February 2012

Judge awards iPhone user $850 in throttling case

When AT&T started slowing down the data service for his iPhone, Matt Spaccarelli, an unemployed truck driver and student, took the country's largest telecommunications company to small claims court. And won. His award: $850.

Judge Russell Nadel found in favor of Spaccarelli in Ventura Superior Court in Simi Valley, saying it wasn't fair for the company to purposely slow down his iPhone, when it had sold him an "unlimited data" plan. The customer contract specifies that those who win an award from the company in arbitration that is greater than the company's pre-arbitration settlement offer will get at least $10,000. Spaccarelli picked the same amount for his claim, though AT&T's stipulation about a minimum award doesn't apply in small claims. Judge Nadel looked instead at the remaining 10 months in Spaccarelli's two-year contract with AT&T and estimated that he might pay $85 a month on average for using additional data. AT&T charges $10 for every extra gigabyte over 3 gigabytes. Judge Nadel said it's not fair for AT&T to make a promise to Spaccarelli when he buys the phone while burying terms in his contract that give the company the right to cut down data speeds.

Study: Wireless Carriers Face Stiff Competition

According to a new report from The Cambridge Strategic Management Group, a variety of factors, from over-the-top voice competition to Wi-Fi operators are helping "shift value away from established mobile industry players."

It predicts that Wi-Fi could take an $8 billion chunk out of wireless carriers' revenue by 2016. The report, Signal Strength: Assessing Value Shifts in the Mobile Telecommunications Industry, says "established players can no longer rely on the rising tide of demand to guarantee growth," given tablets, cloud-based services and other disruptive factors. In fact, the report cites a host of threats to the view of incumbent wireless carriers as poised to dominate the market and the bottom line, arguing that one way to defend against over-the-top services like Skype is to offer unlimited voice and messaging.

ITU Chief: Governments Need to Make It Easier to Deploy Next-Gen Mobile Broadband

The head of the International Telecommunications Union has called on mobile broadband operators around the world to deploy next-generation LTE wireless service, and advised governments to do what they can to ease that process, including cutting or abolishing taxes on equipment and service. ITU Secretary General Dr. Hamadoun Touré said that it is in everyone's interest that mobile broadband be able to deliver the high speeds necessary for video streaming and aps yet undreamed of, the same argument the FCC has been making for freeing up more spectrum for broadband.

CableLabs CEO: Interactive TV As Relevant As Ever

CableLabs CEO Paul Liao said that -- even after the decision by Canoe Ventures to shut down its interactive TV advertising operations -- ITV technologies remain "as important and relevant to the cable industry as ever."

Liao emphasized that CableLabs' development of standard specifications, including the Enhanced TV Binary Interchange, will continue to provide the foundation for a wide range of interactive TV applications -- including advanced advertising. "These technologies are the foundation for the industry's ability to capitalize on interactive advertising opportunities; and its commitment to deployment of these technologies remains unchanged," he said.

Los Angeles Times To Add Paywall

It’s been a big week in newspapers starting to charge for content. First it was Gannett; now the Los Angeles Times will launch a metered paywall on Monday, March 5. Website visitors will be able to read 15 stories per month for free before the paywall kicks in. They will be charged an introductory rate of 99 cents for the first four weeks; thereafter, the paper will charge $1.99 per week for a website-plus-Sunday-print-edition package and $3.99 per month for website access only. The LA Times says the digital subscription also includes “retail discounts, deals and giveaways.” Kathy Thomson, president and COO of the LA Times Media Group, says the company “priced the digital subscription with the Sunday newspaper at a lower rate because they are complementary products.” Access to the paper’s website through mobile phones and tablets remains free for now, but that will change in the future.

Stanford’s Jonathan Mayer On Fixing Privacy

A Q&A with Stanford graduate student Jonathan Mayer.

His research on internet tracking set off an explosive series of media reports and a flurry of privacy demands in Washington. But what does Mayer himself think should be done—is it possible to regulate privacy without harming Silicon Valley? Mayer says that the culture of technology companies, especially their focus on growth, makes them ill-suited to safeguard consumer privacy. Mayer thinks that increased government oversight in the privacy sphere would be effective so long as the mandate was given to an independent agency and not Congress itself.

