July 2009

Some Skepticism Is In Order for Verizon's Offers

[Commentary] When Verizon Wireless decided it would be amenable to changing the ground rules by which it lets other cellphone companies serve their customers who travel through Verizon (called "roaming"), notice how it made the announcement. And when Verizon decided to loosen its grip ever so slightly on the exclusive deals it has with cellular phone manufacturers, notice how that announcement was made. Both were done in letters to Capitol Hill, to influential members of Congress. When a major company makes such an announcement in letters to Congress, be aware. Be very aware. Those letters are intended as much for show as they are for anything substantive. They are part of a little game of "Let's Make A Deal," in which Congress and [insert special interest here] are the contestants and judges. The public's involvement, or even welfare, can be minimal.

Pandora's Back

The history of Internet radio has been a series of unfulfilled promises and near-death experiences. Everyone can see the appeal of streaming music online, but the industry has long seemed precarious. That's partly because the business model has never been obvious, and in recent years it looked as if copyright crackdowns would make the business financially impossible. But two weeks ago, large webcasters and the record industry reached a compromise that seems as if it will provide the Internet radio industry with enough breathing room to survive. Does this mean that Pandora-the largest of the independent webcasters-will now triumph? As you probably know, Pandora streams personalized Internet radio to desktops and smartphones alike. Its biggest competitors include Last.fm-which provides comparable "find music like the music you like" services and is safe in the hands of old-media CBS-and Yahoo's (YHOO) Launchcast (also now run by CBS), which isn't as customizable. In part because it never hooked up with a big company, Pandora's decade-long struggle to survive has been the most apt symbol of the ups and downs of Internet radio.

Access to Broadband Networks: The Network Neutrality Debate

As congressional policymakers continue to debate telecommunications reform, a major point of contention is the question of whether action is needed to ensure unfettered access to the Internet. The move to place restrictions on the owners of the networks that compose and provide access to the Internet, to ensure equal access and non-discriminatory treatment, is referred to as net neutrality. There is no single accepted definition of net neutrality. However, most agree that any such definition should include the general principles that owners of the networks that compose and provide access to the Internet should not control how consumers lawfully use that network, and they should not be able to discriminate against content provider access to that network. Concern over whether it is necessary for policymakers to take steps to ensure access to the Internet for content, services, and applications providers, as well as consumers, and if so, what these steps should be, is a major focus in the debate over telecommunications reform.

Commerce and USDA Host Broadband Stimulus Workshop in Albuquerque

On July 23, 2009, the Department of Commerce's National Telecommunications and Information Administration (NTIA) and the Department of Agriculture's Rural Utilities Service (RUS) met in Albuquerque (NM) and held the ninth of 10 public forums designed to help prospective grantees apply for $4 billion in broadband grants and loans under the American Recovery and Reinvestment Act. Senator Tom Udall provided video remarks. Commerce NTIA Associate Administrator Dr. Bernadette McGuire-Rivera and USDA Rural Development RUS Deputy Administrator Jessica Zufolo participated in the public workshop. Commerce Deputy Assistant Secretary for Communications and Information Anna M. Gomez spoke at a pre-workshop forum on "High Speed, High Stakes: Closing the Digital Divide in Minority Communities."

http://www.usda.gov/wps/portal/!ut/p/_s.7_0_A/7_0_1OB/.cmd/ad/.ar/sa.ret...

Intel appeals $1.45 billion European antitrust fine

Arguing in part that its human rights were violated, chip maker Intel on Wednesday appealed the European Commission's recent decision to slap the company with a record $1.45 billion antitrust fine and order it to change its marketing practices. The 300-plus-page appeal lodged with the Court of First Instance in Luxembourg was not made public, as is common with that court. However, Intel spokesman Chuck Mulloy confirmed it was filed and that one of its arguments is that the commission's action was improper under European human rights law. At least one element of the company's argument, Mulloy said, is that the fine — the biggest ever issued by the commission — is excessive. He noted that a number of legal challenges have been raised in Europe recently about the size of the commission's fines, adding that "they are getting increasingly bigger."

Korea Hits Qualcomm With Big Antitrust Fine

South Korea's antitrust agency said it would fine Qualcomm $208 million after concluding that the US company abused its dominant position in selling chips to cellphone makers in the country. The fine is the largest ever levied by the South Korea Fair Trade Commission against a single company. Qualcomm said it would appeal. Qualcomm popularized a major strain of cellular technology known as CDMA, or code division multiple access. Besides selling chips, the company charges patent royalties to cellphone makers that use CDMA, as well as third-generation networks such as WCDMA that use related technologies. South Korea in the 1990s became one of few countries to standardize on CDMA. The Korean antitrust agency, after a three-year investigation, found that Qualcomm exploited its patent position to discourage handset makers from buying chips from rivals.

