Recently in Internet Category

On Twitter this morning, Josh wrote, "Widely discussed leaked doc, Open Cloud Manifesto, originally authored by IBM - http://bit.ly/cloudmanifesto - could be historic".

"The buzz around cloud computing has reached a fever pitch. Some believe it is a disruptive trend representing the next stage in the evolution of the internet. Others believe it is hype, as it uses long established computing technologies. As with any new trend in the IT world, organizations must figure out the benefits and risks of cloud computing and the best way to use this technology."

Everyone knows the upside to Cloud Computing, but the document explains the downside. Number 1 being Security. Compliance isn't listed, but I would think that it might be an issue, especially if security, management and governance are an issue.

IBM signs off by stating, "This document is meant to begin the conversation, not define it." More at www.opencloudmanifesto.org

Acting FCC chief Michael Copps celebrated the 75th anniversary of both the FCC and the Communications Act of 1934 that birthed the agency. In a speech, Copps said, "How do we take this 75 year old agency, charged with implementing our formative communications law, and make sure it is up to the challenges of the 21st century? Born in the world of primitive radio sets, raised on plain old telephone service, now trying to manage high-speed broadband and orbiting satellites, can we make it an agency for all seasons? I'm glad you're thinking about this."

After that Copps kind of digs at Martin's feral grasp on the communications and free flow of information. (In other words, there was none).

I do think it's time for our agency to take a good hard look at our mission. Indeed, I think every independent agency ought to be required to do this. I have always believed that our government's independent regulatory agencies were set up to serve the public interest. But many of them, my own included, have sometimes strayed-- strayed pretty far -- from that purpose. At the FCC -- and I single out no specific regime or individual -- our processes over time have become opaque rather than transparent. Too often we spend our days refereeing disputes between powerful interests, with consumers and other non-traditional stakeholders pretty much left outside the loop of discussion and decision. Even the public record is difficult for the public to access.
The new Administration's Open Government Initiative is music to my ears and offers a wonderful opportunity to make this happen. At this 75th Anniversary, we should be revisiting the vows and obligations we took back at the beginning. What I'm talking about today is not rocket science. To a large degree, it's just having our goals clear in our mind, and then creating the process and management to achieve them in an open and transparent way. Or, as my old boss, the legendary Fritz Hollings, used to say: "On the way through life make this your goal--keep your eye on the doughnut and not the hole."
"...the Commission has just been charged with a truly important job. With enactment of the Stimulus bill, we are called upon by Congress and our new President to develop a national strategy to get high-speed, opportunity-creating broadband out to all our citizens. This is a very big deal -- the Commission has seldom if ever had a greater summons to action.... How we do on this will have a lot to do with how we fare in future years -- both the country and the Commission." [at least He gets this.]
We must start thinking more rigorously -- and I mean all of us -- about the profound impact of so much of our communications moving to the Internet in the years ahead. How to keep that Internet open and dynamic is an important part of this dialogue. But so is how to ensure that as the Internet becomes our primary vehicle for communicating with one another, it protects the public interest and informs the civic dialogue that America depends upon for its democracy? That's a huge question."

CircleID takes a look at America's Broadband Score

"Leonard Waverman, the dean of the Haskayne School of Business at the University of Calgary, describe a measure he developed called the 'Connectivity Scorecard.' It's meant to compare countries on the extent that consumers, businesses and government put communication technology to economically productive use. Even after deducting the untold unproductive hours spent on Facebook and YouTube, the United States comes out on top..."

What's interesting to me is the comments. How no one can find the US Broadband score is funny. (Heard of Google much?) It isn't so much the score as what the score represents.

We have a few problems to fix:

(1) ISP Competition for one. Many places only have one choice for broadband. Many have two - cable or telco. Few have three. It makes download caps and Net Neutrality a hot button that true competition would eliminate. (And please don't give me that 3G is the third rail because guess who owns that - Ma and Pa Bell in the majority just like they own the Internet backbone and the PSTN structure in more than 70% of the country).

(2) A definition of broadband. Is it 256k one way as the FCC has defined it for years? Is it now the new FCC definition of 768k? Or is it 1M x 1M minimum? Or is it 100Mbps? This would certainly help.

(3) Deployment versus Penetration. "When you look at the 2008 ITIF Broadband Rankings report ...the U.S. ranked 15th among industrial nations at a composite score of 10.25. The U.S. is reported to have an average download speed of 4.9 Mbps, which is a far distant behind Japan's 63.6 Mbps. In addition, the report states that the US broadband penetration comes in at 0.57%." [source] Here's the detail: "Composite Score: Each nation's overall score is the sum of its standard deviation score for each of the three indicators: Household penetration or subscribers per household, average download speed in Mbps and price at the lowest monthly cost per Mbps." 

