CenturyTel to Buy Qwest in $10.6B Stock Swap – NYTimes.com

The third largest telephone company in the United States will be located in Monroe, La…Bastrop really.

Really. Honestly. No kidding…

The New York Times reports that CenturyTel will buy Qwest, the western Bell company for 10.6 in a stock swap deal announced today.

Bits-And-Pieces:

The combination would have about 18 million phone lines serving customers in 37 states, but would still be dwarfed by AT&T Inc. and Verizon Communications Inc. It would be based at CenturyTel’s headquarters in Monroe, La., rather than in Denver, where Qwest is based.

The number of landlines in the U.S. shrinks by about 10 percent per year as consumers chose to rely on their wireless phones or service from cable companies. The fourth-largest provider of landline phone service in the country, by number of subscribers, is now cable company Comcast Corp.

Official LPF reaction: Wowser. This new company will create a national rural wireline carrier. It may well have the largest footprint in terms of square miles in the country.

Fiber Fête, bandwidth touted

Fiber network looks to bolster local economy” appears on the front page of this morning’s Advertiser and focuses on the value of big bandwidth and Lafayette’s upcoming fiber fête conference. Tom Cox and Golfballs.com are featured as a business which is already using LUS fiber to real advantage and that plans to use the speed even more in the future. Cox, not surprisingly, will be on Thursday morning’s panel “Driving Lafayette’s Digital Economy.”

“Pixel Magic to make 100 hires in Lafayette”

An update on today’s Advertiser website says that Pixel Magic has committed to hiring a 100 artists to work at its new Lafayette location. They will work at rendering “old” 2-D films into new 3-D formats. That type of boost to the digital arts community plants the sort of seed that every community is looking for these days. It is the potential beginning of a hothouse economy built around the digital visual arts. 100 highly trained visual ‘magicians’ will have to have something to do in their off time…and some other personal projects to keep their juices flowing. For Lafayette it’s those spin-offs that will be the real payoff. [If the economic development people haven’t put aside some petty cash to sponsor a visual arts club for kids built around these folks as the core group then they aren’t doing their job. It’s stunning how much real development has sprung from cold pizza and warm coke…]

Looking for some of that work? From the article:

Pixel Magic will work with Louisiana FastStart to provide training for interested candidates. Knowledge of stereoscopic 3-D is a plus, but anyone with a visual arts background is eligible.

Candidates who are selected will complete a specialized training course taught by Pixel Magic artists. The course will be taught over 2-3 weeks starting May 2.

This announcement a tremendous success for LITE. And Louisiana, and Lafayette, and, I very strongly suspect, LUS Fiber (even though utility companies seldom get a fair share of the glory).

Pixel Magic is the real item—it’s not a start-up hoping to leverage the fallow assets of Lafayette into some star gig that lets them move up and out…it’s a major established house that has come here because it can accomplish more of what it wants to do for less money than elsewhere. It’s up to Lafayette and the region to set the hooks deep so that nobody ever wants to leave. Festival International will be a good start….and Mardi Gras and crawfish etouffe. [Never heard of Pixel Magic? Shame on you. Check out their site, with the Lafayette location prominently featured on the fly-in, and their list of movies, and, for real fun, go to the “reel” they’ve put up of special effects. Imagine being able to do that sort of stuff…it really does look like magic.]

Pixel Magic bringing employment to Lafayette is not the result of any simple, “silver bullet” approach to development. This had to look good to the company from a number of different angles. Starting at the state level a big chunk of their favorable decision has to be Louisiana’s “aggressive” tax benefits for film and digital production. The company will get some extremely nice tax credits for the work that is done in the city. But that’s not nearly enough. Many states have copied Louisiana’s generosity. There’s also Lafayette’s location on big backbones like the Internet2 and LambdaRail consortiums. Shipping big buckets of bits back to Los Angeles won’t be an issue. Then there’s LITE itself—with a 3D rendering setup and multiple varieties of 3D visualization venues testing out films in settings from theatrical to flatscreens will be easy. LITE also has a couple of monster underutilized rendering farms on site. Pixel Magic no doubt gets a good deal and LITE gets a client that will actually use its massive facilities for more than a prestigious address.

