Month: April 2005

Here’s something that some folks should find interesting: it’s not only Baller who believes that necessary big broadband is being stymied by squashing the municipalities. And it’s not only pie-in-the-sky futurists that think that broadband needs will continue to expand rapidly. It isn’t an invented cadre of “socialists and communists” who think that encouraging municipal entry is absolutely critical to America’s future.

It is, among many others, the Institute of Electrical and Electronic Engineers, the IEEE, the dominant engineering association and the standards setting guys. (You’ve seen the tag “IEEE standards?” Those guys.) This is a group that nobody could rationally place in the ranks of those accused of irrationality. These guys are the opposite of ideologues. What they care about, by nature and by training, is getting the job done right. That pretty much defines an engineer’s job. And what a new white paper published by the IEEE-USA makes perfectly clear is that the group is growing pretty impatient with both the unrealistic hype around alternatives to a full fiber-optic buildout in the U.S. and the growing trend toward blocking municipalities and other “user-owned” (as they so eloquently phrase it) entities from providing what private, for-profit carriers will not.

The IEEE on the bandwidth problem:

A new generation of broadband, or —gigabit networks,— can mean significant benefits to the United States, but our nation must act promptly to ensure that such an infrastructure is ubiquitous and available to all. If we do not act, the consequence will be to relegate the U.S. telecommunications infrastructure to an inferior competitive position, thus undermining the future of our country’s economy.

That’s pretty clear. And pretty clearly the same thing that Baller was saying over at TechSouth the day before yesterday. You’ll note that these guys are as precise users of words as they are of any other tool. The service should be ubiquitous –everywhere– and available to all. They are talking about what policy types (and LUS) would call universal service.

Why the solution should be fiber:

Residences of the future are likely to expect 100 Mb/s to 1 Gb/s. Although such data rates may not be used continuously, that capability is essential for particular applications, as described in the text. Networks such as these are gigabit networks.

In stark contrast, current broadband based on copper wire or coaxial cable links, such as Digital Subscriber Line (DSL) or cable modem, has a nominal (and asymmetric) speed of, say, 2 Mb/s. Thus, typical data rates on gigabit networks range from 50 to 5,000 times as speedy as current broadband networks, which include Wi-Fi and third-generation mobile networks. …

All these facilities are lower in cost, but also lower in capability, than optical fiber. Although fast technological progress is being made across the board, the copper-wire based alternatives cannot reach fiber speeds.

Cannot. Remember, these are engineers speaking to engineers. What they mean is that the physical constraints of copper are simply so much greater than that of fiber that a word like “cannot” is warranted. Copper will always be slower. As any engineer will tell you.

Why don’t we have the necessary fiber for universal gigabyte networks? The IEEE will tell you plainly:

Extending optical fiber access to end users is progressing. However, it is slowed in part by the high cost of capital expenditures and in part by non-market and anti-competitive business actions (and inactions) by incumbent service providers.

Any confusion? No? Good.

Can we count on the incumbents? No. After a review of the incumbent’s projects that note serious problems with less than gigabit bandwidth and a committment to asymetiric bandwidth that leaves end users in the role of passive recipients rather than equal participants in the network, we read that even these inadequate initiatives:

…will be deployed where profitable, meaning “fiber to the dense” or, realistically, “fiber to the rich.” Again, doubtful profitability would foreclose penetration to non-affluent and dispersed U.S. premises throughout the country. Further, “the money” is in content, not carriage (except under monopoly conditions). So these initiatives rely for profitability on control of content by the network provider, rather than open access by competing service providers. Diversity of information would be limited. The result would be closed networks and restricted content, aggravating the digital divide and limiting the engine of innovation that could otherwise exist. In a word, these initiatives will fall short of providing an adequate nationwide gigabit infrastructure.

How to fix this situation? Well among other sensible ideas:

Reduce barriers to competition and deployment of user-owned networks, to facilitate continuing market restructuring in the public interest.

By “user owned” the IEEE means municipals, co-ops, and businesses and business consortia. Let the people who use it control their own destiny.

I’ve always liked engineers.