We may have "broadband" deployed in a large swath of America, but the speed is low compared to other countries. Because we are a suburban and rural country, it takes more infrastructure to hit everywhere with broadband, especially very high-speed Internet Access (greater than 3Mbps). And because most places hit are single family homes - we do live in suburban sprawl consisting of McMansions filled with Yuppies and 2.2 kids - it also affects our score at the ITIF.  According to a CWA study, the speed in the US is just over 2Mbps.

(4) Cost! We probably pay more per MB than any other G8 country. We get less speed and pay more for it. That hurts us. Surprisedly, in Wilson NC, the Muni fiber sells 100MB symmetric while TWCable and Embarq just gape at the speed and price. Well, not gape, so much as sue that it's unfair that a city would provide services it refuses to.

So we have cost, penetration, subscriber per household (density), and speed. Can't do much about density, but you can improve speed and cost. Also, there is a Digital Divide in America. Poorer families do not have computers, so do not have a need (or a budget) to buy broadband. It poses a problem that funding broadband for libraries and schools is supposed to throw a rope at. The Pew Report reflects this chasm.

BTW, the Connectivity Scorecard study has been analyzed here and by my favorite snarky blog, TechDirt.

On Twitter this morning, someone asked about the Cluetrain Manifesto. (I had to look at Wikipedia to remember what the main points were). The Internet will change every business.  "The authors assert that the Internet is unlike the ordinary media used in mass marketing as it enables people to have "human to human" conversations, which have the potential to transform traditional business practices radically."  We see that happening in quite a few verticals. It has changed the newspaper, music, entertainment, retail shopping, and telecom industries. It will likely change even more.

"The clue train stopped there four times a day for ten years and they never took delivery."  Certainly, this quote applies to 3 Detroit CEO's.

During a discussion online, some interesting items popped up.

Companies ban Instant Message. One IT Security Consultant looks at the irony of it here. Tele-Presence is all about improved efficiency in communicating -- no more phone tag, less voicemail, that kind of thing -- but how will that be implemented in a corporate environment that locks it down?

Social networking like LinkedIn and Twitter are becoming commonplace among the marketing set. Maybe instead of banning these things in a corporate environment, you embrace it and set policy. Here's an article from CIO.com on LinkedIn etiquette.

It boils down to tools. Will you give people the tools that they can use to be effective at their position?  If you are that worried about security, do an audit and train your people. Manage by walking around. Most theft is internal or social engineered. You can train against the social engineering, but if someone wants something bad enough they will figure out how to get it. It's just a shame that can't get that passionate and creative about the job.

According to the WSJ, " The federal government's economic stimulus package will include investment in broadband Internet infrastructure and funds to upgrade and repair the national power grid alongside more traditional funding for road and bridge repair, a senior aide to House Speaker Nancy Pelosi said Tuesday."

It's much needed, since Clearwire/XOHM has decided to slow down (cough!*) its deployment schedule because the $3.2B in cash from Google, Intel, and MSO's, just is not enough to roll out their whole network. Clearwire needs $2B more.

And apparently, VZ only wants to over-build its affluent DSL areas with FiOS. It ignores or sells off rural routes.

TWC and AT&T are moving to tiered broadband pricing plans. Heck, TWC is even raising its rates on stand-alone Internet. TWC is also vulnerable to customer switching. In recent bundles from former BellSouth, I did not see a DSL price under $30. What happened to Naked DSL at $20 and DSL Lite at $10 (merger conditions)?

The next ones to ask for a bail-out will be the wholesale Internet backbone companies like Level3, Cogent, Global Crossing, Qwest and Savvis, according to this report on Circle ID.

According to the CWA (telecom union), it's all about new jobs.

Mr. Cohen said 100,000 jobs could be created by immediately investing in more high-speed Internet networks across the country. "Jobs is the best single stimulus," he said.  The demand for services created by broadband Internet access could create another two million jobs, Mr. Cohen argued.

[Editorial note: * As if Clearwire had an aggressive roll out strategy. $3.2B should be enough IF you actual bring in profitable revenue per tower. I know, not a usual business plan for public internet companies.]