Finally, we’re down to LUS Fiber. You have to know if you’ve been down to “the egg” at the LITE building that they’re not going to put 100 cubicle workers in that facility. No way they’d fit. However they do have to do the tedious work in Louisiana to get those credits. So some large percentage of those 100 workers will have to be off-site. But they’ll have to be able to do their work as if they were in the same building with, at a minimum, the 100 megs of connectivity that standard ethernet LANs provide. That, of course, is exactly what LUS provides on its justly acclaimed 100 meg intranet. A person setting behind a nice workstation setup on Moss Avenue with a nice VLAN setup could work within the Pixel Magic network as if they were just down the hall from the boss’s glossy corner office (something both would probably prefer). The ultimate in working from home. I’ll not be surprised if Pixel Magic opts for an offsite work center like NuConn did—but there too LUS’ fiber-to-every-nook-and-cranny make it possible to shop for the cheapest appropriate location rather than the cheapest location that has something close to real connectivity. In that sort of situation it would be easy and damned inexpensive to leverage LUS Fiber to provide a gig or several of commercial grade connection between the two points.

All of that taken together—each element individually impressive but not uniquely decisive—turned out to make Lafayette very hard to match.

The best thing is that this little coup will put the “three ‘L’s”—Lafayette, LITE and LUS Fiber on a lot of people’s radar in the digital video arts. Rev up your motors guys….the race is now beginning.

“Tech efforts getting noticed”

Sunday’s Advertiser carried a story that —as my father might have said—”Does Lafayette proud.” I recommend locals and fans give the full story a read. The article hangs its hook on Kit Becnel’s Academy of Information Technology (AOIT). A school within a school at Carencro High, AOIT prepares students for careers in the broad field of information technology and is affiliated with the national academy foundation. AOIT is a leader in the national academy and its leadership sits on several committees driving changes in the national program. The award cited in the story was actually given to Louisiana Public Broadcasting and showcases several of Lafayette’s tech jewels including LUS Fiber, LITE, AOC, and AOIT:

Louisiana Public Broadcasting partnered with Lafayette Utility System, Bay Area Video Coalition and Louisiana Immersive Technologies Enterprise (LITE) to enhance technology and instruction at Carencro High School. This project provided more bandwidth to the school, expanding instruction to include creation of 3-D models and training students for careers in technology.

But beyond AOIT’s award the article also delves into Durel, Huval, and Bertrand’s recent appearance at Google’s DC headquarters. Not surprisingly, since attendees at that conclave included the Corporation for Public Broadcasting, the Bay Area Video Coalition, and the CIO of San Francisco AOIT’s reputation was already well-known.

…many of those invited to the event at Google’s headquarters already knew about the academy and Becnel’s work.”The pioneering spirit exists in Lafayette with our LUS Fiber and the work and energy of people like Ms. Becnel,” Bertrand said at the meeting. “You’re going to hear her name again and you’re going to hear it a lot. The entire United States is envious of what we’ve done. It’s no small feat.”

Also in this mix is Acadiana Open Channel (AOC) who is providing support and training for AOIT. Part of the conversation

The invitation-only event in D.C. was a workshop on broadband and the public interest, and was co-presented by the Ford Foundation and the Paley Center for Media….”Their purpose was to talk about how digital public media networks should advance in broadband and enrich connected communities,” Huval said…

Lafayette officials discussed LUS Fiber, including how it is used in all Lafayette Parish public schools and is expected to be throughout the whole city by this summer. As the infrastructure portion of it nears completion, Huval said the focus will turn toward how fiber can be applied in both schools and the community.

That last (my emphasis) is what the community is waiting to hear. The benefits to education through the school system and to public media through AOC are simply the entering edge of the wedge.

