Archive for April, 2005

From this moment forward I respectfully request that each and every broadband deployment apologist refer to their oft-quoted excuse by number. This will save us all an enormous amount of time and contribute to the overall efficiency of our discussions.

1.) This really isn’t a problem.

The idea that any professional in this field could actually allow these words to pass through their lips indicates to me that there is a need to have licensing mandated before anyone can enter this field.

Without doubt, these people are the reincarnation of the short-sighted but opinionated members of mankind that used these same exact arguments in every advancement human beings have made from the discovery of fire.

Somewhere in my warped imagination I see the discussion as going something like this…

Tribal Chieftain - “What in blazes do we need fire for?”

A long forgotten innovator - “We need it because food tastes better and it’s safer to eat when we cook it. It also helps keep us warm and safe from the animals at night.”

Tribal Chieftain - “If the great sun god wanted us to have fire, he would have brought the sun down to earth and gave it to us. Now, get rid of that dangerous monstrosity!”

And mankind’s progress vanished in a puff of smoke for another millennium.

Don’t even get me started on what happened when the first human
proposed moving out of the cave and building a home out of wood!

2.) Broadband isn’t a God given right

This argument seems to be based on the idea that the United States sanctions the idea that some people are “better” than others or perhaps some geographic locations are “preferred” over others. I find it rather amusing that if we were to look at the actual locations that have broadband we can clearly see that wealthy communities almost uniformly have service while the poorest communities having next to no service. This line is even more clearly delineated when we use a higher standard for the definition of broadband than the FCC’s 200Kbps benchmark.

We are all expected to pay our fair share of taxes but for some reason some of us are entitled to vastly superior services. This, of course, does not suggest we are all created equal but rather some of us are a lot more equal than others.

I also find it very curious that almost every single one of the people spewing this point connect to an Internet that everyone in the country (who has telephone service) contributes to. As every one of us that has a POTS line pays the Universal Service Fund fee, it stands to reason that every single one of us helps to bring telecommunications services to such places as Odessa, Washington (unknown tourist capitol of the universe) so that high speed Internet can be delivered there.

One thing I haven’t figured out is that if some people are made more equal than others who gets to choose and how can I get directly in touch with them? Maybe, you know, I can slip them fifty bucks and get on their good side!

3.) Our infrastructure is “Good Enough”

The wonderful thing about the “Good Enough” discussion is that the proponents of this excuse have one thing universally in common, none of them will clearly state what is “Good Enough” except to say what they believe is “Good Enough” for their customers at this time. As the argument goes, we provide adequate service to 99% of our customers and those that want better service are either abusing our service or should move to a place where they can get the service they are looking for.

What friggin’ balls!

Instead of embracing the “leading edge” customer as the harbinger of what will soon be the norm, these “providers” (I use the quotes there as I am beginning to believe these companies should be labeled as “barely providing”) will bandwidth throttle “heavy users” or block services (see the earlier discussion about blocking VOIP for more information on this issue) and sometimes kick these customers off their network.

Don’t worry, we’re told, they will upgrade their networks as they see fit – in other words, when there is no choice they will install better equipment that will meet the needs of the majority of their users. If you corner any member of this group you will find that they are split into two distinct groups. The first group understands that any intelligently run network will always be in a constant state of upgrade as new services and technologies cause new problems at the same time presenting new solutions. Ask this group what they think will happen when VoIP moves into the mainstream and you will get an honest answer (along with an involuntary rolling of the eyes) saying that it will raise hell with their current infrastructure and that it will be expensive for them. The other group is also easy to differentiate, their eyes in stead of rolling will immediately glaze over. They don’t understand these issues, have little comprehension of the technology and are basically just trying to find the light switch in their office so they can shut it off one last time and go home.

There is such a level of short-sightedness to the “Good Enough” network excuse that one has to wonder why it isn’t illegal. Oh, that’s right, it’s their network and it should be their choice as to what level of service they should provide the American public with – not the FCC, not the customer – nobody but them. The hell with what real consequences they are wreaking on our economy or the economy of their hometowns. What they are really doing is prolonging the digital divide and providing a convenient excuse for why they are justified in doing so. If that isn’t enough of an insult they also throw in that we should do business with them because “they are part of the local community and “they care” about us.

Perhaps the scariest line in today’s world is, “Hi, I’m a local businessperson and I care about you!” I can tell, that’s the very same feeling I get when I listen to audio Valium on hold as a soothing voice tells me that “Your call is important to us. Please continue to hold as the next available operator will be with you shortly.” Shortly – apparently they changed the definition of that word on me and forgot to publicize the change.

4.) The US is too big a country/land mass

This commonly put up excuse is one I keep hearing repeated – usually by people that find it acceptable to “parrot” what someone else said and they thought was important to remember. What I can’t fathom is how they can remember the excuse but somehow missed the thorough debunking that was provided to it on every one of the previous occasions that it was presented.

