Recently in politics Category

The New York Times has an article explaining "traffic pumping" here. This practice largely centers around Iowa Independent phone companies who are partnering with phone service companies like chat lines and free conferencing companies. AT&T has been complaining to the FCC about it for a while Many of these companies are in litigation to get paid by the IXC's.  What it really comes down to is that the "new" FCC has to take a stand on Inter-Carrier Compensation soon. It has been "studying" the issue for years. It's a political hot potato. Bill-and-keep is the system most pundits see as the quick fix. I'm sure its deeper than that.

UPDATE: NPR has a couple of articles about Google Voice and Traffic Pumping. One here about the 100 numbers that GV is blocking and the other here about the blocking.  BTW, GV has over 1M users now.

This week starts with AT&T being sued and boycotted.

First up is STS Telecom's FCC complaint alleging fraud, discrimination, and unfair competitive practices by AT&T. Apparently, the FTC nor DOJ won't accept any anti-trust complaints against the LEC Giants. We don't want to rewind to 1984 do we?

STS Telecom alleges in the complaint that AT&T failed to comply with Congress's much embattled Telecommunications Act of 1996 in refusing to provide STS fair and reasonable access to various telecommunication services. As a result, AT&T severely restricted STS' access to Florida's profitable residential and small business markets. [press release]

Shouldn't all of COMPTEL be filing these types of lawsuits against the RBOC's?

How about the FCC just enforcing any of the many merger conditions so that consumers (and agents) can have a healthy, competitive telecom environment? Why do you think we need $7.2B in BB Stimulus? Because the LEC's want money to actually deploy broadband across America. (Meanwhile they are throttling economic growth in America). 

In act 2, TechCrunch is reporting that ATT blocked access to 4chan, an imageboard for anime. Apparently, this so angered folks that  "there's pledge up at ThePoint to boycott AT&T and cancel the Internet service with them." Umm, what are you going to do move all those iPhone users to T-Mobile and jail-break them? 

I find it funny that TechCrunch is using the deathstar logo for Ma Bell. When I use it, I get the call from Ma Bell to remove it.

NOFA Reactions

July 16, 2009
Speakers: Peter Radizeski, Marketing and Sales Consultant at RAD-INFO, Inc. and  Juan Vela, Occam Networks

Juan and Peter discuss their reactions to the BIP/BTOP NOFA in the second in our series of Broadband Stimulus related podcasts.  (The NOFA is the notice of funds availability for the Broadband Stimulus package. BTOP and BIP are separate programs that both the RUS and the NTIA are in charge of. Each agency will be administering grants and loans for delivery of broadband to unserved and underserved areas).

Click here to listen.

I'm not the brightest guy in the world. Yet over and over I see politicians and regulators make decisions that the other 99% of the US knows will be bad news. One such decision: approving the sale of Verizon's New England region to Fairpoint.

For one thing, agents can no longer sell in that region because Fairpoint thinks they can sell better than a telecom agent can. Ha! I'd put any agent I know up against any W-2 from a telco.

Two, even VZ knew that it would become too expensive to maintain the copper plant in New England; nevermind deliver broadband to most of it. But for some reason the regulators in 3 states and the folks at Martin's FCC approved the deal. Buying into the story that while a giant like VZ can't, an elfin telco like Fairpoint could, while saddled with the debt from the $2.3B deal. 

The customers in New England are not happy either. As much as 12% of its customers have bailed out. (To cellular and cable probably). But it could get worse as Fairpoint hinted back in March that it could file bankruptcy because of its debt. Verizon still owns about 60% of Fairpoint (I think).

The only happy camper was VZ who took a huge one time credit, released $1.7B in debt, and dumped a rural liability. And smiled the whole time.

In a similar deal, Hawaii Telecom went BK - that was a former VZ area. I know when Alltel (now Windstream) took over Eastern KY, it was like buying a termite infested house. VZ doesn't leave its assets in a state that anyone can work with apparently. Hence, the WSJ suggesting that Frontier learn its lesson from the Fairpoint deal.

BellSouth and Cox fought Lafayette (LA) over the municipal fiber project (LUS) to the  tune of $500,000 in legal fees. Who do you think paid those fees? Taxpayers and consumers.

Then there's the Embarq, TimeWarner Cable fight over the Wilson (NC) municipal fiber project called Greenlight. It was a $28M project. Not for nothing, but couldn't TWC or Embarq have ponied up that cash and delivered FTTH instead of battling it in the legal system?
 
So when the Duopoly doesn't deliver broadband and the government takes matters into its own hands, they get sued. Why? The duopoly can't compete with a government-owned ISP. Instead, they lobby heavy, get the lawyers involved, and start spreading the cash to have laws made that prevent Americans from getting reasonably priced super-fast Internet Access.

Now, the Duopoly spends millions - literally, hundreds of millions - lobbying and contributing to politicians each year. Why not take that money and build FTTH instead? 