The dreams continue to come…Huval, widely know for his prowess on the fiddle and his advocacy of Cajun culture, tossed out this one which will surely resonate with Lafayette’s Creole and Cajun communities:

“You could have the ability for a French immersion school to work on a project with students in Paris, France, and have this real-life collaboration,” Huval said. “The technology now allows you to have the exchange of ideas and understanding that you could only get in-person before. This is only the beginning. To have this little oasis of Lafayette, La. have the ability to do these kinds of things is really exciting for a lot of people.”

Perhaps unknown to Huval the futuristic dream of cross-cultural francophone educational collaboration is already being realized in a project organized by WSIL (World Studies Institute of Louisiana). The pilot project, underway currently, connects classrooms in New Brunswick, Louisiana, and Haiti. Students and their teacher collaborate through Lafayette Commons, a Lafayette nonprofit that supplies the educational edition of Google Apps and support to the project.

The benefit of a community-owned fiber-optic telecommunications system to Lafayette and communities like Lafayette lies less in the technology than in the fact of public ownership. Having built our own network we can now choose to do things to benefit the people and community institutions.

Building our network was the first step—and that is nearing completion. Taking the resource of our new network and firing up the process of doing something useful with it was the next step. That process has already begun.

(full disclosure: I sit on the board of AOC, the advisory board of AOIT, and help supply services via Lafayette Commons to WSIL’s project.)


Lagniappe: LUS and Lafayette have applied for the Google Gig FTTH project; apparently as a direct result of conversations held at the meeting in DC according to an exchange I had with Huval…more on that surprise when I get a little time.

Cox: Costs too high for high-speed service

Our neighbors in Franklin are being told that it’d be too expensive for Cox or AT&T to serve them all with real broadband. It’s not that the incumbents wouldn’t earn money…they just wouldn’t earn it as easily or as quickly as they want.

A story in the Advocate shows that the nub of the matter is well-understood by Franklin’s Councilmen:

“I think everyone should have it and you all should bend a little, especially if you will be making a profit in 10 years,” Foulcard said.

Councilman Logan Fromenthal argued there are many areas of the parish where Cox is making a good profit.

What Foulcard and Fromenthal have in mind is treating telecommunications as a utility in the same manner that your residential telephone service was understood in years: the company that was granted the right to use our public right of ways for private profit was supposed to serve everyone (not just the low-hanging fruit) and it was well-understood that they weren’t supposed to be making the same high rate of profit that was available to businesses that weren’t dependent upon getting favored use of public resources.

The councilmen are right: That is the way it should be.

Unfortunately, the federal government long ago exempted the telephone companies from any local control and our state legislators have spent the last few years passing a series of bills that transfer most of the power to say how local rights of way are used up to the state level and put up barriers to the local communities that own and maintain the land providing these services themselves. The consequence is that communities like Franklin can’t easily do much more than complain and ask politely.

There is an alternative and Lafayette has shown the way. Do it yourself. Build a world class fiber-optic network yourself. Don’t wait for someone else to do it for you. Yes, it would be costly, but yes, it could pay for itself in a perfectly doable period of time if it didn’t have to pay for itself in a short 2-4 year period as the private companies demand.

There are possibilities out there besides “asking politely.”

Apply for some of the federal broadband stimulus money from RUS (the rural utilies service). Look to Google’s recent offer to supply 1 gig of broadband to up to 500,000 people and make your case. Or just make up your mind to do it yourself.

You do have one advantage in making such an effort: Lafayette. Lafayette just up the road has its own publicly-owned state of the art fiber optic network with a brand new head-end that is the technical heart of the system. If St. Mary were to set up their own network they could farm the head-end work out to LUS and avoid the problems associated with building and maintaining that highly technical facility. And I’d bet that an intergovernmental agreement there would be a lot cheaper than any private alternative. (LUS is already a utility, it doesn’t have to make its money back fast. But would surely welcome any additional revenue.) There is already fiber running down the railroad track between the two cities.

Just light it up.

