

A few paragraphs down, the article notes:
In fact, AT&T is trying to eliminate the distinction between residential and mobile service entirely.
Nice try, but it won't work.  Mobile is mobile. Premises is premises.

Saturday, July 27, 2013

Petitions or "broadband mapping," the end result is the same: Bumpkes

Mark dance sundridge broadband campaign pointless | This is Kent: Jane Hunter from the Westerham Town Partnership has campaigned at every opportunity to add names to the petition but she says she is not surprised to hear the votes will not influence the rollout.

"They have been stringing us along for no reason," she said. "They don't want people hassling them so they haven't told us the reality of the situation.

"And while we have been given figures by the council they never answer any of our questions on exactly what the criteria were for which areas would be part of the superfast project.

Across the Atlantic in the United States, petition drives similar to this one in the U.K. -- some dating back years and encouraged by incumbent providers and misguided demand aggregators -- proved equally pointless. Signatures on petitions can't overcome market failure and are just as futile as "mapping" broadband not spots will make them disappear. The result at the end of the effort is the same: bumpkes.

Friday, July 19, 2013

Washington Post flubs story on Netflix

House of Cards Emmy nod a breakthrough for online TV - The Washington Post: Television series produced by the video service Netflix garnered 14 Emmy nominations Thursday, a historic haul for shows that viewers watched exclusively over the Internet without needing satellite dishes, rabbit ears or cable wires.

Instead, the fans of “House of Cards” and “Arrested Development” could tune in wherever and whenever they pleased on any device with a decent Internet connection — so long as they also had a Netflix subscription. And while that may not seem revolutionary in a world with more than 1 billion smartphones, the nominations highlighted the weakening hold that traditional distribution systems have on the wallets of viewers.
The first two paragraphs of this Washington Post story are lacking so much detail that clarification is needed to fill in the holes.

Specifically, the assertion that viewing Netflix does not require "satellite dishes, rabbit ears or cable wires." The only accurate element is rabbit ears since Netflix is not an over the air television service.

As for satellite dishes, if a Netflix viewer is in large chunks of the United States where the only Internet access options are outdated dialup from the phone company or satellite Internet service providers, then a satellite dish is necessary since dialup doesn't provide sufficient bandwidth.  And the satellite providers will slow a customers service to dial up crawl speed if they stream too much Netflix by invoking bandwidth rationing limits that come with satellite Internet service contracts. 

Bandwidth rationing is also in force for mobile smartphone services since they are not intended to provide robust Internet connections on a par with premises cable service. Which brings me to another and very misleading element of the lead paragraph: that Netflix can be viewed sans "cable wires." Hardly.  Many Netflix viewers stream the service using Internet connections provided by -- you guessed it -- their cable company.

And yet another misleading story headlined A fifth of US Netflix users have cut the cord reports 20 percent of Netflix subscribers have cancelled their pay-TV subscriptions, citing research by Cowen and Co. A pay TV subscription is not a "cord" and if cable subscribers cut their cords, they won't have Internet.  No Internet = No Netflix streaming.

How BDUK bungled Britain’s next-gen broadband rollout | PC Pro blog

Interesting dispatch from the UK that portrays the dominant incumbent telecoms provider, BT, as favoring American AT&T U-Verse-style FTTC (Fiber To the Cabinet) over Fiber to the Premise (FTTP), apparently to avoid the higher cost of the latter network architecture.

The UK Government entity charged with overseeing that nation's Internet infrastructure program also allegedly ruled out fixed terrestrial wireless as a viable premises service option. That's consistent with the first point since fiber would have to be deployed to bring it very close to premises in order to achieve high wireless throughput.

Saturday, July 13, 2013

The 2 key inaction risks facing community fiber projects

Creative risk taking is essential to success in any goal where the stakes are high. Thoughtless risks are destructive, of course, but perhaps even more wasteful is thoughtless caution which prompts inaction and promotes failure to seize opportunity.

Communities contemplating fiber Internet infrastructure projects should keep in mind that there are risks -- negative impacts -- associated both with taking action as well as not taking action.  The latter risk -- termed inaction risk -- is perhaps one of the most threatening and pervasive risks.  For some regions and communities, that risk is being left permanently off the modern Internet grid and unable to realize the benefits it offers for government, public safety, health and education, economic development and transportation demand mitigation. 

