Vermont and Norway Join Push For Universal Broadband

Hot on the heels of Sen. Rockefeller's demand for 100Mbps broadband, echoing the sentiments of the FTTH Council, Vermont has passed a so-called "e-state" bill that requires adequate cellular and broadband coverage across the entire state. This is monumental for a rural state where those living outside of cities often don't have access to more than basic phone service. Norway has also joined the push for universal broadband access, realizing that a digital divide between urban and rural is bad for the economy. The Universal Broadband Express is really picking up some steam!

(See full articles here, here and here.)

Could FIOS Spell The End For CLECs?

Prepare to have less choice for local phone service. Thanks to FCC rules, incumbent carrier are not required to share their new fiber networks with competitors the same way they shared their copper networks. Considering that upgrading to Verizon's FIOS is a one-way street (no going back to copper for you!), competing phone companies are rightly worried that they could be entirely pushed out of the market. More than ever, municipal networks like UTOPIA make more sense for bringing true competition into the market by remaining vendor-neutral.

(See full article here.)

Cable Companies Thwart DVRs, CableCARD

In two related news stories, cable companies are clamping down further on network control by skirting around the requirements to support CableCARD and force DVR owners to watch ads. In testimony before congress, TiVo has alleged that cable companies are starting to use protocols and signaling that's incompatible with the uni-directional CableCARD standard. CableCARDs are designed to allow you to plug a digital cable signal directly into the device of your choice without a special box from the cable company, just like the old analog cable used to do. Bypassing support for "bring your own device" standards ensures that the cable company can keep you renting their equipment indefinitely, imposing significant trouble with using third-party devices such as DVRs and TV tuner cards for PCs.

Related to this is Cox Communication's recent announcement that they would no longer let customers renting their DVR to skip commercials for some content from ABC and ESPN, both Disney companies. I guess they missed the part where most people buy a DVR just for that purpose, eh? They probably also forgot to read the numerous reports that fast-forwarded ads are recognized just as much as ads played at normal speed. Boo on them for trying to force more ads down our throats.

Once networks like UTOPIA start breaking up the monopolies, maybe these companies will start to comply with interoperability requirements. 

(See full articles here, here and here.) 

Congressional Push for 100Mbps

Sen. Jay Rockefeller of West Virginia wants broadband and he wants it now. He's just introduced a resolution (albeit non-binding) to push for universal 10Mbps access by 2010 and 100Mbps by 2015. Because it's non-binding, it amounts to little more than fist-shaking at providers who've been dragging their feet, but I suppose it's the thought that counts.

With the upcoming phase-out of analog TV signals to free up so-called "white space" and the auction of the lucrative 700MHz spectrum by the FCC, wireless might get a needed boost to be just what the doctor ordered for rural areas. For most areas, Sen. Rockefeller supports fiber networks similar to what the Koreans and Japanese already enjoy.  The non-binding resolution doesn't have any teeth, but it may pave the way for better speeds, truly universal access and increased competition in the broadband market.

(See full article here.)

Comcast Demos 150Mbps Cable Modem

Comcast's CEO demonstrated a DOCSIS 3.0 cable modem today running at a speed of 150Mbps. It works by building on DOCSIS 2.0 to include channel bonding of up to 4 channels. The real question to be asked is why we need this. Comcast could be using DOCSIS 2.0 with its 45Mbps limit and still not come anywhere near that speed. Even with DOCSIS 3.0 approved, the tech won't hit consumers for at least another year and isn't likely to be available to more than 40% of cable subscribers by 2012.

If you make a really fast Internet service and don't make it available, does it even matter? Survey says no.

(See full articles here, here and here.)

Comcast Slams Subscribers With Contracts, Early Termination Fees

Want to keep that special triple-play pricing in effect for longer? Just hope you don't want to cancel anytime soon. Comcast has started trying to sucker you into a 2-year contract for the service to lock in the rate with a $150 early termination fee if you cancel OR DOWNGRADE service before it's up. They'll also retroactively charge you the regular price for all of the months you had service, making switching providers a very expensive proposition. I suspect they're looking for ways to cut down on customer churn and shut out competitors to bleed them dry. With networks like UTOPIA and a myriad of new municipal and private wireless options, they're starting to sweat.

