AT&T is experiencing declining revenues in its residential wireline market segment, the telco's chairman and CEO Randall Stephenson told Citi's Entertainment, Media and Telecom Conference. Wall Street responded by pushing down AT&T's share price 4.7 percent to $39.10 in afternoon trading.
The Associated Press quotes Stephenson as blaming softness in the residential wireline segment on disconnections by consumers struggling to pay household bills.
However, what's likely the real reason is AT&T's own flawed residential strategy. AT&T has stubbornly resisted investing in upgrades to its aging and increasingly obsolete last mile copper-based distribution system. Consequently, the telco is unable to offer high speed Internet services and bundles of voice and broadband within large portions of its 22-state service area to the residential and growing home office-based market segment.
Moreover, AT&T's Project U-Verse rollout offering "triple play" bundles including television service based on a hybrid of fiber optic and copper cable has run into a variety of technological and market-based obstacles, causing the company to consistently miss projections for new U-Verse customers.
Tuesday, January 08, 2008
Friday, January 04, 2008
Netflix's movie-to-TV scheme premature
Netflix's announcement that it will deliver downloadable films directly to televisions via high speed Internet connections is clearly premature given the current pathetic state of America's broadband infrastructure. Even compressed, full motion audio and video requires lots of bandwidth -- and that bandwidth isn't there for most U.S. households. Even more so with high definition video, which Netflix ultimately hopes to deliver.
Many households lack even basic broadband access needed to view graphics-intensive Web sites. A significant portion of those that have high speed Internet access connect at speeds too slow to make regular movie downloading technologically feasible.
Netflix's move is part of a broader trend in which the content providers will drive broadband deployment. Without these bandwidth dependent applications creating demand for enhanced broadband connections, progress would likely continue to move at a glacial pace, increasing the ever-widening digital divide.
Many households lack even basic broadband access needed to view graphics-intensive Web sites. A significant portion of those that have high speed Internet access connect at speeds too slow to make regular movie downloading technologically feasible.
Netflix's move is part of a broader trend in which the content providers will drive broadband deployment. Without these bandwidth dependent applications creating demand for enhanced broadband connections, progress would likely continue to move at a glacial pace, increasing the ever-widening digital divide.
California communities lacking basic phone service underscore Golden State digital divide
This Sacramento Bee story about a small Northern California enclave not far from the state capitol of Sacramento finally getting telephone service sheds some light on why advanced telecommunications services based on broadband Internet access are lagging in the Golden State. After all, if some communities in a state that prides itself on its technological leadership are only now getting plain old telephone service (POTS) nine years into the 21st century, it's a safe bet that there are plenty of others with phone service that lack the necessary infrastructure to provide high speed Internet access.
The Bee story notes a "surprisingly long list of far-flung California communities still lacking telephone service: Lost Hills in Fresno County, Pine Mountain in Kern County and Siskiyou County's Eddy Gulch, Godfrey Ranch and Swillup Creek, to name a few."
Last fall, the Federal Communications Commission reported that nearly 20 percent of California telco customers weren't offered DSL service as of the end of 2006. (See Table 14)
In July, a Public Policy Institute of California concluded California is riddled with broadband black holes due to lack of access to broadband services, finding only about 30 percent of Northern Californians can get them.
The Bee story notes a "surprisingly long list of far-flung California communities still lacking telephone service: Lost Hills in Fresno County, Pine Mountain in Kern County and Siskiyou County's Eddy Gulch, Godfrey Ranch and Swillup Creek, to name a few."
Last fall, the Federal Communications Commission reported that nearly 20 percent of California telco customers weren't offered DSL service as of the end of 2006. (See Table 14)
In July, a Public Policy Institute of California concluded California is riddled with broadband black holes due to lack of access to broadband services, finding only about 30 percent of Northern Californians can get them.
Hawaii Broadband Task Force issues preliminary report
Following the lead of state-level broadband task forces in California, Kentucky, North Carolina and Ohio, the Hawaii Broadband Task Force has issued its intial report to the governor and legislature.
During 2008, the task force plans to work with the federal government and other states to determine how many states have initiated broadband data collection projects, created unified authorities to drive broadband deployment, and instituted regulatory reforms.
The Hawaii panel will also determine whether other states have considered policies to increase the deployment of Fiber-to-the-Home (FTTH) or are relying exclusively on telcos and cable companies to make their own business cases for these investments based on expected return to investors/owners.
The task force will wrap up its work with recommended policy, regulatory, informational, developmental, and leadership initiatives "that would stimulate both the demand for and competitive supply of advanced broadband capability and services throughout the state."
California's Broadband Task Force, which has a similar charter to Hawaii's, issued an interim report several months ago. It was set to issue a full report in December that is now expected to be completed sometime this month.
Monday, December 31, 2007
California Broadband Task Force report delayed
A report by Gov. Arnold Schwarzenegger's Broadband Task Force making specific recommendations on "how California can take advantage of opportunities for and eliminate any related barriers to broadband access and adoption" has been pushed back until sometime in January, a spokeswoman for the governor confirms.
The report was due out in late November under an executive order issued by the Governor in November 2006. About a month ago, Schwarzenegger had told the University of Southern California's Annenberg Center for the Digital Future conference it would be released in December.
