Holy fiber, Batman! The Rainbow Rabbit may be leaping into Greater Gotham

Possibly sensing weakening commitment on the part of the dominant telco, Verizon, to construct fiber to the premise Internet infrastructure to serve the greater New York City area, a Multichannel News report this week suggests Google Fiber may have greater Gotham in its sights for expansion.

According to Multichannel News, Google Fiber is recruiting a sales manager for the region but isn't confirming -- for now at least -- that it plans a fiber to the premise build in the area.

Google Fiber could also see potential opportunity next door in New Jersey, where Ars Technica reports Verizon mounted an astroturf email campaign to get the blessing of Garden State regulators to wimp out of a premises infrastructure service commitment made more than two decades ago in 1993.

Broadband faces a fork in the road - Computerworld

Broadband faces a fork in the road - Computerworld: Experts who worked on the National Broadband Plan approved in 2010 recently warned that there is still a great need for connecting unserved homes, libraries and schools with even basic broadband at less than 4 Mbps. Most of these unconnected homes are in poor inner city neighborhoods and rural areas.

Not an unexpected outcome when a "plan" is essentially an aspirational expression rather than a concrete project plan to deploy Internet infrastructure. Also, it should be noted there are plenty of unconnected homes that aren't in inner city neighborhoods and rural areas. They can be found anywhere in the United States where residential density is non-contiguous, leaving gaps and pockets of homes redlined by incumbent telcos and cable companies.

Summers urges infrastructure construction to revitalize torpid economy. How about fiber to the premise?

The Perpetual Bubble Economy - NYTimes.com: “A strategy that relies on interest rates significantly below growth rates for long periods of time virtually guarantees the emergence of substantial bubbles and dangerous build-ups in leverage,” Mr. Summers wrote recently. “The idea that regulation can allow the growth benefits of easy credit to come without the costs is a chimera.”

A better route, Mr. Summers argued, would be to run deficits, perhaps indefinitely, even during economic good times. To help the economy right now, for instance, he argued for huge infrastructure spending, especially since money is cheap and so many construction workers are out of a job.

In addition to bridges and highways, water distribution systems and other public infrastructure, why not a public works project to bring fiber optic telecommunications service to every American home and business premise? Especially when 20 to 30 percent of them are left off the Internet grid?

New Telehealth Program Aims To Increase Specialist Care in Northern California - California Healthline

New Telehealth Program Aims To Increase Specialist Care in Northern California - California Healthline
Adequate Internet infrastructure providing sufficient bandwidth is identified as a major challenge to the implementation of the program, which would alleviate the need for patients in rural areas to travel long distances to visit healthcare providers.

Colorado measure would bar Internet infrastructure subsidies to small towns served by satellite ISPs

Broadband act could expand service in Chaffee County - TheMountainMail.com: Free Content: As introduced, the bill’s language would define unserved areas as: areas outside a municipality or a city with less than 5,000 people in which a majority of households do not have access to at least one satellite and one non-satellite broadband provider.

Summed up in two words: Useless and laughable. It basically tells Coloradans with no other premise Internet options to go suck a satellite and be happy with the crappy customer experience, bandwidth "fair access" caps and poor value. A bill only the incumbent preservatives could love. Indeed, they probably drafted it.

Event highlights scarcity of high-speed Internet in rural areas | The News Leader | newsleader.com

Event highlights scarcity of high-speed Internet in rural areas | The News Leader | newsleader.com: During a break, Korte explained how he, his wife, and their business, The Balance Group, switched to 4G cellular broadband service. However the data limits cellphone providers set make business more expensive, Korte said.

They’ve had to stick with it, though, and absorb the cost from exceeding data caps.

“I go to the (cellphone provider) and say, ‘Well, we need 300 gigabytes a month. That would probably do it.’” Korte said. “They laugh at it, and tell me to go to the cable company.”

Like many residents in Augusta County and those served by the two-dozen other rural, local government officials gathered for the workshop, cable service doesn’t extend to his home.