Milo Medin, Google's vice president of access services, laid out two major underlying rationales explaining why communities needlessly run the risk of inaction in his address to the 2013 Broadband Communities Summit. 

1.  The unswerving belief despite more than a decade of market failure that incumbent legacy telephone and cable companies will upgrade and build out their infrastructures to serve all premises.  Here's what Medin had to say on that point:
Part of the reason the U.S. is falling behind is that most cities haven’t been intentional about their broadband infrastructure. Cities know they have to make sure the water system works and scales to support growth, the roads are maintained and built, garbage is collected properly. But often, they think broadband is something that the phone company or the cable company will take care of for them and they can ignore it, or that the FCC will make sure the appropriate incentives are put into place to drive competition and upgrades. Depending on those processes is how we got into the situation we’re in today.

2. The misguided belief that wireless services have obsoleted fiber networks. Medin explains:
Some argue that fiber networks are not really needed because of wireless network growth. As an engineer, quite honestly, this kind of talk makes my brain hurt. Wireless network growth is driven by fiber. All those base stations that smartphones connect to are increasingly connected by fiber because, as speeds go up, fiber is required to carry that kind of traffic. Copper just won’t do for modern wireless networks.
Cisco and others expect wireless data to grow by a factor of 50 in the next few years, and you’re not going to be able to solve that kind of growth by throwing more spectrum at it. You’re going to have to reduce the size of the cells, shrinking them, reducing the number of users that are being served by a given base station. And that means a lot more cell sites and a lot more fiber to feed those cell sites. In the limit, the future of mobile is going to look a lot like Wi-Fi: tons of small cell sites connected by a wireline network, connected by fiber – and that’s just physics, folks.

The full Broadband Communities article excerpting Medin's speech can be viewed here and here (pdf). 

Saturday, July 06, 2013

The 3 big U.S. Internet infrastructure policy choices

The United States now has three major policy options on the build out of Internet infrastructure to serve all American homes, businesses and institutions:
  1. Continuation of the status quo of investor-owned Internet infrastructure and associated private market failure that will leave significant numbers of premises lacking affordable Internet access over the long term and potentially permanently.
  2. A well funded federal aid program including technical assistance grants for community fiber to the premise network construction projects, funded by existing programs such as the U.S. Department of Agriculture's Rural Utilities Service, a program jointly administered by multiple agencies or by a newly created, dedicated agency.  In addition, federal preemption of state laws barring local governments from constructing, owning or operating Internet infrastructure.
  3. De-privatization of all Internet infrastructure (either immediately or over a period of years) combined with a fast track federal construction project to build out fiber to serve all U.S. premises, similar to the 1950s interstate highway project.

Please add your comments.  Which do you favor and why?

Thursday, July 04, 2013

The U.S. Needs A Federal-Aid Highway Act For Affordable Broadband -- Now - Forbes

The U.S. Needs A Federal-Aid Highway Act For Affordable Broadband -- Now - Forbes

Digital media veteran Gary Myer urges a massive Internet stimulus program that goes far beyond the $4.5 billion allocated for Internet infrastructure in the American Investment and Recovery Act of 2009.  (Most of that money went toward middle mile infrastructure that typically left residences and small businesses off the net).

Myer as well as some of the commentators on his Forbes piece point out getting fiber to every U.S. doorstep not only would create a lot of jobs since a large majority of the cost is labor.  It would also make the U.S. network more valuable since more would be connected to it, replacing the current dysfunctional, hodge podge of disparate legacy cable television and telephone company networks whose high cost business models fail outside of densely populated areas.

Myer also puts to rest the fanciful, wishful thinking that cell phone networks obviate the need for premises Internet connections.  Those networks are designed for lower bandwidth mobile voice and data and lack the capacity and reliability to serve as primary premises connections. Those bandwidth caps on mobile service exist for a reason.

Monday, July 01, 2013

Fiber to the Home Council : Blogs : Telcos Saving Serious Money by Upgrading to FTTH, Survey Finds

Fiber to the Home Council : Blogs : Telcos Saving Serious Money by Upgrading to FTTH, Survey Finds: (WASHINGTON) – Small and medium-sized telephone companies that have upgraded their networks to all-fiber are reporting operational cost savings averaging 20 percent annually, according to a study commissioned by the Fiber to the Home Council Americas, a non-profit group of nearly 300 companies and organizations dedicated to expanding the availability of ultra high speed, all-fiber broadband.