Ouch! KMPH Fox 26 reports that, "More than a dozen Web users are suing a Silicon Valley startup that created technology allowing their surfing habits to be tracked. The lawsuit was filed in federal court in San Francisco this week against NebuAd and six Internet service providers that used its product. The 15 plaintiffs are demanding more than $5 million in damages."  NebuAd used Deep-Packet Inspection (dpi) to gather info of ISP customers to better target advertising. That upset users and it ended up in front of Congress. NebuAd execs jumped ship. So did clients. Same thing happened at the similar UK-based company, Phorm. Execs there jumped ship this week.

If you can't get a position at the FCC, perhaps you can put your talents to use at the other governmental telecom agency, which is looking for a few intelligient people like Sue Crawford help shape the broadband policy of the US:

The National Telecommunications and Information Administration (NTIA) is seeking nominations of individuals to represent the business community, public interest groups, and other appropriate groups interested in serving on the NTIA Online Safety and Technology Working Group (OSTWG) for a single fifteen (15) month term to commence in January 2009. At the conclusion of the working group's term, the OSTWG will provide a report to the Assistant Secretary for Communications and Information and NTIA Administrator and to Congress on ways to promote and to preserve a safe environment for children using the Internet.

DATES: Nominations must be postmarked or electronically transmitted on or before December 12, 2008.

SUPPLEMENTARY INFORMATION: On October 10, 2008, the President signed into law the ''Broadband Data Improvement Act'' (the Act), Pub. L. No. 110-385. Section 214 of that Act directs NTIA to establish the OSTWG to review and evaluate:  READ here...

Who is Sue Crawford? Read her bio here. Besides being a law professor, she is on the board of ICANN. Her writings are very articulate and logical - until the ramblings you read from me. I understand that she is part of the Obama transition team, but I can't confirm that.

Most people that know me know I am a Follower of Seth Godin. No one else that I read regularly makes me re-think how I view business and the world more often as Godin. IN his post, How to make money from the Internet, he writes:

Connect organizations spending money with ways to save money.
During the last recession, plenty of entrepreneurs scored by selling businesses on doing a phone bill audit. They took 30% of the first year's savings and did the work for free. Today, there are countless ways businesses can save money using technology and outsourcing, but few take full advantage. You can train them to do this and keep a share of the savings.

If you are in telecom and do not work with an auditing firm, you might be missing out on some opportunity. Telecom expense management and telecom asset management and cellular tracking (both asset and expense) will be big ways to make revenue while saving folks revenue. (They are also expensive Google key words to buy!

So on Linkedin, Neal Lachman, asked if the $100 Triple Play was Viable in today's economic molasses. Neal writes:

Bundling voice, video, data services for a higher ARPU was an obvious, great move when broadband services and advanced digital services were first introducded......  However, the market is moving more towards a lower ARPU for the triple play services. This is especially going to play a big role in future operations. The time of high ARPUs is going, and soon it will be history.

I believe operators have to lower their ARPU estimates from 2010 onward, simply because the customer won't be willing to pay as much. Today operators generate $100+ revenue per month on their triple play services. In 2010 and later, they should be happy if they can reach ARPU of $50. One example is the FTTH service in Holland, where people do not even want to pay more than €50 for their triple play bundle.

My thoughts on it are here:

Telcos like AT&T and Verizon are actually losing money on triple-play. Think about the fact that they were getting $35 for a phone line and $35 for DSL (averages for consumers 2 years ago). Now they have to upgrade the network to offer TV, which is the least profitable service. And do that for $30.

Install and maintain the network that they will be capping. Install home equipment like ONT and STB. To give it away for $100. Now usually the telcos will add taxes and fees on that to increase their profit.  But its the MSO's who are making out. They went from the least profitable service (TV) to the more profitable services of phone and Internet.

With all of the CAPEX for DOCSIS upgrades as well as FTTx and WiMax build-outs, these companies won't be able to lower ARPU for triple play.

The cost of TV content is increasing. Must carry TV channels are now asking for a bite of the pie. You have seen the battle that NFL Network and the other sports networks are having to get carried by the systems -- and to be carried in the most popular packages.

I can see how the MSO's and telcos would have to lower ARPU averages in the face of the economic tsunami we are experiencing, but they won't be offering triple play for $50.

Remember that for the Bells, RGU's include security, cellular, and now tech support. Cablevision rolled out a $350M wi-fi network in NY. The duopoly knows that to keep churn down, they have to get sticky with ubiquitous Internet Access and to get close to a quad-play. Surprisingly, while Verizon has the quad play in my town (Tampa) - FiOS TV, Internet, phone and Cell - that is not the package that they advertise to my house Every Single Day.

 The cost of customer acquisition, retention, advertising, tech support, customer care, bad debt, security, upgrades, and maintenance are too high for the triple play ARPU to drop below $99.