This week saw the DTV transition delay get, uh, delayed (though not for long), Cox’s new traffic management plan, and a competing version of the broadband stimulus package that offers 50% more cash for 90% fewer conditions. Qwest also renewed its fight with SkyWi, Charter dropped a 60Mbps gauntlet, and Google launched tools to find out if you’re being throttled by your ISP. All that and more in this week’s Broadband Bytes!
Cox Communications is the latest large ISP to implement some kind of network management, opting for a system that’s a lot like what Comcast did. Unlike Comcast, however, they plan to throttle specific “low-priority” traffic types once the congestion gets too high including FTP file transfers, torrents and newsgroups. Predictably, there are a lotof peoplecalling bunk on the plan, but I don’t think it’s so bad. Comcast is getting ripped by the FCC since their protocol-agnostic version would degrade competitor’s VoIP traffic if you end up being one of the hogs, so it makes sense to try and only smack around the data types that generate a lot of packets and a lot of transfer. Most users are fine with network management schemes so long as they are transparent and generous; the complaining just happens to be very, vey loud.
Qwest decided to ignore an order from New Mexico’s PRC and disconnect some of SkyWi’s customers without the required 10-day warning. Qwest has likely figured that whatever the penalty is, it’s worth it to kill off a competitor and SkyWi might not be around to finish its lawsuit. The company tried to pass it off as a clerical error. Expect New Mexico’s PRC to give Qwest a serious smackdown (provided it can survive Qwest’s army of robot lawyers) and keep an eye open for possible FCC involvement. Spurned CLECs like SkyWi are prime companies to recuit onto open networks like UTOPIA.
Charter, despite its severe financial problems, stole the St. Louis speed crown from AT&T by launching a 60Mbps DOCSIS 3.0 service at a wallet-busting $140/mo. This bests Comcast and Verizon by about 10Mbps, but it far faster than anything AT&T can do with ADSL2+. Verizon took the opportunity to make fun of DOCSIS 3.0 and its limits as compared to fiber. Users on UTOPIA are likely very “ho-hum” about the announcement since 50Mbps service has been available for quite some time.
Google fired a shot at ISPs who employ any kind of throttling or traffic management by offering up free tools to test for it. Even if your ISP isn’t engaging in these kinds of practices, the presence of these tools will help keep them honest. In the debate over network management, it’s very important to be clear and upfront about any caps or network management policies you plan to employ. Comcast got a PR black eye by hiding its policies for months as angry users took to the Internet and flooded forums with complaints. They get kind of stabby when you mention it after the fact (and for good reason).
I imagine users on Comcast and AT&T will appreciate these new tools. All three ISPs have signed on with the RIAA to disconnect users who are sharing copyrighted files. It’s part of the RIAA’s broad approach to turn ISPs into their copyright cops in exchange for a cut of the action, something they have successfully pulled off in Ireland. Given the lack of an appeals process and frequent ISP mistakes, you can bet that this opens the market for competing providers to snap up those customers.In the UK, they’re debating a different approach: a £20/mo “piracy tax”. Such a tax has already been implemented in Isle of Man which allows residents there to pirate as much as they want for under $1.50/mo. The RIAA would probably do better to offer an “all you can download” music service or some kind of “piracy license” that gives you the right to download whatever you want.
Comcast is thinking about offering WiFi to subscribers, but no word yet on if they plan to charge for it or use it as a perk to lure in customers. They’re currenting testing it out in New Jersey in a partnership with Cablevision. Cox Communications really took the lead on this by snapping up a lot of regional 700MHz licenses so that they can start offering wireless services as well, including leasing tower space to cell phone carriers. Thinking beyond the triple play to include these kinds of services is a smart move for any service provider.
Smart companies also focus on customer service. Charter has taken up permanent residence on the DSLReports forum and, like Comcast, has a customer service team assigned to Twitter. And while Sprint has announced that they will layoff 8,000, they plan to avoid sacking anyone in a customer service position even as subscribers decline sharply. High customer satisfaction leads to low churn and lots of free word-of-mouth advertising. I recently got support from Sprint’s Twitter team and got my issue resolved in record time.