The survey of more than 350 telecommunications providers across North America, conducted by the market analyst firm RVA LLC, also pointed to a steady drumbeat of FTTH deployment activity, with the number of homes that can access FTTH networks increasing by 17.6 percent over a year ago to 22.7 million.
While consumers served by these smaller telcos will benefit (as will the telcos with lower OPex costs), there are many more served by large telcos like AT&T and Verizon who won't.  Neither company is upgrading its copper plant to fiber to the premise.

Tuesday, June 25, 2013

Israel's 1Gbps fiber will show the world what superfast broadband can really do: Cisco CEO | ZDNet


The planned deployment of gigabit fiber to the premise (FTTP) infrastructure in Israel as described in this ZDNet article Israel's 1Gbps fiber will show the world what superfast broadband can really do: Cisco CEO | ZDNet illustrates a trend in much of the industrialized world.  As the Internet grows into an all purpose communications platform, it will overtake and obsolete telephone and cable companies that built their business models on a pre-Internet world.  Some excerpts:
 The network should be completely operational in five to seven years, giving Israelis the opportunity to surf the net with downlinks of 1Gbps, ten times faster than anything the local competition — chiefly the Bezeq phone company and HOT cable service provider — can provide with their FTTN (fiber to the node) network, which delivers a top speed of 100Mbps.

Chambers predicts the network will bring in major changes: healthcare where doctors are connected instantly to providers' and hospitals' databases, with all records kept electronically and updated constantly; an education-anywhere system, where students can learn at home, in class, or elsewhere, communicating with teachers and fellow students over the internet; safer roads and streets (a major issue in road accident-prone Israel), with traffic authorities able to keep better tabs on speeders and unsafe drivers; and a proliferation of "internet of things" technology, with sensors keeping air conditioners, refrigerators, washing machines, front doors, and more connected to systems than can enable better and more efficient allocation of electricity and other resources. In a few years, all of this should be in place, according to Chambers.

Saturday, June 15, 2013

Google's Project Loon no cure for the common Internet not spot

Google's experimental Project Loon unveiled this week that envisions a fleet of high altitude balloons providing Internet connectivity is likely to benefit only the most remote and undeveloped areas of the globe.  Fittingly, remote New Zealand was the site of the first experimental deployment of these 'loons, mate.

The technology won't be a panacea for more populated parts of the globe in developed nations plagued by incomplete wireline Internet infrastructure that serves only some residences and businesses while others adjacent are left off the Internet grid.

Nor can it provide sufficient throughput to support the rapid growth in bandwidth demand driven by video and the use of multiple devices common nowadays in many households.  According to Google, the high altitude digital dirigibles will provide connectivity at speeds comparable to 3G, the legacy mobile wireless service now being superseded by higher bandwidth 4G mobile wireless.

NYT op-ed complaining of low Internet subscribership undermines author's credibility

No Country for Slow Broadband - NYTimes.com: The major causes for low subscribership, as extensive survey research shows, are low interest in the Internet and minimal digital literacy. And too many American households lack the money or interest to buy a computer. As a result, more Americans subscribe to cable TV and cellphones than to Internet service. Our broadband subscription rate is 70 percent, but could easily surpass 90 percent if computer ownership and digital literacy were widespread.
So argues Richard Bennett, senior fellow at the Information Technology and Innovation Foundation.  There is a big hole in this argument.  Information and communications services are universally verging toward employing Internet Protocol (IP) to deliver them.  People are increasingly viewing video content delivered over the Internet to making voice calls using Voice Over Internet Protocol (VOIP). 

In segmenting discrete services and citing just one type of Internet-enabled service (personal computing), one has to question why someone with Bennett's level of knowledge would even make this point, undermining his credibility and suggesting a hidden agenda.

Thursday, June 06, 2013

Obama administration's ConnectED program only half a solution

President Calls for High-Speed Broadband in 99% of Schools/Libraries - 2013-06-06 15:21:00 | Broadcasting & Cable: The White House Thursday announced a new initiative to get high-speed broadband to America's schools and libraries.

