Fast Net News, DSL Prime, DOCSIS Report

Broadband for all is the goal of the EU, but “the commissioner-designate didn't speak concretely on the social challenge for a guaranteed development of Internet, respecting fundamental rights and freedom of expression,” French Socialist MEP Catherine Trautmann tells Carolyn Henson. Kroes led the EU competition drive against Microsoft, so power wants her scalp.

    Austrian conservative Paul Rübig led the opposition. If the left also remained unhappy, Barroso needed to find a replacement. So Kroes went back for some private meetings, told people what they wanted to hear, and held the post.

   Kroes took strong action when she saw outrageous behavior but generally is pro-business. At her hearing, she angered even conservatives by her weak endorsement of Viviane Reding's cut of the ridiculous telco roaming charges, believing “it is up to the market to do the job.”

Kroes “I am for net neutrality.”

The consensus at the European Parliament for NN is so strong that Nellie Kroes was very clear. “I am for net neutrality. The Commission must protect it. There are many reasons to remain vigilant with regard to new threats to the net’s neutrality.” Britain's telecom regulator, Ed Richards, in practice takes the opposite opinion. He believes that competition is strong enough to prevent any issues. Matthias Kurth of Germany was also skeptical of the need for NN regulations. ISPs "shouldn't be allowed to limit the access to service or content out of commercial motivation, but only in cases of security issues and spamming", David Meyer quotes at ZDNET

I have pulled part of this for the moment. Someone I've known to be reliable for years tells me there are important things I am missing. I was working from NTIA/DOJ filings and other normally reliable sources, but this is someone usually very well informed. Apologies. If you are someone active in policy, email me and I'll send you the current draft. Some things I have confirmed include:

What's in

• More spectrum. "Doubling available spectrum is practical and top of agenda for Obama's tech people." I wrote back in December, 2008. http://bit.ly/1aohhP That wasn't because of any inside leak. Kevin Werbach and Susan Crawford of the transition team had been writing on the subject for years.  Many of the suggestions in that article have been echoed in D.C. lately, but I don't know which of the many choices will make it into the final plan.
• Some of that spectrum might be reserved for new entrants. Mexico, Canada, and France are doing this, but it's not been part of U.S. policy. Both DOJ and NTIA mentioned the idea. If that's included, it may or may not be sufficient for new competition to thrive. As it is, Sprint and T-Mobile have enough spectrum but they are falling far behind AT&T & Verizon. NTIA notes “A key question looking forward is whether emerging 'fourth generation' (4G) wireless services will have price and performance characteristics that might make them a viable alternative to wireline services for a significant number of customers.16 Although early projections from industry are encouraging, it is premature to predict when, or even whether, these wireless broadband services will provide the competitive alternatives that can benefit consumers of all services, including wireline. … It remains to be seen, for example, whether WiMax and Long Term Evolution (LTE) technology services will be offered at prices and on terms (e.g., speed and quality) that make them attractive to wireline users” The experts in my broadband delphi are more certain, predicting that in 2015 wireless will substitute for between 5% and 25% of wired broadband connections. The speed/capacity limits of wireless mean it's only a partial substitute, but how partial is a very tough call.
• Better information for consumers, which in principle can significantly improve the way any market works. This actually can be very helpful, although the details have to be constantly watched. In particular, the usual terms of service of "up to" and "might" need to be replaced with "the measured average is" and "will, no more than xxx hours/month on average. Incidentally, better information and eliminating false advertising was a theme of Kevin Martin's since 2003 and the lack of disclosure was part of the reason he disallowed Comcast's throttling. There's much more to do, however.
• Lifeline extended to broadband,

In D.C. they call it "Beltway Blindness" but the affliction is common elsewhere as well. Folks - especially paid advocates - who don't know the facts about networks simply don't recognize their errors and they get repeated by others until they become common wisdom. We all make mistakes, and if honorable correct them when we discover them. So ordinary mistakes don't belong under this heading. This is about continuing errors of fact, not disagreements of opinion.  Please send me examples.

AT&T Wrong About ~Half the Broadband Unserved

"The customers who are easiest to serve already have access to broadband; the remaining unserved customers overwhelmingly live in sparsely populated, high-cost areas that cannot economically be served absent government support", from AT&T seems to make sense and similar is often said in D.C. Actually, it turns out that something like half the remaining unserved do not "live in sparsely populated, high-cost areas that cannot economically be served absent government support."  Getting this right leads to policy that would reach the unserved at billions less than the commonly estimated cost. Combined with using improved satellite for perhaps 1%, the $20B and $35B projections in the September broadband plan can easily be cut in half. So this is important.

