Over the last decade, a number of cities attempted to roll out municipal wireless Internet access, but ended up rolling them back up in the face of mounting cost, logistical problems, or pressure from for-profit telecomm providers. 

"What makes Santa Clara unique is that we've provided a public WiFi network for the whole city for free," explains Larry Owens, Manager of Customer Services for Santa Clara's municipal electric utility, Silicon Valley Power. "We're the only one that has provided coverage over the entire city for free."

Santa Clara's infrastructure puts the city ahead of the municipal network challenge. Santa Clara is likely the most connected city in Silicon Valley, and its infrastructure is one of the reasons that it's one of the number one locations for data centers.

Santa Clara jump-started its municipal network by buying the assets of WiFi provider MetroFi when the company went out of business in 2009. At that time SVP was planning for a next generation network to provide the communications for the smart meter system and mobile city services. By choosing a WiFi infrastructure, the Santa Clara got public Internet access as a happy byproduct.

But when it was made several years ago, the WiFi choice wasn't the no-brainer it seems now. At the time, Owens says, ZigBee and WiMax were also in the running. However, the opportunity to acquire MetroFi's assets at pennies on the dollar was the deciding factor. 

"We were able to maintain the system for the residents and test it for utility use," says Owens. "There wasn't a lot of extra effort needed to provide the data channel for public Internet access. We took a serious utility infrastructure approach. Our model wasn't to sell advertising. It was to provide good service to residents."

Even before buying the WiFi assets, SVP had built-in advantages -- not least because the municipal utility has a century-long history of investment that includes owning a significant percentage of its own electric generation. As a city-owned utility, access to utility poles for network equipment isn't a problem. SVP also has access to the city's radio towers. And the city-owned dark fiber network – SVP Fiber Enterprise, the only service of its kind in Silicon Valley – handles the backhaul, significantly increasing the efficiency and reducing network bottlenecks. 



The effort just completed replaced and upgraded the original MetroFi equipment, expanding coverage, speed and reliability. It cost about $1 million for the $300 million utility to upgrade the network for its primary use to support the smart-meter program, and costs less than one-tenth of one percent of the utility's revenue to support the public Internet access. "It's very small additional cost for a very high value community service," says Owens. 

Santa Clara is already seeing direct benefits from the investment. Mobile city workers are using the system to connect to information and applications – for example, maps and drawings to fulfill field service orders.

Owens sees the network's ubiquitous coverage paying back its cost many times over in the future for the city. One way is smart equipment and monitoring systems. Another benefit is that mobile devices in the city will have an alternative, and cheaper, route to the Internet than 3G cellular networks. "There are ten of thousands of types devices that will be able to connect," he says.

Public safety, too, will benefit. "We designed in a battery backup so the system could be used to divert cellular traffic in the case of a power outage or natural disaster," Owens explains.

The network can also help bridge the "digital divide," Owens says, noting that in 2011 almost 20 percent of households in Santa Clara County are below the poverty line. "It allows those who cannot afford an Internet connection in their home to be able to connect to the Internet throughout Santa Clara."

The city will continue to increase network use, Owens reports, for its mobile workforce and to consolidate communications that are being handled by other telecom providers to the WiFi system -- such as a solar energy monitoring system currently used by the City.

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Per Vices' Phi Brings to New Meaning to Anything, Anywhere - May 03, 2012

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That's what the curiously-named Per Vices – it's pronounced pir-veessiss – company is up to with its new Phi card, a transciever that captures all wireless signals from the air and demodulates and processes them, according to a post today by Broadcast Engineering's Michael Grotticelli  has a good  today about Per Vices.  Certainly one application that's screaming to be deployed is  true "any content, anywhere, any screen" – as opposed to "anything the carrier chooses to give you, on any device they let you have it on, and anywhere they let you get it."

On the other hand, I can see some shortcomings in this. For example, what happens when you have a house-ful of connected appliances? While it may be convenient to start the washing machine from your Kindle while you're sitting by the pool, what happens when you answer your mobile phone and inadvertently turn on the oven? 

Anyway, priced at $700, I don't expect Phi is ready for the mass market just yet. The company is offering it currently to developers, hoping to foster some industry-disrupting innovation. There's also an Phi overview video on YouTube.  

