The telco video challenge: 25Mbs or bust

Here's an interview in the DesMoines Register with Qwest's Iowa President Max Phillips. It shows while telcos like Qwest desire to get into offering video programming like cable companies and push for state statutes easing the way into the market, they face a daunting technological challenge doing that over existing copper cable pair that was originally designed to carry analog voice signals and not huge amounts of digital data.

"We offer up to seven megabits in Des Moines. You've probably got to get those speeds up somewhere in the 25-megabit range to make this product work," Phillips tells the newspaper.

Getting that kind of throughput on a reliable level in order to support video appears to be a major reach, particularly when much of the telcos' existing copper cable plant can provide only 1.5 Mbs DSL service tops -- and in many areas can't provide DSL at any speed.

Verizon sends mixed messages on need for Mass. state franchise legislation

Last month, I noted local government franchising doesn't seem to be slowing down telcos like Verizon who have backed legislation in various states that would put the state instead of local governments in charge of issuing franchises. I pointed to Verizon's progress in New York and also questioned why given the slow pace of telco broadband infrastructure deployment there would be any need to bypass the locals in the first place.

The telcos complain it takes too long to deploy new broadband infrastructure to support IPTV (Internet Protocol Over TV) when they have to negotiate agreements with local governments one jurisdiction at a time.

This week, The Boston Globe reports Verizon officials concede that local governments in Massachusetts are not slowing Verizon's rollout of its fiber to the home FiOS infrastructure, undercutting Verizon's claim state franchise legislation is needed in that state.

Why the private market fails on broadband

Robert D. Atkinson, president of the Information Technology and Innovation Foundation, a Washington, DC-based technology policy think tank, explains why the private sector -- mostly represented by the telco/cable duopoly -- fails when it comes to deployment of broadband infrastructure, resulting in uneven distribution where some neighborhoods have broadband access while others don't:

To be sure, the conservative faith in markets is amply justified in many areas where consumer choice leads to the best outcomes. No one is calling for a national iPod policy or for tax subsidies on Blu-Ray DVD players, for the good reason that these are consumer items that the market best allocates.

But broadband is different: market failures lead to it being undersupplied. The principle market failure is that the provision of broadband involves what economists call "positive externalities."

For example, the fastest broadband connections simultaneously support a host of digital video, voice, and data applications, like telemedicine. Yet the success of these applications is hindered by a classic "chicken or egg" dilemma: they will not develop without a market of high-speed broadband subscribers, but consumers need these applications as a lure to enter the high-speed broadband market in the first place.

So yes, conservatives are right. Proactive policies and incentives for more broadband might "distort" the market. But they are wrong in saying that this distortion would outweigh the benefits. In fact, the innovation and productivity spurred by more and faster broadband is likely to vastly exceed any minor losses from "misallocation" of economic resources.

Broadband has become the 21st century equivalent of a "chicken in every pot." Everyone is in favor it. But the real issue is not whether broadband is good and more is better, but whether the market alone will provide the right amount of it anytime soon. The OECD numbers suggest that we can do better. Now it's up to us to do so. We can start by crafting and implementing a proactive national broadband policy.

Waxman calls for GAO review of federal broadband efforts

More than a decade after the enactment of the federal Telecommunications Act of 1996 that directed the Federal Communications Commission to encourage the deployment of broadband, a House oversight committee wants to determine what has actually been accomplished.

Henry A. Waxman, chairman of the House Committee on Oversight and Government Reform, asked for the review in a May 22 letter to Comptroller General David M. Walker. Waxman also wants information on how widely broadband is deployed and who has access to it.

AT&T Worldnet founder predicts universal residential wireless broadband by 2012

For those of you wondering when you'll ever get DSL, AT&T Worldnet founder Tom Evslin has a prediction: probably never. The reason: residential land line service will all but disappear by 2012 as telcos abandon the foundation of the U.S. telecommunications system, copper cable.

Rather than wimpy DSL that can't reliably propagate more than three miles from the phone company central office, Evslin prognosticates, homeowners will get broadband via WiFi-enabled mobile phone services. “Trust me, by 2012 we’ll all have wireless hotspots in our homes by one means or another,” Evslin wrote.

Evslin points to the high cost of maintaining copper cable in less densely populated areas and the continuing decline of residential land lines as people migrate to mobile phones as their primary telephone number.

Evslin could be onto something. Just last week, AT&T sent out a market research survey to gauge interest in a potential product called Unify that would combine voice and Internet service and chose either a wireline or wireless broadband connection depending upon the subscriber's location.

The coming broadband traffic jam

Two former assistant secretaries of commerce -- one from the Bush administration and the other from the Clinton administration -- warn of a coming digital deluge that threatens to clog the Internet.

Point well taken. Many Americans get broadband over twisted copper cable designed for the pre-Internet era. Even the relatively bigger pipe offered by the cable providers may max out soon without additional bandwidth. Finally, there are millions of Americans still stuck on the dirt roads of dial up, unable to reach the broadband highway.

"Video competition" is all about broadband access

The failure of AT&T state "video franchise" legislation in Tennessee last week shows a major discrepancy between AT&T spin and perception. While Ma Bell may claim she wants to bring competition for television programming by offering a cable TV alternative called U-Verse using Internet Protocol over Television (IPTV) technology, local governments and consumer advocates correctly see the real issue isn't about a mere cable TV alternative, but more broadly -- pun intended -- broadband access itself since IPTV by definition requires broadband.

Since U-Verse is deployed only in selected areas, large areas will not only go without IPTV but broadband access altogether since these gaping broadband black holes remain on early 1990s dial up technology or a satellite, a costly, crippled poor broadband substitute. Those living in areas fortunate enough to have broadband by today's standards using Digital Subscriber Line (DSL) service may not in as little as 3-5 years as broadband applications and their bandwidth demand continue to grow.

AT&T says that the bill would have increased competition in the pay-TV sector, by presenting viewers with another option aside from cable and satellite providers.

Opponents of the legislation, however, claim that it would have allowed AT&T to cherry-pick high-income neighborhoods for the service, potentially widening the so called “digital divide” between rich and poor.