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Broadband Blindness Documentary

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A new documentary from California explores the failure of the private sector and competition more generally to sufficiently invest in fast, affordable, and reliable access to the Internet.  It comes in three parts and runs about 25 minutes in total.  

This provides a good summary of the present broadband landscape and how AT&T, Comcast, and other major providers are not the answer to our increasing need for better connections to the Internet.

 

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AT&T Abandons Wireless Consolidation Attempt

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It is hard to avoid becoming cynical when watching the federal government interact with big corporations like AT&T. So when AT&T announced it would merge with T-Mobile, giving AT&T and Verizon a combined 3 out of 4 cellular subscribers, I thought two things: 1) What a terrible idea. Higher prices, fewer jobs, less choices, etc. 2) The Federal Government will likely not prevent it - instead opting for some minor concessions that no one will bother to enforce. Sometimes, it is very good to be wrong. Cecilia Kang of the Washington Post, decodes the language from Wall Street to explain the biggest winner from the federal government blocking the merger: consumers.
“Without the combination, we think the wireless industry will be further weakened by continued hypercompetitive activity, particularly regarding subscriber acquisition costs,” said Nomura Securities analyst Mike McCormack. That means customers can still get lower rates as the industry competes for their dollars. T-Mobile, for example, will continue to be a low-cost competitor, according to consumer advocacy group Consumers Union. A survey showed that data plans from T-Mobile were $15 to $50 less per month than those offered by AT&T.
An excellent reminder that what is best for Wall Street is not what is best for the 99%. Big companies like AT&T find competing for customers a hassle that lowers their profits -- they consider a market with four sellers to be hypercompetitive. In wireline, they have acquiesced to the "competition" of two competitors -- cable and DSL. This is one reason communities build their own networks -- the private sector is not truly competitive when it comes to ISPs and most communities have no prospect real of improvement absent a public investment. But we should rejoice in this victory -- because we earned it. Without the hard work of many grassroots groups, it is hard to imagine the Department of Justice or FCC standing up to such a powerful corporation.
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The Internet is More Important than Broadband

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I encourage readers to visit Doc Searls post "Broadband vs. Internet" for a discussion about things that matter regarding the future of Internet access for most Americans.
The Internet is no more capable than the infrastructures that carry it. Here in the U.S. most of the infrastructures that carry the Internet to our homes are owned by telephone and cable companies. Those companies are not only in a position to limit use of the Internet for purposes other than those they favor, but to reduce the Net itself to something less, called “broadband.” In fact, they’ve been working hard on both.
There is a difference between the Internet and "broadband." Broadband is a connection that is always on and tends to be somewhat faster than the dial-up speeds of 56kbps. Broadband could connect you to anything... could be the Internet or to an AOL like service where some company decides what you can see, who you can talk to, and the rules for doing anything. The Internet is something different. It is anarchic, in the textbook definitional sense of being leaderless. It is a commons. As Doc says,
The Internet’s protocols are NEA:
  • Nobody owns them.*
  • Everybody can use them, and
  • Anybody can improve them.
Because no one owns it, few promote it or defend. Sure, major companies promote their connections to it (and when you connect to it, you are part of it) but they are promoting the broadband connection. And the biggest ones (Comcast, AT&T, Verizon, Time Warner Cable, etc) will do anything to increase the profits they make by being one of the few means of connecting to the Internet -- including charging much more and limiting what people can do over their connection, etc. This is one reason the connections from major corporations are so heavily tilted toward download speeds -- they want consumers to consume content. Just about every community network built in the last 3-4 years offers symmetrical connections by contrast.
Last I heard, the fastest cable offering in the upstream direction was 12Mbps. Cox, our cable provider in Santa Barbara, gives us about 25Mbps down, but only 4Mbps up. Last time I talked to them (in June 2009), their plan was to deliver up to 100Mbps down eventually, but still only about 5Mbps up.
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AT&T's Lobbying Power

