November 2009

[Commentary] Many of you involved in the broadband stimulus process, and those sitting on the sidelines, have had moments where it seemed dealing with the rules of the game was like suffering the death of a thousand cuts. Today opens a 15-day window of opportunity for you to influence a kinder, gentler set of broadband stimulus rules. Last week, the National Telecommunications Information Administration and the Rural Utilities Services announced that there is only to be one more round of broadband funding. This probably doesn't surprise people since it's been hinted at a bunch over the past month that the agencies were considering consolidating the final two funding rounds. When you look at the degree of headache and heartburn both agencies have endured since February, this move should be no surprise. The level at which the first round was over-subscribed, with applicants collectively asking for seven times the $4 billion of funds available, assures us that there won't be a lack of people queuing up for the remaining $3 billion. The unrelenting pressure to get more stimulus money on the street faster was likely becoming unbearable and so another factor in the decision. NTIA/RUS also let it be known that the joint RFI to gather comments on changing/improving the broadband stimulus rules. As you may remember from one of my previous columns, others and myself have been clamoring for some changes. It's time for us step up since the RFI is officially open for business starting today once it is published in the Federal Register.

The economic effects of broadband are much more far-reaching, although not as obvious as the typically narrow "direct impacts" (technology sectors, e.g. "IT jobs") and e-commerce activities related to B2C and B2B transactions. To understand the full impact of investing in broadband infrastructure and broadband adoption initiatives one needs to look deeper. Business users understand quickly the broadband-enabled benefit of doing the same things faster: whatever the organization was doing before (online research, Internet communications or online document transfers) can be done more efficiently and reliably. However, the most significant benefits are generated from opportunities whereby businesses and organizations transform their business operations by using broadband-enabled applications to be creative and do things in new ways that were previously not possible, such as adopting new business models, or reaching-out to new markets. Where investments in broadband are made with the goal of stimulating economic activity it is both essential and possible to measure the outcomes from those investments. It is equally essential to invest not only in broadband infrastructure, but also in providing a support and learning infrastructure to assist organizations in effectively adopting and utilizing e-solutions. This creates the direct impacts for their business and the spin-off effects for their communities. It is only through broad and effective utilization of broadband that economic benefits can be realized.

[Commentary] With broadband becoming the norm and connection speeds continuing to quicken, what has happened to music companies and newspapers is beginning to happen to broadcast networks and cable companies. People are using the Net to bypass the customary providers of television programming, along with the ads they show and the fees they collect. Blu-ray players are just the tip of the iceberg that the TV business is about to hit. Today you can watch snippets of shows on YouTube or entire episodes on sites like Hulu or Yahoo TV. You can view news reports at CNN.com, sports events at ESPN360.com and documentaries at PBS.org. You can download shows, sometimes without charge, from Apple's iTunes store and watch them on your iPod, iPhone or PC. Or you can stream them through your Xbox or Wii. Television is escaping the TV set and the cable box. We no longer watch the tube. We watch, to borrow ex-Senator Ted Stevens's memorable conceit, a series of tubes. As the technology of television changes, so, too, does the experience of watching it. In the past, TVs often served as the focal points of communal gatherings. Families or groups of friends would collect around the set to watch the prime-time shows or the weekend games. They would laugh at the sitcom slapstick, cheer for their local teams, chat through commercials and, during the duller stretches, keep one another from nodding off. TV may have been a vast wasteland, as Newton Minow, the F.C.C. chairman in the Kennedy administration, said in a speech in 1961, but at least it was a wasteland we shared. The communal mode of TV viewing isn't gone, but it's becoming less common. As screens proliferate and shrink, and as the Web allows us to view whatever we want whenever we want, we spend more time watching video alone. That's one funny thing about the Internet: it's an extraordinarily rich communications system, but as an information and entertainment medium, it encourages private consumption. The pictures and sounds served up through our PCs, iPods and smart phones absorb us deeply but in isolation. Even when we're together today, we're often apart, peering into our own screens.

Americans, it turns out, are less willing than people in many other Western countries to pay for their online news, according to a new study by the Boston Consulting Group. Among regular Internet users in the United States, 48 percent said in the survey, conducted in October, that they would pay to read news online, including on mobile devices. That result tied with Britain for the lowest figure among nine countries where Boston Consulting commissioned surveys. In several Western European countries, more than 60 percent said they would pay. When asked how much they would pay, Americans averaged just $3 a month, tied with Australia for the lowest figure — and less than half the $7 average for Italians. The other countries included in the study were Germany, France, Spain, Norway and Finland.