Compared to other countries, the FCC is quite tame in its treatment of telecoms monopolies. Blair Levin, who is in charge of the National Broadband Plan, admitted as much in a recent interview with Ars Technica (h/t Richard Shockey) when he said, “In [other] countries, when a regulator says to do something, what happens is that within a very reasonable, short timeframe, those things are done. What happens in the United States is that, when a regulator says something — I’m not complaining about it; I’m just pointing out reality — it’s challenged in the courts and you have a time lag.”
Susan Crawford, who recently left the Obama adminstration, had stronger words. In a blog post earlier this year, she listed a lot of things that the U.S. does for telcos that no other first world nation does. One key point: “The theory that unbundling deters investment is not proven by either empirical or theoretical literature.”
But that’s exactly what the telcos threatened to do: “The nation’s largest Internet service providers warned the Federal Communications Commission against any possible move that would put them more clearly under the agency’s jurisdiction, saying that doing so could deter their investments in broadband networks.”
The threat appears to have worked. Forbes on Friday guessed that the winners from the broadband plan will be the usual crowd: Verizon, AT&T, Sprint, and Clearwire. The tower companies could benefit too. Equipment makers such as Juniper and Cisco will win. All of this because the broadband plan wants to deliver 100 Mbps to 100 million people by 2020 at a cost of tens of billions of dollars.
For decades, the telcos and cellcos were insulated from the free market by rate of return regulation. They were guaranteed a fixed percentage on anything they could claim as a cost. So instead of investing in networks, they bought real estate. The carriers are sitting on billions of dollars of real estate paid for by rate of return regulation. Everywhere you look, there’s a switching office in the center of town, often overlooking a park even though it has no windows.
One prime example is 1095 Avenue of the Americas in New York City, which overlooks Bryant Park and is one of the best locations in the city. This was sold for about $500 million in 2005 — and renovations could cost at least another $500 million. Verizon has many more buildings like this in its portfolio.
While the telcos claim to support a free market, they continue to fight competition and to benefit from years of monopoly regulation and cosy relationships with regulators at all levels.
Look around your city or your neighborhood. The phone company purchased the most expensive real estate in every town in the USA and built windowless switching centers on it. These are valuable properties.
What it means for WISPs
Wireless ISPs could lose here. “We could lose if the National Broadband Plan fails to recognize and address the need for additional fixed wireless spectrum to meet the needs of 48 million Americans without access to broadband at home,” says Jack Unger, consultant and leader of WISPA’s FCC initiatives.
Meanwhile, the tower companies will have all the business they want from the broadband plan and may choose to ignore WISPs to an even greater extent than they do so today. The plan appears to focus on mobile wireless, not fixed, discriminating once again against networks built by private enterprise in the areas the government funded monopolies refused to serve.
Left out of the plan, as far as we know: any protection from the deceptive pricing that is the habit of the monopolies and which consumer groups were hoping for.
Your WISPA FCC team is on the case. “WISPA will be raising its voice loudly and clearly if the FCC and Congress fail to acknowledge the important role that wireless ISPs play to bring fixed wireless broadband to millions of Americans whose needs are otherwise ignored by the traditional telco, cable, and cellular industries,” says Unger.
Much is still not known about the broadband plan — including the definition of the word “broadband” in the plan. But WISPs must remain alert.
Equipment
Out of India, an interesting article on open source network monitoring tool Zenoss.
A large WiMAX network will launch in the Spring in Vancouver.
Business
VC firm ABRY Partners has acquired competing cable operator RCN for $1.2 billion.
AT&T’s latest unusual fee: $2,761.07 when a technician broke his leg on a house call. AT&T backed down after the customer called in the local news.
Google acquired DocVerse, adding the ability to parse Microsoft Office documents as it continues to build a competitor to Microsoft Office.
Government
A recent New York Times article says that China’s government hackers may be conducting attacks from its elite universities. In other news, China is trying to get Google to return.
Meanwhile White House Cybersecurity Czar Howard Schmidt unwisely told Wired magazine that there is no cyber war. Wired also reported that the U.S. has identified a Chinese man who may be working for the Chinese government as being behind the recent attacks on Google.
Beware of Italian law: thanks to a judgment against Google, ISPs are liable in Italy for content they host.
Publicly-owned WISP KeyOn’s stock tanked when it was turned down for stimulus funds in round 1.
The UK’s latest privacy intrusion: measuring waste quantities in public trash cans.
It’s official: don’t hack your spouse’s e-mail account during a divorce.
Real Networks abandoned the fight to offer software to enable DVD copying.
Smart meters are a key goal of the stimulus bill, but security experts continue to warn that the risks might outweigh the benefits.
The RIAA fined a teenager $27,750 for sharing 37 songs when she was 14 years old.
A Pennsylvania school stopped monitoring teenagers at home through webcams on school laptops.
Free stuff online
Craig Settles interviews ERC Broadband of North Carolina, which is one company that applied for Google’s fiber offer.
The archives of Popular Science have been digitized and are now available online here.
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