March 2010

AT&T, Verizon, Google May Be Winners in U.S. Broadband Plan

Mobile-phone companies led by AT&T and Verizon Wireless may be the biggest winners from a U.S. plan for more high-speed Internet service.

The two largest wireless companies, as well as No. 3 and No. 4 providers Sprint Nextel and Deutsche-Telekom AG's T- Mobile unit, would benefit from proposals to make more airwaves available, analysts said. Builders of communications towers, those laying lines to the new towers, and Internet companies reaping more traffic also may profit. The Federal Communications Commission's plan to expand high-speed Internet service, or broadband, is due to Congress by March 17. The agency will publicly preview its proposals in Washington tomorrow. More airways for mobile use of the Web will be "a core goal," FCC Chairman Julius Genachowski said in a Feb. 24 speech. "More spectrum from the FCC can only be good" for wireless carriers, said Paul Gallant, a Washington-based analyst with Concept Capital's Washington Research Group, in an interview. "It's hard to tell which mobile phone companies will benefit most, since it's hard to predict the outcome of auctions that will be used to allocate newly available airwaves." The broadband plan will set broad policy rather than imposing new regulations, Chairman Genachowski said in an interview March 2. He said the document will spawn "a significant number of rulemakings," the months-long proceedings the FCC uses to make policy.

Broadband Trojan Horse

[Commentary] Health care isn't the only policy arena in which the Obama Administration aims to ram through controversial new rules. The Federal Communications Commission is set to unveil a "national broadband plan" opposed by industry and without any of the five commissioners voting on it.

Last year, Congress directed the FCC to develop a plan to make high-speed Internet available to more people. But given that 95% of Americans already have access to some form of broadband—and 94% can choose from at least four wireless carriers -- rapid broadband deployment is already occurring without new government mandates.

FCC Chairman Julius Genachowski is moving to increase the reach of his agency and expand government control of the Web. Among other things, he wants broadband services reclassified so the FCC can more heavily regulate them. The national broadband plan, to be unveiled tomorrow, will call for using the federal Universal Service Fund to subsidize broadband deployment. The USF currently subsidizes phone service in rural areas, and Mr. Genachowski knows that current law prevents it from being used to subsidize broadband unless broadband is reclassified as a telecom service. Congress ought to be wary of letting the FCC expand its jurisdiction through back doors like this. Chairman Genachowski wants more control over broadband providers so that he can implement "net neutrality" rules that would dictate how AT&T, Verizon and other Internet service providers manage their networks. To date, Congress has given the FCC no such authority. Nor has the agency had success in court.

FCC says some broadcasters like spectrum plan

Federal Communications Commission Chairman Julius Genachowski says some US television broadcasters have indicated they support a proposal to give up their airwaves to help resolve a shortage of spectrum for advanced mobile phone services.

Some analysts have been skeptical about whether the plan would appeal to broadcasters unless the FCC offers them a very big percentage of the auction proceeds. "We've certainly heard from a number of broadcasters who have told us that this is a promising direction and (they) are getting ready to roll up their sleeves with us," Chairman Genachowski said in an interview on Friday. He did not name specific broadcasters, nor would he comment on the percentage of proceeds that would go to broadcasters under the plan. Analysts say there could be a public outcry if the FCC gives broadcasters too big a share, since wireless auction proceeds typically go to the U.S. Treasury. The country's broadcasters -- including General Electric's NBC, News Corp's Fox, Walt Disney's ABC and CBS Corp -- hold spectrum licenses estimated to be worth $50 billion.

FCC to unveil sweeping proposal for broadband

Recognizing that high-speed Internet has joined telephone service and electricity as essential tools of modern life, the federal government will unveil an ambitious blueprint this week to extend broadband to virtually all Americans.

Crafted by the Federal Communications Commission over the past year, the national broadband plan is expected to set the federal government's high-tech agenda on a variety of fronts, with far-reaching implications for Silicon Valley. At its core, the plan, which will be released Tuesday, will propose ways to close the long-standing digital divide by bringing broadband into 90 percent of American homes by 2020. For those with broadband already, the plan will target vastly increased speeds for wired and wireless service, fostering the already-booming market for Web-based video and other high-bandwidth applications. FCC Chairman Julius Genachowski said the plan could spur advancements in telemedicine, education and energy efficiency through a Web-enabled smart grid.

FCC prepares for broadband shake-up

The Federal Communications Commission is due to unveil plans on Tuesday aimed at improving the country's mediocre performance in the global broadband race.