Lagniappe: A lot of people in Lafayette think that owning its own utilities was the key to Lafayette becoming Acadiana’s “hub city.” Awareness of that history was one good reason the community supported extending the idea to LUS Fiber. Ownership made sure that modern electricity and clean water was reliably available when that was what made a city “modern” and livable. Owning those facilities meant that the city was not dependent on any outside force to provide the necessities and attract new citizens and businesses. And it meant that all those dollars of profit stayed and circulated in the city. There was a day when both New Iberia and Opelousas were bigger and more important than Lafayette…but those days passed. Any community that wants grow and prosper needs to own its own local resources. Owning your own telecom utility is today’s equivalent of electricity. Now is the moment.

Regional Fiber UltraBroadband Network in Lousiana?


They’re beating the drum in Baton Rouge on Google’s FTTH (fiber to the home) project. A facebook page, Bring Google Fiber to Baton Rouge,” was launched almost immediately and quickly became the leading Facebook page devoted to the topic. The page reports meetings within the city leadership. Baton Rouge is enthused.

Lafayette’s cadre of pro-fiber partisans are urged to support Baton Rouge’s effort. Join the facebook page and voice your support.

A fibered-up Baton Rouge would create a regional ultra broadband fiber to the home corridor stretching from Gonzalez through Baton Rouge to Lafayette. My back of the napkin calculations using year 2000 census data shows that network would pass around 419,000 people. That would just about double the bang-for-the-buck that Google would receive for fibering up Baton Rouge alone.

It may well be that Baton Rouge’s strongest argument for Google to invest there will be to leverage the spirit already shown by its neighbors.

The number of people effected is no small issue. As Google is undoubtedly aware, the major stumbling block to developing really big pipes here in the US is that building out little pockets here and there do not provide the critical mass of users that would prod application developers and service provider to provide apps and services that make full use of the available bandwidth. If 90% of your audience is limited to 6 megs or less you develop and plan for—maybe—10 megs. Of download. Upload speeds are a fraction of download in most of the country. Everyone knows we want big broadband and symmetrical up and download speeds eventually but we’re caught in a chicken and egg situation and no one wants to go first. Google is playing on this national stage and hopes that dropping half a million people into the pool of those with really big broadband will: First, drive the incumbents to try and match their efforts, particularly if Google can prove that it is not nearly as expensive or daunting a task as the incumbents claim. Secondly Google hopes that by jump starting a market of a half million (and if they have calculated well another 1 or 2 million more to that in incumbent responses) they will have created a tipping point in the development of truly high-speed, low latency, big pipe applications. That would be a GREAT thing for leading-edge communities like Lafayette.

But its not just the number of people effected—it is the density as well. One of the things we know from studies of new tech adoption in the realm of communications is that it is strongly subject to local network effects. Take telephone service. If you are the only subscriber it really is pretty much worthless. The more people take the service the more valuable it becomes. If you can count on everyone having it you can start organizing everyday activities around it and integrating it fully into your social life. That is what Google wants to have happen on its new fiber. Network effects are most powerful within a city or region. Most telephone calls are local and most of the remaining are regional. By ensuring that an entire region, approaching 500,000 people in that area alone, is fully-fibered Google can have the greatest hope of seeding a game-changing demonstration project. (By the way: my prediction is that one of the first high-bandwidth apps to come out of the famous “google labs” complex will be HD video telephony and conferencing for just these reasons. Google Voice HD anyone?)

And wait, wait, there’s more! 🙂

As Lagniappe Google gets to watch 2 distinctly different FTTH providers closely interact with one of its big pipes project. Lafayette is a utility—a municipal FTTH provider. EATel is a classic rural telephone company. Both are offering some of the highest speeds over FTTH in their categories. How do the 3 differing models interact? What form really drives adoption the fastest?

Google’s 1 gig, low-latency pipes will, I believe, drive the development of amazing new gaming, cloud, and communications applications. They could get an awful lot of additional data by building in Baton Rouge and partnering up with EATEL and LUS.

Google To Fund 1 Gig FTTH!

Google plans to build at least one 1 gig FTTH community network somewhere in the United States.