I have another suggestion:  Eminent domain. Eminent domain seems to work for cities that want to take over waterfront property for developers. How is having a network that you won't upgrade and deliver your promises on any different? When the Duopoly sues a city over a Muni Broadband project, why can't the city just counter-sue under eminent domain and take the network assets over?

Former SBC chief Ed Whitacre is going to be the next Chairman of GM. Huh? According to Bloomberg, Whitacre is doing his patriotic duty and loves the challenge. Rich Tehrani thinks that Whitacre was a strategist. He dismantled the regulatory landscape, fought off (and then ate) is competitors, and turned a local Bell back into Ma Bell after numerous acquisitions that have never been integrated. (AT&T still acts like 7 different companies to anyone that has to work with them).

So how successful will an insider monopolist from SBC be at a dying auto maker? Well, less debt to deal with. Inside political track, which is the only way he plays the game. He didn't really understand the Internet and probably doesn't understand the auto industry either. 

His "partners" at SBC (authorized sales agents) are much like dealerships, who should expect the worse, since every company SBC bought tightened the screws to the agents. 

Rich writes, "For too many years GM had lousy management and created cars that for lack of a better word sucked. Americans ran away from Detroit automobiles like AT&T ran away from VoIP in the nineties." Rich, SBC (now called the new AT&T) isn't exactly known for being innovative either. No VoIP. Compete on price. Long installation intervals. Bad billing. What exactly is Whitacre going to bring to the new GM? From what I can see having dealt with all the Bell companies over the last 10 years, he was a lousy cheif exec except that he could put deals together. So what? GM is selling parts and Whitacre knew as much about internal organization and integration as Level3 execs. 

This is also the guy whose company allegedly helped the NSA wiretap the nation. I guess this is his thanks, since Crazy Ivan at VZ is still busy.

Who is my choice? How Elon Musk? How about someone from P&G or Unilever? 

Success is measured a number of different ways, but make a big, hulking, inflexible, non-innovative tech company isn't what I would consider a success. GM needs fast, flexible thinking; innovation; reach out to dealers and workers; and a huge re-branding campaign (which might be the only thing Whitacre is capable of: re-branding GM as the new GM with the same crap as before).

SUMMARY:

GM needs a creative thinker that is flexible and industry knowledgeable. Someone who can bring new partners and ideas to execution quickly, because mergers and acquisitions are not going to be the solution for GM.

GM has two prime missions: convincing people to buy its cars; making cars people want to buy despite the state of GM.

Unfortunately, the government once again shows that change has not come to Washington as they pick a crony instead of the right person - something we have seen too much of during these times of re-invention and government intervention.

I'm seeing a lot of news in our space but not enough time to cover it all or analyze it, so here's just the headlines:

DPI (deep packet inspection) by cable being investigated by Congress. It scares the crap out of Boucher (ARS). Cox, Comcast, NebuAd  = new privacy law being debated (NYTimes).

Broadband download caps: in the news all week because apparently TWC said that without caps, they won't upgrade any more. Well, I have news for them: if they don't upgrade they will lose customers. Can you say FiOS, WiMAX, U-Verse, and now Wildblue is testing 18MB service.  ARS notes there are caps even when not explicit like TWC.  VZW and others have usage limits built into the acceptable usage policy.

Clearwire is being sued - class action status - for ETF (early termination fees) and network quality issues (can you say: false advertising on network performance?). (see here and my twitter pal @morisy).

And speaking of Caps (no, not hockey, how about Comcast battling it out with the former FCC chief's ruling that cable companies can only have a maximum of 30% of the entire market? If we applied that to telecom - and why shouldn't we? - we would have to break up Ma and Pa Bell (Verizon and AT&T). Please note: I am all for that.  Meanwhile Comcast's defense is Freedom of Speech.

Lastly, Facebook exec becomes new CEO at MySpace. Too little, too late? And Yahoo! is closing down GeoCities free hosting services, which it bought in 1999 for $3.5B. The analysis of the deal is on Fred Wilson's blog. Worthwhile read for start-ups about what VC deals look like.

As the FCC, USDA, and NTIA get set to disburse $7.2 billion in moneys to telecommunications companies for broadband deployment, penetration, and mapping along with E-Rate type services and tele-medicine, the FCC has to actually come up with a National Broadband Strategy.

"The American Recovery and Reinvestment Act charged the FCC with creating a plan to give all Americans access to broadband. The FCC began the effort, which will include a series of hearings and meetings, on Wednesday by asking for public comment. The FCC must present the plan to lawmakers by Feb. 17, 2010." [Infoweek]

One would have thought that former FCC Chairman Martin would have put a national policy in place, but all he had was a chalk board with "ideas" or guidelines that the telcos could ignore. Now acting FCC Chair Copps has been tasked and he takes this seriously.

"This commission has never, I believe, received a more serious charge than the one to spearhead development of a national broadband plan," FCC Chairman Michael Copps said in a statement Wednesday. [CircleID] 

The three agencies did  whirlwind tour of America to listen to experts and public opinion about Broadband availability. April 15th is the last day to comment on the NTIA Broadband Grant Program.  The NTIA does break down how their share of the money will be allocated and are working diligently to put in place a grant program for disbursement. The lynchpin is going to be how terms are defined. By terms, I mean broadband, unserved, and underserved.