(See full article here.) 

Meeting with DynamicCity

I was invited to pay a visit to the offices of DynamicCity last Friday to talk about what can be done to help spread UTOPIA. (For those that don't know, this is the company in charge of building the physical plant for UTOPIA.) A special thanks to Joel, Cory and Keith for taking time out of their day to talk to me.

There's some really exciting stuff on the horizon. A few years ago, the legislature passed SB66 to limit participation in UTOPIA by barring new cities from joining before July 1, 2007. Qwest was the main pusher of the bill and originally wanted to use it to kill the project. The moratorium was seen as a compromise that Qwest and UTOPIA member cities could live with. Now that it's coming up for expiration, new cities will be free to join the project.

We also spent a lot of time discussing how to bring UTOPIA to unincorporated county lands. It seems that the best solution is to create a special improvement district in conjunction with the White City Community Council. This would overcome the issues with not being a city without having to amend the law to make unincorporated areas eligible. This is going to be untested water since the law explicitly permits cities but doesn't specifically permit other entities. (By the same token, an SID is not explicitly prohibited either.) The next step is to round up some of my neighbors and start talking to Community Council members at next month's meeting to gauge the interest level.

If you live in White City and want to see UTOPIA in your area, please contact me as soon as possible. The next meeting is Wednesday June 6th at 7PM at Eastmont Middle School, 10100 S. 1300 E. Room #105 in Sandy. If a bunch of us show up in support of this project, we just might be able to get it rolling here and pave the way for other unincorporated areas to do the same.

Earthlink Scaling Back Muni WiFi on Big Losses

With low take rates, political spats and pesky introductory discount rates, Earthlink posted a $30M loss for Q1 blamed on a shrinking dial-up business and expensive WiFi rollouts. With just 2,000 regular subscribers, a handful of government contracts and the upcoming auction of the lucrative 700MHz spectrum by the FCC, Earthlink is poised to bleed serious red ink for some time to come.

(See full article here.) 

Latest Provo Budget Shows Future of iProvo

Provo Mayor Lewis Billings rolled out a new city budget where iProvo funding takes center stage. The city plans to loan an additional $1M to the project to cover bond payments while seeking additional service providers and pushing additional commercial accounts. Signing up businesses for iProvo service will be critical since commercial accounts are willing to pay more for faster Internet thus producing higher margins. Businesses accounts are also far less likely to suffer from the same level of "churn" that hits residential accounts. With these two changes, it seems like the light at the end of the red ink tunnel may finally be approaching.

(See full article here.) 

Companies Building Fiber Punished By Short-Sighted Investors

It's earnings report season, and it looks like the short-term thinking of investors has been ruling the day with telcos. Verizon has watched earnings tumble as they make significant investments in their FIOS system while Qwest tripled their profits by building a whole lot of nothing and cutting retirement benefits. Investors have reacted accordingly to drive Qwest stock higher while Verizon stays flat despite their significant investments in an upgraded network they are likely to use for the next fifty-plus years. Meanwhile, AT&T's second-rate U-Verse network is slow but cheap, keeping investors happy while putting on a "we do fiber too" facade for the general public. It's only a matter of time, however, before those last mile issues catch up to them and force the expensive upgrades that Verizon has already jumped on top of.

Diving deeper into Verizon's numbers, we see that the take rate for FIOS is about 13% of homes served with a jump of over 20% in the last quarter alone. Over 42% of Verizon's new broadband customers signed up for FIOS so the demand for the higher-speed connections is definitely there. Verizon has also positioned itself as a triple-play provider with this network and has been entering new markets to aggressively compete with incumbent phone and cable providers. Companies like Qwest and AT&T that refuse to make these kinds of capital investments are going to be stuck in the perpetual state of catch-up with more nimble competitors and networks.

Who knew that big, bad Verizon would end up being the company to lead the charge on making good on the industry's broadband promises? Better late than never.

(See full articles here, here and here.)