New Fixed Broadband Subscriber Data Study

ABI Research has a new study out titled Broadband Subscribers Market Data. This study is updated quarterly and profiles subscriber trends categorized by operator, by country, and by technology. Detailed market trends and market forecast information for key regions and countries around the globe are provided where available. The database forms part of the company’s Home Networking Research Service.

Here's some highlights from that latest quarterly report:

The number of fixed broadband subscribers will rise to 501 million at the end of 2014. Of those, about 106 million will subscribe to services delivered via fiber.

Fiber broadband subscribers totaled 44 million at the end of 2009.

The number of fixed broadband subscribers totaled more than 422 million at the end of 2009, a 9% increase from 2008.

Among the three broadband technologies, 65% of worldwide fixed broadband consumers subscribe to DSL, 25% to cable and 11% to fiber broadband services.

The number of fiber broadband subscribers is increasing fastest, showing a compound annual growth rate of 20% from 2008 to 2014.

The Asia-Pacific region has the highest fiber broadband penetration, followed by North America.

Asia-Pacific represents nearly 84% of worldwide fiber broadband subscribers.

South Korea and Japan have the highest fiber broadband penetration.

NTT is the largest fiber broadband operator with approximately 12 million subscribers.

In 2009, Western Europe had only about two million fiber broadband subscribers — a very low penetration compared to North America and Asia Pacific, although Western European countries are planning to accelerate fiber broadband penetration.

You can find additional information in the study press release, linked here.

Time To Close A Telco Tax Loophole?

You may not have heard of a Reverse Morris Trust (RMT) - it's an obscure tax loophole that allows large telecommunications companies to dump assets on smaller weaker companies. In 2007 Verizon took advantage of one, selling off their landline services in Maine, Vermont and New Hampshire to Fairpoint Communications for $2.7 billion and saving $300 million in taxes for themselves. The biggest losers in that deal today are the people of Maine, Vermont and New Hampshire who are now left with deteriorating service after the recent Fairpoint bankruptcy. We've seen similar results in other places - in 2005 Verizon sold off landlines in Hawaii to Hawaii Telcom Communications. Hawaii Telecom also filed for bankruptcy in 2008.

Fast forward to today, the're another big deal in the works with Verizon looking to sell 4.8 million rural landlines in 14 states to Frontier Communications. It is estimated the Verizon/Frontier deal would save Verizon approximately $600 million in taxes due to an RMT. There's been considerable opposition to this deal - here's an interesting quote from a PC World article:

The deal is a "tax scam, at its base," added Ben Scott, policy director of Free Press, a media reform group. In a Reverse Morris Trust deal, the selling company can avoid paying taxes on its sold assets as long as its shareholders end up with more than 50 percent of stock of the buying company.

Tax scam or no tax scam - I'm not knocking the companies - if there is an opportunity to save money it is smart business to take advantage of that opportunity. What concerns me is what this is doing to the quality and growth of broadband services in the United States. We need to start building modern high bandwidth IP-based infrastructure everywhere in our country if we are to compete with the rest of the world. If RMT loopholes remains open, then telcos will most likely continue to expand their dumping of landline services and ultimately hurt us all - not just those living out in rural areas.

U.S. Representative Alan Mollohan (D-WV), is referenced also in the PC World article:

The Reverse Morris Trust deal with FairPoint should be an "ominous" sign for regulators looking at the Frontier deal...... Frontier will have to cut thousands of jobs, and Verizon will walk away with a tax break.....I'd prefer to see that funding go to extend broadband in West Virginia. This [deal] is not in the best interest of our state.

What can be done? U.S. Representative Paul Hodes (D-NH) has announced he will introduce legislation that would reform the Reverse Morris Trust (RMT). I personally believe this legislation is crucial if we are going to modernize the communications infrastructure in our country.

You can get more information on Reverse Morris Trusts, the tax loophole and working to close it at a site put up by Speedmatters.org linked here. If you agree with what you see there (be sure to also do your own research) you can send an electronic letter via the site urging your member of Congress to co-sponsor Rep. Hodes' legislation.

Australians Moving On Broadband

There's an interesting post on Reuters today about how the Australian government has rejected private company bids and has decided to lead a new private-public company, building out their own $31 billion high-speed broadband network. The government will ask private companies to join the infrastructure project, building a network that would be up to 100 times faster than the current network.

Australian Prime Minister Kevin Rudd is quoted in the piece, saying:

It's time for us to bite the bullet on this. The initiative announced today is a historic nation-building investment focused on Australia's long-term national interest.

After the network is fully operational for five years, the government plans to sell its majority stake.

A gutsy move by Rudd in uncertain fiscal times that will likely pay off when things start to improve.

The initiative still requires Australian parliamentary approval.

United Kingdom Broadband Green Light

In the United Kingdom the government agency that oversees the communications industry is the Office of Communications (Ofcom) . Ofcom is the equivalent of the Federal Communications Commission (FCC) in the United States and, like the FCC, has been struggling with the same television, radio and broadband issues.