This pretty well sums up the sorry state of Internet infrastructure in much of the United States and trying to get by on mobile wireless.

The case for overbuilding incumbent telcos and cablecos

Twentieth century, metal wire-based legacy incumbent telephone and cable companies naturally don’t like it when progress inevitably emerges in the form of 21^st century fiber optic to the premise (FTTP) telecommunications infrastructure offering the proverbial better (and faster) mousetrap as well as protection against technological obsolescence. Particularly if they have opted not to construct it and someone else is planning to do so. Especially if the new fiber infrastructure benefits from government subsidies. No fair, incumbents protest. That’s government subsidized competition that picks winners and losers and we’ll lose.

That argument cuts both ways, asserts Christopher Mitchell of the Minnesota-based Institute for Local Self Reliance (ILSR), one of my favorite incumbent spin busters. Incumbents have benefitted from favorable governmental policies that have been in place for decades including the availability of high cost subsidies and public policy that permitted them to maintain a monopoly. Not allowing government subsidization of FTTP infrastructure built by non-incumbents in the footprints of the incumbents, Mitchell suggests, is a double standard.

Given that telecommunications infrastructure must be broadly dispersed in order to be economically viable and adhere to Metcalfe’s Law, Mitchell accurately notes FTTP infrastructure builders must be able overbuild outmoded incumbent infrastructure when they opt not to upgrade to FTTP -- and receive government subsidies for doing so if available. That’s eminently fair and good old American progress – the same progress that brought electricity to large swaths of the nation in the 1930s when market forces alone could not do so.

As for the incumbent argument they will come out losers, Mitchell observes incumbents have made losers out of nearly 20 million Americans who according to a 2012 Federal Communications Commission estimate live in neighborhoods incumbents redlined and declined any wireline premises Internet connectivity, leaving them to dialup and satellite.

Click here to hear Mitchell and ILSR colleague Lisa Gonzalez elaborate in a 13-minute podcast.

U.S. at inflection point on premises Internet infrastructure

The United States is at an inflection point relative to premise Internet infrastructure serving homes and small businesses. The “walled garden” business model of legacy incumbent cable and telephone companies has reached the limits of its reach. Connecting the remaining 20 to 30 percent of premises outside the wall isn’t economically practical as testimony at a U.S. House Small Business Subcommittee hearing this week in upstate New York illustrates.

Mark Meyerhofer, a government relations administrator for Time Warner Cable, said while there has been a change in the national mindset that favors a greater focus on unserved areas, nevertheless “It remains extremely challenging to extend broadband to most rural areas of New York State, where geographic isolation and topographic issues make it economically infeasible for companies to reach these areas,” Meyerhofer explained. “Investments simply cannot be recouped before it is time to reinvest.” Although Meyerhofer was specifically referring to only one part of the country, his testimony applies elsewhere across the nation including many suburban and exurban areas where service gaps exist. That economic reality of the walled garden Internet also applies to Google Fiber, which plans to expand into several metropolitan areas.

The other challenge faced by the legacy incumbent providers (but not Google Fiber) is the ever growing demand for more Internet bandwidth. It’s similar to the problem facing manufacturers of silicon-based microchips that eventually will reach a physical barrier where no additional circuitry can be crammed onto the chip. That will require the incumbent providers to change out their metal wire-based premise service infrastructure with fiber optic connections to accommodate the additional bandwidth demand and stave off technological obsolescence. But barring a revolutionary breakthrough that significantly reduces the cost of constructing fiber to the premise infrastructure, their shareholders aren’t likely to approve of such large capital expenditures that could cut into dividends as shown by Verizon’s 2012 pullback of its FiOS fiber to the premise product offering.

Given the growing consensus that the so-called “last mile” premise Internet infrastructure challenge can’t be met within a commercial framework, it strongly suggests other business models including a nonprofit cooperative or public works approach similar to that used for roads and highways will be necessary in many areas of the U.S.