But they are already learning the hard way that change will not be easy. The Obama administration came to power with ambitious plans to boost the nation's flagging communications infrastructure. Having been at the forefront of broadband deployment a decade ago, the US has slipped back to a middling position among Organisation for Economic Co-operation and Development countries, according to a Harvard University study commissioned by the Federal Communications Commission last year. One idea has already been floated by the FCC to help remedy this: enticing TV broadcasters to give up part of their spectrum in return for some of the estimated $50bn (€36bn, £33bn) in proceeds from re-auctioning it for use in wireless broadband networks. But that has gone down badly with many broadcasters, who claim they are being railroaded into giving up airwaves they could still use.

Japan May Separate NTT's Fiber-Optic Businesses, Yomiuri Says

The Japanese government may separate fiber-optic businesses of Nippon Telegraph and Telephone Corp. to create a new company. The move is part of an effort spread the use of high-speed broadband. About 30 percent of Japanese households now have access to broadband. The government plans to increase the ratio to 100 percent by 2015.

The Internet and Political Freedom

[Commentary] We're all just beginning to understand the importance of the modern-day version of Radio Liberty—the Web and services available online. It's time to get serious about protecting the freedom of servers.

Technology helps dissidents around the world share information, communicate and organize through services such as Twitter, Facebook and YouTube. These companies have done more thinking about the implications of their technologies than have the government agencies charged with defending the Internet. As of last week, at least the Treasury Department now makes clear it does not prohibit companies from helping dissidents. Still, we're a long way from having a clear policy in support of the liberating power of digital technologies. The potential is unmistakable. The Cold War was won by spreading information about the Free World. Information was backed up by hard power. In a world of tyrants scared of their own citizens, the new tools of the Web should be even more terrifying if the outside world makes sure that people have access to its tools.

Google Is Poised to Close China Site

Google appears increasingly likely to shutter its Chinese-language search engine, a step that would remove one of the last major foreign players from the world's most populous and fastest-growing Internet market.

A person familiar with the situation said on Saturday that Google is likely to take action within weeks. Separately, Chinese authorities on Friday told local news Web sites that Google's Chinese site is likely to close and that, if it does, the news sites will be required to use only official accounts of the situation, rather than publish stories from anywhere else, according to a person familiar with the order. Google and Chinese authorities have been in talks about the extent to which the U.S. Internet giant will be able to operate a business in China if it follows through on its pledge two months ago to stop following government censorship requirements on its Chinese site, Google.cn. Those talks increasingly appear deadlocked, and Google's hopes for being able to operate Google.cn without filtering results—which were always thin—have all but disappeared. On Friday, Minister of Industry and Information Technology Li Yizhong, asked by a reporter about Google's plan to stop filtering results, said doing so would be "irresponsible" and warned that the company would "have to bear the consequences" if it violates China's rules. His comments reinforced expectations that the authorities will force Google.cn to close if the company stops censoring it.

China Issues Warning to Major Partners of Google

The Chinese authorities have warned major partners of Google's China-based search engine that they must comply with censorship laws even if Google does not.

The Chinese government information authorities warned some of Google's biggest Web partners on Friday that they should prepare backup plans in case Google ceases censoring the results of searches on its local Chinese-language search engine. The warning was the latest indication that two months of negotiations between Chinese officials and Google over government censorship have reached an impasse, making it more likely that Google will end up shutting down its Chinese search engine. The two sides have been at a standoff since Google announced in January that it planned to stop self-censoring the results of searches on its Chinese site, google.cn, in reaction to what it described as China-based cyberattacks on its databases and e-mail accounts. The warning was intended to head off a wave of frustrated users should their Internet searches be stymied because of Google's conflict with the government. Google controls nearly 30 percent of China's Internet search market.

Google Advertisers Urged to Defect on Speculation of China Exit

Google advertisers in China are being advised to switch to rivals such as Baidu and business partners are exploring alternatives as speculation grows the U.S. company will shut its Web site in the country.

"When we talk to clients, we have been pushing them in the direction of Baidu more," said Vincent Kobler, managing director at EmporioAsia Leo Burnett in Shanghai, which buys advertising on behalf of customers. "The Chinese government has taken a firm stance, and Google, they have their own principles, and are going to shut down." Google clients and partners may be turning more pessimistic about the company's prospects of operating in China after the government last week said a plan to end censorship at the Google.cn site was "irresponsible." Failure to end the dispute may lift sales at Baidu and Sohu.com Inc., and force partners such as China Mobile Ltd. and Sina Corp. to review co-operation.

Benton

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