There has been one particular ruling that Ofcom has been deliberating that involves the rollout of telcommunications provider British Telecom (BT) fiber networks. BT (telco) and Virgin Media (cable) are the two major broadband providers in the UK. BT in particular has been extremely anxious to upgrade its old copper based network with fiber but only if the company could get a fair return on their investment.

Well.... last week Ofcom made a decision to allow BT to set its own prices on how to sell access to its network to secure a fair return on their investment.

Here's an interesting BBC News quote from Ofcom chief executive Ed Richardson on the ruling:

Our message today is clear: there are no regulatory barriers in the way of investment in super-fast broadband. We want to promote investment to support the widespread adoption of superfast broadband but we want to balance that with the need for competition.

BBC News blogger Rory Cellan-Jones predicts by 2012, 40% of the UK will have BT's 40Mbps service, and 50% will have 50Mbps Virgin cable broadband - and although the two firms will overlap a lot, that means well over half of the UK should be in the fast lane.

Nice bandwidth! Two questions still remain though according to Cellan-Jones:

- How much will consumers pay?
- What will happen to the large numbers of people who still won't get access?

These questions sound very familiar.

U.S. Dept. Of Agriculture: Rural Broadband At A Glance

The U.S. Department of Agriculture recently published an interesting six-page (short!) report titled Rural Broadband At A Glance . The report draws on research done by the Dept of Agriculture's Economic Research Service , the Federal Communication Commission and the U.S. Census Bureau.

Rural Internet is investigated and indicates rural residents are less likely to have high-speed, or broadband, Internet access than their urban counterparts. The main limitation of slower, dial-up Internet access is that many content-dense applications and documents, and such critical services as anti-virus protections, are not readily usable via dial-up due to low transmission capability and speed.

Circumstantial evidence in the report suggests that the difference in access may lie in the higher cost and limited availability of broadband Internet in rural areas. As a result, rural residents depend more on Internet use outside of the home, relying on places like the library, school, and work, where broadband Internet access is available.

Here's some selected report stats:

• Internet use is lower for individuals in rural areas (71 percent) than in urban areas (77 percent).
• In 2007, 63 percent of all rural households had at least one member access the Internet, at home or elsewhere, compared with 73 percent of urban households.
• Fifty-two percent of all rural households had in-home Internet access compared with 64 percent of urban households.
• In 2005, 30 percent of farmers were using the Internet for farm business; 2 years later, use had increased to 63 percent. As Internet adoption increases, the need for high-speed Internet also rises as online purchasing and marketing become the norm.

The report summarizes that rural communities have not been left out of the ever-changing information economy, although issues of equal access exist. Evidence suggests that the difference in access may lie in the higher cost or limited availability of broadband Internet in rural areas. The report indicates more information is needed, saying data on broadband use in households and businesses and its cost are needed to better address this issue.

You can download and read the full report PDF here.

10 Random Thoughts On 3-11-09

I haven't written one of these in a while - here's my list for this week:

1. I've become a big fan of the iPhone Kindle App. If you've got a Kindle and an iPhone you need to to start using this free app!
2. I've been dealing with a back problem and it slowed me down for the past couple of months. Physical therapy is working and I'm feeling much better now!
3. We moved our office after 11 years in the same space. Cannot believe how many Windows 98 install floppy disks we tossed!
4. We'll see how far broadband reaches into rural areas with the stimulus package. The FCC is seeking comment until March 25 so we may not hear much until then.
5. It's been a long winter here in New England but things are warming up a little bit..... finally. Really looking forward to spring and some trout fishing (not through the ice!).
6. I've become an even bigger Twitter user over the last couple of months and find myself going to it often for both posting and finding content. Follow me here and I'll follow you back!
7. To organize Twitter content on your desktop I highly recommend Tweetdeck.
8. For tweeting using my iPhone I'm a big fan of Hahlo . Even if you don't have an iPhone you can check it out here.
9. Wanted to congratulate my daughter Gabby again on her National Center for Women & Information Technology (NCWIT) award! Go Gabby!!
10. Finally - my favorite quote from this past week:

"The relative decline of American education is untenable for our economy, unsustainable for our democracy and unacceptable for our children."

- President Obama at the 19th annual legislative conference of the U.S. Hispanic Chamber of Commerce.

IBM and IBEC Providing Broadband to Rural Markets

There's been a lot of ups and downs in the delivery of broadband services over power lines (Broadband over Power Lines or BPL) here in the United States. Trials have been setup and the technology has been demonstrated to work but really has not gone anywhere.

Here in Western Massachusetts I recall a trial setup by one of the electric companies that delivered broadband services to wireless access points hung on poles. Customers made their connections by logging in wirelessly. That trial was done in a suburb/residential type area where other broadband options were available. The technology worked but I believe, in the end, the power company could not compete price-wise with the cable and telecommunications companies already servicing the area and the trial was dropped.

This scenario has played out across the country - here's an interesting quote from a BPL piece at NetworkWorld :

BPL so far has not caught on as a broadband technology in the United States. As of June 30, 2007, the FCC reported that only 5,420 people in the United States subscribed to broadband over power line, vs. 34 million cable subscribers and 27.5 million asymmetrical DSL subscribers.