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If, like me, you think lunch is never a bad idea, though, you'll be disappointed that the service is only available in London. However, you can read Joann Pan's article at Mashable.com.

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The world's most famous Internet company uses the annual conference of the company that practically invented the Software-as-a-Service industry to announce that Google's next business move is manufacturing telephones.

While everyone is running around with "software prohibited" buttons pinned to their sky-blue lanyards – get it, clouds in the sky? – one of the industry leaders in no-software applications is talking about making actual stuff.

Let that sink in.

There's certainly a message here. But not necessarily one that the boys – and I do mean boys, but more on that some other time – in Cloud Cukooland think they're hearing.

In other words, as more and more people attempt to do things "in the cloud," the Next Big Thing is making appliances that connect to it. Like, for example, telephones. Or e-readers.

Consider the Amazon Kindle. Remember Steve Jobs' remark when the Kindle was introduced, "The whole conception is flawed"?¹ Four years later, Amazon's success with the Kindle is beyond doubt. In 2010, the Kindle eclipsed "Harry Potter and the Deathly Hallows" as the Amazon's single best-selling product. And that year e-books outsold physical books for the first time.²  

Why is this? Simplicity.

Google has expressed itself very clearly on this point in the past:

"Google doesn‘t set out to create feature-rich products; our best designs include only the features that people need to accomplish their goals… Google teams think twice before sacrificing simplicity in pursuit of a less important feature. Our hope is to evolve products in new directions instead of just adding more features."³

And this is an argument that it's time to get back to basics. Certainly, Salesforce.com's own success grew from its simplicity. Salesforce.com did one thing, was simple to start using, and the initial investment – money, time and effort – was low.

Something like a telephone.

References:

1. Cnet Reviews: Fully Equipped, "Steve Jobs meets the Kindle," David Carnoy, Feb. 5, 2009. 
2. Amazon Q4 2010 report, Amazon 2009 Annual Report. 
3. www.google.com

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The recent Skype outage highlights a fundamental problem, according to Lagerway. Pure-play VoIP providers ultimately don't control the underlying network that delivers their service.

"I've been in this business 15 years and over that time VoIP has been in beta 15 years. The main reason is that the network that people are riding on is unreliable," he says. Unless a provider owns the upstream broadband network, a 'best effort' service is all a provider can promise.

"If the upstream provider has decided they're going to be making some changes, you're going to be feeling those changes. If the upstream provider decides they want to filter out [other providers' VoIP] packets or handle them with less priority than  their own packets, you're going to experience that regardless of what kind of service you have.

"If they decide they're going to route packets to Istanbul, they can do that," he says, adding, "The long and short of it is that the incumbents have their long arm deeply inside the network."

Having said that, Lagerway does allow that Skype's proprietary peer-to-peer (P2P) architecture – a closely guarded "black box" -- leaves the system unnecessarily vulnerable in a way that conventional centralized services like Vonage don't.

"My main issue with Skype is that it's a closed system," says Lagerway, an outspoken evangelist for the open communications standard, SIP. "Having one guy [Janus Friis] create the entire peer-to-peer architecture, it's destined to fail – no one is smart enough.

Lagerway points to Skype's implementation – a self-organizing P2P network operating exclusively on users' PCs – as untenable for providing a service to millions of users. "To have such a dependency on so many people's PCs, that's pretty risky business. What happens if a whole lot of people decide to de-install?"

A better approach for a P2P network is an architecture that fails back to a centralized client-server network – the way TelTel's P2P VoIP network operates, for example.  "That's the way SIP operates," Lagerway explains. "It's a peer-to-peer network but it bootstraps the operation with a client-server network."

In the end, while no one can ever fully escape Murphy's Law, a more open approach could have helped Skype avert this particular disaster, Lagerway says.

"If this [Skype] had been an open standards projects, you would have had much more peer review. If they had used SIP, this particular outage would have been less likely. It could have possibly been averted," he explains. "Correcting it now is going to be costly."

****

For those of you who've been wondering what happened to the VoIP Princess, over the last five months I was overwhelmed with a family crisis. If you're interested, you can read about how I became an unpaid caseworker for the Pennsylvania Department of Public Welfare, here. 

