FCC Connect America Fund Phase I Round Two

Last week, the Federal Communications Commission (FCC) posted an interactive map (embedded below) showing the locations where new higher-speed broadband may be deployed as the result of the second round of Connect America Phase 1 funding.

Back in 2011, the FCC launched the Connect America Fund (CAF) and it has had limited success. Round one of funding only dispensed $115 million of $300 million in available funds. I'm not sure why the FCC has had difficulty giving this money out - currently the FCC defines broadband as 768 Kbps downstream and 200 Kbps upstream. In this next round the FCC has decided to offer two levels of subsidy in the current round - $775 per location to bring broadband into underserved locations (where broadband does not exist) and an additional $550 per location (where lower speed broadband does exist) to bring broadband speeds up to 3Mbps downstream and 768 Kbps upstream.

Coverage includes over 600,000 homes and businesses in the United States and the map shows the number of homes and businesses along with the amount of subsidy ($775 or $550) for each location.

Four rural telcos are receiving most of the funds:

CenturyLink - $54 million
Frontier Communications - $72 million
AT&T - $100 million
Windstream - $124 million

Interesting that Verizon Landline (with regional sell-offs over past few years) does not appear to be a rural player any more.

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.

A Summary Of The Verizon - Frontier Deal

Yesterday, Verizon and Frontier Communications announced an agreement that would sell off a large chunk of Verizon's rural markets. Here's a quick summary taken from DSL Reports pieces on the deal:

• Frontier will give Verizon $5.3 billion in Frontier stock and take on an additional $3.3 billion in debt.
• Frontier will get Verizon landline networks in Arizona, Idaho, Illinois, Indiana, Michigan, Nevada, North Carolina, Ohio, Oregon, South Carolina, Washington, West Virginia. Wisconsin and some rural areas of California.
• Frontier will grow to more than 7 million access lines in 27 states and will be the largest provider of voice, broadband and video services focused on rural to smaller city markets in the United States.
• Frontier will be picking up some FiOS - 41 local franchises and the state of Indiana will be transferred from Verizon.
• Approximately 11,000 Verizon employees will end up working for Frontier.
• Verizon Wireless and Verizon Business services in the listed states will not be transferred to Frontier.
• With this deal Verizon may eventually reach 80% FiOS coverage on their remaining footprint.
• It is doubtful Fiber to the Home (FTTH) services will be expanded in any of the transferred regions (by Frontier) in the near future.

According to DSL Reports, Frontier has struggled of late to deliver even 3Mbps worth of connectivity to many of its rural users according to posts in their forums, but Verizon CEO Ivan Seidenberg issued a statement saying Frontier would apply their "laser focus" on the needs of rural customers to ensure a smooth transition and quality service.

The deal is expected to take about a year to complete.

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.

Cable Companies Selling More Broadband Than Telcos

Last week the Leichtman Research Group published a study that included the nineteen largest cable and telephone broadband providers in the United States. The survey, representing 94% of the current U.S. broadband market, revealed some interesting findings:

• The top broadband providers account for 64.1 million subscribers.
• Cable companies have about 34.7 million broadband subscribers.
• Telephone companies have about 29.5 million subscribers.

And even more interesting:

• The top cable companies added 1.2 million subscribers, representing 54% of the net broadband additions for the quarter versus the top telephone companies
  
• This is the first quarter since 3Q 2004 that cable added more broadband subscribers than telephone providers.
• Overall, broadband additions in 1Q 2008 amounted to 75% of those in 1Q 2007 – with cable having 84% as many additions as a year ago, and Telcos 67%.
• The top cable broadband providers now have a 54% share of the overall market, with a 5.2 million subscriber advantage over the telephone companies.

Cable broadband subscriber rates are growing at a more rapid rate than the telcos. The cable companies have built a network that has always been easier to upgrade and offer broadband services on. Telcos are stuck with having to provision lines for ADSL by removing bridge taps and loading coils on copper wire lines that, in some of the older cities, are approaching 100 years old. The telcos have also had to deal with distance limitations and have struggled with cramming ADSL equipment into remote terminals in the field - there is only so much room in those roadside boxes and if they don't have space for you, you don't get a connection. Here's more from the Leichtman Research Group:

Verizon added a net of just 4,000 subscribers to its copper-based DSL service in the first quarter. It gained 262,000 customers for its fiber-based (FiOS) service during the same period.