Rural areas are different though - what if BPL service was made available to customers that have no option except dial-up? This is the question IBM asked and, as a result, the company signed a $9.6 million agreement with International Broadband Electric Communications (IBEC) to expand broadband services to rural customers. IBM and IBEC plan to roll out BPL service through seven electric cooperatives in Alabama, Indiana, Michigan and Virginia and say they could end up providing broadband connectivity to approximately 200,000 people that otherwise, would not have it.

IBEC's trademarked tag line is "For Underserved and Rural Markets™" - exactly what we need in our country. I'm hoping this will be a sign of more good things (broadband) to come.

Broadband and the Stimulus Package

The $787 billion American Recovery and Reinvestment Act, being signed in Denver today by President Obama, includes $7.2 billion directed towards broadband deployment in rural and other unserved and underserved areas in the United States. I find it especially encouraging to see broadband considered "infrastructure" - just like roads and bridges - in the bill. Here's an interesting USA Today quote from Gene Kimmelman of Consumer Union:

With a baseline established, Kimmelman says, he expects major public policy shifts to follow, with the goal of making broadband available and affordable to all Americans.

I personally believe Kimmelman is right - broadband availability and affordability are critical to our economic recovery and will allow us to better compete with the rest of the world. Not everyone agrees.

To track where your money goes, www.recovery.gov was launched today. Here's a quote from the site:

The site will include information about Federal grant awards and contracts as well as formula grant allocations. Federal agencies will provide data on how they are using the money, and eventually, prime recipients of Federal funding will provide information on how they are using their Federal funds. On our end, we will use interactive graphics to illustrate where the money is going, as well as estimates of how many jobs are being created, and where they are located. And there will be search capability to make it easier for you to track the funds.

Here's how the funds will be distributed (from www.sppedmatters.org):

The National Telecommunications and Information Administration (NTIA) will receive $4.7 billion to distribute as grants designed to improve broadband deployment in unserved and under-served areas, increase broadband adoption, improve access to broadband by public safety agencies, and stimulate the economy and create jobs.

The remaining $2.5 billion will go to the Rural Utilities Service, which works to connect rural Americans to broadband, allowing them to reach all the services and opportunities the digital age has to offer.

The bill also requires that $350 million of the funding go toward the Broadband Data Improvement Act for mapping and community initiatives, at least $200 million to expand public computer center capacity in libraries and community colleges, and at least $250 million for programs encouraging broadband adoption.

Finally, as part of the stimulus package, the FCC must submit a report to Congress containing a national broadband plan that details the most effective ways to ensure broadband access for all Americans.

We'll be watching.

Tell Senators To Keep Broadband Investment In The Stimulus Bill

Today Beth Allen at Speedmatters.org sent out an email some of you may have received. If you did not get it - here it is:

Dear Speed Matters Activist,

We're getting closer to important new investments in high speed Internet across America.

After hearing from thousands of Speed Matters activists like you, the House of Representatives included funding for broadband infrastructure in the American Recovery and Reinvestment Act.

The Senate is debating stimulus legislation this week. But you know what can happen when Congress picks through a piece of legislation -- some parts are added, some parts are removed, and what finally passes can look very different from the original version.

That's why the entire Speed Matters community must send a strong, united message about the importance of broadband investment -- for the sake of our Internet and for the sake of our economy. Make your voice heard by contacting your Senators right now:

www.speedmatters.org/stimulus

Broadband funding in the American Recovery and Reinvestment Act is a good start on the road to universal high speed Internet access, job creation, and economic growth. Every $5 billion in broadband investment creates an additional 100,000 jobs -- and provides the key infrastructure to keep our economy growing in the long-term.

The Senate stimulus legislation couples flexible grant programs with tax incentives to spur investment in rural areas and high speed networks and encourage job growth. It also includes funding for grants for broadband mapping, setting up community technology teams, and other broadband community outreach efforts. Together, these policies can solve the challenges of expanding broadband access and adoption and upgrading networks -- all while giving a strong boost to our economy.

Universal, affordable broadband also helps us address other pressing concerns, including health care, education, online job search and job training, our environmental crisis, access for people with disabilities, public safety, and civic participation.

Make sure your Senators know about all these benefits of broadband investment. Contact them today:

www.speedmatters.org/stimulus

We've gotten this close to new broadband investment and hundreds of thousands of good jobs -- we can't afford to let up now.

Sincerely,

Beth Allen
speedmatters.org Online Mobilization Coordinator

Sign the digital petition and get a sample letter to send to your Senators at www.speedmatters.org/stimulus

Broadband: Can We Catch South Korea?

A couple of months ago I wrote about our poor broadband penetration rate (15th) in the U.S. when compared to the rest of the world. First place last year went to South Korea and in looks like the Koreans will not be sitting back enjoying their lead. A couple of days ago the Korea Communications Commission (KCC) announced plans to increase high-speed Internet and wireless broadband services to rates 10 times faster by the end of 2012.