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The recent Skype outage highlights a fundamental problem, according to Lagerway. Pure-play VoIP providers ultimately don't control the underlying network that delivers their service.

"I've been in this business 15 years and over that time VoIP has been in beta 15 years. The main reason is that the network that people are riding on is unreliable," he says. Unless a provider owns the upstream broadband network, a 'best effort' service is all a provider can promise.

"If the upstream provider has decided they're going to be making some changes, you're going to be feeling those changes. If the upstream provider decides they want to filter out [other providers' VoIP] packets or handle them with less priority than  their own packets, you're going to experience that regardless of what kind of service you have.

"If they decide they're going to route packets to Istanbul, they can do that," he says, adding, "The long and short of it is that the incumbents have their long arm deeply inside the network."

Having said that, Lagerway does allow that Skype's proprietary peer-to-peer (P2P) architecture – a closely guarded "black box" -- leaves the system unnecessarily vulnerable in a way that conventional centralized services like Vonage don't.

"My main issue with Skype is that it's a closed system," says Lagerway, an outspoken evangelist for the open communications standard, SIP. "Having one guy [Janus Friis] create the entire peer-to-peer architecture, it's destined to fail – no one is smart enough.

Lagerway points to Skype's implementation – a self-organizing P2P network operating exclusively on users' PCs – as untenable for providing a service to millions of users. "To have such a dependency on so many people's PCs, that's pretty risky business. What happens if a whole lot of people decide to de-install?"

A better approach for a P2P network is an architecture that fails back to a centralized client-server network – the way TelTel's P2P VoIP network operates, for example.  "That's the way SIP operates," Lagerway explains. "It's a peer-to-peer network but it bootstraps the operation with a client-server network."

In the end, while no one can ever fully escape Murphy's Law, a more open approach could have helped Skype avert this particular disaster, Lagerway says.

"If this [Skype] had been an open standards projects, you would have had much more peer review. If they had used SIP, this particular outage would have been less likely. It could have possibly been averted," he explains. "Correcting it now is going to be costly."

****

For those of you who've been wondering what happened to the VoIP Princess, over the last five months I was overwhelmed with a family crisis. If you're interested, you can read about how I became an unpaid caseworker for the Pennsylvania Department of Public Welfare, here. 

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The reality is that nobody stays in business selling something for less than it costs -- despite the self-indulgent fantasies of dot-com startups. And in the brave new always-connected world, devices (other than Apple products) to connect may be dirt cheap, but the infrastructure that makes it all work is anything but. AT&T isn't the first carrier to observe that more is less when it comes to iPhone profits. As smartphone subscribers eat up rich media and interactive content, operational costs grow faster than ARPU.

Selling the iPhone hurt Southeast Asian carrier SingTel's operating margin by about 4%, the company told Reuters a year ago. Scandinavian carrier TeliaSonera reported a 20% decline in Danish ARPU (average revenue per user) in the two years since introducing the iPhone -- from US$38.35 to US$30.39 - according to the same report.  

AT&T's move points to the future. Once upon a time, minutes were a relevant measure of telecommunications infrastructure cost. When minutes became irrelevant, that didn't mean that the infrastructure was free. Today bandwidth is the meaningful measure of infrastructure cost and average profitability per user (APPU) is more important than ARPU. The pricing model will change simply because businesses that can't sell their services at a profit won't be in business to offer high quality all-you-eat data plans.  

And that will have another impact. When network operators' returns match investment, the infrastructure business - the pipe - is going to be a lot more attractive. Which, no doubt, is part of the reasoning behind Google's 1-Gbps FTTH network "experiment" that the Internet giant announced last February. Certainly, Google stands to benefit from increased use of its Web-based applications, ad revenue from the new network, and control of the  underlying delivery  infrastructure.  

But the bottom line is that Google sees a business opportunity in becoming a traditional telecommunications company.  And why not? One of the greatest beneficiaries of VoIP disruption of voice communications business was Comcast Cable - now the 3rd largest US telephone company.  

For more analysis of AT&T's new pricing, read media sociologist Shelly Palmer's June 6 post, Understanding AT&T's New Limited Data Plan. 