Is the low hanging ADSL fruit picked over? The ADSL push by the telcos may be coming to an end - at least for some of the providers.

See the Leichtman Research Group study for details.

Qwest's FTTN Broadband Plan

I've spent some time blogging and podcasting Verizon's fiber to the premise (FTTP), AT&T's fiber to the node (FTTN) and Cable's DOCSIS 3.0 plans but have not had a chance to discuss what Qwest's plans are for network upgrades and higher bandwidth broadband delivery. Qwest is based in Denver and provides services to 14 states in the western part of the U.S.

Yesterday, Broadband Reports posted an interesting summary of a conference call with new (he started in August) Qwest CEO Ed Mueller. Here's a summary from the Broadband Reports post:

Qwest will spend $300 million over the next two years to bring 20Mbps VDSL to around 1.5 million customers.

- $70-100 million will be spent on FTTN this year and another $200 million next year.

Qwest hopes to see a FTTN/VDSL penetration rate of 40% by 2010. Upgrades are going to cost the company around $175 per home. Qwest will focus on portions of around twenty un-mentioned markets.

The Denver Post also published an article yesterday outlining the call and indicated the company will not focus on IP video delivery, stating "the $300 million fiber-to-the-node project is not intended as a deployment of IPTV." Qwest currently has a video agreement with DirectTV and it looks like that agreement will stay in place.

The Post article gave a little more detail on deployment, stating the rollout "will focus on 20 markets with the project, 10 of its largest and 10 others." Also according to the article, Qwest has started to upgrade their network in Denver and Colorado Springs.

Second generation VDSL (Very High Speed Digital Subscriber Line), referred to as VDSL2, provides up to 100Mbps over standard copper telephone wires.

250 Mbps Over Your Telephone Wires!

Dr John Papandriopoulos, an Australian research fellow at the University of Melbourne, won the University's highest academic prize on Tuesday - the Chancellor's Prize for Excellence in the PhD. According to the Australian Herald Sun, Papandriopoulos has "developed technology to make broadband internet up to 200 times (Internet speeds up to 250 megabits per second) faster without having to install expensive fiber optic cables."

This kind of bandwidth is hard to imagine over copper telephone wires and requires a little bit of background to understand. Papandriopoulos' work is based on the work of Stanford Professor John Cioffi, considered by many as the "father of ADSL". Cioffi is currently working in the area of dynamic spectrum management which, according to Wikipedia, is: "a technique being researched to improve DSL performance over ordinary copper phone lines by reducing or eliminating crosstalk between DSL phone lines that are close together."

Crosstalk occurs between conductive wires that are close together. Information, whether voice, video or data is transmitted in the form of electrical signals on copper wire. These signals produce magnetic fields around the wires and these fields are inductively coupled into surrounding wires. Ever drive under a high voltage power line with your AM radio on? If you have then you've likely heard the effects of a coupled field. Telephone wire fields are no where near as strong as high-voltage power transmission fields but, when other wires are close, crosstalk will occur and produce interference on the receiving wire.

Right now there is not a lot of technical information available on Papandriopoulos' work. According to the Herald Sun:

"Dr Papandriopoulos' research, which took a year to complete, uses mathematic modeling to reduce the interference that slows down downloading."

Also, according to Image and Data Manager:

"Dr John actually plans to part ways with the University of Melbourne and is “Currently trying to find a licensee for the intellectual property and I’ve also recently taken a position with a startup in the US, this startup focuses on this area and is run by Stanford Professor who is known as the father of ADSL” he continued, “The professor is John Cioffi who is pushing this whole notion of dynamic spectrum management, which is another way of saying dynamically managing interference.”

and:

"... the technology could be installed directly into existing modems as a software upgrade or be shipped in new modems depending on the ability of the particular modem type. In addition to this there would be a further installation required at the DSLAM in your telephone exchange which would then start cutting down the interference. Don’t expect to see the offering on your local PC store shelves anytime soon though, as Dr John hopes it will be available within 3-4 years."

This will be very interesting to watch.

Broadband Gaming in the Sticks

I'd like to thank Karl Kapp for including my blog in his Blog Book Tour for Gadgets, Games and Gizmos for Learning.