The proposed network will be all IP-based with a total cost of 34.1 trillion won ($24.6 billion) spread out over the next five years. The Korean government will pitch in 1.3 trillion won ($937.83 million), with the rest being covered by private companies. The KCC estimates the project will create 120,000 jobs. Connected high-speed Internet services will increase to 1 Gbps and wireless services will increase to 10 Mbps. Here's a couple of interesting quotes from the JoongAng Daily:

The KCC said the changes will make high-definition TV images up to 16 times clearer, and interactive TV services such as e-commerce and home schooling will also be possible. The service will also make it possible to watch I-Max films on home TVs.

“This plan will bring innovation to the public’s digital lives,” KCC said in the release. Digital TV coverage will also rise to 96 percent in 2012 from the current 87 percent, according to the plan. The KCC added that the project will help Korea cement its position as one of the world’s leading IT countries. More than 94 percent of Korean households already have access to high-speed Internet services, and Korea has the highest number of subscribers to broadband services in the world as of last year, according to OECD data.

Can we catch them? Let's see. The U.S. Department of State keeps population and area statistics on their website. Here's the latest on South Korea:

Population (2008): 48,379,392
Area: 98,480 sq. km. (38,023 sq. mi.); slightly larger than Indiana.

Doing some quick calculations figuring on the $937.83 million government input in South Korea:

Korean gov. dollars spent for upgrade per resident: ($937.83 million) / (48,379,392 people) = $19.38 per resident
Korean gov. dollars spent for upgrade per square mile: ($937.83 million) / (38,023 sq. mi.) = $24,664 per sq. mi.

Right now it looks like the Obama stimulus plan has between 6 and 9 Billion dollars tagged for broadband services. Do we have any chance of catching South Korea? Here's some statistics for the U.S.

Population (2008): 303,824,640
Area: 3,537,441 square miles

Let's use the higher $9 billion number and do similar calculations for the U.S.

U.S. gov. dollars spent for upgrade per resident: ($9 billion) / (303,824,640 people) = $29.62 per resident
U.S. gov. dollars spent for upgrade per square mile: ($9 billion) / (3,537,441 sq. mi.) = $2,544.21 per sq. mi.

We're in good shape when we compare dollars spent per resident - we're more than $10 over what South Korea will spend.

What hurts us is the physical size of our country - the South Korean government is spending almost ten times what we would spend per square mile. It looks like we're going to need to do things a little differently if we are serious about catching up.

Gigonomics: The New Workforce Model?

Newsweek published an interesting piece today titled The New American Job: Are freelance and part-time gigs the future? The piece discusses how, in the current economy, a job is not a job using the traditional definition. Work for many has become a pastiche of part-time gigs, project contracts and fill-in freelance work. Here's an interesting quote from Newsweek:

According to the Bureau of Labor Statistics, unemployment was up in December across all fifty states from the previous month and the prior year. Some 2.5 million full-time jobs have evaporated in the last 13 months, contributing to what's being called the "gig economy." But there is a convergence of other, more developed trends at play as well. Tight-budgeted company managers long ago embraced outsourcing to only pay for what they can use. A new generation of workers has 24/7 connectivity, lacks corporate loyalty, and thinks like (if the McCain/Palin contingent will give us back the word) mavericks. Put them together and you get gigonomics.

New York is a good example of what's being seen around the country where (from Newsweek) two thirds of the opportunities created last year were either part-time, temporary or contract based, according to Sara Horowitz of the Freelancers Union, a group which does advocacy work and provides benefits for independent workers. Mayor Michael Bloomberg has proposed giving tax relief to the thousands who actually pay more in taxes because they are self-employed.

Will self-employment stick or is this just the result of our current economic meltdown? Should we be teaching business/self-employment survival skills in our science, technology and engineering classes?

My final question is do we have the broadband infrastructure in place in our country as we shift to this model and compete with the rest of the world? I think most of us realize the answer to this question is no.

Be sure to read the entire Newsweek piece linked here.

Will U.S. Continue Broadband Slide Under Obama?

Since 2001, according to the Organization for Economic Cooperation and Development, the United States has moved from fourth in the world to fifteenth in broadband penetration. Not exactly bragging rights. Lot's of us have been out advocating for broadband reform and a new definition of broadband. Congress is working to determine what speed broadband should be defined as, whether taxpayer money should be invested in areas that do not have broadband access and whether existing slower networks should be subsidized for upgrades.Here's a summary from an article in today's Wall Street Journal:

Large cable operators are seeking to increase the FCC's definition of broadband download speed to about five megabits per second, about 6½ times as fast as the current definition, according to people familiar with the situation. Internet-service providers building out "unserved" regions, where service of that speed isn't available, would be given the full benefit of tax incentives or grants.

The big cable providers also want to target "underserved" areas, where there is only one broadband provider or the service isn't widely available. In those markets, companies would get incentives to build out next-generation services. The download speed that would qualify as next-generation would likely be in the range of 40 to 50 megabits per second, people involved in the discussions say.

I'm loving this right now but.... the smaller telcos don't like it - how come? Here's more from the Journal:

The cable plan would disadvantage phone companies, especially smaller ones whose digital-subscriber-line services are slower than cable modems. The Independent Telephone and Telecommunications Alliance, which represents midsize phone companies, is pushing for a slower broadband standard, in the range of 1.5 to three megabits per second. Curt Stamp, the group's president, says the federal largesse should be used to subsidize carrier investments in rural areas rather than to finance upgrades to their existing networks.

