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  2. November 2015

November 2015

The Broadband Future Has Enemies

[Commentary] T-Mobile’s uncapped video experiment heralds a wireless alternative to cable. But, as usual, the net neutrality eccentrics have managed to upset themselves over the wrong things.

Never mind that T-Mobile here functions less as a gatekeeper than as the supplier of an incentive for video operators to make unlimited video manageable on T-Mobile’s capacity-constrained cellular network. This means, mainly, tagging the data so the network can recognize it. It also means allowing a reduced resolution that T-Mobile calls “DVD quality” but is less crystalline than customers are used to getting over a wired broadband connection. The poor, deranged dears should welcome T-Mobile’s experiment.

A touch disgraceful is that certain full-time cheerleaders who have spent the past 20 years blogging about the Internet still don’t bother to understand anything about pricing or the deadweight loss that comes from charging different users, with different needs and appetites, the same price for a service. What they should care about is competition, the force that ensures experiments like T-Mobile’s and Comcast’s will end up working for consumers. Happily, T-Mobile’s video offering (which the company calls “Binge On”) is exactly the reason we can expect a more competitive future—the convergence of fixed and mobile. That is, pending the Obama administration’s willingness not to get in the way.

Aided by social media, college students find new power in campus protests

Inspired by the marches in Ferguson (MO) and Black Lives Matter, students are taking to social media to question the institutions they once approached for answers. Calling for racial and social reforms on their campuses, they are borrowing tactics of the past — hunger strikes, sit-ins and lists of demands — and have found a collective voice to address their frustrations, hurt and rage. Their actions seem to have hit the mark.

Facebook Adds More Free Services In Africa

Facebook Free Basic services will be provided with free mobile data for its users on Bharti Airtel Africa in 17 countries in Africa.

Airtel customers will not pay for data for Free Basics, which is a key part of the social network’s Internet.org initiative which aims to spread internet access in the developing world where such data costs are often prohibitive. Bharti Airtel Africa will also offer Free Basics for free in Zambia, Kenya, Malawi, Ghana, Seychelles and Rwanda, where it has already been working with Facebook’s Internet.org initiative.

Levers to Intensify Broadband Competition -- Part II Telco Upgrades

[Commentary] Given the current market, what are the appropriate government levers to intensify competition at this part of the cycle? Earlier, I explored spectrum policy. Now let’s look at the second leverage point; improving the economics of a telco upgrade. We made a number of proposals at the national level in the National Broadband Plan, but frankly, cities have greater leverage to improve the math than the federal government. This has become clear through the Google Fiber effort. Google has turned out to be the cop that has caused the greatest level of defection.

Language and Citizenship May Contribute to Low Internet Use Among Hispanics

While the United States has made great strides in recent years to close the digital divide, the latest National Telecommunications and Information Administration data on Internet and computer use suggest that gaps remain among certain groups.

The Hispanic community faces some key challenges:

  • July 2013 data reveal disparities in Internet use based on citizenship status (see Figure 1). More specifically, persons who were born in the United States were 10 percentage points more likely to use the Internet than foreign-born non-citizens (72.5 percent compared to 62 percent).
  • Additionally, persons living in households where Spanish is the only language spoken were far less likely to use the Internet (see Figure 2). The difference in home Internet use between persons living in households where Spanish is the only language spoken by adults and those in other households was nearly 30 percentage points.

Even when holding a range of demographic factors constant, including family income, education, age, race, sex, disability status, employment status, the presence of school-age children at home, population density, and region, statistical modeling suggests that language barriers and non-citizenship are negative indicators of Internet use.

  • Controlling for demographic factors, individuals who were 15 years or older and identified as Hispanic were slightly more than 10 percentage points less likely than White non-Hispanics to use the Internet.
  • When adding citizenship status to the model, the estimated gap in Internet use between Hispanics and White non-Hispanics drops to 7 percentage points. Furthermore, controlling for language barriers in addition to citizenship causes the gap between these two groups to drop further to 6 percentage points.
  • By comparison, African Americans were approximately 7 percentage points less likely to use the Internet than White non-Hispanics. That estimate does not change substantially when adding citizenship and language to the model.

89.5 Million in US Get Broadband from Top Cable and Telephone Companies

The seventeen largest cable and telephone providers in the US -- representing about 94% of the market -- acquired about 645,000 net additional high-speed Internet subscribers in the third quarter of 2015. These top broadband providers now account for 89.5 million subscribers -- with top cable companies having nearly 54.3 million broadband subscribers, and top telephone companies having over 35.2 million subscribers.

Other broadband findings for the quarter include:

  • Overall, broadband additions in 3Q 2015 amounted to 92% of those in 3Q 2014
  • The top cable companies added about 790,000 broadband subscribers in 3Q 2015, representing 134% of the net additions for the top cable companies in 3Q 2014
  • The top telephone companies lost about 140,000 broadband subscribers in 3Q 2015 -- compared to a gain of about 110,000 in 3Q 2014
  • AT&T and Verizon added 305,000 subscribers via U-verse and FiOS in 3Q 2015, while having a net loss of 432,000 DSL subscribers
  • In the first three quarters of 2015, cable companies added about 2,300,000 broadband subscribers, while Telcos lost about 130,000 subscribers

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