Category Archives: Broadband Bytes

Broadband Bytes: January 1-9, 2008

By | |
1 Comment

Heartburn over the pending DTV switch, CES 2009 and a local retransmission battle are the main headlines of the last week. There’s also plenty of sour economic news and a few rays of hope for providers willing to grab onto innovative ways to deliver content. And, as expected, incumbents are trying to get in on the broadband spending bonanza.

  • Now that nobody can afford to buy an HDTV and the money for DTV converter boxes is completely gone (not to mention all of the nasty digital signal gaps), politicos and lobbyist are trying to push back the digital conversion date from February 17. So far, president-elect Obama is on-board as are several former chairmen of the FCC and Consumer’s Union. Draft legislation, however, does not move the date, instead choosing to assume a DTV coupon redeption rate of 70% instead of 100%. With anywhere from 2 million to 11 million people unprepared for the digital switch in just 5 short weeks, this could end up being a big issue in the 2010 mid-term election; some folks are rightfully pointing out that with the 10-year lead on this transition, the unprepared should suck it up. A delay in switching could spell problems rolling out services on the freed-up 700MHz spectrums, including delays in LTE deployment. If you still need a DTV converter box, sign up even though the money is gone; the feds will put you on a waiting list until they have more money.
  • Ah, CES. A time of releasing all kinds of gizmos you didn’t even know you needed until you knew they existed. For instance, LG is rolling out a TV with Netflix integrated into the set. That could set a trend of more set-topless boxes that can stream video from online providers. If the sets support flash-upgradability, they could even add more providers after you’ve already purchased the set. Sony already provides a module for many of its Bravia line that add sources such as YouTube and Sports Illustrated to the set and Samsung is working on it. This will fuel the projected growth in Internet viewers who use their TV.

    Another app worth mentioning is the Pogoplug, a network device that can turn any USB hard drive into an uber-NAS. In addition to the traditional NAS functions, it will also share your files over the Internet and includes both a iPhone app and a robust API. This can easily create an app promotion campaign. Transferring gigs of stored data means even more demand for bandwidth.

  • Are you a DirecTV subscriber? You may have noticed that you no longer have access to KJZZ, the primary source of Jazz games and an exclusive source for USU and WSU games. Despite getting retransmission fees from Comcast and Dish for the previously free channel, DirecTV said the cost was too high and has been attempting to negotiate a lower rate since March. When that failed, DirecTV dropped the station. The messy fight is drawing ire from viewers and causing black eyes for both DirecTV and Larry Miller, owner of KJZZ. With ad revenues sagging, it’s no surprise that broadcasters have turned to retransmission fees as a source of additional revenue. Retransmission revenues climbing at a precipitous rate: 32% in the first 9 months of 2008 with a projected tripling by 2012. With those kinds of rate increases, more subscribers will be driving into the arms of free Internet video.
  • Broadband subscriber growth is projected to drop about 12% this year with cable gobbling up about 75% of the growth. Why, you may ask? Because DSL is much slower and next-generation broadband options are few and far between. Verizon is already unsure that it will expand past the initial 18M-home footprint for FIOS, especially since it ends up being Verizon’s biggest competitor to its shrinking DSL subscriber base. Time Warner also dropped a bombshell when it wrote off $25B worth of AOL, an asset that continues to drag the company down. Both AT&T and Verizon at looking at some poor revenue forecasts with global telecom spending to inch forward a meager 1%. Don’t cry too hard for them, however. US companies topped worldwide broadband revenues with a nearly $9B lead over second-place Japan, a country that enjoys wide-spread 100Mbps service. US companies still charge a lot more per megabit than any other first-world country.

    Clearwire can’t get away from the bad news either. Despite launching service in Portland, Chicago has been delayed until the second half of this year. Comcast had to write off a significant chunk of its investment in Clearwire and Intel is hurting from the slow adoption of WiMax as handset vendors sit this one out.