This white paper is really one you should read: Providing Ubiquitous Gigabit Networks.

(Thanks to Dirk van der Woude of Citynet in Amsterdam (www.citynet.nl) for the lead. Go take a gander over there. They’re doing great things in Holland.)

This just in (via Mike) from Baton Rouge Business Report’s “Daily Reports.”

The Bus Rep briefs are notoriously hard to get a stable URL link to. Here’s the whole thing:

Cox ready enter Ascension phone market

The Louisiana Public Service Commission has approved an agreement between EATEL and Cox that lets the cable provider begin offering telephone service in Ascension Parish. The approval signals escalating competition in Ascension, where EATEL has begun offering TV service to accompany its traditional phone and high-speed Internet access over a fiber optic network. Cox will begin phasing in digital telephone service over its cable system to Ascension customers. The interconnection approval is likely to boost competition in Ascension more than in East Baton Rouge, where Cox has the unique position of providing bundled services. BellSouth has countered with its own bundle of services, but only by partnering with DirecTV.

It’s the shape of the future here in Lafayette. In Gonzales, EATEL is LUS–it’s got the clear hometown advantage and the clear technological one. With fiber technology and local trust going to the competition, Cox starts out with no advantage other than incumbency.

EATEL is able to buy programming at the same competitive coop rates that LUS will be able to. EATEL will garner the same maintenance and upgrade savings that LUS will.

This should be instructive–we’ll see Cox preview its competitive strategy against fiber. And we’ll get to see the competitive response a fiber-enabled hometown boy can raise.

Stay tuned.

The Advocate does a good job of overviewing Jim Baller’s TechSouth address yesterday. Baller, who represents LUS, is widely regarded as one of the nation’s top lawyers on issues involving telecommunications and that reputation rests securely on his work helping municipalities. Beyond his role in our not so little battle, knowledgeable folks all over the country find Baller is worth listening to.

A theme in his interviews and frequent public presentations recently has been the concern that the United States is falling rapidly in the rankings in broadband deployment behind other nations of the world, a failure that we can ill-afford as nations like India and China move rapidly to dominate the world’s industrial base as a direct consequence of the lower costs of labor. Because he (and many economists as well) regard this as inevitable, it seems necessary —and urgent—to find some other way for Americans to earn a living. Most folks who come to this conclusion look to “the knowledge economy” and the “information age” with a strong admixture of “creatives” as our best bet to remain on top of the economic pile globally.

That background explains some of the passion we heard yesterday (I attended), a passion the Advocate story accurately reflects. Some of the best quotes:

“The United States is falling behind the remainder of the world in broadband services because telecommunications corporations have been slow to keep up.

That’s why municipalities across the country are trying to get into the business themselves, said Jim Baller, a Washington, D.C., attorney who represents many of those municipalities.”

Baller is peeved with those companies and feels they’ve let America down. It’s hard to argue when you see numbers like these:

In Japan, consumers can already receive 100 Mbps service for $58 a month — a fraction of the per megabit cost Americans pay.

Other parts of Europe and Asia are also well ahead of the United States, Baller said.

This issue has been widely reported in the technical press, with Korea, a country regarded by most Americans as third world, acknowledged to be ahead of Japan, but the issue doesn’t appear to have much traction among news outlets oriented toward “breaking” news and sensationalism. When it does appear it gets mostly “wow, how amazing” or “gosh, how terrible” kind of coverage. Nobody tries to tell us what the problem is. Baller does:

The problem is phone and cable companies have formed an effective “duopoly.” Municipalities will have to provide competition in order to raise the U.S. prospects, Baller said.

“I don’t believe the private sector can do it alone,” Baller said. “Municipalities have a critical role to play.”