• Between 25% & 70% of the "unserved" do not cost prohibitively much because of sparse population but instead are hard to serve because backhaul locally is not competitive and costs 5-20 times what backhaul costs in competitive markets. I can buy transit for $5-15/megabit across several hundred U.S. cities, but some rural carriers are asked to pay $100 and even $200/megabit because there aren't competitive suppliers. This came up time and again at the FCC broadband workshops. This is not because of a shortage of fiber capacity; fiber in place can easily handle any likely increased load at very modest cost. Sometimes, this is monopoly suppliers "charging what the market will bear" when there's no effective market. Other times, the sole fiber supplier is the telco who does not want to make backhaul available to a possible competitor at a fair price.
  This is the whole "middle mile" problem so visible in D.C. these days. There are some places without fiber, but they turn out to be amazingly few. The problem is cost. As I explain elsewhere, overbuilding to create a little competition is rarely the right policy. I believe the FCC will use "special access" to get rid of the worst examples. Bringing reasonable prices for backhaul to a very narrow set of poorly served rurals is the single most important thing Jules can for rural broadband. Really.
• Between 10% and 25% of the unserved are not "high-cost" but are held back by problems at their local carrier. Earlier this year, there were 600K probably "unserved" at Charter alone, which was in bankruptcy. So they couldn't make even ordinary upgrades. That's perhaps 10% right there, an obvious target of opportunity. There are a significant number of similar but smaller cases.
• A substantial number of the "unserved" are on systems held back because the carrier wanted to sell them. That applies to the better part of 1M in the territory Verizon wants to spin off with Frontier, and presumably others.
• AT&T & Verizon refuse to use well-proven modest cost technologies if they only apply to a scattered few percent of homes. They don't want the operational problem. My source on this is former AT&T CEO Ed Whitacre, who told me he was able to serve "100%" with inexpensive DSL repeaters.

12.06

1. The FCBA Chairman's Dinner is Thursday December 10 at the DC Hilton. Last time I went, two people pointed out the spot where Ronald Reagan was shot. Some folks may not be able to come this year because of the change in government. The procedure had been for companies to buy tables ($120-$300/ticket) and provide tickets to government staff. Kim Hart reports that the FCC has forbidden that for senior executives this year. A good change.
2. 11.16

• There's a very ugly war in D.C. right now, with $200B of power and influence throwing everything they have against NN although even their own CTO John Donovan and policy SVP point out NN is not a major problem for them. I don't know whether this is an attempt to show just how powerful they are, a misguided move by their D.C. people, or something subtle behind the scenes. But there's no doubt that one of the richest companies in the world can persuade many wall street types to call Larry whenever they ask.
• Charter CEO Neil Smit met with Julius Genachowski at the FCC just a few days after I wrote Found At Charter: 600,000 Probably Unserved, Cheap to Reach http://bit.ly/3lt3NF. That makes unnecessary the piece I was about to write. “Jonathan, please call Neil,” urging him to offer the loans necessary to bring service to them. Their quarterly indicated they've reached 70,000 more homes in the last quarter; with some RUS loans, they can probably do several hundred thousand more in the next year. That might be more than the entire stimulus achieves. No details on what Neil and team said to Jules; I've sent a note over to their lawyer, Paul Glist, reminding him that Charter's ex parte filing should have more detail.
• Jules' speechwriters should be careful to delete “The World Bank estimates that a 10-percentage-point increase in broadband penetration corresponds to a 1.2-percentage-point increase in GDP in developed countries, and even higher increases in the developing world.” from his next speech. I believe it's almost certainly far less today, if it ever was even close to that figure. Logically, most folks who with a large gain from broadband were among the 60-70% of the population who have already connected. It's good to bring in everyone, but there's no evidence to suggest that connecting more homes can have such an impact. Data-driven policy is useless if the data is garbage in, like this one. Other obvious lies being tossed around D.C. are that going “Rah Rah” for broadband will persuade many uninterested or poor people to pay $300-400/year to the carriers; that network congestion is getting worse (really stupid – the data is very clear); that TV over the net requires a special managed service (I was watching 480P HD of ABC shows last night over an Time Warner cable modem without trouble); and that companies like AT&T, Verizon, Windstream, Qwest and Embarq will abandon all rural customers if they aren't allowed to raid the “universal service fund.”
• Speaking of USF, it's going up to 14.9% or so, up 40-50% this year. Some day a Republican will notice this, call it a tax increase (since everyone needs to pay it or not use a phone) and make it a weapon against the Democrats. Blair Levin in Chicago pointed out that USF is not sustainable, but Ed Mueller at Qwest just told investors the FCC will increase his allotment. (Apologies for the typo leaving off the "not.")

Which is how it should be. I'm sick and tired of Verizon and AT&T paid advocates who claim to be "non-profits" and unbiased and refuse to reveal how much they collect from companies with interest in the issues. Folks like Bob Crandall prominently put "supported by Verizon" on their research, so that a reporter knows to review the work closely. But far too many other D.C. folks refuse to let you know their funding while they write material that reads like a lobbyist statement.  No honest academic would do that, and U.S. Public Radio fired one of their most popular hosts for similar transgressions.

Evidence-based medicine has introduced the important concept of "publication bias." No reputable journal would accept an article without disclosure of industry ties. There are seveal major studies comparing the results of industry-supported research and that without industry funding. The results are just what you'd expect, and very clear.

"We support our friends," Verizon tells me, with the result that Verizon friends are able to get research funding and to promote their work. Doing decent econometric work takes time and staff; many basic studies require $50K to $500K to perform. Even distinguished University researchers generally don't have the time/money to do labor intensive studies, nor do I. AT&T has a similar band of "friends," including one "non-profit thinktank" whose main emphasis for two years was spreading the AT&T gospel of imminent Internet disaster if net neutrality were endorsed. One of the partners in that "thinktank" registered $200,000 of AT&T lobbying money; the other refused to provide the information of who paid him how much money.

I am now making a practice of asking policy advocates how much funding they get from which interested parties. Here's Doug's exemplary web page.