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A deep thank you to Public Knowledge for their throwing back the curtain on AT&T's lobbying operation in the attempted takeover of T-Mobile. Whenever the discussion of public v. private arises, the focus is inevitably on the advantages that the public sector supposedly has over the private providers. We have documented these "level playing field" claims and refuted them. When I recently visited Lafayette, the head of the public utility told me that in fighting the Local Government "Fair" Competition Act in 2005 (meant to prohibit competition against incumbent cable and phone companies) Lafayette hired one lobbyists and the incumbents hired all the rest. In Tennessee, Chattanooga hires one lobbyist to defend itself from many lobbyists -- in October I learned that AT&T has already registered 26 lobbyists for the 2012 session in Tennessee. Not only do major national companies like AT&T already have most of the advantages in the marketplace, they spend mightily on lobbyists and campaign contributions to make sure it stays that way. One of the reasons I am an enthusiastic supporters of Larry Lessig's Rootstrikers campaign is because the power of big telephone and cable companies likes in their ability to influence policy and elections, not in the quality of their services in the marketplace. Back to Public Knowledge -- they researched AT&T's push for th T-Mobile merger and found AT&T hired three former US Senators, four former House members, dozens of staffers from both parties, and spent over $40 million in advertising to push its bid to reduce competition in the wireless market.
“This information gives us a more complete picture of the vast lobbying and advertising resources AT&T has dedicated to trying to ram through this takeover,” said Harold Feld, legal director of Public Knowledge. “It is even more impressive that while many members of Congress have ignored the facts and are backing this takeover, the Justice Department and the Federal Communications Commission have not. It is clear that the data the DoJ and FCC have compiled on this deal will negate all of the money AT&T has spent to mislead policymakers and the public.”
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AT&T Defunds 9-11 To Undercut Competitors

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There are definitely times when you learn of a business practice where you think, "Wow, my opinion of AT&T could not go any lower." And then, BOOM. You find out that AT&T was intentionally underfunding a 9-11 call center in order to undercut its competitors in bids. Yikes. Did we mention that this is not an isolated case? AT&T has been busted in several jurisdictions for this practice. Hat tip to Stop the Cap! for bringing my attention to a lawsuit brought by Hamilton County against AT&T for its practice of under-reporting the number of business lines it provides. This practice allows it to undercut all competitors in the market, including the community fiber network run by Chattanooga's Electric Power Board. From the Times Free Press article:
The lawsuit claims that, since at least July 2001, AT&T has filed monthly and annual reports listing fewer business phone lines than they actually provide. Under Tennessee law, phone companies must pay $3 per month per line to pay for 911 access. ... In a March phone service bid proposal for Hamilton County, AT&T stated it would not collect the $3 rate and instead collect $2 per line per month. That allowed the company to underbid the next lowest bidder by 69 cents per line per month, “unlawfully increasing its profits at the expense of revenue to support the critical emergency services that” 911 provided, according to court records.
A difference of $.69 may not seem like much, until you consider they may be providing 1,000 lines - which is a difference of $690/month or $8,280/year. 911.gif It is an incredible racket. AT&T gets more high-margin customers, pays less in fees than competitors, and the only people who get hurt are those who depend on 9-11. Just when you think AT&T is brilliantly evil (an accusation I tend not to make against many corporations no matter how much I disapprove of their practices), you have to consider how incredibly incompetent they are.
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Despite Delays, Dunnellon Builds Muni Fiber in Florida

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Dunnellon, a small town in Marion County south of Gainesville, decided to invest in a community fiber network to spur growth and diversify its income stream. Though citizens did not want to cut government services, they have not been pleased at property tax increases. 364 days ago, we published a story discussing their financing. The town itself is quite small, with 1,733 residents but the network will be serving areas in the County as well. Though AT&T and Comcast offer services in the area, they have big gaps in coverage and apparently the cable television packages are antiquated (only 50 channels???). An article last year noted Dunnellon's Internet connections will range from 10Mbps to 125Mbps. They hope to sign up 1,647 subscribers within 6 months of launch -- the network is named Greenlight (not sure if they were aware that the city of Wilson, NC, already operates a triple-play FTTH network called Greenlight). They hoped to launch 6 months ago. Bill Thompson's "Dunnellon dreams of a connectied future," offers a comprehensive look at the promise and the challenges Dunnellon faces. Dunnellon's city manager comes from Valparaiso, which had a city-owned cable network that upgraded to FTTH. Unfortunately, Dunnellon is in the hard position of building a network from scratch. logo-valp-net.jpg Building a new network requires a massive up-front capital investment - in this case the city will have spent $4.4 million to connect the first connection. Good thing they aren't all that expensive! The article identifies two main sources of the delays: difficulty in getting on the poles owned by Progress Energy and long delays in receiving the fiber-optic cable they ordered (stimulus projects have hogged the supply). Rather than taking 12 weeks, they had to wait 30. Delays cause problems:
The installation delay has put the city in a pinch with its lender, Regions Bank.
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AT&T Group's Lawsuit in Wisconsin Fails