I've written in the past here frequently about our lack of a competitive broadband policy in this country. So..... cable companies pushing for higher speed broadband definitions and wanting to target "underserved" areas at speeds up to 50 megabits per second. Smaller telecos pushing for a new broadband definition that is about half of what the cable companies want. Here's a little more from the Wall Street Journal:

The Telecommunications Industry Association, which represents equipment makers, is pushing for a $25 billion grant program for Internet service providers. Under another proposal that is being discussed, grants could go to state and municipal authorities, which would build high-speed networks and then open them up to competing service providers. That would likely meet with considerable resistance from large carriers like Verizon Communications Inc., which have challenged attempts by local governments to build and operate their own wireless or high-speed fiber networks.

Cable companies, smaller telcos, big telcos and equipment manufacturers all lobbying and every day we continue to fall further behind the rest of the world. Obama will have his hands full trying to turn this one around - his transition team declined comment to the Journal.

2009 - Lots of Bandwidth?

Yesterday, Comcast announced 50Mbps service in Baltimore, Chicago, Atlanta, and Fort Wayne, Indiana. The service is being offerred over upgraded DOCSIS 3.0 tiers and will initially cover only parts of the listed cities.

The company is offering two new residential tiers:

• Extreme 50, offering up to 50 Mbps of downstream speed and up to 10 Mbps of upstream speed at $139.95/month.
• Ultra, offering up to 22 Mbps of downstream speed and up to 5 Mbps of upstream speed at $62.95/month.

And two new business class tiers:

• Deluxe, offering 50 Mbps / 10 Mbps tier for $189.95/month, which includes a full suite of features and support.
• Premium, offering speeds up to 22 Mbps / 5 Mbps for only $99.95/month.

The company says they will complete upgrading these cities early next year and will continue to roll out high bandwidth (what Comcast is calling wideband ) services at a rapid pace.

With the cable companies rolling out these tier levels we should see the telcos (Verizon and AT&T especially) respond pretty quickly. If you are fortunate enough to live or work in an area where there is this kind of broadband competition 2009 should be a nice year - you'll be seeing some very nice service offerings as the cable companies and telcos go after your business.

Broadband Growth In U.S. - 1.3 Million New Q3 2008 Customers

Leichtman Research Group, Inc. (LRG) has just published a short report that looks at the twenty largest telco and cable companies in the United States. These twenty companies represent 66.7 million (94% of U.S. market) customers. Here's a breakdown of some of the information in the report:

• Cable companies have 36.5 million broadband subscribers.
• Telephone companies have 30.2 million broadband subscribers.
• The top cable companies added over 870,000 subscribers, representing 67% of the net broadband additions for the quarter versus the top telephone companies.
  
• Overall, broadband additions in 3Q 2008 amounted to 61% of those in 3Q 2007 – with cable having 82% as many additions as a year ago, and Telcos 40.
  
• The top cable broadband providers have a 55% share of the overall market, with a 6.3 million subscriber advantage over the top telephone companies.

Bruce Leichtman, president and principal analyst for Leichtman is quoted in the report:

Over the past two quarters the top cable providers accounted for 71% of the net broadband additions, adding over 900,000 more broadband subscribers than the top telcos. Cable’s recent success compared to the telcos should not necessarily be interpreted as consumers suddenly choosing cable’s speed advantage over that of the telcos' DSL service. It is more a function of the telcos' shift in focus towards higher value subscribers while cable has been consistent in marketing broadband as part of its nearly ubiquitously available Triple Play bundles.

The report includes a very nice chart that breaks down subscriber numbers for all 20 of the companies. You can view the online version and download a PDF here.

OECD Statistics: U.S. Broadband Penetration Rate Still Low

The Organisation for Economic Co-operation and Development (OECD) has released their June 2008 international broadband statistics. Here are some of the highlights:

The upgrade to fibre-based connections continues in the OECD. Fibre subscriptions comprise 9% of all broadband connections in the OECD (up from 8% in December 2007).

Fibre overtakes DSL/Cable in Korea and Japan and now accounts for 45% of all Japanese broadband subscriptions and 39% in Korea. Korea’s fibre penetration alone (12.2 per 100 inhabitants) is higher than total broadband penetration in 5 OECD countries.

The number of broadband subscribers in the OECD reached 251 million by June 2008, an increase of 14% from June 2007. This growth increased broadband penetration rates to 21.3 subscriptions per 100 inhabitants, up from 20% in December 2007.

Denmark, the Netherlands, Norway, Switzerland, Iceland, Sweden, Korea and Finland lead the OECD with broadband penetration well above the OECD average, each surpassing the 30 subscribers per 100 inhabitants threshold.

The strongest per-capita subscriber growth over the year was in Luxembourg and Germany. Each country added more than 5 subscribers per 100 inhabitants during the past year. On average, the OECD area increased 2.7 subscribers per 100 inhabitants over the year.

The United States is the largest broadband market in the OECD with 75 million subscribers. US broadband subscribers consistently represent 30% of all broadband connections in the OECD.

Even though the United States has the largest broadband market, our penetration rate continues to be low with a ranking of 15th in the world.

