Category Archives: Jeers

San Francisco is intent on using WiMax to reach more rural areas around the Bay Area's numerous hills. Clearwire has bought access from AT&T to start operating a national WiMax network and Qualcomm is set to laugh all the way to the bank. In a move all too reminiscent of Rambus sneaking their patented bits into memory standards, Qualcomm owns a series of patents covering the 802.16 WiMax standard after purchasing a small company that was involved in defining those standards. With that club in hand, they'd had no issues with threatening companies looking to deploy services with heavy royalty fees. With this case of patent trolling likely to drag on for years, WiMax seems like the wrong technology for new wide-spread broadband platforms.

(See full articles here, here and here.)

iProvo might still be some time away from breaking even, or so says the "we'll print anything negative about iProvo" Deseret News. According to the article, a miscalculation places the break-even point with current projections as far away as 2012. The original calculation failed to take into account repayment of funds borrowed from the city's electric department. In the meantime, iProvo plans to increase revenues more quickly by adding one or more additional service providers, marketing more aggressively to individual homes and businesses and exploring new services such as security monitoring and teleconferencing.

Personally, I think they need to bump wholesale rates up slightly for some of the services, especially the Internet service, to reach a break-even point faster. Even paying $45/mo for 15Mbps is a steal at just $3 per megabit and that's still lower pricing than what Qwest or Comcast can offer for the closest comparable service. It'd also pump an extra $600K per year into the project just from higher Internet fees. Tack a few dollars each onto the phone and television and the project could be paying off debt early, lowering rates as the revenues increase.

Whatever they do, they need to start erasing the red ink more quickly. All the bad press is going to soften the resolve of the city in holding onto the network.

(See full article here. And remember, it's the Deseret News: they hate iProvo.)

In a move only a die-hard monopolist would dare engage in, Qwestar Gas is moving to keep individual consumers out of rate hearings. The move is designed to prevent upset customers from criticizing the company and questioning its witnesses at Public Service Commission hearings. This is all despite very few people actually appearing at the meetings and has been prompted by a citizen activist raising Cain over some proposed rate increases.

What does this have to do with broadband policy, you might ask? The Public Service Commission also oversees telecommunications companies. I'm betting that Qwest and Comcast won't waste too much time in supporting Questar's efforts.

(See full article here.)

It's a bad week to be Vonage. A federal court has ruled that all VoIP providers must start collecting and paying into the Universal Service Fund (USF), adding about $1.30 a month to the average bill. Vonage had sued the FCC to protest not only having to pay but having to pay so much compared to wireline and wireless providers.

To top it all off, South Korean telcos have blocked all access to VoIP services not provided by a company registered in South Korea. This would be such a big deal except that US servicemen stationed in Korea use Vonage lines with US numbers to call home without paying through the nose. The shutoff occurred on June 1 after a one-year delay in enforcement.

(See full articles here and here.)

The Supreme Court has given incumbent telcos a free pass on their abuse of monopoly power by dismissing a suit alleging conspiracy to prevent competitors from offering phone and broadband services. While the legal standard for anti-trust could barely not be met, the suit does show a strong history of industry-wide collusion in not entering each other's markets and offering similar pricing and service options throughout the country in a manner similar to the similarly corrupt payday loan industry. The ruling specified that while there is strong evidence of said collusion, it doesn't pass muster with the Sherman Act. Expect telcos to more boldly hinder local competition now that they know they can more-or-less get away with it.

(See full articles here and here.)

Six years ago, a new housing development in Loudoun, VA decided to build an FTTH network as a part of their neighborhood of luxury homes. Today, they're regretting every bit of that decision. Where they went wrong was signing a 75-year contract with a no-name company that has done a poor job of providing reliable services to the point that many residents now use satellite dishes for both TV and broadband. The rub is that even if they don't use the frequently flaky service, they still shell out $150 a month in HOA fees for the service.

There's not much of a chance of firing Open Band, the company providing the services. The developer has a sweet deal in which they will maintain a majority control of the HOA for 20 years after the completion of the development, a period up to 10 times longer than standard. With the developer, Van Metre, getting tons of money from Open Band, there's almost no chance at residents being able to take action until 2028 at the earliest. It sounds like these homeowners would've been better off letting Verizon and Comcast come to town. At least then they'd have some semblance of competition.

(See full articles here and here.) 

Though the threat stemming from last year's loan never materialized, there's concern that Qwest could sue Provo over the proposed loan of $1M to cover bond expenses. It all depends on where the proposed $1M loan comes from. If it's another loan from the city's electric department, it would likely not be challenged. A payment from the general fund, however, could end up being settled in court. While the city attorney thinks that such a deal is legally defensible, Mayor Billings would rather not go through the hassle.

Some good news in the tussle is that at least four companies have made proposals to start being service providers on iProvo's network and could each bring 500-1000 customers instantly as well as push MStar and Veracity to improve their customer service levels. The network will also be receiving payments from other city departments that use the network in their own offices, defraying many costs associated with its operation.

(See full article here.)

In what's bound to start a wave of "me too" from the industry as a whole, Charter Communications has obtained a waiver from the FCC to get an extra year to comply with open access rules for set-top boxes. The rules require cable providers to comply with the CableCARD standard so you can buy your own cable box or DVR and use it with any cable provider. While the rule is set to go into effect on July 1 of this year, the waiver gives Charter an extra year to work with. Any bets that other providers like Comcast, Cox and Time Warner aren't going to ask for a similar waiver?

(See full article here.)