The so-called ConnectED program has a goal of connecting 99% of students to high-speed wired and wireless broadband (speeds of no less than 100 Mbps and preferably 1 Gbps) within five years. The president called on the FCC and National Telecommunications and Information Administration to "modernize and leverage" its E-rate program to achieve that goal. The E-rate program provides discounted broadband service to schools and libraries through the Universal Service Fund.

The President's plan while laudable is only a partial solution.  Learning now takes place both at school and in the home -- what educators describe as "blended learning."  Jeremy Meyers, superintendent of the El Dorado County (California) Office of Education, wrote about the emerging educational method in which pupils do much of their learning and class projects outside of the classroom via the Internet – arguably the world’s biggest and best stocked library.  Back in the classroom, their teachers review their projects, answer questions and lead discussions.

As Meyers notes, blended learning requires good Internet connectivity both at schools and at students' homes.  However, too many homes in Meyers' district lack even basic Internet service.  "El Dorado County faces a special challenge that is assuming greater urgency each year: How to bring all our households into broadband Internet access in a cost-effective manner," Meyers wrote. "Having large Internet 'dead zones' is not acceptable in today’s world of connectivity. It limits us academically and hurts us economically."

Are you listening, Mr. President?

Thursday, May 23, 2013

FCC Expands CAF Definition of Broadband Subsidy-Eligible Areas - 2013-05-22 22:48:29 | Broadcasting & Cable

FCC Expands CAF Definition of Broadband Subsidy-Eligible Areas - 2013-05-22 22:48:29 | Broadcasting & Cable

Summed up, this subsidy program designed to underwrite the cost of building telecommunications infrastructure in high cost areas is ineffective.  Telcos won't apply because they don't want to fully serve these areas and complain the subsidy amounts are too low.  And even if they did want the money, they have to fight cable companies ineligible for the funding (derived from a surcharge on telephone bills) that claim the telcos are upgrading their infrastructures in order to steal their customers.

This circumstance only adds to the argument that communities and particularly those with lower population densities can't expect legacy providers to serve them.  They must build their own publicly and cooperative owned and operated fiber networks.

Wednesday, May 22, 2013

Light Reading - Google Fiber's Future Looks Limited

Light Reading - Google Fiber's Future Looks Limited: Google is destined to remain a small player in the broadband service market, unable to dislodge cable companies such as AT&T Inc. and Comcast Corp., according to analyst Dexter Thillien of IHS iSuppli.

Outside of a few select metro areas, the costs and risks get too high for Google Fiber's 1Gbit/s broadband service, Thillien writes in a report issued Tuesday.

IHS is not the first to warn against expecting Google to light up fiber across the nation. Last month, analysts at Alliance Bernstein said in a report that they remained "skeptical that Google will find a scalable and economically feasible model to extend its build out to a large portion of the U.S., as costs would be substantial, regulatory and competitive barriers material, and in the end the effort would have limited impact on the global trajectory of the business."

These analyses affirm recent posts on this blog casting doubt on the irrational exuberance of some who believe Google is going to overbuild metal wire-based incumbent telephone and cable company footprints with fiber.  It might make sense on the surface as somnolent incumbents have placed their wireline plant into "harvest" mode (in the case of the cablecos) and runoff mode (telcos).

But as deep as its pockets are, Google simply can't afford anything other than one off, opportunistic builds. And the incumbents can't undertake massive fiber infrastructure CAPex using grandma's shareholder dividend.  As I've been saying for several years, that leaves it up to communities to build their own municipal or cooperatively owned fiber networks.

Verizon Hopes to Nudge Some From Wired to Wireless - NYTimes.com

Verizon Hopes to Nudge Some From Wired to Wireless - NYTimes.com

This story illustrates why communities must build their own fiber networks.  The incumbents like Verizon aren't going to do the job.  As the story notes, that leaves residents and business owners with lousy options:  poor voice quality over garbled wireless premises phone service that can go out in a prolonged power failure and data capped satellite Internet service.