Karl's book takes a look at members of the "just starting to retire" baby boomer generation - highly skilled individuals who will be taking with them all of their expertise. Simultaneously, a new generation of employee (dubbed by Karl and others as "gamers") is entering the workforce with a different focus and learning style. For the first time, our workplace will experience the invasive influence of video games, Internet surfing, blogging, and podcasting. Karl's personal website is linked here, the book website is linked here and you can purchase his excellent book by following this link to Amazon.

In my blog today I take a look at broadband access and availability - critical for gamers and many of the applications Karl discusses in his book. My post is a little different than most that have been posted on the blog tour - I hope it makes sense and you can make the connections to gaming, gamers and Karl's book.

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One of my passions is what I refer to as the "broadband divide" - basically the broadband "haves" and "have-nots" in the United States. In today's blog I focus on availability in some of the rural parts of my state - the Commonwealth of Massachusetts. Broadband availability and affordability are critical as our online efforts in education (including gaming) move forward - whether it's bandwidth on our campuses or in our student's homes. Residential access is especially important for community colleges since most do not have dorms - students are commuting back and forth from their homes.

Let's get into some of the things going on in my state - I think you may find similar scenarios wherever you live.

When most people think of Massachusetts the first thing they think of is probably Boston and second maybe the Red Sox or New England Patriots. If you've been to Boston and the surrounding area you know, like any big city and its suburbs, it's relatively congested. The fact that it is congested is good in some ways - typically it's great for things like broadband roll out. Houses are close together with short consistent length driveways. Many of the neighborhoods are older and there are still poles carrying power telephone and cable services. It's relatively easy for providers like Verizon to come into a neighborhood and run a piece of aerial fiber down a street and then add relatively short and consistent length drops to homes on the street. As a result, people in these kinds of neighborhoods (including school kids) have lots of bandwidth available for information, education and entertainment.

Those in the more rural parts of Massachusetts (and many other areas in our country) are not so fortunate when it comes to broadband availability. Today, there are 32 towns in rural parts of Massachusetts that have no high-speed Internet, or broadband, access whatsoever. An additional 63 are under-served, with broadband access available in only some areas of the community. Many of these rural town are parts of regional school districts which can present significant problems for students living in these towns. I'll use the beautiful town of Blandford, MA as an example. Blandford is part of a regional school district that services seven towns. Blandford does not have broadband availability (no cable modem or DSL) while others do (although coverage in some of these towns is not complete). Students living in Blandford are at a "broadband disadvantage" when compared to other students that do have access.

In a podcast interview late last month, Stan McGee, Massachusetts Assistant Secretary for Policy and Planning for the Executive Office of Housing and Economic Development and also Director of Wireless and Broadband Development (try to get all of that on a business card!) talks with Sharon Gillett, Commissioner of Telecommunications and Cable for the Commonwealth of Massachusetts. The two discuss Governor Deval Patrick’s recently announced broadband initiative.that will invest up to $25 million over five years, and will seek to make broadband available in all under-served towns in Massachusetts by 2010 and "improve conditions" in many of the under-served communities. Here's a few quotes from the show-notes:

The main elements of the plan include creating a Massachusetts Broadband Incentive Fund. And the fund will be capitalized by the issuance of a $25 million broadband bond. The fund is proposed to be managed by the Massachusetts Broadband Institute, a division to be created within the Massachusetts Technology Collaborative. Once this management entity is in place, we believe public-private partnership developed here can be extended to under-served regions of the Commonwealth to ensure ongoing broadband equity.

The Commonwealth’s approach will be to invest public funds into essential and long-lived broadband infrastructure assets. These include things like fibers, conduits, or towers for wireless broadband services. By investing in these assets, the Commonwealth will lower the overall cost of deployment for private providers.

Public-private initiatives have worked in some situations and failed in others - several Municipal WiFi projects come to mind off the top of my head. There have also been some successful wireless initiatives in rural areas including an AT&T implementation in Alaska I blogged about recently.

The Massachusetts initiative is referred to as "ambitious" and I'll add challenging but it is something we must do. Here's one of my favorite quotes from the podcast:

We believe that any individual or community without high-speed Internet access today is educationally and economically disadvantaged, and Governor Patrick tasked us early on to prepare a plan that would bridge the digital divide that faces all too many communities across the Commonwealth.