Well, it isn’t that the “effective duopoly” can’t do it alone. That’s just a polite way to say they won’t when you’ve got Gary Cassard of Cox Cable sitting in the back of the room. I’m not half so polite. They won’t because, being effective monopolies, their economic self-interest lies in wearing out their infrastructure before replacing it. The good and wealth of the United States don’t factor into their equations; only their own do. And honestly, given the situation these companies find themselves in, they are acting rationally. The irrational actors are ourselves: the citizens of this country. We’ve let ourselves be blinded by ideologues that demand that we ignore the plain fact that the telecommunications system that is crucial to our future economic health is dominated by ailing monopolies dependent upon antique networking hardware that they cannot afford to upgrade in anything like a timely manner and still maintain the profit margins that are necessary to satisfy their stockholder owners.

If they won’t do it then we can.

The solution is municipal broadband networks. Invest in ourselves and bypass the dinosaurs. This is just what LUS is prepared to do. As the largest municipal broadband build in the nation, Lafayette is unquestionably on the cusp of doing something pretty amazing.

What Baller is arguing in a pretty understated way is that we are lighting the way not just by lighting up with advanced fiber technology, but also by deciding to employ a municipal solution that bypasses the ailing giants. If other cities follow our lead the US might well regain hers.

It’s what folks like Baller hope for . . . and what the incumbents most fear is true.

This story from MarketWatch on a fight in Congress between cable and telephone advocates over the matter of regulating entry into video and data services is further proof of a couple of points that are relevant to our local fiber fight.

First, the Cox/BellSouth alliance against LUS is unnatural and runs counter to the recognized corporate interests of both companies. Second, for all their talk of belief in markets, the cable industry consistently seeks to use regulation to shield itself against competition.

The hearing that drew cable and phone reps to the barricades was a House Commerce Committee meeting that one of the early sessions of a process that aims to re-write the Telecommunications Act of 1996.

About a year after BellSouth’s army of lobbyists swarmed Baton Rouge trying to legislatively block municipalities like Lafayette from getting into the information services business, the lobbyists for the RBOCs in Washington are arguing against any regulation of phone company attempts to get into the video business.

In the same week where a bought and sold state senator in Baton Rouge gives up one of her precious five-bill limit slots to the state cable TV association for a bill that would, in effect, waive the municipal franchise fee where municipalities enter the cable business, in Washington industry lobbyists argue in support of imposing franchise fees on new market entrants (i.e., phone companies).

Bottom line: BellSouth, Cox and their local allies opposing the LUS fiber project will use any available argument and tactic in their desperate attempts to kill this project. They have taken positions that run counter to their corporate and industry positions as staked out where it really matters to them – national telecommunications policy.

They will make arguments here that they cannot live with elsewhere. Their disregard for truth in this process is matched only by their total disregard for the intelligence of Lafayette citizens and the interests of this community.

In the “Incumbents in Wonderland” — up is down, black is white — world of the opponents of the LUS fiber project, multi-billion dollar companies are imperiled by the actions of a municipally-owned utility in a community of about 115,000.

In that world, the entry of that municipally-owned utility into the information business of voice, video and data services will put those incumbents at a competitive disadvantage. Well, the superior infrastructure will give LUS an advantage because, over that network, it will be able to deliver services that the incumbents can only talk about but not deliver.

What really has the incumbents worried is the presences of any true competition in the market at all.

To appreciate this, one need look no further than the dockets of the courts and the Federal Communications Commission since the Telecommunications Act of 1996 became law. Incumbent phone and telephone carriers have spent hundreds of millions of dollars in attorneys fees fighting to make sure that they did not have any competition.

The cable companies have been fighting since the late 1990s to keep competitive Internet Service Providers from having access to their networks. That is, when you buy high-speed Internet service from a cable provider, you are paying for more than just bandwidth. You’re also paying for their role as an Internet Service Provider. The cable companies don’t want providers like Earthlink, or Yahoo! others to get a piece of your business. There is a case in the U.S. Supreme Court now that will render a final decision on whether the cable companies can, in fact, exclude other ISPs from their networks.

The phone companies have spent even more money on attorneys fees, congressional campaign contributions (even hiring the children of key congressmen) in a mostly successful effort to keep competitors off their networks as well.

Now, members of both the phone and cable camps will tell you that they really just want “a level playing field.” This is code for “incredibly high barriers to entry” in to their respective fields. That is, by closing their networks (which were built when they were regulated monopolies) to competitors, the phone and cable companies have relied on the high cost of network building to protect them from genuine competition — while mouthing platitudes to the virtues of the competition which they actually detest.