Find all international statistics on the OECD Broadband Portal linked here http://www.oecd.org/sti/ict/broadband

Vermont + Fairpoint = WiMax

Mike Q sent along a link from Information Week titled WiMax Coming To Remote Regions Of Vermont. The article describes how FairPoint, Nortel, and Airspan Networks are investing in building out the 3.65 GHZ spectrum to help spur the use of fixed WiMax in many regions of Vermont.

I've written here in the past about Verizon's sale earlier this year of Maine, New Hampshire and Vermont networks to Fairpoint Communications. I've also written about a successful WiMAX implementation in Alaska and questioned the use of WiMax in rural areas to close the broadband divide.

Here's a couple of quotes from the Information Week article:

Nortel and Airspan Networks reported this week that they will supply 802.16d WiMax equipment for the Vermont deployment, which, because it will operate in the 3.65 GHz band, is unlicensed and relatively inexpensive. Scott Wickware, general manager of Nortel, said he believes the Vermont rollout is the largest 3.65 GHz WiMax scheduled for installation to date.

Noting that it is less expensive to use wireless in many regions, Nortel said the FCC's decision last year to approve the use of the 3.65 GHZ spectrum is helping spur the use of fixed WiMax in many regions that previously weren't able to obtain broadband technology.

The article quotes range of a few miles with up to 10 miles where signals have little or no interference and have no obstructions. Transmission bandwidths are quoted ranging from 1 Mbps to as much as 5 Mbps in some cases.

Some Good Broadband News for the U.S.

Last July I wrote about a couple of bills that were before Congress - S. 1492, the Broadband Data Improvement Act and H.R. 3919, the Broadband Census of America Act of 2007. These bills would improve information-gathering about current broadband deployment and assist in targeting resources to areas in need of such services.

A few days ago on September 26, S.1492 passed in the Senate by unanimous consent. Today (September 29), S.1492 passed in the House of Representatives without objection.

S. 1492 was introduced by Hawaii Senator Daniel Inouye in May of 2007. The bill would require the FCC to provide users with more accurate information about the cost and capability of their broadband connection, and to better compare the deployment and penetration of broadband in the United States with other countries. It would also encourage private and public partnership efforts that identify barriers to broadband adoption on the state level. Senator Inouye is quoted on the Speed Matters blog:

If the United States is to remain a world leader in technology, we need a national broadband network that is second-to-none. The federal government has a responsibility to ensure the continued roll-out of broadband access, as well as the successful deployment of the next generation of broadband technology. But as I have said before, we cannot manage what we do not measure. This bill will give us the baseline statistics we need in order to eventually achieve the successful deployment of broadband access and services to all Americans.

S.1492 will now move to a joint conference committee to work out the differences between the Senate and House versions.

McCain and Obama on Broadband in the United States

Before I start...... and if anyone wants to know - I will not endorse a specific candidate here and will keep my final choice to myself.

That said...... I've been picking apart the candidates technology policies - specifically in the area of broadband. I've written frequently here about the broadband divide - basically the bandwidth have and have-nots. Our track record over the Bush presidency period has not been good - in 2001 the U.S. was rated number 5 in the world for broadband penetration by the OEDC, today we rank 22nd. What happened over the past 8 years? What have other countries done that we have not been able to do? How come someone in Japan can get a 1Gbps Internet Connection in Japan for $51 / month while all I can get in South Hadley, MA is around 5Mbps for right around the same price?

Lawrence Lessig (an Obama supporter) claims our nosedive is because of changes in government policy. Lessig says we began the Bush administration with literally thousands of ISPs, both narrowband and broadband ISPs. We will end the administration with essentially two, if you are lucky, in any particular district.

From my perspective, Lessig is right - in 2001 I had one choice for broadband (cable modem) and I had probably 20 choices of narrowband (dial-up) service. Today I've got two choices for broadband - ADSL from Verizon and cable modem from Comcast. I'm not sure how many dial-up choices I have and don't really care! I do find myself asking why there is not more DSL competition where I live. Providers can legally co-locate in Verizon facilities and offer service over Verizon lines - what's up here? Why didn't the dial-up ISPs move to offering ADSL service? Many of them tried but most of them failed. Has policy driven these providers out of the market? Have the markets consolidated to the point where we do not effectively have competition any more?

Speaking of competition - I'm jealous of those who live in Verizon FiOS territory - we're just starting to see the cable companies and Verizon starting to leapfrog each other in bandwidth and price offerrings. Am I seeing this kind of response where I live - no. Why? I only have the two broadband options - cable modem from Comcast and ADSL from Verizon. Sources at Verizon tell me it will be years before I'll see FiOS in my neighborhood. Am I seeing any competition? Minimal - the two companies compete on price in my region, not bandwidth.

In his policy, McCain describes his “People Connect Program” that rewards companies that offer high-speed Internet access services to low income customers by allowing these companies offset their tax liability for the cost of this service. Former FCC Chair Reed Hundt (another Obama supporter) estimates this would cost us over $8 billion for just the top two U.S. broadband providers. If Hundt is right and not playing politics, the People Connect Program will end up driving most of the money to the largest providers and further burying smaller competing companies.