Sunday, May 19, 2013

Former FCC Chairman and GTCR Fund See Strong Rural Cable Future

Former FCC Chairman and GTCR Fund See Strong Rural Cable Future: Former FCC Chairman Reed Hundt hopes this week’s acquisition of tier 2 cable company NewWave Communications by investment firm GTCR will be “the first of many.” Telecompetitor spoke this week with Hundt, who headed up the FCC during the Clinton administration and is now an advisor to GTCR.“We believe cable is the universal American communications medium,” said Hundt. “Cable is the essential connection for everyone, especially in rural America.”
 The Telecompetitor article continues:
GTCR’s strategy is interesting, considering that service providers have had difficulty finding a business case for deploying broadband in some rural areas – particularly as distances from population centers increase.

When I asked Hundt about that he said, “Technology keeps producing breakthroughs.”
Indeed it does.  But has it reduced the labor costs associated with deployment and maintenance of wireline Internet infrastructure, which rule of thumb estimates place at about 70 percent of the total?  I haven't heard of of any such technology breakthroughs unless Hundt is talking about using drones to spool and drop cable from the sky and robots to bury and install it on poles.

Thursday, May 16, 2013

AT&T CEO: We'll piggyback on Google's Fiber rollout plans | Mobile - CNET News

AT&T CEO: We'll piggyback on Google's Fiber rollout plans | Mobile - CNET News

More mutually assured diminished returns threatened by AT&T.  Ma Bell is basically saying she will overbuild Google to obtain a slice of picked over cherry pie, leaving each competitor serving 15 percent of the premises passed at best.

This should put to rest the hopeful, magical thinking of some who claim Google is somehow going to goad legacy telcos to undertake a broad-based upgrade of their obsolete last mile copper plant to fiber.  Not in this lifetime and not with grandma's shareholder dividend.

Monday, May 13, 2013

Businesses Lining Up for Service in Longmont, FTTH Build-Out Studied | community broadband networks

Businesses Lining Up for Service in Longmont, FTTH Build-Out Studied | community broadband networks: If LPC wants to pursue a triple play offering, Uptown estimates it would cost another $6 million. At this point, LPC does not consider triple play a good investment:

"The young generation that's active now, they don't watch TV in the conventional way," Jordan said. At a recent presentation, he said, when he asked a college student how often he watched traditional scheduled TV programming, the response was "Never."

The implication here is the subscriber television channel Internet service offering is losing its appeal going forward with the changing viewing habits of younger adults.  This is a potentially huge disruption of the current business models of both incumbent cable providers and telcos offering TV in service bundles like AT&T's U-Verse product.  It's also very disruptive of the TV advertising business model that has traditionally targeted younger adults.  

Wednesday, May 08, 2013

California lawmakers revise legislation governing Internet infrastructure subsidy program

California lawmakers are scaling back a previously proposed increased appropriation for the state’s broadband infrastructure grant and loan subsidy program. As amended this week, SB 740 would also redefine the policy goal of California Public Utilities Commission’s California Advanced Service Fund (CASF) to fund projects to ensure broadband access to at least 98 percent of California households by 2016. SB 740 would also prioritize funding for those areas of the Golden State deemed to be “unserved.” The CPUC has defined this to mean “an area that is not served by any form of wireline or wireless facilities-based broadband, such that Internet connectivity is available only through dial-up service or no broadband service can be identified.”

From a practical perspective, this means only modest wireless Internet infrastructure projects will be subsidized by the CASF since unserved areas per the CPUC’s definition are likely to be very thinly populated. These will also likely be very low budget projects per the CPUC’s decision to require project sponsors kick in 30 percent of the project costs for unserved areas.

The CPUC has also written the CASF rules to discourage community fiber builds by allowing projects in “underserved areas” only if the area has no wireline or wireless service offered at advertised speeds of at least 6 mbps download and 1.5 mbps up. That means an area that is only partially served by an existing wireline providers could not be overbuilt to fill in the coverage gaps. Under the rule, such project would also not qualify since wireless providers could merely advertise service at the minimum speeds, further slicing and dicing a potential fiber service area such to render the project ineligible under the rules. On top of that, the rules require community fiber project sponsors to kick in 40 percent of the project costs – an onerous burden for newly formed entities.

The upshot is California policymakers will end up going through the motions and the CASF monies left largely unspent as sizable areas of the state unserved by the incumbent telephone and cable companies are consigned to technologically substandard, low value Internet service options.

