Happy New Year! This Broadband Bytes covers from December 20 through the end of the year. The end of 2008 saw even more retransmission battles (in particular the 11th-hour showdown between Time Warner and Viacom), Qwest trying to unplug a rival that’s suing it for racketeering, and the pending launch of FTTH services in Lafayette, LA. I predict that 2009 will offer up explosive growth in broadband speeds and availability fueled by federal dollars, an increased flight of users from cable to online video streaming and continued greater-than-inflation rises in programming costs.
- The retransmission fights got especially ugly as a contract between Viacom and Time Warner Cable expired at midnight New Year’s Day. Viacom ran a message on all of its channels to ask subscribers to complan to Time Warner which landed it in hot water with the American Cable Association; Viacom ran the crawl for all subscribers, even ones not with Time Warner. The two parties came to an agreement just after midnight which could see rates bumped as much as 25 cents per subscriber, almost 10%. With a lot of people willing to give up cable and stick to online options, cable companies are between a rock and a hard place with these kinds of disputes. Time Warner, in an interesting move, told viewers to go online to look for Viacom shows. Kind of proves the point, doesn’t it?
- Qwest’s official company policy appears to compete on everything but having a superior product at a superior price. After small New Mexico ISP SkyWi sued them for anti-competitive practices, Qwest decides to shut down the ISP claiming that they are in arrears by $1.7M. Regulators in New Mexico responded by demanding that Qwest restore service pronto to “critical” customers. Given Qwest’s attitude with Centerville over RDA funds for UTOPIA and their continued efforts to block pole attachments, I think we can see a pattern from America’s least competent ILEC. At least they’re smart enough to slash prices on DSL service across the board.
- After years of litigation and construction, Lafayette is finally to launch fiber services in the city next month. Packages are priced very competitively with AT&T and Cox with an $85/mo triple-play package that includes 10Mbps symmetrical Internet service. Lafayette is both wholesaler and service provider, so it makes their financial goals a good deal lower than open networks like UTOPIA that have to share revenue with third-party providers. The Lafayette Pro Fiber blog has a breakdown of pricing options.
- It wouldn’t be 2008 without some more bad economic news. The Washington Post reports that the housing slump is hitting homebuilders pretty hard which means you can’t depend on greenfield development to power your growth. New providers will have to look at expensive brownfield development in order to gain new customers. One bright spot is that a think tank has recently called for lowering pole attachment rates as a way to spur broadband deployment. That could spell good news for overbuilds.
- As if it wasn’t bad enough that video rates keep on climbing (thank the Governor of New York for some of those increases), text messaging rates are seeing a precipitous climb in overage charges even though it costs fractions of a cent to send each of them. Providers have uniformly increased the cost per message from 10 to 20 cents. Given that a text message is no more than 140 characters, you’re essentially paying over $1400 per MB for texting.
- Could big broadband kill Blu-Ray? ZDNet seems to think so citing the growth on online HD video options and the high cost of both players and movies. (h/t: Woods Cross Citizen) A few high-profile flops aside, online HD video has been exploding with manufacturers like Roku and LG integrating Netflix, YouTube and a bevy of other video providers into set-top boxes and DVD players. Even the Wii is getting in on the streaming action. To really compete with Blu-Ray, however, requires a solid 16-24Mbps of bandwidth, something most households only dream of having access to. Will the explosion of on-line video kill cable and broadcast TV? Probably not. Despite some strong warnings to get ahead of the online viewing trend, a recent study showed that online viewers are just as likely to watch live TV as everyone else.
- While CableCARD is enjoying deployment in almost 10M set-top boxes, cable providers have distributed a scant 392K of them to consumers who ask for them. Ars Technica basically rips the entire CableCARD effort for poor device integration, high install and monthly fees and clueless cable providers. tru2way should alleviate some of the two-way issues incuding offering up a program guide, but CableCARD will still be needed to decrypt channels; Comcast has just rolled out the head-end equipment required to support tru2way in Chicago and Denver. One consumer in California got so fed-up with the mess of equipment rentals that she filed a class-action suit against Comcast for not selling the STBs and CableCARDs. The Consumer Electronics Association is also fed-up with waiver shenanigans by cable operators that they feel is holding up CableCARD deployment and market acceptance.
- The FCC’s free wireless plan is still not quite dead yet. Kevin Martin, in his waning days, has tried to bring it back by dropping the porn-filtering requirement. With broadband shaping up to be a major issue before Congress in 2009, this plan is very likely to get lost in the shuffle. We already have telcos lining up to get some coins dropped in their cups, not to mention a push to subsidize the winner of the public safety spectrum auction. The same lobbyists that are trying to get a piece of the stimulus pie are responsible for trying to kill off any national wireless broadband plans. Both Wired and DSLReports are frustrated by the inability to come up with clear definitions and plans. Lawrence Lessig is angry enought to say that the FCC should be permanently disbanded as the agency is overrun with lobbyists and corruption.
- Kevin Martin has also been busy with a few last-minute items being wrapped up. He nixed a plan by the MPAA to restrict how you can watch movies and allowed TV stations to broadcast warnings on analog channels for a month after the digital switch (though up to 35% of markets won’t be eligible for the warning broadcasts). He even managed to score one last ticket to CES.
- Remember how much TV sucked after the writer’s strike and how some shows (I’m looking at you, Heroes) managed to never quite recover? The Screen Actor’s Guild is getting dangerously close to authorizing a strike after it’s January 12 meeting. If, like me, you’ve been eagerly anticipating new seasons of hit shows like Lost, we might end up waiting a lot longer. Maybe it’s time to get around to watching Jack of All Trades on Hulu.
- The RIAA and MPAA are intent on making life for ISPs difficult, this time by trying to get them to be their copyright cops. Some ISPs are pushing back and demanding payment for enforcement, not content to potentially make their customer service suck even more as they deal with angry customers. Given how “succesfully” Australia’s filtering plan is going, this seems like a recipe for disaster. Of course when your only case to go to trial results in having your posterior handed back to you on a silver platter, you’re liable to try anything that doesn’t involve the courts.
- Here’s a list of predictions to watch. Infoworld compiled a list of 10 things they believe will not survive this recession. Included are video rental stores, landlines and paid WiFi. Business landlines are starting to show significant weakness and online sales dropped the least of any venue with most brick-and-mortar retailers taking drops as high as 35% over last year. With efficient distribution chains like Amazon, Netflix and VoIP, it’s time for some of these old paradigms (I hate that I used that word) to buy the farm house.