Obama's policy says: As a country, we have ensured that every American has access to telephone service and electricity, regardless of economic status, and Obama will do likewise for broadband Internet access. Obama's policy continues saying: we can get true broadband to every community in America through a combination of reform of the Universal Service Fund, better use of the nation’s wireless spectrum, promotion of next-generation facilities, technologies and applications, and new tax and loan incentives.

The Universal Service Fund (USF) Obama's policy references is one fund with four programs. The four programs listed on the USF website are:

High Cost - This support ensures that consumers in all regions of the nation have access to and pay rates for telecommunications services that are reasonably comparable to those in urban areas.

Low Income -This support, commonly known as Lifeline and Link Up, provides discounts that make basic, local telephone service affordable for more than 7 million low-income consumers.

Rural Health Care - This support provides reduced rates to rural health care providers for telecommunications and Internet services so they pay no more than their urban counterparts for the same or similar telecommunications services.

Schools & Libraries - This support, commonly referred to as E-rate support, provides affordable telecommunications and Internet access services to connect schools and libraries to the Internet. This support goes to service providers that provide discounts on eligible services to eligible schools, school districts, libraries, and consortia of these entities.

Here's more from the USF website:

Currently, all telecommunications companies that provide service between states, including long distance companies, local telephone companies, wireless telephone companies, paging companies, and payphone providers, are required to contribute to the federal Universal Service Fund. Carriers providing international services also must contribute to the Universal Service Fund. Telecommunications companies pay contributions into one central fund. USAC makes payments from this central fund to support the four Universal Service Fund programs.

McCain's policy does not mention the USF but does say ......he supports private/public partnerships to devise creative solutions and help rural area and towns and cities in their efforts to build-out broadband infrastructure through government-backed loans or low-interest bonds.

So, Obama says he'll reform the USF fund and use it to give new tax and loan incentives. McCain says he'll build out the infrastructure using government-backed loans and low-interest bonds...... I like Obama's idea of appointing the nation's first Chief Technology Officer (CTO) to ensure that our government and all its agencies have the right infrastructure, policies and services for the 21st century. The CTO will ensure the safety of our networks and will lead an interagency effort, working with chief technology and chief information officers of each of the federal agencies, to ensure that they use best-in-class technologies and share best practices.

Both lack enough detail to really get down to specifics. For example, neither policy includes what I consider one of the biggest broadband roadblocks in this country - a modern definition of broadband bandwidth. Obama's policy uses the term true broadband (whatever that is) and I did hear Obama use the word broadband in the debate last week. I did not hear McCain use it in the debate. I wonder if we'll ever see the 1Gbps they are getting today in parts of Japan for $51 / month in South Hadley, MA.

I teach so I suppose I should give them each some sort of a grade for the broadband sections of their policy papers:

McCain: C-
Obama: C

If McCain updated his policy, saying he would also appoint a CTO, I would probably change his grade to a C .........

McCain on Technology and Innovation

A few days ago I wrote about Barack Obama's policy for technology and innovation and take a look at John McCain's policy today. I got a lot of hits and a lot of feedback (I have not posted any of it) on the Obama piece with many asking who I was supporting. My intentions here are not to support or endorse a single candidate - my goal is to outline the plans of each candidate and keep my political preferences to myself - this is a technology blog not a political one!

In mid-August, about 8 months after Obama released his technology and innovation policy paper, John McCain released his 3000 word paper titled Technology. McCain's policy was drafted in-part by Michael Powell, former chairman of the Federal Communications Commission. In a format similar to Obama, McCain's policy lists 6 key points (Obama lists 5) with detail:

1. Encourage investment in innovation:

• Supports risk capital for investment in American innovation
• Will not tax innovation by keeping capital gains taxes low
• Will reform and make permanent the R&D tax credit
• Will lower the corporate tax rate to 25% to retain investment in U.S. technologies
• Will allow first-year expensing of new equipment and technology
• Will ensure technology and innovation is not hampered by taxes on Internet users
• Opposes higher taxes on wireless services

2. Develop a skilled work force:

• America must educate its workforce for the innovation age
• Fill critical shortages of skilled workers to remain competitive

3. Champion open and fair trade:

• Has been a long and ardent supporter of fair and open world trade
• Offering opportunity, low prices, and increased choice for our citizens
• Will protect the creative industries from piracy

4. Reform intellectual property protection:

• Will push for greater resources for the patent office
• Will pursue protection of intellectual property around the globe
• Provide alternative approaches to resolving patent challenges

5. Keep the Internet and entrepreneurs free of unnecessary regulation:

• Will preserve consumer freedoms
• When regulation is warranted, McCain will continue to act

6. Ensure a fully connected citizenry:

• Will pursue high-speed Internet access for all Americans
• Would place a priority on science and technology experience
• Would ensure that the federal government led by example
• Would support the federal government as an innovator
• Would make sure that all citizens can participate in the technology revolution

In my Obama post I included detail on how Obama would encourage the deployment of a modern communications infrastructure. Here's some detail from John McCain:

John McCain has long believed that all Americans, no matter if rich or poor, rural or urban, old or young, should have access to high-speed Internet services and receive the economic opportunities derived from technology. Access to high-speed Internet services facilitates interstate commerce, drives innovation, promotes educational achievements, and literally has the potential to change lives. As President, John McCain would continue to encourage private investment to facilitate the build-out of infrastructure to provide high-speed Internet connectivity all over America. However, where private industry does not answer the call because of market failures or other obstacles, John McCain believes that people acting through their local governments should be able to invest in their own future by building out infrastructure to provide high-speed Internet services. For this reason, Senator McCain introduced the “Community Broadband Bill,” which would allow local governments to offer such services, particularly when private industry fails to do so.