The anti-competitive nature of phone and cable companies is also being driven home by the recent spate of merger activity which has surged in on the telephone side of the business, but which is continuing apace on the cable side as well. This Washington Post article details the players in the recent telecom mergers, but makes no mention of the cable consolidation which is also taking place.

The consolidation in the industry has loaded the remaining incumbents with debt incurred to buy others in the field or, as in the case with Cox, to buy out all other shareholders and take the company private. Is it just a coincidence that this consolidation and the accompanying accumulation of debt have occurred during a time frame when the U.S. has fallen to the rank of 14th among countries in broadband access — even as defined by the diluted status of the phone companies?

Think of it this way: as large as these companies are, they do not have unlimited resources to draw upon. Committing billions to mergers and buyouts consumes resources that otherwise might have been used on more essential tasks like, say, modern network infrastructure like fiber to the home.

So, the top priority of the incumbents has been to eliminate competition at the same time that many companies and communities recognized that new network infrastructure and affordable bandwidth were essential for their ability to compete successfully in an information-driven, global economy.

This misalignment of the priorities of the incumbents with the priorities of their customers (and the communities where those customers reside) has real economic consequences. American companies are finding themselves at competitive advantages to their better-connected foreign competitors. Another impact is that companies are choosing to locate more operations in those areas where bandwidth is more abundant and more affordable.

At Wednesday’s TechSouth luncheon, Mark Marcin of George Lucas’ Industrial Light & Magic noted that is building a new animation campus in Singapore. One of the drivers in that process was the fact that Singapore has a robust network infrastructure — including fiber to the home.

What so galls the incumbents about LUS and other municipally-owned network builders (yes, even those settling for ‘better than the incumbents’ WiFi or WiMAX wireless) is that they have the resources to build those networks. The munis (short for municipals) also have the element that the incumbents don’t — interests that are aligned with the businesses and consumers in the communities that own them.

So, in the next few weeks when you hear opponents of the LUS project criticize it name of protecting ‘competition,’ point to the long and well-documented history of the incumbents in fighting competition. Then demand that those folks to come up with an honest reason for opposing this project!

UPDATE: Consolidation Accelerates as Time Warner and Comcast Gobble up Adelphia

Cable company Adelphia, the victim of corrupt corporate leadership, is being bought out of bankruptcy by cable giants Time Warner and Comcast. $12 billion would have bought a LOT of network upgrades, particularly when one considers that SBC’s fiber to the home investments are going to total $8 billion in the next decade.

As I have been reminded recently, there are a fair number of folks from out of state and even across the pond who check in on this blog from time to time. The content here is determinedly local so these folks deserve special praise for putting up with our Boudreaux and Thibodeaux shenanigans and wading through laws and lawsuits that don’t particularly make much sense–and aren’t intended to, by and large. One of the good things about this fight for fiber is that it doesn’t involve, for the most part, foolishness that we ourselves generate. (Lousianaians will affirm, I think, that we do a lot tripping over our own feet.) This one is being visited on us by outsiders. Makes it a little easier to take.

For those patient visitors who’ve offered sympathy during our travails, I offer up one of the better things about our culture and people in partial repayment: Festival International de Louisiane. Go thumb through the too-abreviated but handsomely designed site. (And hey, if you are from around here and not going, I say why not, cher? Get up and get yourself in gear.) The festival is the United States’ premiere francophone festival. Music from all over the world with an emphasis on French-speaking lands; a big juried craft fair, un place des infants, mixed drinks, great food stands (really), and dancing..lots of dancing…almost anywhere.

It’s a wonderful experience spread out over downtown’s three stages with activity also running along the turn of the century main downtown drag, Jefferson Street. The festival stages are new, with a clean design, spacious enough for a real crowd but not so large that anyone ends up out of sight or out of earshot. This is what they were designed for and the spaces work. The artwork and the crafts look out from your usual American fare and toward the Caribbean and Africa. There’s an energy and…well..joie de vivre. If you ever get the chance you should come. Folks get happily addicted.