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In the last two years, Google has made several forays in the voice market. After buying VoIP startup GrandCentral in 2008, Google went on to buy the peer-to-peer softphone Gizmo5. Google did nothing with these investments; suspending new customer signups for both services at the end of 2009, with the explanation that Google was conducting extended beta tests before "re-launching" the services.

Google has undoubtedly studied the history of Internet companies in VoIP; and AOL's, eBay's, and Yahoo's VoIP missteps paint an uninspiring picture, as Tom Keating noted last year. 

There's a fundamental lesson: operating a telephone company has a very different imperative than operating an Internet company: subscribers have to get a dial tone when they pick up the phone - 100% of the time.

Meeting that imperative is what legacy telephone carriers are good at: performing a well-understood and clearly defined operation in real-time, with near-absolute reliability. How hard it is to achieve these goals simultaneously can be measured by how little Internet software pioneers Yahoo, AOL and eBay advanced the VoIP technology that they purchased.

Google certainly has the financial resources for building infrastructure and operations with "five nines" reliability. And Google has one advantage over legacy telecoms. It can start on Day One with the best technology - Google doesn't have to figure out how to upgrade millions of miles of copper wire.

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While You Were Making VoIP Calls on Your TV at CES, Mobile TV Was Calling Your Phone - Jan 12, 2009

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In the last two years, Google has made several forays in the voice market. After buying VoIP startup GrandCentral in 2008, Google went on to buy the peer-to-peer softphone Gizmo5. Google did nothing with these investments; suspending new customer signups for both services at the end of 2009, with the explanation that Google was conducting extended beta tests before "re-launching" the services.

Google has undoubtedly studied the history of Internet companies in VoIP; and AOL's, eBay's, and Yahoo's VoIP missteps paint an uninspiring picture, as Tom Keating noted last year. 

There's a fundamental lesson: operating a telephone company has a very different imperative than operating an Internet company: subscribers have to get a dial tone when they pick up the phone - 100% of the time.

Meeting that imperative is what legacy telephone carriers are good at: performing a well-understood and clearly defined operation in real-time, with near-absolute reliability. How hard it is to achieve these goals simultaneously can be measured by how little Internet software pioneers Yahoo, AOL and eBay advanced the VoIP technology that they purchased.

Google certainly has the financial resources for building infrastructure and operations with "five nines" reliability. And Google has one advantage over legacy telecoms. It can start on Day One with the best technology - Google doesn't have to figure out how to upgrade millions of miles of copper wire.

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While You Were Making VoIP Calls on Your TV at CES, Mobile TV Was Calling Your Phone - Jan 12, 2009

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Fox News, with its customary fair and balanced perspective, offers "FCC Goes For Nuclear Option - Seeks To Control Interent," and "Genachowski's 'Third Way' Is a Washington Internet Takeover."

Over at Whited Sepulchre we have: "The announcement last week by Federal Communications Commission Chairman Julius Genachowski that the agency planned to assert authority over the Internet raises all kinds of red flags...Every street in America should look like one of Chairman Mao's Cultural Revolution Rallies."

And at Freedom's Phoenix, "FCC Chairman Julius Genachowski's Mussolini-like Internet Power." It's right there next to "Obama's secret plan for the 4th reich? Part 1," and "The Military is Spraying Our Skies."

Despite the fact that everyone, from the Washington Post to career conspiranoid Alex Jones - Police State 4: The Rise Of FEMA - Don't Miss Out! Get Your Subscription Today! - is saying that Chairman Mao Tse Genachowski is enacting a diabolical master plan for crushing the free spirit of the Internet - not to mention Avatar downloads from BitTorrent - under the FCC's Wehrmacht, the FCC is not, repeat IS NOT, proposing to regulate ISPs like telephone companies.

How do I know this? Because unlike most of these reporters, apparently, I actually read the FCC's 14-page statement.

It all goes back to 1910 when the Federal Trade Commission first established its jurisdiction over telecommunications, along with the notion of "natural monopoly," the helpful suggestion of the Bell Telephone Company.

(Nothing like a "free market" married to a "natural monopoly." Our current worst-of-all-approaches telecommunications un-regulation is its bastard offspring.)

Twenty years later the 1934 Communications Act established the FCC, which remains the underlying architecture of US telecom regulation. The 1934 law chartered the FCC to regulate telecommunications, but not necessarily promote its development.