John McCain has fought special interests in Washington to force the Federal government to auction inefficiently-used wireless spectrum to companies that will instead use the spectrum to provide high-speed Internet service options to millions of Americans, especially in rural areas. As President, John McCain would continue to encourage research and development in technologies that could bring affordable alternatives to Americans, especially in rural areas.

John McCain would seek to accurately identify un-served or under-served areas where the market is not working and provide companies willing to build the infrastructure to serve these areas with high speed Internet services incentives to do so. He also supports private/public partnerships to devise creative solutions and help rural area and towns and cities in their efforts to build-out broadband infrastructure through government-backed loans or low-interest bonds.

John McCain will establish a “People Connect Program” that rewards companies that offer high-speed Internet access services to low income customers by allowing these companies offset their tax liability for the cost of this service.

Ubiquitous connectivity can allow employees to telecommute, or better yet, open up job possibilities to millions of Americans who wish to work from their home. As President, John McCain would pursue an agenda that includes encouragement of telecommuting in the federal government and private companies.

Comparing the two policies I see a few differences of opinion with the biggest being the issue of network neutrality. I'll write about those differences in an upcoming post.

Obama on Technology and Innovation

The Democratic National Convention starts today so I thought it would be interesting to take a look at Barack Obama's communications and Internet policies. Obama has a comprehensive technology and innovation plan posted on his website -the nine page document is titled BARACK OBAMA: CONNECTING AND EMPOWERING ALL AMERICANS THROUGH TECHNOLOGY AND INNOVATION. He lists 5 key points with detail:

1. Ensure the full and free exchange of information among Americans through an open Internet and diverse media outlets:

• Protect the Openness of the Internet.
• Encourage Diversity in Media Ownership
• Protect Our Children While Preserving the First Amendment
• Safeguard our Right to Privacy

2. Create a transparent and connected democracy:

• Open Up Government to its Citizens
• Bring Government into the 21st Century

3. Encourage the deployment of a modern communications infrastructure:

• Deploy Next-Generation Broadband

4. Employ technology and innovation to solve our nation’s most pressing problems, including reducing the costs of health care, encouraging the development of new clean energy sources, and improving public safety.

• Lower Health Care Costs by Investing in Electronic Information Technology Systems
• Invest in Climate-Friendly Energy Development and Deployment
• Upgrade Education to Meet the Needs of the 21st Century
• Create New Jobs
• Modernize Public Safety Networks

5. Improve America’s competitiveness.

• Invest in the Sciences
• Make the R&D Tax Credit Permanent
• Reform Immigration
• Promote American Businesses Abroad
• Ensure Competitive Markets
• Protect American Intellectual Property Abroad
• Protect Intellectual Property at Home
• Reform the Patent System

I found parts and pieces of the last three especially interesting. Let's look at some detail for #3 - Encouraging the deployment of a modern communications infrastructure. Specifically, Obama proposes the following policies to restore America’s world leadership in this arena:

Redefine “broadband:” Current Federal Communications Commission broadband definitions distort federal policy and hamstrings efforts to broaden broadband access. Obama will define “broadband” for purposes of national policy at speeds demanded by 21st century business and communications.

Universal Service Reform: Obama will establish a multi-year plan with a date certain to change the Universal Service Fund program from one that supports voice communications to one that supports affordable broadband, with a specific focus on reaching previously un-served communities.

Unleashing the Wireless Spectrum: Obama will confront the entrenched Washington interests that have kept our public airwaves from being maximized for the public’s interest. Obama will demand a review of existing uses of our wireless spectrum. He will create incentives for smarter, more efficient and more imaginative use of government spectrum and new standards for commercial spectrum to bring affordable broadband to rural communities that previously lacked it. He will ensure that we have enough spectrum for police, ambulances and other public safety purposes.

Bringing Broadband to our Schools, Libraries, Households and Hospitals: Obama will recommit America to ensuring that our schools, libraries, households and hospitals have access to next generation broadband networks. He will also make sure that there are adequate training and other supplementary resources to allow every school, library and hospital to take full advantage of the broadband connectivity.

Encourage Public/Private Partnerships: Obama will encourage innovation at the local level through federal support of public/private partnerships that deliver real broadband to communities that currently lack it.

C-SPAN recently ran an interview with Barack Obama policy advisor and former Federal Communications Commission (FCC) Chairman Bill Kennard who discusses Obama's telecommunications policy. You can watch the 31 minute interview here.

Last week John McCain issued his own 3,000 word technology policy statement - I'll take a look it in my next post.