It's great to hear this kind of spirit and ambition and I hope it does not get bogged down in state politics. I do have concerns that $25 million may not be enough to push this to critical mass in Massachusetts. It's a start though - I look forward to the day when all of my students and their families have available and affordable broadband access in their homes.

AT&T Looking to Close Broadband Divide with WiMax

I've written in the past and Mike Q and I have podcasted about rural areas and how the lack of broadband availability (Cable modem or DSL) can handicap residents including students. WiMax is one of the more promising technologies that can help solve this problem and it looks like AT&T is moving in this direction. The company launched a trial with their Alascom subsidiary in Juneau, Alaska where customers can purchase WiMax service starting at $19.95 a month. Alascom is using Alvarion IEEE 802.16e-based WiMAX equipment to provide speeds up to 1Mbps symmetrical. According to an Alascom press release:

"AT&T Alascom is fully committed to deliver the benefits of broadband Internet service as widely as possible," said Mike Felix, president of AT&T Alascom. "Our deployment of WiMAX-based high speed Internet service in Juneau is the result of years of research into new-generation broadband technologies that are well-suited for deployment in challenging environments such as Alaska. Today, those efforts enable us to deliver a compelling new broadband choice for thousands of Alaskans, including many who have previously not had access to high speed Internet service."

The press release concludes:

"Outside Alaska, AT&T will evaluate opportunities to deploy fixed wireless technologies in other areas of the country based on customer needs and the results of its existing deployments."

DSL Reports Monday quoted anonymous sources saying the company will likely be rolling this out in some areas in the lower 48 - specifically the south:

"AT&T's limited spectrum holdings could make it hard for the operator to take on serious deployment outside of the South"

"Spectrum will also be an issue for AT&T if it wants to deploy outside the South. The 22 2.3 Ghz licenses that it holds come from the BellSouth merger and only cover some of the Southern markets that operator provided service in. AT&T sold off its remaining 2.5 Ghz licenses to Clearwire LLC earlier this year."

I've written about the Sprint/Clearwire WiMax initiative which is directed towards mobile devices (hand held computers, phones, PDAs, etc). This AT&T project appears to be directed as a residential and business broadband alternative - exactly the kind of technology we need to start closing the broadband divide in the U.S.

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Read Show Notes and listen to Mike Q and my latest Podcast titled Micro-blogging linked here.
Podcasts also free on iTunes.
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Goodbye Copper?

There’s been some recent press about Verizon and their FIOS product installation. FIOS is a fiber optic network service that delivers voice, video and data services. You may also see it referred to as a Fiber to the Premises (FTTP) or Fiber to the Home (FTTH) service that Verizon is selling and installing in select markets in 16 different states.

Most who have the service installed are extremely happy with the bandwidth and cost when compared to lower bandwidth DSL and Cable Modem services. The product has become so popular that it is even being used as a selling point by real estate agents when marketing homes.

A few are complaining though. It appears Verizon, when installing the FIOS service, is cutting out the existing copper lines leaving the customer with only one option – fiber and FIOS. There are a couple of good reasons from a business perspective for Verizon to do this. The first is the existing copper wiring is old and requires a significant amount of maintenance – Verizon spends hundreds of millions of dollars a year just maintaining the existing “copper plant” and it makes sense to remove it when it is replaced. The second reason is the Telecommunications Act of 1996 which requires the telephone companies (like Verizon) share their existing copper lines with competitors. There is no current legal requirement for Verizon to share new fiber optic lines with anyone.

In fairness to Verizon, there is a three step notification process for people who sign up for the FIOS service. According to the International Herald Tribune, customers are told by the Verizon sales person, it is indicated in the sales contract and the customer is told by the technician that the copper will be cut out. Currently, Verizon is publicly stating they will replace removed copper if a FIOS customer wished to revert back to copper service.

Also according to the International Herald Tribune, Verizon has filed more than 100 notices with the Federal Communications Commission to retire portions of copper throughout its network.

I can understand the customer concerns about lack of choice and some technical issues like battery back-up and also Verizon’s concerns about having to maintain two separate networks.