It’s the end of the line for telco

[Commentary] The telecom industry has reached its peak. This is it. Look around you. Whatever you are doing in telecom, however you are making money in the field, it isn’t going to get better than this.

This industry has acquired its maximum share of the economy. We are the digital railroad business at the height of the railroad barons. The only way now is down. We’ll see maybe one or two more mini-booms, a few more troughs, but the long-term trend has just gone into reverse. Telcos aren’t going to be able to divide-and-conquer Apple’s and Google’s platforms. The locus of power has shifted fundamentally. The value creation is outside the network. It gets worse. These players may start to aggregate assets and wholesale access to build AppleNet, GoogleGlobe and AmazonRiver to connect merchants to eyeballs and wallets, without any other gatekeepers, such as a telco retail bundle, in the way. It gets worse. Telcos as profitable networked cloud services providers? You’ve got to be kidding me. It gets worse. Ericsson has positioned itself as what my colleague Dean Bubley refers to as a dominant “under the floor” player. It is potentially a king-maker for telcos, controlling the delivery platform from which their operations have to be run. Networks are just large, distributed supercomputers — and Ericsson is the new IBM. Nobody got fired for choosing them. Their power is ominous for operators. It gets worse. Home networks don’t need service providers. You just buy a box and plug it in. Street-level networks don’t either — you can build a simple resilient mesh. Nor do town networks that join the kids with their school. We fundamentally don’t need communications service providers to manage data transmission. As long as we have a means to fund infrastructure, just as we manage with roads, we can do it for ourselves.

Sprint, MetroPCS were “hours away” from now-dead $8 Billion deal

CNBC reported Feb 24 that Sprint and MetroPCS were “hours away” from announcing an $8 billion merger agreement, but the deal was thwarted by Sprint’s board of directors.

CEO Dan Hesse was said to have endorsed the deal, which would have seen MetroPCS owning about 30 percent of the combined company, but it would have been a challenge. For one thing, MetroPCS and Sprint don’t operate in the same spectrum bands, according to The Verge. That means blending the two customer bases would have been quite difficult. On top of that, Sprint is already carrying substantial debt and won’t make money on its extremely expensive iPhone deal for several years, leaving the company with few options to generate cash.

California Bill Would Prevent Cell Service Shutdowns

Local governments in California might lose their ability to black out wireless communications networks. A new bill has been drafted that would extend the California law that requires a court order to shut down land-based telephone service to mobile devices, giving users uninterrupted access to 911 and telecommunications services.

Introduced Feb. 22 by Sen. Alex Padilla (D-Pacoima), SB 1160 follows the Bay Area Rapid Transit Agency’s (BART) shutdown of mobile services during August’s public protests regarding the shooting deaths of two men by BART police. The network blackout stirred a firestorm of controversy, attracting the attention of the hacker collective “Anonymous” and the Federal Communications Commission.

Kickstarter Expects To Provide More Funding To The Arts Than NEA

Kickstarter is on track to distribute over $150 million dollars to its users’ projects in 2012, or more than entire fiscal year 2012 budget for the National Endowment of the Arts (NEA), which was $146 million.

The milestone is “good” in the sense that it means that Kickstarter may now reach a point where it will funnel as much money to the arts as the federal agency primarily responsible for supporting them, effectively doubling the amount of art that can get funded in the country. “But maybe it shouldn’t be that way,” said Kickstarter co-founder Yancey Strickler, “Maybe there’s a reason for the state to strongly support the arts.” It’s worth pointing out that Kickstarter is quite different from the NEA. The 3-year-old website allows users to post their own random ideas for projects — everything from iPod Nano watches to children’s books on reproduction — and solicit donations from the rest of the Internet to turn them into reality. Kickstarter does restrict the kinds of projects it will allow to be posted on its website to “projects with a creative purpose.” As the site’s guidelines state: “Kickstarter can be used to fund projects from the creative fields of Art, Comics, Dance, Design, Fashion, Film, Food, Games, Music, Photography, Publishing, Technology, and Theater. We currently only support projects from these categories.”

Benton

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