More state-level broadband access initiatives predicted for 2008

The end of 2007 and the start of 2008 will see a shift in governmental attention to state-level broadband access and away from municipal Wi-Fi.

That's according to Craig Settles, a consultant to governments regarding mobile and wireless networks, who was inteviewed by newsfactor.com's Richard Koman in this Yahoo News story:

"In rural areas and many small towns, providing access is something government should be involved in," he said, adding that, unlike with municipal Wi-Fi, residents probably don't necessarily expect it to be free.

Settles worked with local governments in rural North Carolina and Kentucky, where it was not economically feasible for the incumbent provider to come in. "In those outlying areas, they don't really have an option for technology and there's a greater need for people to be served by local or state government activity."

A key issue is how the build-out should be funded. States are providing grant money and seeking funds from federal homeland security and other programs. "The bottom line is that the vendor picks up a check," Settles said. "There can't be any of the silliness of how advertising will pay the bills."

Looking at 2008, "we'll see more state-driven initiatives for underserved areas," Settles said. Just as municipal Wi-Fi spread as cities started talking to each other, "a similar kind of dynamic will happen at the state level," he predicted, "but with a much more pragmatic and cautious approach than cities showed."

NY Gov. Spitzer forms state broadband council; RFPs issued for research of nontraditional infrastructure

New York Gov. Eliot Spitzer announced the state would issue RFPs today to begin the process of distributing $5 million in seed funds allocated in the Empire State's budget for competitive grants to research, design and implement accessible Internet for unserved and underserved areas of rural and urban New York. Spitzer also announced the formation of the New York State Council for Universal Broadband. The council will recommend "a comprehensive statewide strategy that charts a course towards affordable broadband access throughout the state" and "leverage existing resources, consider new ways to extend high-speed Internet access beyond traditional means and recommend approaches to increase digital literacy in underserved urban and rural communities."

“As we build an innovation economy we must make New York the most connected and technologically advanced place to live and do business in the world," said Spitzer said in a news release. "Internet access is no longer a luxury. We must implement a strategy that leads to every New Yorker having access to affordable, high-speed Internet so that they may take advantage of the economic, social and cultural opportunities it provides.”

When he was inaugurated in January, Spitzer set a goal of universal broadband access, starting by mapping out existing infrastructure and broadband black holes. The state Broadband Council will be charged with this task.

Spitzer said a lack of federal leadership to establish a national broadband policy requires his state take the initiative, which comes as California Gov. Arnold Schwarzenegger is to issue a report this month his Broadband Task Force has been developing over the past year. The report will make specific recommendations on "how California can take advantage of opportunities for and eliminate any related barriers to broadband access and adoption." Similar state-level initiatives are have been undertaken in several other states over the past two years.

A key element of Spitzer's strategy -- one likely to be embraced by Schwarzenegger's Broadband Task Force -- is public-private partnerships. "State government will not be the one constructing these networks, Spitzer emphasized. "Instead, state money will be used to leverage matching funds from the private and not-for-profit sectors. In the end, it is New York’s vibrant telecommunications sector—together with their tireless and invaluable workers—who will implement this vision in partnership with government."

It remains to be seen whether states can inject enough money into public-private broadband initiatives to spur telecom providers to build out their networks -- particularly when states such as California continue to deal with sizable budget deficits. And because the telcos and cable companies are publicly traded, short term earnings pressures make it difficult for them to undertake major projects to expand their broadband infrastructures.

States could be convinced to find ways to fund broadband initiatives if they believed the funding would have a multiplier effect by stimulating economic activity and generating tax revenues that could be used, for example, to service state bond debt.

An AT&T-funded California study released in November found the Golden State would gain 1.8 million jobs and $132 billion of new payroll over the next 10 years with a 3.8 percent increase in the utilization of DSL and cable broadband Internet services.

“There is a clear connection between investing in broadband technology and job growth,” said Dr. Kristin Van Gaasbeck, Assistant Professor of Economics at California State University, Sacramento and one of the authors of the report.

AT&T distorts build out as socioeconomic issue

As it did in California and other states where it has sought statewide broadband franchising statutes, AT&T is once again distorting the issue of build out requirements as one of socioeconomic status.

This time it's Tennessee and AT&T Tennessee President Gregg Morton is insisting that AT&T supports language in proposed state franchise legislation that prohibits red-lining of low income neighborhoods.

That's an irrelevant red herring. Building out advanced telecommunications infrastructure has nothing to do with neighborhood income levels. AT&T wants states to issue franchises rather than local governments because they know the locals will rightly insist they serve their entire communities and not just parts of them with an incomplete system.

The reality in Tennessee and other states where it has petitioned for state franchise laws is that AT&T wants to build advanced telecommunications infrastructure on the cheap, leaving some residents and businesses with access to advanced broadband-based services and others without.