It’s hard to capture the spirit, maybe impossible, but here are two moments from past festivals that might convey some sense: The fiddler, The dancer. What the heck..one more: Cajun dancin down on Jefferson Street.

And here’s the best part. If you’ve developed a certain sense of solidarity with Lafayette after following our efforts, you can participate in the festival with us virtually. During the next 4 days, (through Sunday, April the 24th) the festival’s fun will be streamed live via KRVS from the festival. Being with us in spirit might be a little more fun in the next few days than your reaction to most of the stuff you’ve found yourself being sympathetic about here. Give yourself a break, pop open a beer and pretend you’re down in Louisiana in April. It’s just starting to cool off, evening is falling, and the dance band is starting up a block down. Just as soon as you get up the energy you’re going to go down there too…

Thanks folks, for all the support from all over the country and the world. What we can give back we will… if at all possible, by remaining ourselves…

Lagniappe Update, Friday 4/22/o5: The Adverstiser has a nice backgrounder piece on the music that’s worth your review.

Advocate coverage of the Lafayette City-Parish Council fiber-optic vote focused on the outcome: the bonds.

Pull quotes:

The Lafayette City-Parish Council voted Tuesday to call a July 16 election on the funding of the LUS plan to offer phone, cable and high-speed Internet services on a fiber-optics network run to homes and businesses in the city…

The proposition states the $125 million in bonds will be paid off by the revenue generated from the new communications division.

Should that money not be enough, the remainder of the obligation would be paid by a “secondary or subordinate” pledge of the revenue of the overall utilities, the bond proposition said…

Using the words “secondary or subordinate” pledge was intended to convey that all other LUS obligations would first have to be met…

That previous document detailed that only “excess revenue” would be used for such purposes, and went through the list of all other utilities obligations that would have to be paid first, including the sizeable in-lieu-of-tax payment LUS makes to the city each year.

The point of going through this is to assure folks that the chance of any blow-back to their favorite angst, be it rates or taxes or something else they don’t want changed, is minimal. The bond holders will be last in line after all of LUS’ local responsibilities.

There’s risk of course, but it is small and distant–you have to go through some pretty fancy shenanigans to find a situation where a big fiscal hit is taken–and what risk there is is mainly to a hope for future reductions in rates. As the city has said, it’s a lot easier to find credible scenarios where the fiber optic system makes money and relieves the pressure on the city to turn to taxation instead of direct fees for service to fund necessary city services. That’s exactly what is happening with the current city utilities; they function to save the citizens money that would otherwise be taken from them in the form of taxes.

The story closes with a few words of wisdom Kaliste Saloom:

“Bold vision is the exclusive mark of a progressive community and Lafayette is such a community,” Saloom said. “The future of Lafayette cannot be left in the hands of distant board rooms.”

Saloom said he expects the election will feature heavy advertising from the two private companies, BellSouth and Cox Communications, which have already spoken out against the LUS plan.

Indeed. And my guess is that we’ll get not a few ads developed on top of the little trolling expedition through LUS’ records that Lawsuit #1 is meant to enable.

The Advertiser reports on the City-Parish Councils vote for a vote on fiber last night:

More than 73,800 registered voters in the City of Lafayette will have the opportunity July 16 to decide if the city’s utility system should spend up to $125 million on a controversial fiber optics project.

The City-Parish Council on Tuesday voted to call the July 16 public referendum. All present voted in favor of the election. Councilman Rob Stevenson was absent.

The special election is expected to cost the city about $100,000. Only registered voters in the city of Lafayette can participate. A simple majority vote decides the fate of the proposed Lafayette Utilities System fiber-to-the-home project.

The Advertiser also brings to the fore digital divide issues that started to emerge yesterday. Look for more; I know that good things are coming. There is a real possibility that Lafayette will go forward with a digital divide plan that will garner as much national and international press as the fiber plan itself.