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Yet another court has ruled against an incumbent telephone or cable company that filed a lawsuit to block any threat to their continued monopoly in America's communities. Access Wisconsin, an AT&T dominated trade group, has been trying to stop communities in Wisconsin from building their own next-generation networks to serve schools and libraries that AT&T has long neglected with slow, overpriced, broadband connections. A local judge has dismissed this blatantly anti-competitive attempt to stop communities from building the networks they need.
Wisconsin Independent Telecommunications Systems, operating as Access Wisconsin, sued the UW Board of Regents in July in an effort to stop a $32.3 million fiber optic network to Platteville, Wausau, Superior and the Chippewa Valley region. The lawsuit also named WiscNet, CCI Systems Inc. and the state Department of Transportation. ... The grant — made available through federal stimulus funds — will build high-speed Internet fiber to anchor institutions such as libraries, schools and government, health care and public safety buildings.
A press release from the UW-Extension office that organized the Building Community Capacity through Broadband program, funded by the broadband stimulus program, notes:
“This work by the University of Wisconsin-Extension and our many community partners is vital to the future of the Wisconsin economy,” said Ray Cross, chancellor of the University of Wisconsin-Extension and University of Wisconsin Colleges. “I hope that now government, the university, private businesses and communities in every corner of the state will be able to work together to assure Wisconsin is connected to the global economy.”
Remember that these lawsuits are rarely intended to be won.
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Senate to Vote on Giving Internet Governance to Comcast, AT&T

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Update: The Senate voted against turning the Internet over to Comcast, AT&T, and other major carriers. How did your Senators vote? The US Senate began debating network neutrality yesterday - the historic governing principle of the Internet that ISPs should not be allowed to tell their users where they may or may not go and should not prioritize some connections over others merely because it generates more revenue for the ISP. As Al Franken has said several times, this is the 1st amendment for the Internet - protecting everyone's speech. It prevents a few massive companies (or even local governments where they offer access to the Internet) from exerting too much influence over what subscribers are able to do on the Internet. Unfortunately, many Senators are campaigning against this principle, in part because they have been misinformed as to what it means and in part because they are getting a ton of campaign cash from corporations that recognize how much more profitable they would be if they could charge users extra to go to YouTube. There will be a vote today on a resolution of disapproval for the mild network neutrality rules proposed by the FCC last December (which the FCC Chairman chose to water down in part because he thought it would be less controversial -- FAIL). We would like to recognize some of those who have stood up to protect the open Internet, starting with Free Press. The American Sustainable Business Council authored an op-ed:
The truth is that if we want to make sure small businesses can grow with the assistance of broadband, the Internet must remain open.
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Riverside: Municipal Wi-Fi is Alive in California

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Riverside, California, an innovative city of 300,000 in the eastern part of Los Angeles has been a broadband pioneer even though it sits in the shadow of tech centers like nearby Santa Barbara.   Riverside’s accomplishment as a city catching up with the information age was evident when it was selected as one of the top 7 Intelligent Communities Award in 2011 by New York-based Intelligent Community Forum.  

“It’s an honor to be selected as one of the top 7 cities in the world.  It comes down to a couple factors, what communities are doing with broadband, but... includes digital inclusion, innovation, knowledge workforce (of folks within your community) and marketing advocacy... We rank very high in all those categories.” - City CIO Steve Reneker [Gigabit Nation Radio]

The cornerstone the city’s SmartRiverside initiative is a free public wireless network which covers 78% of the city’s 86 square miles.  Established in 2007 by AT&T (which also offers DSL services in Riverside), the maximum speed of the network is 768kbps, which at just under 1Mbps is decent enough to surf the web and check emails.  However the road to providing free Internet access and bridging the digital divide wasn’t so easy for Riverside.  

The City issued a RFP in 2006 for a provider to deploy a citywide Wi-Fi network, with the goal of making the Internet accessible to users who can’t afford higher cost plans.  The City met with respondents and a speed of 512kbps or about half a megabit was initially quoted as an entry-level speed that would complement existing services rather than compete against them.  The contract was awarded to AT&T who hired MetroFi to build the network and charge the city a service cost of about $500,000 a year.  MetroFi went bankrupt after completing only 25 square miles and Nokia Siemens took over but only completed up to the present level of coverage. 

In 2007, the wifi network launched and began bridging the digital divide. Through the City’s digital inclusion efforts, not only were modest-income families able to obtain low cost or free PCs but also have means to use them with an Internet connection.  

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