The Telecommunications Act of 1996 - of which we in the Internet industry are so fond - brought significant change to the communications the industry landscape. In addition to letting us plug in our 2400 Bd modems, the 1996 law formally defined two types of public communications services: "regulated telecommunications services" - conventional telephone service - and "information services" that were not subject to the requirements governing telecommunications services. The FCC later ruled in 1998 that the agency "did not find it appropriate" to classify Internet access as a telecommunication service "in the absence of a more complete record focused on individual IP service offerings."

Fast forward to 2010 and the United States is now in 16th place in broadband speed -ahead of Greece, behind Portugal. The FCC proposes a plan to get broadband Internet to every one of the US 300 million residents and gets a giant smackdown from the Supreme Court. Why? Because neither the 1934 nor 1996 Telecommunications Acts give the FCC "statutory authority" over the Internet.

So the FCC responded with its May 6, 2010 proposal  for "light-touch" Internet oversight by the FCC. First, the proposal describes three approaches. The first is doing nothing - the favored Republican Party answer to all questions of public policy. The second alternative is the dreaded reclassification of the Internet access as a regulated telecommunications service. But don't get hysterical just yet. It's just an alternative.

The third alternative, which is the one that the FCC is putting forward, is further defining "information services."

This redefinition rests on another Supreme Court decision (so-called Brand-X) about whether cable modems should be classified as information services or telecommunications services. In that case, the court's majority ruled that federal telecommunications law left policy "in this technical and complex area" to be set by the FCC. In a dissenting opinion, Justice Antonin Scalia wrote "the 'computing functionality' and broadband transmission component of retail Internet access service must be acknowledged as two separate things."

The FCC's proposal makes the case that both the majority and dissenting opinions in Brand X provide the basis for FCC Internet oversight.

If this arcane legal reasoning seems too recherché, the FCC's proposal states right up front: "The Commission does not regulate the Internet. The policy of preserving the Internet as a generally unregulated, free-market forum for innovation, speech, education, and job creation finds expression in (among other provisions) section 230 of the Communications Act, which states Congress's conclusion that "[t]he Internet and other interactive computer services have flourished, to the benefit of all Americans, with a minimum of government regulation." (47 U.S.C. 230(a)(4))"

What's that you say? That's just there to put folks off the scent of the FCC's true intentions? Better hurry up and unload that worthless fiat paper money and get out of Dodge before the FEMA lizard-people come to eat your children and haul you away to those secret Venusian prison camps.

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Fox News, with its customary fair and balanced perspective, offers "FCC Goes For Nuclear Option - Seeks To Control Interent," and "Genachowski's 'Third Way' Is a Washington Internet Takeover."

Over at Whited Sepulchre we have: "The announcement last week by Federal Communications Commission Chairman Julius Genachowski that the agency planned to assert authority over the Internet raises all kinds of red flags...Every street in America should look like one of Chairman Mao's Cultural Revolution Rallies."

And at Freedom's Phoenix, "FCC Chairman Julius Genachowski's Mussolini-like Internet Power." It's right there next to "Obama's secret plan for the 4th reich? Part 1," and "The Military is Spraying Our Skies."

Despite the fact that everyone, from the Washington Post to career conspiranoid Alex Jones - Police State 4: The Rise Of FEMA - Don't Miss Out! Get Your Subscription Today! - is saying that Chairman Mao Tse Genachowski is enacting a diabolical master plan for crushing the free spirit of the Internet - not to mention Avatar downloads from BitTorrent - under the FCC's Wehrmacht, the FCC is not, repeat IS NOT, proposing to regulate ISPs like telephone companies.

How do I know this? Because unlike most of these reporters, apparently, I actually read the FCC's 14-page statement.

It all goes back to 1910 when the Federal Trade Commission first established its jurisdiction over telecommunications, along with the notion of "natural monopoly," the helpful suggestion of the Bell Telephone Company.

(Nothing like a "free market" married to a "natural monopoly." Our current worst-of-all-approaches telecommunications un-regulation is its bastard offspring.)

Twenty years later the 1934 Communications Act established the FCC, which remains the underlying architecture of US telecom regulation. The 1934 law chartered the FCC to regulate telecommunications, but not necessarily promote its development.