Guess who’s making money hand over fist? If you guessed Netflix, give yourself a red envelope. Or don’t, since most of the company’s revenue has come from users switching from mailed DVDs to streaming on their PC or TV. Even with the switch to streaming, Netflix is going to start shipping DVDs on Saturdays to help speed up processing and delivery times. (No word on how the post office’s plans to drop Tuesday service will affect this.) I wouldn’t be surprised if the secret sauce in Netflix’s bottom line is customer satisfaction. The few times I’ve had an issue, I had a short hold time to talk to a live person who was empowered to make me happy.
On the DVR front, AT&T has finished deploying whole-home DVR in 69 markets. This will allow customers to watch recorded programs on any TV in the house and is a smart move on AT&T’s part to drive DVR adoption. While there’s no fee for this service, AT&T does charge for the STBs for each set. Dish Network, meanwhile, will be deploying a new kind of DVR next week that can record from satellite broadcasts, analog over-the-air and HD over-the-air and function as a digital-to-analog converter box. Not all is good in DVR news, however. The Supreme Court is going to hear appeals in the Cablevision networked DVR case and the content cartel is aggressively lobbying to make sure it gets outlawed. This will be an important case to watch as it will have a lasting effect on video innovation.
Forget triple-play: welcome to the quad. Cox Communications plans to use recently-purchased spectrum to deploy cell-phone serivce in its markets. Since Cox can leverage its existing infrastructure to keep transport costs low, the profit margins should be substantial. They will also deliver video services to handsets for existing video customers as they had tried to do with Pivot. AT&T and Verizon have been using wireless revenues to help subsidize the construction of their next-generation networks for quite some time with a lot of success. Qwest, meanwhile, has had poor financial performance as it does not offer its own video or wireless products.
That depends on who you ask. Consumer groups are no doubt going to flip for his proposed expansions of online privacy, pushing providers to offer true next-generation speeds and fighting bandwidth caps. ISPs, free market types and the MPAA/RIAA are no doubt going to call foul on some of these proposals. Obama is also proposing to open up big chunks of wireless spectrum including the already-opened white spaces. Unfortunately, there’s no mention of fiber or enabling better competitive choice in our telecommunications options.
As a rarity, I’m going to ask that you drop your two cents into the comments and leave my opinion out of the main post. Do you think Obama will fix broadband? Which policies do you want to see him adopt?
Have you noticed that video rates have been going up at a painful rate? FCC Chair Kevin “I love Ma Bell” Martin did and he wants answers. Despite also naming Verizon in the inquiry, it’s pretty obvious that cable is the real target. The focus is on the move of more and more channels out of analog tiers and onto more expensive digital tiers, a practice he believes is compelling consumers to pay bigger prices for the same set of channels. We’ve already seen a bunch of cable providers up their rates with Cablevision and Time Warner both getting in on the hikes.
Unfortunately, Martin is not investigating how wholesale rates from programmers have gone through the roof and has more-or-less abandoned “a la carte” programming options. He’s also ignoring caps from both Frontier (5-20GB) and AT&T (20GB) that are designed to boost revenues. Telcom in general is hurting right now and companies may see rate increases as a way to soften the dropping subscriber numbers. Both Qwest and Cox are planning lay off workers and Comcast had disappointing earnings results.
We may, however, see some big changes in store once the new president takes office. Word on the street is that Martin will voluntarily resign to pursue political ambitions in North Carolina. It’s anyone’s guess as to who would take over his spot and what they would do about these out-of-control telcom prices.