WOW. (Respectful pause while we collectively gather our wits.)

This stunning announcement is, in part, Google putting its money where its mouth is. Google has been a strong advocate of the FCC’s upcoming national broadband plan showing some imagination and has been a strong advocate of fiber to the home in that context. My guess is that part of what Google found out that fiber is the necessary first step during its initial experiment in public networking. In its hometown of Mountain View they built a public WiFi network. While that has been a mild success by most accounts wireless simply cannot push the bandwidth Google wants to watch people explore; especially without a dense fiber network. Fiber To The Home is the endgame here and Google is going directly for the gold in its second experiment.

Google has issued a request for information (RFI) asking communities to express an interest. They’ve announced a few constraints. First, they want to fund full communities projects, 50, 000 to 500, 000—no big announcements and small 100 house “pilots” for Google! Besides size they are also planning to explore open networks—they want to build open networks that any service provider can use. That goes hand in glove with their open source stance in other areas. The model of municipally-centered open networks has show tremendous success in Scandinavia and that is likely the model they are taking as a starting point.

This is, of course, all great stuff. With most of the scuttle-butt about the upcoming National Broadband Plan warning of a less than exciting document Google is offering to blaze a path forward out of the national ennui. Good for them.

Basically this would be great for Lafayette: we desperately need large population in other parts of the country to get onboard with truly high speed broadband. Until there is a sizable population there won’t be much development of new apps. And since research shows that most communications (as opposed to passive consumption) takes place between people who live close by the only way to get a handle on the next generation internet is to wire up whole, concentrated communities. Another several dozen full fiber communities is what Lafayette and the few fully fibered communities in the US really need.

The catch for Lafayette, and the few communities that have already invested in advanced networking, is that, well, we’ve already built our state-of-the-art fiber network. But it would be really great to participate in the “innovative apps” part of the game. And our network is up and running. If I may be so bold: Google, can we play too. You can use our community as a contrast to the one you build elsewhere….

Update: Here’s the smartest analysis of what Google is doing here that I’ve seen. And by smart I mean that once I read it I say. Oh…wow…yes..of course. 🙂 Harold Feld over at Tales of the Sausage Factory does that to me on a regular basis. Recommended

The Bad: St. Mary council demands Internet, cable service for all

Early this morning I posted the good news that a small rural carrier in northeast Louisiana was building out a fiber to the home network for its customers using stimulus money. What made it news was that a poor rural area was getting advanced connections.

Today the Advocate carries the bad news story that rural residents in St. Mary parish are complaining that they can’t get a decent internet connection—and that the council there is calling the incumbents Cox and AT&T in on the carpet saying: “If you are going to serve St. Mary Parish, you have to service all of St. Mary Parish.” It’s not news that rural folks don’t have decent broadband. What makes this news is that their local representatives are trying to do something about it.

What reading these two stories back to back makes pretty clear is that explaining the difference between the two isn’t hard. The rural areas that have little chance to get world-class connectivity are places “served” by large national carriers like Cox and AT&T. Places that do better are served by local folks, be they private or publicly owned.

That might be something for the people of St. Mary to think about. The people of Lafayette already have.

The Good: Fiber To The Home…in Morehouse Parish

Hey, it’s true…Northeast Louisiana Telephone Company up in Morehouse Parish is going to rebuild its aging copper network and roll out FTTH in rural parts of the parish. It serves customers in Collinston, Bonita, and Jones. They are up in the NE corner of the state outside Bastrop.

Read all about it in the Monroe News Star. The heart of the story:

The Collinston-based company will replace its current copper network with buried fiber optic cable that will give its customers access to high-speed Internet, digital TV service and expanded telephone service.


The funds, awarded by the U.S. Department of Agriculture following a grant application by the company last summer, include a $4,359,000 grant and a $8,124,600 low-interest loan. The company must complete the project within three years under the terms of the grant.

Congratulations!