Is Apple Hiding Problems with Fiery iPods?

Apple iPods have overheated and burst into flames and smoke on a number of occasions, causing both injuries and property damage. And Apple has fought to keep federal government reports of these incidents from becoming public, according to a Seattle TV station. KIRO-TV posted a story on its website Wednesday that details its investigation into a series of fiery iPod episodes that have affected numerous users across the US. In some cases the overheated iPods, including recent Shuffle and Nano models, have even burned their owners.

Wait grows on OMB's regulatory review

The Obama administration is more than two months late in releasing a review of its regulatory process, leading critics to charge it is failing to meet its promise of transparency. Many suspect the stalled nomination of Cass Sunstein, a Harvard Law School professor and friend of President Obama's, for administrator of the Office of Information and Regulatory Affairs (OIRA) may be the reason the report has yet to be released. Nevertheless, some say the administration's inability to produce the review is leaving it out of step with its pledge for a more open government. "It is inconsistent with their promise of transparency," said Rick Melberth, director of regulatory policy at OMB Watch, a public interest group. "What had started as a very public process has not stayed that way." Sunstein has earned praised from the right, including an endorsement by The Wall Street Journal editorial board, because the Harvard professor believes in review of regulations and a rigorous cost-benefit analysis during the rulemaking process. For now, Sunstein's nomination, which was sent to the Senate in late April, is stalled and is unlikely to come up before the August recess. Sen. John Cornyn (R-Texas) has placed a hold on the nominee. "Sen. Cornyn finds numerous aspects of Mr. Sunstein's record troubling, specifically the fact that he wants to establish legal 'rights' for livestock, wildlife and pets, which would enable animals to file lawsuits in American courts. Sunstein's musings about instituting a Fairness Doctrine for the Internet are equally as troubling," said Kevin McLaughlin, a spokesman for Cornyn.

"Hundreds of Billions" Invested In Broadband And Yet We Still Lag Behind

[Commentary] Have we wisely invested in broadband infrastructure? We're a long way from universal broadband access in the US. Hundreds of billions of our dollars have gone to creating a broadband marketplace where competition is inherently limited (because of the high cost of deploying new networks) and very few people have access to world-class broadband. Daily wonders if it would have been smarter to concentrate on encouraging competition between services over a common infrastructure vs. between last-mile technologies.

FCC Releases Broadband Data

On Thursday, the Federal Communications Commission released the final High-Speed Services for Internet Access report to be based on the old Form 477 data collection requirements.

1) High-speed lines, defined as connections delivering services at speeds exceeding 200 kbps in at least one direction, increased by 10% during the first half of 2008, from 121.2 million to 132.8 million lines in service, following a 20% increase, from 101.0 million to 121.2 million lines, during the second half of 2007. For the full twelve-month period ending June 30, 2008, high-speed lines increased by 32% from 101.0 million to 132.8 million (or 31.8 million lines) compared to a 55% increase, from 65.0 million to 101.0 million lines (or 36.0 million lines), in the twelve-month period ending June 30, 2007.

2) Of the 132.8 million total high-speed lines reported as of June 30, 2008, 79.1 million served primarily residential end users. Cable modem service represented 46.7% of these lines while 34.1% were asymmetric DSL (ADSL) connections, 0.1% were symmetric DSL (SDSL) or traditional wireline connections, 2.7% were fiber connections to the end user premises, and 16.4% used other types of technology including satellite, terrestrial fixed or mobile wireless (on a licensed or unlicensed basis), and electric power line.

3) Advanced services lines, defined as connections delivering services at speeds exceeding 200 kbps in both directions, increased by 10% during the first half of 2008, from 80.3 million to 88.4 million lines, compared to a 15% increase, from 69.6 million to 80.3 million lines, during the second half of 2007. For the full twelve-month period ending June 30, 2008, advanced services lines increased 27% from 69.6 million to 88.4 million (or 18.8 million lines).

4) Of the 88.4 million advanced services lines reported as of June 30, 2008, 55.5% were at least 2.5 mbps in the faster direction and 44.5% were slower than 2.5 mbps in the faster direction.

5) Of the 88.4 million advanced services lines, 74.5 million served primarily residential end users. Cable modem service represented 49.2% of these lines while 31.3% were ADSL connections, 0.2% were SDSL or traditional wireline connections, 2.9% were fiber connections to the end user premises, and 16.5% used other types of technology including satellite, terrestrial fixed or mobile wireless (on a licensed or unlicensed basis), and electric power line.

Benton

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