  • Qwest is already trying to get in on the broadband spending bonanza. Their proposal is to give the money to the states and let them administer it, just like they did with the Telecommunications Act of 1996 that screwed over Americans to the tune of over $200B. Unsurprisingly, they also want broadband defined as 7Mbps downloads, about what their current FTTN system can support. It’s not just the obvious industry shills we have to worry about either; sock puppets and astroturfing are going to be as rampant as they’ve ever been. Given how pooly these companies have done with broadband already, some are rightfully asking if we should give money to the same folks who created the problem in the first place, especially since we so often see rising rates. While the details of the upcoming broadband spending are up in the air, it will include spending for smart electrical grids and improvements in medical IT systems, both of which should result in big job gains. A competing idea that should be thown into the mix is using loan guarantees instead of just giving the money away. At least then we could be guaranteed some some return on investment.
  • Remember how Qwest is using FTTN upgrades to degrade ADSL service and poach customers from other ISPs? Apparently other providers think it’s a pretty good idea. AT&T decided to downgrade 2G EDGE service to make way for faster 3G service, a move that forces many to seek a new handset. That spells a lot of angry 1st gen iPhone users who paid big bucks for a device that’s already woefully outdated. AT&T and Verizon have both used delays in moving phone and DSL service as an opportunity to upsell to U-Verse or FIOS. Customers increasingly fed up with incumbents are ready to bolt and Consumer Reports recommends going with a fiber provider. Will you be there to pick them up?
  • Speaking of dirty tricks, the fallout from the dispute between Qwest and SkyWi has the latter claiming that Qwest cost the company a bunch of customers that switched to other providers. State regulators in New Mexico slammed both companies for putting their differences before the best interests of customers. New Mexico’s AG also lambasted Qwest for “unfair billing and business practices” when dealing with CLECs. (He’d better watch their northern neighbor; Qwest decided to sue Colorado when it didn’t get the rate increases it wanted.) Idaho’s PUC didn’t get involved in the matter on behalf of that state’s affected customers since SkyWi is a VoIP provider and the PUC doesn’t believe it had authority to act. Small providers would likely be eager to jump to another transport given the opportunity, especially as Qwest flexes its muscle.
  • IPv4 is rapidly running out of addresses with another 200M snapped up in 2008. Developing countries such as China, Russia and Brazil had the biggest percentage spikes with most of the new addresses being used in North America and Asia. Google had already started a migration to IPv6; you should too.
  • Comcast has flipped the switch on its new throttling system and it appears to be solid engineering as opposed to a cheap grab for more subscriber dollars. (I’m looking at you, Time Warner.) If a particular network segment is congested and you’re part of the problem, your traffic bumps to a lower priority regardless of what protocols or programs you’re using. This is much better than using forged TCP reset packets or cutting off customers for using too much of an undisclosed amount of bandwidth. They still aren’t disclosing what happens when you hit the magic 250GB cap or how exactly we’re supposed to keep track of it, but this is a step in the right direction.
  • Broadcom is now offering up 8-channel DOCSIS 3.0 bonding which should be able to support up to 320Mbps downloads. That’s all fine and dandy, though cable operators have been slowing their DOCSIS 3.0 single-channel deployments, not to mention that most of them can’t spare 8 channels as they beef up HD offerings.

Broadband Bytes: December 13-19, 2008

By | |
4 Comments

I think 2009 is going to end up being the year of broadband. Advocates are very well-organized and the new administration is putting a lot of post-election emphasis on telecom policy, an issue that’s typicaly given only election-cycle lip service.

Broadband Bytes: December 6-12, 2008

By | |
Leave a comment

This week was kind of a slow news week. Most of the telecom world has been focused on President-Elect Obama’s plans for broadband stimulus and the continuing bad economic news from providers, programmers and manufacturers.

