Broadband

Clearwire has announced plans to operate its proposed national WiMax network as an open access system, and major players like Sprint, Comcast, and Time Warner have apparently already agreed to become resellers on the network. It will be interesting to see how this turns out, as an enormous investment will be required to build the national infrastructure required to meet the promised goals. One of the backers of Clearwire is Sprint, which is losing cellular marketshare rapidly, and may regard Clearwire as its last chance to keep from being broken up and sold.

Once again, fairly small countries are far ahead of the U.S. in thinking about broadband. Malaysia has announced an ambitious but entirely doable plan to take fiber to major areas of the country, with the Federal government paying about 30% of the cost in a deal with the biggest telecom company in Malaysia. In the U.S., it would be the equivalent of the states making deals to write checks directly to the incumbent providers (which some states already do).

VPNs, or Virtual Private Networks, are fast becoming a major issue with respect to broadband. A VPN is a way for a remote user (e.g. from home, traveling) to be connected to the corporate or business network as if he or she was in the office. It gives the home-based worker or business traveler complete access to all the documents and services he or she would normally have sitting at their desk.

Chicago ComEd electric power customers may end up paying an extra $3 per month to help fund a Smart Grid data network that will allow ComEd to better control power use and to speed diagnosis and identification of power outages.

Telehealth services are the sleeper when putting together a business model for community broadband projects. Telehealth services, which will be focused primarily towards the elderly but will also provide additional mobility and freedom for those with chronic health conditions, will have a substantial positive impact on the financial health of a community or municipal open services, open access broadband network.

FCC Commissioner Deborah Tate spoke on the last day of the Broadband Properties conference. She had some interesting statistics that should give pause to anyone who thinks that DSL and cable modem broadband services are "good enough." Commissioner Tate noted that:

At the Broadband Properties Summit, there was a case study on IP TV (TV delivered via broadband). DirecTV and an apartment owner in Alexandria, Virginia teamed up to provide competitive TV services in a large, 350 unit apartment building. Some of the highlights of the experiment:

Prior to the introduction of the new service, the biggest tenant complaint was about the incumbent TV provider service. The number one tenant demand was for more choice in selecting a TV provider.

After introducing the competitive DirecTV service, complaints are down and compliments are up.

Bruce Mehlman, from the Internet Innovation Alliance, which is a lobbyist group in D.C., had some interesting statistics on the state of broadband in the U.S. today. He spoke this morning at the Broadband Properties Summit.

Dan Rogers, an economic developer from Kendall County, Texas, just told a story about a conversation that just occurred last week. A middle manager who lives in Kendall but commutes about an hour to work out of the region related to Rogers that he had negotiated an agreement with his firm to let him work two days a week from home to save on the cost of commuting. He was able to do that because he has fiber to the home and can access the corporate network as if he were sitting in his office at the main company location.

The sharp increases in gas and diesel fuel are raising the cost of commuting. Even if fuel prices recede (as they did after the '73 oil crunch), it seems likely that we will never see $2 gas again, and it may be that $3 gas becomes the new normal.

While the cost of fuel affects everyone to some extent, rural communities may be at most risk. Many workers in rural towns drive long distances to work, and a doubling of the cost of such drives may make it too expensive to make those commutes for a $12 or $14 per hour job.

A senior AT&T official has indicated that video is eating up Internet capacity at a rapid rate, and predicted that in three years, the demand for video in all forms, especially HD video, will put enormous strains on the Internet and Internet access providers like AT&T. Here is the key quote:

Video will be 80 percent of all traffic by 2010, up from 30 percent today,"

The use of BitTorrent, a peer to peer file sharing service, is up 24% in the past four months. Like the big jump in YouTube traffic in December, some it may be related to the writer's strike. The lack of anything new on that old-fashioned TV thingy in the rec room apparently had people headed in droves to the Internet for some mindless entertainment. And of course, the Internet has plenty of mindless entertainment.

The City of Seattle, which selected the open access, open services model as a general direction for its municipal broadband effort last year, is planning to issue an RFP to actually select a fiber to the home vendor. City officials continue to be dismayed with the service offerings from the incumbent telephone and cable companies.

According to a New York Times article, Europe is pulling far ahead of the United States in high performance broadband deployment. European countries, led by Sweden, Denmark, Holland, and Finland, are adding 50,000 broadband lines a day.

Christopher Mitchel of the Institute for Local Self-Reliance has written an article in the current issue of Broadband Properties.

There was widespread speculation last week, including a cover page article in USA Today, that the March Madness basketball tournament would create widespread Internet slowdowns. The NCAA decided to make all 65 games available on the Internet, leading to predictions of clogged networks and low productivity at work while employees sat at their desk and watched "TV" on their computers.

The IP TV basketball games are yet one more strong signal that there is a sea change underway as more and more people are tuning in to watch video via the Internet, rather than on "television."

Here is a short, two page paper that defines the characteristics of a modern community broadband infrastructure designed specifically to encourage economic development and jobs creation. The overall approach is focused on public/private partnerships that creates new business and market opportunities for services providers so that local government telecom investments are not seen as "competing" with the private sector.

An interview with the new head of Qwest, Edward Mueller, has some surprising (or not so surprising) comments from the CEO. When asked about fiber to the neighborhood and fiber to the home, Mueller responded, "It's too expensive. We don't see the return."

There are still a lot of community leaders who doubt the importance of broadband, but one city official I spoke to earlier this week said they had a Fortune 500 company that told him the firm loses a million dollars an hour for every hour their Internet connection is down. This firm is urging the city to help get additional fiber cable paths in and out of the community so those kinds of outages can be avoided.

If you live in Paris and have the new 100 megabit fiber to the home service, it only takes about ten minutes to download a high quality version of a one hour TV show. Here in the U.S., the FCC has announced that more than 95% of the U.S. has broadband. The FCC defines "broadband" as "anything faster than 256 kilobits, or about 400 times slower than the current Parisian definition of broadband.