“Municipal fiber needs more FDR localism, fewer state bans”

Christopher Mitchell, the best researcher/commentator on municipal fiber in this country bar none (IMHO) has an outstanding essay up on Ars Technica today that you ought to read.

http://arstechnica.com/tech-policy/news/2010/01/municipal-fiber-needs-more-fdr-localism-fewer-state-bans.ars

It holds Lafayette up as the premier example of a city that has done the right thing by its citizens. I have to say that I agree. But more than that: this essay lays out as coldly and directly as I have seen it done the rock-solid case for municipal broadband. It doesn’t pull punches, and it doesn’t bother to engage in histrionics.

I cand do no better than to excerpt the case he lays out and emphasize the parts that delight a Lafayette partisan but really, you’d be better served to read it yourself and not bother with my abridgement…it’s not long and it’s well-crafted.

The “broadband market” in much of the US happily provides snail-speed connections at inflated prices when compared to many of our peer nations….Recognizing the disconnect between the best interests of distant shareholders and the best interest of their community, cities across the US have built their own networks, taking a page from the thousands of small cities that built their own electricity networks a century ago when private utilities ignored them…

Lafayette, Louisiana is a good example. The city begged its incumbents to beef up local broadband networks and was rebuffed. This Cajun country community decided to build its own next-generation network. The incumbents argued that the households and businesses of Lafayette had all the broadband they needed and sued to stop the city. This year, after years of litigation, the victorious city began connecting customers to LUS Fiber.

LUS Fiber may offer the best broadband value in the country, offering a true 10Mbps symmetrical connection for $29/month. Those wanting the 50Mbps symmetrical connection have to pony up just $58/month—about what I pay to my cable provider in Saint Paul for “up to” 16/2 speeds.

Lafayette and Monticello were lucky because they had the power to build a digital network. Many communities do not…. Eighteen states impose some barriers to community broadband….Though Monticello and Lafayette have succeeded in spite of barriers, many other communities are unable to persevere, and watch their younger generation leave for modern opportunities elsewhere…

…communities have fought this fight before—when electricity was only available to the urban and affluent. Profit-maximizing companies not only refused to build the grid to low-profit areas but argued those areas should not be permitted to wire themselves. Fortunately, FDR saw things differently:

I therefore lay down the following principle: That where a community—a city or county or a district—is not satisfied with the service rendered or the rates charged by the private utility, it has the undeniable basic right, as one of its functions of Government, one of its functions of home rule, to set up, after a fair referendum to its voters has been had, its own governmentally owned and operated service.

We need FDR to remind us that we are discussing the basic right of a community to invest in its future. Communities must not be held hostage by an absentee company that knows it can overcharge and under-invest without consequence.

Wireless is nice for mobility, but does not threaten the wired monopoly or duopoly. These networks—particularly full fiber-optic networks—are natural monopolies. There is no natural “market” any more than one could imagine a competitive market in streets or metro airports. This is infrastructure—the foundation for many other markets…

Industry-funded think tanks have produced many reports claiming publicly owned networks are failures. Their methodology is suspect—equating long-term investments in next-generation networks with lost money….The truth is that publicly owned networks do quite well. Communities typically borrow from outside investors to build the network and pay off the loans over a 15-20 year period with revenues from phone, television, and broadband services…

State barriers to publicly owned broadband networks may benefit monopolistic cable and telephone companies but can cripple communities within those states. Of course, such policies also give a competitive edge to cities in other states who have moved ahead.

Actually,” says Lafayette’s Republican Mayor, Joey Durel, “I often say with tongue firmly planted in cheek that I hope that the other 49 states do outlaw what we are doing. Then I will ask them to send their technology companies to Lafayette where we will welcome them with open arms and a big pot of gumbo.

Cold weather is gumbo weather and we can sit down over a bowl and watch TV with our grandchildren, and later help with their homework over a medium that we own. It’s been a good week for self-reliance in Lafayette regardless of the icy weather and Mitchell’s essay is nice reminder of how good we have it.

PS: Check out Christopher’s blog: muninetworks.org, and for some background on the topic of municipal restrictions his recent post.