  • Yes, there’ still even more layoffs and bad economic news. Level 3 is planning to cut about 8% of its workforce and Brightcove is looking at a 15% reduction in headcount. DirecTV has also implemented a hiring freeze, usually a first step before issuing pink slips. Multichannel has a good roundup of layoffs throughout the industry totalling over 15,000 employees. With the tough times, providers are looking at cutting perks for subscribers, raising rates or agressively pushing bundles. While ad spending is going to worsen overall, cable may already be over the hump. There’s still good opportunities for small and growing companies to pick up top talent on the cheap and move quickly to outmaneuver larger rivals by taking advantage of their sagging bottom lines.
  • Qwest is planning to keep spending flat in 2009 which could mean a halt to construction of its FTTN network. There’s a lot of concern that Qwest won’t be able to meet its 2010 debt obligations which has investors seriously spooked. If Qwest does halt or slow FTTN deployments, it could mean that Comcast will make similar cuts to DOCSIS 3.0 rollouts in shared markets as they get bloodied in FIOS territories. Fiber projects like UTOPIA can capitalize on these stalled rollouts to snap up more customers. Part of Qwest’s problems could be related to its tendency to litigate and legislate its way to success rather than offering compelling products. Its shenanigans have recently gotten it sued by a CLEC in New Mexico.
  • There’s still ways to survive the tough times by focusing on business services and localizing your product offerings. Also be aware that customers are looking for a good deal and have no problem asking you to cut their bill. It’s often worth it to take a hit on your profit margin in order to keep the customer. Comcast regularly offers a 6-month promo rate to retain customers.
  • Speed matters. Comcast has rolled out DOCSIS 3.0 in a handful of markets, CableVision is getting ready to do the same and across the pond, Virgin is getting 50Mbps into the hot little hands of subscribers tomorrow. Good thing, too: subscribers have a need for speed. It’s not just the last mile either. Satellite is getting a big bump with a 100Gbps satellite to be launched in 2-3 years and Ciena has shown off a 100Gbps fiber connection on a single wavelength.
  • Wireless also matters… kinda. Verizon is going to make a push to have the first LTE markets ready for service by next year, no doubt spurred on by the Clearwire WiMax juggernaut. It’s mostly a marketing ploy, though it could end up being a very effective one. Clearwire is already facing substantial hurdles and it’s probably safe to assume that even cash-rich Verizon won’t have a solid product for several more years. There’s also the problem of transport from the towers, an area where UTOPIA can shine. In other wireless news, AT&T is planning to stream satellite TV to cars and trucks, yet another move beyond the triple play. Augmenting a wired infrastructure with wireless offerings such as this is going to be critical in the future to increase revenue streams and keep bundled customers, especially if they don’t blend in.
  • Obama’s plans to allocate a substantive chunk of any stimulus package for broadband is being called a “Broadband New Deal”. The real question is how much of any package will be allocated to broadband and how it will be administered. Obama’s plan is to give states “use it or lose it” grants and let them best figure out how to spend the money. If additional conditions aren’t attached to the grants and vigorously enforced, we could just get a repeat of the Telecommunications Act of 1996. It will be very important that providers start now to get their political ducks in a row and line up for some of the cash.
  • Add Congress to the list of people who are miffed at the FCC under Kevin Martin. The House released a 110-page report slamming his management of the agency and calling for substantive change. With the White House changing hands in 6 weeks, I don’t think that’s going to be much of a problem. Given Obama’s legit technology chops, I’m optimistic that the new FCC head will do a better job.
  • Even though households with HD sets have doubled since 2007, only a quarter of homes are using the latest technology. With converter boxes and subscription services that don’t require a new set, plenty of consumers are content to keep using what they have, especially during a pinch. Your standard-definition packages will still be relevant for some time to come.
  • Speaking of content, you’d better learn how to play nice with local broadcasters. There’s a lot of instances of over-the-air stations flexing their muscle against cable over retransmission issues. CableOne and Dish have both ended up dropping local channels when they couldn’t reach agreements on fees and Lafayette’s fiber networkfound itself in the same kind of squabbles.
  • Online video is still booming. Netflix is now streaming to TiVo, AppleTV and Linux PCs while YouTube has added a Watch in HD option to all of its videos, I recommend checking out v where you can get free fcp transitions for your videos. . Hulu also managed to explode to 24 million viewers in October though Google properties still own the online video market. Even the NFL is starting to get a clue with a $20 season pass to watch games in HD after they air. Smart providers will want to focus on delivering products to their customers that bridge the gap between PC and TV since there’s no content provider to pay and the possibility of a strike from the actors guild could put new shows on ice. ZvBox already does it, though you’ll need to find something that lacks its hefty $500 price tag.

