It's only natural: U.S. Supreme Court rejects anti-trust action targeting big telcos

Bloomberg reports the U.S. Supreme Court today tossed out a lawsuit alleging telcos Verizon, AT&T Inc. and Qwest violated anti-trust law by colluding not to compete in each other's service areas.

The high court found there was no evidence of collusion. Rather, the justices ruled 7-2, the fact that the former baby bells hardly ever directly compete is a natural consequence of their business models. "There is no reason to infer that the companies had agreed among themselves to do what was only natural anyway," Justice David Souter wrote for the court.

Maryland county lacks adequate broadband access, report finds

The insufficiency of existing services doesn’t come as news to Ken Decker, chairman of the Carroll Cable Regulatory Commission. Home-based workers in Carroll often need broadband access and can’t get it, he said.

The report recommends the county increase broadband access by exploring partnerships with service providers, conducting a feasibility study of a public broadband network and considering how other infrastructure projects can provide opportunities to add fiber-optic lines.

Arizona state broadband authority backed

According to this item in the East Valley Tribune, the Arizona Telecommunications and Information Council has given its support to the creation of an Arizona Broadband Development Authority that would oversee the implementation of a statewide plan for high-speed Internet service. It would study ways to reduce the cost of extending broadband infrastructure including fiber-optic lines to rural areas and ensuring that local communities play a major role in the process.

The council also proposed a revolving fund under the control of the authority that would be used to help pay for rural broadband projects that could be funded by a 50 cent surcharge on the monthly bills of existing broadband customers, said Michael Keeling, chairman of the council. Implicit in this subsidization scheme is the recognition of broadband as vital as basic telephone, roads and utilities.

Federal measure would map broadband black holes, redefine broadband

Nate Anderson of ars technica reports on draft federal legislation, the Broadband Census of America Act, that would define broadband as 2Mbps and have the National Telecommunications and Information Administration create a searchable, Web-based map census of broadband availability. The cable/telco duopoly has historically resisted such maps since they would show large portions of their service areas don't include broadband access and discredit providers' claims that market dynamics are filling America's broadband black holes.

A broadband census has already been enacted in California as part of that state's Digital Infrastructure and Video Competition Act of 2006, AB 2987. It requires those providers who hold broadband "video franchises" issued by the California Public Utilities Commission to provide the PUC broadband penetration data by census tract each year beginning April 1, 2008.

Tales from the dark side of the digital divide, 95709

Nearly seven years ago, a postcard arrived in the mail from Internet Service provider EarthLink announcing that DSL was available in my El Dorado County, California neighborhood. That turned out to be premature — very premature. Seven years later and two years after a promising community meeting with a regional manager for the incumbent local exchange carrier (ILEC), then-SBC Communications and now AT&T, DSL is still not available despite fiber optic cable less than two miles away on a frontage road for a major U.S. highway. Nor is Comcast cable, which recently declined to extend its existing cable plant located a mile and a half away, citing a franchise agreement that allows it to skip neighborhoods that aren’t set up like densely developed common interest developments with zero lot lines.

Today, another postcard — actually the size of a flyer — arrived in the mail. This one from HughesNet satellite Internet and addressed to:

DIAL UP INTERNET USER AT
ADDRESS
CITY, STATE, ZIP

"Been overlooked by DSL and cable?” it asks. “Your high-speed Internet solution has arrived."

Judging from a neighbor’s experience with HughesNet, I hardly think so. It’s maddenly sluggish and not surprisingly so considering each keystroke to load a Web page must make a 46,000 mile round trip up to the HughesNet satellite and back down to the surface. For months, about 20 percent of his inbound email wouldn’t download to his Outlook Express program. So we installed Thunderbird mail as an alternative. The emails came in OK, but nothing would go out.

We spent two hours on the phone with some incompetent HughesNet support guy in Bangalore who couldn't solve the problem. So my neighbor is now relegated to using HughesNet’s crappy Web-based mail program. That’s not all. About a month ago, his granddaughter downloaded a TV program and HughesNet responded by throttling down the throughput to dialup speed as punishment for using too much bandwidth since it has too many ex-dialup desperados trying to cram onto too little HughesNet bandwidth. Many of these ex-dialuggers including my neighbor — large numbers of them seniors simply seeking a viable Internet connection to share pics with the grandkids — have been sucked into signing two-year contracts for what more aptly should be dubbed “MolassesNet” on steroids.

I imagine in another two years, another postcard will arrive in the mail addressed to:

DIAL UP INTERNET USER AT
ADDRESS
CITY, STATE, ZIP

Telecom association chief's assertions at odds with reality

United States Telecom Association President and CEO Walter B. McCormick Jr. filed comments with the Federal Communications Commission this week that contained two key myths of telco propaganda when it comes to broadband deployment in the U.S: 1) that competition is speeding broadband deployment and 2) that telcos are investing in broadband deployments in less densely populated areas of the U.S.

“In addition to deploying new and innovative products and services in urban and suburban communities, telecom companies are spending billions of dollars to reach many of the most geographically challenging and expensive rural areas in the nation,” said USTelecom President and CEO Walter B. McCormick Jr. “The FCC’s market-based policies encourage communications companies to stay ahead of the competition and continue to make significant infrastructure investments. These policies are working and we strongly urge the Commission to allow the highly competitive broadband market to continue to thrive.”

First of all, there's no real market competition in areas that lack broadband access since no one's providing service there. Second, telcos are NOT investing in infrastructure in less populated portions of their service areas. Just the opposite. Infrastructure investment is being concentrated in urban areas such as AT&T's Project Lightspeed and U-Verse initiatives and Verizon's FiOS fiber optic deployment. The FCC's own research found that as of last June, more than 20 percent of telco customers couldn't even get DSL over telcos' aging copper cable plants.

Protecting the telco/cable duopoly

This story out of New York state shows that telcos (in this case, Verizon) can offer broadband-based Internet Protocol TV (IPTV) in without legislation the telcos are seeking in the Empire State to put the state in charge of issuing so-called "video franchises" In this case, Multichannel News reports, the towns of West Haverstraw and North Castle approved Verizon's applications to provide IPTV over its propriety fiber optic FiOS infrastructure.

The telco/cable duopoly has pursued similar legislation in about a dozen states, claiming it would allow them to bypass local governments, bring greater market competition (pretty hard to do in a duopolistic market) and deploy broadband-based services more rapidly. However, at the slow pace at which the telcos and cable companies are expanding the availability of their broadband services, doing with local government regulation one area at a time certainly doesn't seem to be an impediment.

Rather than speed up deployment of broadband, the true objective of the state franchise measures, like a recently-promulgated Federal Communications Commission rule (which is being legally challenged by local governments), is to protect telcos and cable companies from local government demands they hasten the build out of their infrastructures in order to make broadband available to unserved areas.