LUS Director Terry Huval is expected to report to the council May 17 with plans for using the fiber project to shrink the digital divide between residents who have access to Internet service and those who cannot afford the service. When the fiber project originally was proposed a year ago, bridging the digital divide was supposed to be a primary selling point and benefit. On Monday, LUS connected to its existing fiber service the Simcoe Street housing development’s tutorial center in an effort to bridge the digital divide.

A couple of times in the past I’ve mentioned our household’s love affair with TiVo on these pages. We don’t watch a whole lot of TV (by the standards of surveys taken of Americans) but what we do watch we actually want to see—but only when we have time. If we’re keeping a kid that evening I’d rather have fun with the child than catch the show. TiVo removes any possible conflict by making time-shifting recordings actually practical. We set up the the machine to record our show, say “Lost,” and we don’t need to know if the network shifts the time or starts running some reruns. We just get the new shows whenever they appear and watch them when we care to. And we watch zero ads. I now find watching standard TV with ads excruciating. If you could easily skip them, so would you. It’s amazing what we learn to put up with.

The point is only this: watching TiVo is not like watching TV. TV demands your time and attention on its arbitrary schedule. TiVo is your servant. It stores things till when you want them and doesn’t force you to watch anything you don’t want to watch. If you want to take a phone call about homework, it lets you pause the show while you finish and then lets you start it up from where you stopped.

My purpose isn’t to promote TiVo, just to give you some background on why you might like such a service preparatory to referring you to the story “Search giants court TiVo” that goes into some pretty nice detail about the corporate reasons that Yahoo or Google might want to acquire the company and the technological rationale behind thinking it a good fit. Interesting. But it doesn’t get to the heart of the matter for me: that the sort of things that TiVo allows and which folks love is about to move online in a major way. The “channels and schedules” model of television and cable is about to die. The death will be messy and probably prolonged but it is in the midst of happening (something else we’ve written about from time to time). What will replace is it a sort of on-network TiVo: downloadable video streaming that you can pause, combined with really gooda video search (harder than you would think) which lets you find what you want to watch. The day will come when this is way we will watch our monitors. (Though we’ll still call it TV, no doubt.)

This is why we’ll need that 60 megs that pundits talk about American households needing in the next few years: download a stream of video and take a full-screen video call from a grandchild about the Pythagorean theorem in his homework and you’ve bound up the available bandwidth in a 60 meg stream. Your wife’s TV show starts stuttering and you hear about it. Add a white board discussion of how the theorem works with a little hopefully interesting detail about using it to build houses from my days as a carpenter and the whole household network is in trouble and you have to shut down some function. If I had the bandwidth I could do this today. And I’d like to be able to. It may sound pie in the sky but then TiVo sounded like a fantasy to most just a few short years ago. Now, at least in some households, it’s indispensable. When the online services breaks, many, many more will want the control of TV that it represents.

Of course there’s a fly in the ointment. To quote the story:

“To be sure, there will be many issues to iron out before successfully transferring Web video to the television. TiVo will likely have to expand its storage capabilities. The quality of Web video must improve for television viewing. And bandwidth capabilities in homes must expand, among other considerations.” (my emphasis)

They are right, of course, and my fantasy, and Google’s, Yahoo’s and TiVo’s will remain a fantasy until we get that bandwidth. The only real solution is a fiber-optic connection to the home. Nothing else has the capacity.

Local media (Advocate, Advertiser, KLFY) covered yesterday’s press conference on the first fiber brought to a housing project in Lafayette. LUS has partnered with the Lafayette Housing Authority under Walter Guillory to make fiber optics available in the city’s housing projects. The first location, the lighting up of the Simcoe street housing project, was celebrated yesterday.

The effort to bridge the digital divide that is being pursued here is near and dear to my heart. Much of my support for LUS comes from the conviction that only lower prices and universal service—neither of which it is reasonable to expect from the incumbents—will begin to ensure that access to the internet will be equally available and affordable to everyone in Lafayette.

The Advocate story also hints at a bigger project, saying that the housing authority’s tutorial project was could serve as a template for a larger education program that would certify qualified –meaning low-income– learners to receive donated computers.

All very interesting and very encouraging. Look for more on this front.