The other sticking piint will be what companies are eligible to get grant. Certainly, the 20% matching funds will limit the smaller providers. However, the larger companies (like Verizon and TW Cable) are not happy with the Net Neutrality type of conditions on the money.

Back to the FCC: Copps could really use your input on the development of the National Broadband Plan. The FCC "Seeks public input on plan to ensure every American has access to broadband capability. (Dkt No 09-51). If you have thoughts on these elements, the Commission now seeks your comment:

• The most effective and efficient ways to ensure broadband access for all Americans
• Strategies for achieving affordability and maximum utilization of broadband infrastructure and services
• Evaluation of the status of broadband deployment, including the progress of related grant programs
• How to use broadband to advance consumer welfare, civic participation, public safety and homeland security, community development, health care delivery, energy independence and efficiency, education, worker training, private sector investment, entrepreneurial activity, job creation, and economic growth, and other national purposes.

CircleID has the story of ILECs and Cable companies once again fighting municipalities, like BellSouth and Cox fought LUS.

With President Obama determined to promote the development of open network telecommunications and smart grid networks we can expect the incumbents to step up their legal battles to stop this from happening.

In relation to the recent $7 billion stimulus package AT&T made a statement that it didn't need the money, but that it would launch a defensive campaign against any competitors using the money to encroach on its territory.

To me, it's anti-American for the Duopoly to fight the city. It's more taxpayer money that could be used for something useful that gets used to fight against two enemies of progress and innovation. Should Lafayette taxpayers have had to spend $500,000 in fees to fight the Duopoly?

There is case after case where the city or town with broadband including FTTB (fiber-to-the-business) has created jobs and added tax base while increasing home values. When the duopoly sues to stop broadband deployment, while crying that it is unfair competition, look at the profit statements of these companies. And look at what it is costing your community.

The Obama Administration has nominated Larry Strickling to head the NTIA. Right now former Sprint exec, Anna Gomez, is running that department as it gets ready to disperse $4.7B in broadband stimulus money. We don't have a set plan or any procedures in place yet, but picking Larry Strickling should help. Or will it?

Granted picking someone from Sprint probably was a great choice either. (Sprint isn't exactly knocking any socks off). Larry was on Obama's team as a tech advisor. He's a Harvard grad and worked at the FCC up till 2000. According to BroadcastingCable, "Strickling's resume includes Ameritech (now AT&T), Allegiance Telecom (now XO), CoreExpress (sold to Williams, which was bought by Level3), Network Plus, and he was a partner in the firm of Kirkland and Ellis." He also was Chief Compliance Officer at Broadwing Communications for three years also. Am I missing something? He's an attorney. We need more than that.

The head of the NTIA has to interface with the FCC and the USDA/RUS. And by August 1, 2009, start disbursing one-third of the funds under the Broadband Stimulus Plan. There needs to be policies and procedures and guidelines put into place so that (a) the money will actually go to broadband deployment soon; (b) the money can be tracked to ensure that it actually goes for broadband deployment.

The ILEC's have a long history of taking money (and rate hikes) for promises they do not keep. These same companies bought up spectrum and did NOTHING with it. (I hear that Sprint and/or Clearwire are actually looking to sell some spectrum, as is NextWave and Nextlink). So why would we expect these companies to actually deploy broadband in a timely manner now?

Also, this is supposed to be a Stimulus package. Not a help out your Corporate buddy deal. We have had enough of those already. And these companies have laid off by the thousands (Layoff Tracker).

What America needs is for small businesses to get this money.

I don't see how picking another pal of Obama is going to do that. One of the most disappointing things about this new Administration is the lack of creative choices for positions. If people have been there, they have done that. And we don't need THAT. We need a new THIS. Got it? (The people who brought you here, won't get you there).  Where are the round tables of experts to come up with the best plan? We did see the FCC/RUS/NTIA take to the road, but those meetings certainly centered on one or two niche markets. 

Here's my take on the companies that CAN do deploy Broadband across America: Independent ISP's. Guidelines to include:

• ISP's that are already supplying broadband to rural and non-urban areas.
• ISP's that have filled out the FCC Form 477.
• ISP's with at least 8 employees
• ISP's that are Incorporated.
• ISP's with a credit line or extensive credit history.
• ISP's that have a CPA firm.

Why? Because tracking is this money will be a full time job and if you haven't got at least 8 employees and a CPA firm, you probably will fall behind. (And I don't visit clients in jail). The 20% match means you have to have a credit line or be cash flow positive.  This also means that your ISP is a business, not a hobby, that you have been working it as a business for a while and likely will be successful in this new endeavor.

BTW, the Chicago Sun-Times describes Larry's job as Assistant Secretary for Communications and Information at the Department of Commerce. Turns out that is the NTIA. Oops.