Broadband Bytes Doubleheader Edition: November 22-December 5, 2008

By | |
3 Comments

Between visiting family in Sacramento for Thanksgiving and a business trip to Montreal (where the hotel apparently didn’t believe in reliable Internet service), I got a bit behind on the Broadband Bytes feature. Never fear: I’ll make it up to you with a special double feature to get caught up on the previous two weeks.

There’s still a lot more going on in the industry, but that covers the big highlights.

Broadband Bytes: November 15-21, 2008

By | |
1 Comment

Mike just posted a Broadband Bytes, but there’s a few other things that are worth mentioning in the world of telecommunications.

  • Remember how pinched consumers are more likely to drop video service than data service? A recent survey shows that unhappy people watch a lot more television than happy people do. With economic times getting tough, it may be a smart move to come up with innovative low-cost video packages to snag/retain these customers. Comcast is already trying out a $50/mo data/voice combo and is offering free basic cable for a year for anyone who subscribes to either voice or data services.
  • Comcast is looking at sneaking in data rate increases after all. Their plan is to upgrade various tiers of service to higher speeds with accompanying higher rates. If you want to downgrade to a lower-priced package, tough noogies: speeds under 12Mbps will be gone except for a 768Kbps “value” tier. Competing providers should be able to snap up a lot of customers by offering a slower and cheaper tier between the two. T-Mobile is also raising rates on data packages, but with a 10GB monthly cap and terrible ping times, few are likely to use it for primary access.
  • Copper is dead? Multichannel is pretty sure that DSL is DOA and the subscriber numbers back that up as cable dominates. (Ars Technica offers some excellent commentary on the Multichannel article.) AT&T, while still clinging to FTTN with U-Verse, is already using WiMax as a DSL replacement in rural areas and could very well push voice over WiMax. Businesses are also seeing the light (bad pun, I know) and choosing Ethernet and big-pipe services (think OC-3/OC-12+) over T1 and T3. The price of T1 lines is also leading many small businesses to look at business-class DSL and cable options. Some are going so far as to say that copper landlines could be dead by the end of Obama’s first term as customers flock to VoIP and cell phones.
  • Telcos are hurting but cable could stick around for a while as coax offers a good chunk of bandwidth. They do, however, feel the pinch from the massive amount of bandwidth eaten up by video services. Even as SDV and DTA boxes ease some of that up, the demand for higher-quality signals to all of these shiny new HDTV sets will eat up a lot of the gains as cable operators are forced to move from 480p to 720p and 1080p signals. Competing providers will need to move quickly to offer true HD signals with low compression and superior data rates while the cable companies perform system-wide upgrades over the next 18-24 months. There’s something said for being first to market.
  • Speaking of HD, incumbents are still making agressive inroads with their HD channel counts. Comcast and Time Warner announced more HD channels this week and Dish Network is agressively adding OTA HD to many of their markets. HD isn’t the only content being expanded; both Verizon and Dish are adding more international programming as well.
  • Video isn’t just for your TV. Netflix is rolling out HD streaming with coincides with Watch It Now movies on the XBox360. YouTube is also doing a trial of high-quality video. Of course, streaming isn’t everything. Bright House is also pushing customers towards online video, just of the pay variety. They’ve inked a deal with RoadRunner to sell via their online store. All of these things is going to increase demand for greater bandwidth. And speaking of “content” delivery, you can now use your TiVo to order a pizza from Dominoes.
  • Comcast apparently feels bold enough these days to blow off the FCC. FCC Chairman Kevin Martin asked for data on the operator’s policy of moving channels out of analog tiers and into more expensive digital ones, but Comcast was bold enough to give him only partial data even as threats of fines loom.
  • It also appears that DTA boxes could be a sticky subject. CableONE asked the FCC for a waiver for a HD-capable DTA box with integrated security. This could shut out CableCARD (and possibly Tru2way) as well as a number of third-party devices like TiVo DVRs. Manufacturers are already pushing these boxes which could very well kill the Carterphone of video before it gets off the ground. Competitive operators will see the opportunity to be fully interoperable with CableCARD and Tru2way and ensure that customer DVRs will work on their systems.
  • Local programming is in high demand, but there are some chinks in the incumbents’ armor. Since local programming options like high school sports, General Conference and rebroadcasts of local news are so popular, competing operators should mimic what Comcast is doing and look into an old-school public access channel.
  • Online college classes are starting to show serious promise. Minnesota is pushing to get a quarter of college credits completed online by 2015. A collection of Utah colleges and universities headed by USU is pushing OpenCourseWare, entire courses in digital format that are free to reuse and distribute. These kinds of initiatives could drive demand for metro area networks between the universities and students.