Tennessee should reject this effort and tell AT&T and other backers of the bill it won't tolerate dividing the state into digital haves and digital have nots.

California PUC receives several franchise applications from cable providers

The California Public Utilities Commission has received several new applications for broadband video franchises from cable companies. Among the new applicants are Charter Communications and several of its operating units as well as Seattle-based Northland Cable Television.

Time Warner Cable, which was issued a franchise in October by the California PUC, also submitted several new applications for subsidiary operations in the state.

Verizon, which received a franchise earlier this year, filed an amended application reflecting an expansion of its service area in Southern California.

The applications can be viewed at the CPUC's Web site by clicking here.

Telco/cable duopoly an obstacle to information tech progress

The U.S. telco/cable duopoly is getting slammed in articles this week for standing in the way of progress in terms of getting more Americans connected to high speed Internet access.

PC World magazine blasted the big telcos like AT&T and Verizon as among the most anti-tech organizations in America:

The effect of slow broadband speeds and poor availability on tech is obvious. A whole generation of innovative businesses that depend on real broadband is still waiting to come into existence. For now, consumers will have to wait for new, lightning-fast information, media, and telecommunications services that could change the way we work and play.

Tech.Blorge.com, meanwhile, writes that the lack of competition has made big cable player Comcast indifferent to its customers who compete for a static amount of bandwidth over its coaxial cable. Tech.Blorge.com sees Comcast as headed the way of the dinosaurs into tech extinction with the likes of America Online (AOL):

For a short time, Comcast will be able to sit on the customer base it has developed and sap money from customers that could receive better products at a more competitive price. But, just like AOL, once people get a taste of where technology is heading, that pile of money will deplete to nearly nothing…unless Comcast can step up, stop functioning like a monopoly, and start being competive.

Report: AT&T hikes dial up prices

The story here isn't so much about Ma Bell raising dial up prices. Rather, it's that AT&T is leaving lots of money on the table by pricing DSL too low relative to dial up prices.

AT&T's costs to deploy DSL are obviously going to be higher in areas where cable loops are long and remote terminals must be installed in order to distribute the service. Its one-size-fits-all pricing scheme for DSL would be fine if there were enough total revenues to subsidize these higher costs. Clearly there are not. Consequently, AT&T and other telcos leave more than 20 percent of their U.S. service areas with no DSL service whatsoever.

The obvious solution would be to charge higher rates for DSL -- including for reseller ISPs -- in higher cost areas where 20 bucks a month for service doesn't allow for a reasonable profit. That would gain a lot more wire line broadband and potential bundled service customers who'd gladly pay two to three times that amount rather than be stuck with dial up or the high up front costs and sluggish connections afforded by satellite "broadband."

Broadband Task Force report due in December, Schwarzenegger tells USC conference on digital infrastructure

California Gov. Arnold Schwarzenegger addressed the University of Southern California's Annenberg Center for the Digital Future conference on California's digital infrastructure today. But despite the stated focus of the conference, Schwarzenegger devoted very little of his keynote speech to the state's digital infrastructure. Like the state's other critical systems such as water and transportation, the state's digital telecommunications infrastructure is years behind where it should be and now requires billions of dollars of investment to bring it up to date to serve California's current and future needs.

I had expected the governor would use the conference as a platform to unveil a report that his Broadband Task Force formed by executive order last year was due to issue this week. It will now come out in December, Schwarzenegger said during a question and answer session following his speech. The report is to make specific recommendations on "how California can take advantage of opportunities for and eliminate any related barriers to broadband access and adoption."

Data recently released by the Federal Communications Commission show nearly 20 percent of California residents were unable to obtain broadband DSL service from their telephone companies as of Dec. 31, 2006.

Schwarzenegger told the USC conference he's directing the California Public Utilities Commission to be "much more aggressive in pushing broadband." But the CPUC's authority to prod telcos and cable companies to build out their infrastructures -- which in many areas of the state are unable to provide broadband Internet access -- is sharply limited by legislation Schwarzenegger signed into law last year, the Digital Infrastructure and Video Competition Act of 2006.

While the legislation pays homage to the notion of wider broadband deployment, it also allows the big telcos and cable companies that dominate the state to avoid building out broadband infrastructure to as much as half of their service areas over the next four years. Backed by telco and cable companies, the statute effectively sanctions California's digital divide and makes any gubenatorial rhetoric to bring broadband to nearly all Californians ring hollow.

As Cisco Systems' Director of Technology and Communications Policy Jeffrey A. Campbell aptly put it in a panel discussion at the event: “The key is broadband infrastructure. We can have everything in terms of content, but if people cannot access them and at the appropriate speeds, it is worthless.”