The Telecommunications Act of 1996 - of which we in the Internet industry are so fond - brought significant change to the communications the industry landscape. In addition to letting us plug in our 2400 Bd modems, the 1996 law formally defined two types of public communications services: "regulated telecommunications services" - conventional telephone service - and "information services" that were not subject to the requirements governing telecommunications services. The FCC later ruled in 1998 that the agency "did not find it appropriate" to classify Internet access as a telecommunication service "in the absence of a more complete record focused on individual IP service offerings."

Fast forward to 2010 and the United States is now in 16th place in broadband speed -ahead of Greece, behind Portugal. The FCC proposes a plan to get broadband Internet to every one of the US 300 million residents and gets a giant smackdown from the Supreme Court. Why? Because neither the 1934 nor 1996 Telecommunications Acts give the FCC "statutory authority" over the Internet.

So the FCC responded with its May 6, 2010 proposal  for "light-touch" Internet oversight by the FCC. First, the proposal describes three approaches. The first is doing nothing - the favored Republican Party answer to all questions of public policy. The second alternative is the dreaded reclassification of the Internet access as a regulated telecommunications service. But don't get hysterical just yet. It's just an alternative.

The third alternative, which is the one that the FCC is putting forward, is further defining "information services."

This redefinition rests on another Supreme Court decision (so-called Brand-X) about whether cable modems should be classified as information services or telecommunications services. In that case, the court's majority ruled that federal telecommunications law left policy "in this technical and complex area" to be set by the FCC. In a dissenting opinion, Justice Antonin Scalia wrote "the 'computing functionality' and broadband transmission component of retail Internet access service must be acknowledged as two separate things."

The FCC's proposal makes the case that both the majority and dissenting opinions in Brand X provide the basis for FCC Internet oversight.

If this arcane legal reasoning seems too recherché, the FCC's proposal states right up front: "The Commission does not regulate the Internet. The policy of preserving the Internet as a generally unregulated, free-market forum for innovation, speech, education, and job creation finds expression in (among other provisions) section 230 of the Communications Act, which states Congress's conclusion that "[t]he Internet and other interactive computer services have flourished, to the benefit of all Americans, with a minimum of government regulation." (47 U.S.C. 230(a)(4))"

What's that you say? That's just there to put folks off the scent of the FCC's true intentions? Better hurry up and unload that worthless fiat paper money and get out of Dodge before the FEMA lizard-people come to eat your children and haul you away to those secret Venusian prison camps.

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Oh sure, we'll get a separate-but-equal version "later in the year," Skype says. They just neglected to mention which year.

Much of Skype's success can be attributed to individuals who use it, like it and go on to insinuate the service into their work lives.  It's certainly not Skype's talent for PR. (I was once dis-invited to a Skype event when someone realized I was a journalist, not a system integrator.)

So it's not unreasonable to think Skype should be more politic - if not actually attentive - to the notoriously independent-minded Mac community.

On the other hand, Skype does enough of what it does, and does it well enough, to make it easy for people to keep paying them money.

Before eBay sold Skype back to its founders, eBay reported $620 million in net revenue from Skype (eBay Inc. Fourth Quarter and Full Year 2009 Results, Jan 20, 2010) with a 24% margin (eBay Q3 09 Financial Highlights, October 21, 2009.

Maybe the company's blinkered product strategy is part of that success. 

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Oh sure, we'll get a separate-but-equal version "later in the year," Skype says. They just neglected to mention which year.

Much of Skype's success can be attributed to individuals who use it, like it and go on to insinuate the service into their work lives.  (It's certainly not Skype's talent for PR; I was once dis-invited to a Skype event when someone realized I was a journalist, not a system integrator.)

So it's not unreasonable to think Skype should be more politic - if not actually attentive - to the notoriously independent-minded Mac community.

On the other hand, Skype does enough of what it does, and does it well enough, to make it easy for people to keep paying them money.

Before eBay sold Skype back to its founders, eBay reported $620 million in net revenue from Skype (eBay Inc. Fourth Quarter and Full Year 2009 Results, Jan 20, 2010) with a 24% margin (eBay Q3 09 Financial Highlights, October 21, 2009.

Maybe the company's blinkered product strategy is part of that success. 

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