Broadband Bytes

By | |
1 Comment

Here’s your broadband news:

  • Here’s an interesting post about a guy who regrets his decision of moving to an area where there is no broadband (rural southwestern Wisconsin).
  • A sparsely populated town of 350 in Wyoming is now a major English teaching hub, doing “outsourcing” in the opposite direction.  How did this happen?  The local telco coop that serves their area upgraded to fiber and now residents are doing business with people all over the world.
  • The new mantra in real estate? Location, location, broadband. From this AP Article: “In less than a decade, broadband has gone from a luxury to a must for many people, and for some of them, it’s started to influence their real-estate decisions. Homes that have broadband are winning out over more remote ones that don’t. Areas with better and faster broadband are becoming more desirable than ones with slower access.”
  • Akamai has released the 2008 3rd quarter report on the State of the Internet.  The U.S. is in 8th place in terms of speed, and just 26% of users have download over 5 Mpbs.  Upload speeds are far more dismal.
  • Another telecom expert says the U.S. “needs more broadband competition”.  We certainly aren’t going to get that in Utah with a Qwest and Comcast duopoly.  We need UTOPIA and it’s accompanying open access principles to succeed.

Finally, Jesse already talked about this in his post, but the city of Monticello is moving forward with their own fiber network despite the legal appeal from TDS Telecom.  The bond money has been locked in escrow by the courts, but they are moving ahead anyway with liquor store reserve funds.  I guess they consider broadband that important.

I think we are seeing a trend here: fast broadband is becoming vital to businesses and individuals.  It truly is becoming the “railroad” of this century.  In the last six months, I personally know of three businesses that chose to locate in Murray because of UTOPIA and at least two friends that moved to Layton in the hopes of eventually getting UTOPIA.  And can you believe I am in an area in west Ogden where neither Comcast nor DSL is available, it’s unbelievable!

Broadband Bytes: November 8-14, 2008

By | |
2 Comments

Here’s a quick list of what’s going on in the telecommuncations market for the week of November 8-14:

Broadband Bytes: Monday Edition

By | | ,
Leave a comment

There hasn’t been any news in the broadband world the last few weeks. Just kidding. Here are some “morsels” for you to chew on:

  • A local telco in Monticello, Minnesota (Bridgewater Telephone, child company of TDS Telecom) lost a suit against a city-built Fiber-to-the-Home network. (A project very similar to UTOPIA). The judge dismissed Bridgewater’s complaint of competition by a governmental organization. Apparently, the incumbent telco, Bridgewater, wouldn’t build a fiber network so the city had decided to bond and build their own. I thought this network was interesting because the goals of the network read a lot like the goals of UTOPIA:
    • choice of service provider
    • competitive rates
    • local service
    • local ownership
    • economic development
    • economic returns to the community

    There is a site like FreeUtopia that is covering this network: http://www.monticellofiber.com/