The report was due out in late November under an executive order issued by the Governor in November 2006. About a month ago, Schwarzenegger had told the University of Southern California's Annenberg Center for the Digital Future conference it would be released in December.
Friday, December 21, 2007
Comcast applies for California video franchise
Comcast has joined cable providers Cox, Time Warner, Charter and Wave Broadband in applying for a statewide franchise with the California Public Utilities Commission under the Digital Infrastructure and Video Competition Act that took effect in early 2007.
Comcast's Dec. 12 application can be viewed on the CPUC's Web site.
Comcast's Dec. 12 application can be viewed on the CPUC's Web site.
California PUC allocates $100 million as broadband build out incentive
The California Public Utilities Commission announced it has formed the California Advanced Services Fund (CASF), allocating $100 million in matching funds for 2008 and 2009 to encourage broadband providers to bring service to unserved and underserved areas of the state. In order to qualify, providers will be evaluated on a broadband throughput benchmark of 3 Mbps download and 1 Mbps upload and would also have to offer Voice Over Internet Protocol (VOIP) service.
The CPUC said the funds will come from a .25 percent surcharge on telephone bills, estimated to be five cents a month for an average customer. The CASF surcharge will be offset by an equal reduction in the California High Cost Fund-B surcharge created to subsidize deployment of basic voice telephone service.
One year ago, your blogger suggested the administration of Gov. Arnold Schwarzenegger direct the CPUC to reform the five funds in California's Universal Service Fund program including the High Cost Fund-B -- which together received a total of $2.8 billion since 2003 to serve more than 7,600 designated high-cost areas -- to help speed the deployment of high speed Internet access in higher cost areas of the state.
The CPUC action sets a deadline of June 2, 2008 for submission of CASF funding requests. Consideration will be technology neutral and applicants will be required to provide a minimum of 60 percent matching funds as a prerequisite for consideration of their applications.
The CPUC decision finds that broadband infrastructure is critical to the economic health and welfare of the state and that "ubiquitous deployment of broadband holds tremendous opportunities for consumers, technology providers, and content providers, and is important to the continued health and economic development in California."
"Today's decision signals that this state is not content to sit around waiting for federal action to bring broadband to every part of our state," said CPUC President Michael R. Peevey. "We encourage every broadband provider in California to be a part of the solution for ending the digital divide in our state and participate in the CASF process."
As with other state-based broadband build out initiatives, the question is whether funding in the millions is sufficient to result in a meaningful expansion of broadband considering that in California and other states, the existing metal wire line based infrastructure is increasingly obsolete for the deployment of advanced telecommunications services and requires billions of dollars of investment to bring it up to date.
Here are links to the decision implementing the program and related proceeding documents.
The CPUC said the funds will come from a .25 percent surcharge on telephone bills, estimated to be five cents a month for an average customer. The CASF surcharge will be offset by an equal reduction in the California High Cost Fund-B surcharge created to subsidize deployment of basic voice telephone service.
One year ago, your blogger suggested the administration of Gov. Arnold Schwarzenegger direct the CPUC to reform the five funds in California's Universal Service Fund program including the High Cost Fund-B -- which together received a total of $2.8 billion since 2003 to serve more than 7,600 designated high-cost areas -- to help speed the deployment of high speed Internet access in higher cost areas of the state.
The CPUC action sets a deadline of June 2, 2008 for submission of CASF funding requests. Consideration will be technology neutral and applicants will be required to provide a minimum of 60 percent matching funds as a prerequisite for consideration of their applications.
The CPUC decision finds that broadband infrastructure is critical to the economic health and welfare of the state and that "ubiquitous deployment of broadband holds tremendous opportunities for consumers, technology providers, and content providers, and is important to the continued health and economic development in California."
"Today's decision signals that this state is not content to sit around waiting for federal action to bring broadband to every part of our state," said CPUC President Michael R. Peevey. "We encourage every broadband provider in California to be a part of the solution for ending the digital divide in our state and participate in the CASF process."
As with other state-based broadband build out initiatives, the question is whether funding in the millions is sufficient to result in a meaningful expansion of broadband considering that in California and other states, the existing metal wire line based infrastructure is increasingly obsolete for the deployment of advanced telecommunications services and requires billions of dollars of investment to bring it up to date.
Here are links to the decision implementing the program and related proceeding documents.
Wednesday, December 19, 2007
Qwest abandons IPTV in Colorado
Qwest, the former Baby Bell US West spun off from AT&T two decades ago, has abandoned plans to deploy Internet Protocol TV in Colorado next year. At the same time, the Denver Post reports, Qwest has shelved lobbying efforts like those pursued by AT&T in its 22-state operating territory to get a statewide video franchise bill enacted preempting local governments and their irksome demands that telcos deploying advanced telecommunications services including video service to compete with cable be available to everyone and not just selected neighborhoods.
The build out issue apparently figured into Qwest's decision:
The build out issue apparently figured into Qwest's decision:
Ken Fellman, former mayor of Arvada and a local communications lawyer, said he respects the company's decision to back off of its video plans. Fellman has asked that Qwest be required to offer video services to all members of a city or town, not certain select neighborhoods.
"It was a concern that Qwest didn't have the financial resources to widely deploy service," said Fellman, who also represents the Greater Metro Telecommunications Consortium. "We would have ended up with pockets of competition. Perhaps in some ways, (Qwest CEO Ed) Mueller came to a similar conclusion."
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