Report: DSL must make way for fiber

Many people fail to understand that the world's most predominant method to deliver residential broadband Internet access -- Digital Subscriber Line or DSL -- is an interim technology and not a viable long term option.

I and others have observed that as broadband bandwidth consumption increases, driven in large part by the proliferation of bandwidth intensive full motion video, DSL capacity will grow increasingly tight. Already there are reports that DSL users are straining the telco network, with users reporting their connection speeds declining or losing their connection altogether, often during night and evening hours.

Like the U.S., Europe and much of the world gets broadband access via DSL. Consultant Frost & Sullivan is out with a report warning Europe must wean itself off of DSL and migrate to fiber optic to the home (FTTH) which offers far greater carrying capacity than copper cable-based DSL.

Broadband black holes plague California, PPIC study finds

The Public Policy Institute of California has issued a study of broadband Internet access in the Golden State that not surprisingly finds broadband access lacking outside of urban areas.

The study, Broadband for All? Gaps in California’s Broadband Adoption and Availability, found California households with high-speed Internet ranges from under 30 percent in the Sierra Nevada (21%) and northern part of the state (29%) to just over 50 percent in the San Francisco Bay Area (51%) and the greater Los Angeles area (52%).

After controlling for individual characteristics such as income and education, the PPIC analysis finds that more than half the regional differences remain, indicating that broadband availability — or more specifically the lack thereof — explains why many residences aren't on line with broadband.

Gov. Arnold Schwarzenegger's Broadband Task Force, which is expected to issue its own report in October, could help identify barriers to providers’ offering service in rural areas and the state could offer subsidies to providers serving rural areas, the PPIC report suggests.

In addition, it recommends the California Emerging Technology Fund should focus on broadband deployment in rural areas. "Our findings have important implications for broadband policy," PPIC Research Fellow Jed Kolko concludes. "If closing gaps in broadband availability is a policy goal, raising availability in rural areas should be the top priority."

As the study finds, household income and ethnicity aren't germane when it comes to broadband access. Unfortunately the issue managed to make its way into California's DIVCA (the Digital Infrastructure and Video Competition Act of 2006) which erroneously assumes broadband providers "redline" poor neighborhoods when in fact deployment of broadband infrastructure is based on residential density. There are people with million dollar homes -- even ones relatively close to other homes -- who can't get wireline-based broadband short of installing business class T-1 lines.

The PPIC study correctly views broadband as vital infrastructure and not as a socioeconomic issue. It's all about availability and build out and not about income or ethnicity.

Silicon Valley businesses meet on broadband infrastructure needs

Leaders of high tech Silicon Valley companies are growing concerned that the telco/cable duopoly is failing to keep up with their growing Internet bandwidth needs:

These company and city leaders will discuss how to overcome current regional challenges to building a telecommunications system worthy of the region many consider the technology capital of the world. The meeting will be guided by a keynote presentation by Scott McNealy, Chairman and Co-Founder of Sun Microsystems, plus a report by the Bay Area Council, prepared by Bonocore Technology Partners, that reviews what other countries or regions have done to improve their infrastructure, and recommends Bay Area actions.

U.S. wireline broadband expansion hitting the wall

USA Today and many other media outlets are carrying an Associated Press story reporting a study by the Pew Internet and American Life Project shows the rate of broadband growth among American households is slowing sharply. Broadband adoption grew just 12 percent from March 2006 to March of this year compared to the 40 percent rate of the previous 12 months.

John Horrigan, Pew's associate director for research, says providers have picked the low hanging fruit. They now have to make substantial investments in their infrastructure to bring in more broadband customers since many households who don't use wireline broadband can't get it because it's not available.

Their prospects of getting it in the near term don't look good, which could produce even lower broadband adoption numbers when Pew and other think tanks report on broadband growth in 2008.

The results of the Pew study aren't surprising considering that AT&T appears to have all but halted deploying additional equipment necessary to expand its Digital Subscriber Line (DSL) service beyond three miles from the telco's central offices. Those who can't get DSL get pitched to sign up for inferior satellite Internet service via AT&T's reseller deal with WildBlue announced a year ago.

The other big player in the telco/cable duopoly, cable provider Comcast, also doesn't appear to be expanding its footprint in existing neighborhoods, concentrating instead on new home developments seen as good prospects for the company's bundled video, Internet and voice services.

Sierra foothills economic development nonprofit gets federal funding to expand broadband

According to this report in TheUnion.com, the Sierra Economic Development District is getting a $190,000 grant from the USDA Rural Business Enterprise Grant program.

The funds will be loaned to local Internet providers -- in this case apparently Wireless Internet Service Providers or WISPs -- to help extend their services.

Analyst: Telcos no threat to cable

Sanford Bernstein Senior Analyst Craig Moffett opines that cable companies face no near term threat from telcos. Moffett is particularly dismissive of AT&T, which he sees unable to match broadband throughput speeds provided by cable companies and unlikely close the gap. Moffett also echos my own observation earlier this year that customers will find DSL increasingly inadequate as they download higher amounts of video content:

But while AT&T may upgrade 40 percent of its DSL plant to fiber in order to bring faster high-speed data service to its customers, some 60 percent of its network won’t be upgraded, Moffett projects. That means that AT&T will still be competing at a maximum standard DSL bit rate of 768 Kbps while cable operators offer substantially higher bit-rates, a disparity that could become more of a competitive challenge for AT&T as consumers download more video online through services like YouTube.