BroadbandReports broke it and Comcast confirmed it: starting on October 1, Comcast will institute caps of 250GB per month. It’s beleived that overage fees are off the table for now, a welcome change from the initial plan to charge $1.50 per GB, a markup of around 100 times cost. There’s also a concrete DMCA policy. Anyone getting 4 or more DMCA warning notices in a 12-month period could have their connection terminated (but you were smart enough to use PeerGuardian, right?), but there’s nothing to hint at any kind of stepped-up enforcement.
The upside is that Comcast’s “you’re using too much Internet” policy is now clearly spelled out, though there’s no mention as to what counts or how to see your current usage. A cap of 250GB, while still a cap, isn’t all that bad considering that amounts to downloading about 125 standard-def movies.
The real lesson is that with all of the caps and “network management”, the age of all-you-can-eat Internet is over. It’s not fair to low-use customers to raise prices across the board to subsidize the top end of users and customers aren’t willing to accept vague limits on their previously unlimited Internet access. As long as the policies are clear and there’s a way to verify your own usage, I’m perfectly happy with the Age of Caps.
Qwest announced key leadership changes in Sales and IT. The link includes some background about each of the new executives that have been chosen. I’m hoping the new leaders will realize the importance of bringing telecommunications into the 21st century by investing in infrastructure like Verizon has been doing and understand the increasing importance of upload speeds.
Recently, it has come to light that Comcast has been throttling bandwidth for various applications with little or no disclosure. In a 67 page order, the FCC has said that “Comcast has 30 days to fess up about P2P throttling”. On Wednesday, there were also reports that Comcast would slow traffic for heavy users, but today in the NYTimes Comcast claims that no final decisions have been made about managing network traffic.
There is a looming problem on the Internet, IP addresses are running out. There is a finite number of addresses and experts keep telling us we are close to exhaustion. The solution is IPV6, but according to reports, it is failing to gain traction.
Internet traffic is on the rise and consumers are using more and more bandwidth:
“As cable and phone companies race to upgrade services or offer video for the first time, they’re doing it by installing equipment in boxes on lawns, easements and curbs all over American neighborhoods. Telecommunications rollouts have always been messy, but several towns and residents are fighting back…”
Some ISP’s have responded to increased bandwidth usage by some of their customers with announcements of new bandwidth caps.
P2P data is a big bandwidth user, apparently accounting for 40%-60% of all the traffic used on the Internet. Some researchers have a novel idea for cutting bandwidth usage. In a paper to be released next week, researchers found a way to lessen the load of P2P with an algorithm they dub “P4P”. Though the P4P article is scant on technical details, it involves finding shorter routes between users thereby making the traffic traverse fewer networks.
An analyst at a major investment firm says that broadband competition is today as good as it is going to get and that there aren’t going to be any major disruptive technologies in broadband in the future. All the more reason UTOPIA is so important: it provides an open infrastructure that fosters provider competition.
Speaking of politics, this article has an interesting look at the Internet policy in the 2008 Democratic platform. I couldn’t find any info yet about the 2008 Republican platform (it hasn’t been released yet). In 2004, the Republican platform stated: “Broadband provides Americans with high-speed Internet access connections that improve the nation’s economic productivity and offer life-enhancing applications, such as distance learning, remote medical diagnostics, and the ability to work from home more effectively…Broadband technology will enhance our nation’s economic competitiveness and will improve education and health care for all Americans.” It’s nice to see that both major parties acknowledge the importance of broadband for the future of this country.
We’ll see you at the Layton U-CAN meeting on Saturday at Noon at the Davis Library.
Frontier Communications, the incumbent phone carrier in Tremonton, has decided to give UTOPIA a helping hand by implementing a 5GB monthly cap on all of their DSL customers to drive them into the arms of a competitor. By comparison, the lowest cap available from a UTOPIA provider is 20 times that at 100GB per month. When the service starts rolling out in September and October, I’m sure that UTOPIA will see a good number of signups from angry customers who don’t appreciate per-byte billing.
One of two possibilities exists: they arrogantly think they’re so much better that nobody will switch or don’t see how boneheaded a move this is. Either way, it highlights the need for a bit of competition in the marketplace.