Google Project May Spur Broadband Competition - NYTimes.com

Google Project May Spur Broadband Competition - NYTimes.com

The take away from this story is it's highly unlikely incumbent telephone and cable companies will upgrade and build out their infrastructures to provide better Internet connectivity and serve more premises.  It makes more business sense for them to preserve the status quo and harvest whatever profits can be had from their existing cable plants. Particularly given the fact that the legacy incumbents pay fat dividends to their shareholders. Google pays none.

The NY Times piece postulates it will take an third party like Google to break the inertia.  But Google thus far is pursuing fiber builds in only a few metro areas of the United States including Kansas City and Austin and lacks a strategy to serve the nearly 20 million Americans forced to live off the Internet grid because the incumbent telcos and cablecos won't serve their homes.  These areas will have to rely on good old fashioned American self help and build fiber to the premises infrastructure operated by local governments and consumer cooperatives as was done in much of the nation in the 1930s and 1940s for electricity and telephone service.

There's also the sheer enormity of the financial challenge that would test the resources of even the deepest pocketed players like Google.  In 2009, the U.S. Federal Communications Commission projected it would cost $350 billion to universally deliver 100 Mbps or faster Internet connections to all American homes and businesses.  That's more than the sum of Google's 2012 revenues.

Sunday, May 05, 2013

California PUC-created nonprofit warrants review


Today’s Sacramento Bee reports on the increased legislative scrutiny being applied to the California Public Utilities Commission and whether it is adequately fulfilling its mission of ensuring safe and reliable utility service.

According to the Bee, a California Senate committee is requesting that the state’s Fair Political Practices Commission investigate nonprofits established by the PUC for “possible conflicts of interest or bequesting violations” including the California Emerging Technology Fund (CETF).

Lawmakers should also look into whether the CETF is fulfilling its stated mission “to close the ‘Digital Divide’ by accelerating the deployment and adoption of broadband to unserved and underserved communities and populations.”

A review of the CETF website, its annual reports and a summary of 2013 grant investments shows no funding awarded to advance the direct, tangible deployment of advanced telecommunications infrastructure to serve residential premises despite findings by a state broadband task force in 2008 that nearly 2,000 California towns and communities lack broadband access.

Without the infrastructure for broadband access, promoting its adoption is putting the cart before the horse and nothing more than window dressing. This is policy failure piled on top of market failure.

Tuesday, April 30, 2013

WISP targets incumbent wireline providers

An El Dorado County, California Wireless Internet Service Provider (WISP) is challenging incumbent telephone and cable providers in a small, suburban segment of the county.

Cal.net's "Urban Wireless Internet" is offered at a flat $40 monthly fee with no contractual commitments -- clearly aimed at undercutting the triple play bundle pricing of the incumbents.  The service offering claims asymmetrical connectivity of 15 Mbs down and 3 Mbs up. There's a $95 installation fee.

FTTN: An alternative Google fiber model to build out Internet infrastructure

Google has been getting a lot of attention lately over its current and planned fiber to the premise (FTTP) builds in Kansas City, Austin, Texas and potentially Provo, Utah. But Google is unlikely to expand that model to the outer suburban, exurban and rural areas of the United States anytime soon for the same reason the incumbent telephone and cable companies have declined to do so: too few potential subscribers to justify the business case for the sizeable investment.
 
However, Google may be able to make the numbers pencil better with a fiber to the node (FTTN) network in these unserved and underserved areas, mixing in aerial fiber cable plant where the cost of burying fiber conduit is overly expensive. Using the FTTN model described in this November 2008 white paper, Google would bring Internet “trunk” connections to neighborhood nodes.  Property owners could join together in a telecom cooperative – compared to a condominium in the paper -- to build the final fiber segment to bridge the gap from their premises to the neighborhood nodes.  The cost of the construction for those projects in rural areas can be financed by low cost, long term loan funding offered by the federal Rural Utilities Service.

The paper notes the property owners would economically benefit given research showing adding a fiber “tail” to a residential property increases its marketability, thereby allowing property owners to recoup and potentially profit from any upfront investment they would have to make to fund the cooperative and get wired up.

It’s worth noting that although disclaiming official representation of Google, the white paper titled Homes with Tails: What if you could own your Internet connection? is co-authored by Derek Slater, a Google policy analyst. Back when Slater wrote the paper, Google wasn’t in the fiber infrastructure business. Now that it is, Google management would be well advised to dust off Slater’s paper and give it another look.
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