  • Some universities seem to be cutting back on POTS (plain old telephone) offerings to dorms because of lack of use.
  • Cox and Time Warner were fined for implementing SDV and knocking CableCARD customers offline without proper notification.
  • It also looks like BPL (Broadband over Power Lines) is dead. Manassas, Virginia where the flagship BPL network was deployed has been turned over to the city who will keep it around until about 2010. For all you amateur radio (PDF) operators out there this is good news.
  • Apple is rumored to be working on a networked TV. That’s going to require a lot of bandwidth. In addition to normal TV functions, you could stream any content from iTunes like downloaded movie rentals, TV episodes on demand, etc.
  • Business Week recently did an excellent piece called “The Digital Divide” that talks about just how important broadband is becoming in spurring business in areas that have it, and leaving those that don’t in the dust.
  • President Bush signed the Broadband Data Improvement Act into law on Oct. 10. The bill will provide for improved data on the status of broadband deployment in the United States by forcing the FCC to make a couple of major changes to the way it puts together broadband information. This includes yearly metrics for “second-generation” broadband that can support full motion HD video and more granularity to for reporting of broadband broken down by ZIP+4 instead of just ZIP (as it is now). The bill also authorizes a program of grants to support public/private public partnerships to stimulate broadband deployment and adoption at the state level. I’m interested to know what this would mean for projects like UTOPIA. Thoughts?

Broadband Bytes: Monday Edition

By | | ,
Leave a comment

Broadband Bytes: Weekend Edition

By | |
3 Comments

Today’s Broadband Bytes was brought to you by the letters C, W, and T.

  • Robert X. Cringely has some words to say about Comcast’s new bandwidth caps. He compares today’s caps to the caps he had years ago. Do they match up? Is Comcast offering a better deal than the ISP’s of the late 1990’s? And from Slashdot, “Comcast has filed a court appeal of an FCC ruling that says the company can’t delay peer-to-peer traffic on its network because it violates FCC net neutrality principles.“
  • Australia’s caps make Comcast’s look great.
  • With all the talk about city wifi networks becoming ubiquitous there are some downsides…scalability. Networkworld has an interesting article about the the technical problems with scaling WiFi to meet today’s bandwidth hungry users. As a side note, some users ask the network engineers at my place of employment (higher ed) when wifi will become our primary means of connecting desktops to the network. The answer is always the same: never. They say: “What do you mean I can’t use this new 2.4Ghz phone I just purchased?” Some departments decide to go wireless anyway (usually to avoid the cost of wiring) but later end up having to convert to physical connections anyway.
  • It looks like Comcast’s new caps are around thanks to Florida consumer protection laws. It seems that prior to the 250Gig caps there was no cap. They just cut off the top 1000 users every month. Because consumers were unable to find out how to avoid this in the future the Florida AG became involved.
  • As the Analog TV signals fade out, will you receive the new digital signals? In rural areas you may not!
  • Along those lines I dug up these old articles about Utah getting a jump start on converting the state-wide network of TV translators to digital signals. One interesting tidbit from the article: “It is widely believed that Utah has the largest terrestrial-analog translator network in the world. The system provides rural viewers with over-the-air television in approximately 80 percent of the state.”
  • Speaking of rural communities, two very small communities got federal grant money totaling $1.7 million from the United States Rural Development to build fiber optic networks. Is this different than the RUS funding UTOPIA originally had?
  • Verizon is using Yahoo as their “portal partner” for all their broadband users.
  • We’ve talked about the FCC wanting free broadband before. Here’s a company that wants to make it happen (good details). In a letter to the editor in USA Today, the writer asks, why should broadband be free? (he thinks it shouldn’t be). T-Mobile has been the most vocal opponent to this plan by the FCC to give out free broadband, they say because it could cause interference with other wireless signals. The FCC is trying to put that fear to rest in a demonstration.
  • The Register (based in the UK) has a great piece titled “Why the U.S. faces broadband price hikes” (due to the recent FCC Comcast net neutrality ruling).  But in somewhat unrelated news, others like CNET are talking about broadband price wars brewing. Those price wars could end up hurting consumers though instead of helping them.
  • Cable broadband is growing faster than DSL and tecos, and interestingly, VOIP is a big factor in driving broadband growth and makes up the biggest percentage of broadband value added services.