Technology Futures

eWeek has a good article that provides a useful snapshot of anti-muni telecom investment legislation that is that is making the rounds of legislatures (Pennsylvania, Ohio, Indiana).

Some of these laws are so bad it makes your head hurt. Why on earth are state legislatures wading into what is clearly a local issue? It is exactly the same as if these legislators had decided to make public water projects illegal because "it keeps out private companies." Would our communities be better places to live if all water distribution was handled by private companies?

Actually, we know exactly how that turns out, since that is the way things were done in the late 19th and early 20th century. Prior to the 1906 San Francisco earthquake, as one tawdry example, water to the city was provided by several private firms. To save money, they build the main water lines to the city directly over known earthquake faults, and provided no backup means of delivering water.

The earthquake is not what leveled San Francisco. It was the fires that occurred after the earthquake. With all the water lines broken, there was no water to put out fires, and so, over a period of a few days, the entire city burned completely to the ground.

I'm not trying to be hysterical here; my point is that a knee jerk "leave it to the private sector" is not always an appropriate response. Some things really should be done by government, and there is ample precedent to take services that were once offered solely by the private sector and move at least part of them into the public sector--like the transport layer of telecom (NOT the service layer).

Telecom is best done, in my opinion, as public/private partnerships. Are there other ways to do it? Of course there are. But an overreaching principle should be that state and Federal lawmakers should not be usurping the right of communities to decide their own future.

Add Indiana to a growing list of states that have legislatures turning their backs on communities. Legislations is being considered there that would prohibit communities from providing telecom services.

Even though I think that communities ought to stay out of the service business and limit their investments to telecom infrastructure, I think that decision ought to be left to the community, and not be pre-empted by the state legislature.

This is a serious issue that is being co-opted by the incumbents, who are lobbying legislators vigorously. It's not that the legislators are necessarily bad people, it's just that they are only getting one side of the story, and are being unduly influenced.

The answer is education. Local communities and regions need to spend more time with their legislators explaining the issues, and in particular, explaining that there is more than one way for communities to invest. Taking the infrastructure only route is pro-competition, not anti-competition. Unfortunately, few lawmakers understand that. Only by preparing talking points and having local leaders take them out to lunch, or meeting them in their offices at the state capitol, is that situation likely to change.

Cnet has a story about how businesses are grabbing onto Skype, the free telephone service that works over the Internet.

We're just at the beginning of the biggest change in telecommunications since voice telephone service became available 100 years ago.

One of the ways Skype is being used is by business travelers. Roaming charges, lack of cell coverage, and different standards for phones often makes it difficult to call back to the main office easily or without great expense.

If the home office staff and the business traveler have Skype accounts, all the busines traveler has to do is find a broadband connection (sometimes easier now than cellphone coverage) and make a call. Anywhere in the world.

The telephone companies are terrified of this. They don't really want broadband to get out to their customer base too quickly, because it will just accelerate the loss of their analog voice service cash cow.

What's next? In the next year or two, expect an incumbent telephone or cable provider to block certain kinds of services from traveling over their network. That's right, they can block Skype, Vonage, or any other kind of voice call if they think it is competing with their own services.

Just one more reason for community ownership of part of the network.

Take rate is an industry term for the number of customers that agree to buy a service. Take rates are notoriously hard to predict, and historically, take rates for services like telephone and cable service have been very low (e.g. 10%, 15%), meaning it takes years to get most households connected to a new service.

The town of Nuenen, Holland recently installed a blown fiber to the home, open access network, and had a remarkable 96% take rate. This means that essentially, every household that is likely to be a customer became one as soon as the service became available.

This is the global competition.

While U.S. incumbents are gingerly sticking their toes in the waters of *real* high performance broadband by grandly promoting one or two trial projects, overseas, communities are just going ahead and doing what needs to be done. Nuenen's open access network means customers have a choice of providers for their services. Nuenen is proof that not only can it be done, but that there will be customers waiting when the duct goes by the house.

Emtelle, which provided the microduct for the project, has a short video and a four page description of the project. There is some sales stuff in both, but I believe microduct is an excellent approach to implementing community broadband networks.

Quicktime movie?

PDF file