I can only rationalize this type of belief as another example of somebody completely blocking out any point of view that doesn’t fit in within their scope of understanding. I do understand that this is a human trait, one that we all (yes, me too) sometimes fall into but we all also need to realize that reality is something that will still be there, unchanged, even after everything we try to believe is shown to be false. In fact, I believe that is a very suitable definition for the word reality.

Was our country that much smaller when we decided to bring telecommunications to every last corner of our country, the same telecommunications network that every single one of these service providers connects to? Was the expense of that project so great that we learned to never try to do something like that again? Perhaps it was the rural electrification of our country was something that convinced us that connecting the entire country with a reliable, ultra high speed Internet connections would be far too expensive to attempt. Did all of a sudden everyone forgot the incredible payback we are all still enjoying? Seems to me like the entire country chipped in to bring telecommunications to Odessa, Washington but somehow that has nothing to do with the Internet, these are two completely unrelated services.

This begs to question why we would entrust a service as important as Internet delivery (arguably soon to replace telephone) to any company that doesn’t understand that the net isn’t just a porn delivery service any longer. It boggles the imagination.

5.) We don’t care what the rest of the world is doing!

The isolationist approach! Contrary to any wisdom I am familiar with, this approach seems to feel we shouldn’t have to worry about what is going on in Europe or Asia because it doesn’t effect what happens inside our borders. This one excuse is perhaps he one I have the most difficulty with because it shows a clear disconnect from how interdependent our country has become with the world economy.

Is it possible that even though almost every single thing we acquire is produced somewhere else anyone in this day and age could believe we are not directly in competition with pretty much the rest of the world?

How is this possible? We are constantly bombarded with media stories about outsourcing, manufacturing facilities being closed down to be opened overseas where it is cheaper to produce the same goods. I do not wish to enter into a discussion about whether this is right or not but rather point out that we are no longer an island – I’m not sure we ever were.

Here’s a head’s up, if you’re not worried about your job being replaced by someone else, you should be. If these is a high paying field that isn’t under attack from people overseas – starving people (starving for your job, that is) you might want to pull your head out of wherever is is currently placed and take a wide look around.

Canada is a huge land mass and they are now number five in the world in broadband deployment (down from number three) as things sit. Canada has managed to provide broadband into its most remote areas almost uniformly and they will profit from that investment.

If the argument that we are too big a land mass had any validity at all one has to question why even our cities don’t have ubiquitous coverage? Why is it Hong Kong has GigE and Boston doesn’t? Both cities are roughly the same size, the geographies are similar and the fact is they are both very high tech cities. I was “treated” to one explanation of why this was that made me scratch my head. I was told that Hong Kong was only interested seeing “local content” as if the entire island is planning to ignore the rest of the known world.

What is this, revenge of the “C” grade student?

6.) The full deployment of ultra high speed Internet is too expensive.

This excuse is usually provided by someone who has no idea what value is or how to measure it. I am sure that connecting almost every location in the United States to the telephone network was expensive – incredibly expensive – but we did it and as a nation we all reaped the benefits.

In study after study it has been shown conclusively that areas that have high speed Internet introduced show almost immediate improvement in economic indicators but even more importantly improvement in the lowest economic portion of our population. In one study conducted in Philadelphia the results was amazing. In this study there is a clear link that when broadband is provided to people that normally couldn’t afford it upward economic progress is made. I believe it can be safely stated that dollar for dollar this is without doubt one of the best values we will ever find to help poor people escape from poverty.

I’m sure there was a significant portion of the population that didn’t want to spend money to bring telecommunications to the entire country back then too. Every generation is saddled with them – people that the extent of their vision can be measured in feet, usually the same feet they constantly trip over. What I find most curious is the fact that these people are not “stupid” or intellectually challenged. In fact, quite the opposite is true.

However, it has been my experience that they need to maintain a set of beliefs that they can rely one to support their view of the world. One thing I have consistently noticed is that they almost all uniformly have one trait in common, they refuse to look at new information or any information that might change, alter or shape their perception of the way they want things to be. This is often tied into a financial commitment, one that their future might well rest on which provides a strong incentive for them to not want to disturb this house of cards they have built to convince themselves they are correct in their assumptions. The good news is these people will go out of business as did their counterparts in the mimeograph machine and electric typewriter business.

Those who fail to learn from history are doomed to repeat it.

Unfortunately, they didn’t tell us that these people will be reincarnated generation after generation until they get it right.

Hang on folks, it’s going to be a long and bumpy ride…

7.) The equipment/upstream connection cost too much

Now this excuse has some validity on the surface but when we take a close look at the real meat of the matter we can clearly see this is just one more line of bull we hear from the amateurs to shirk their responsibility.

Is the equipment expensive? I suppose that depends on how you define expensive. I’m sure a tractor trailer is expensive, a huge investment but there are hundreds of thousands of them on the road. They are bought, worked, serviced, expenses are paid on them and they earn money. This is no different from what a well run WISP could do – the term “well run” being the key operational phrase there.

Where the idea that a reliable, professional communications company could be started and built up with very little or no capital is beyond me – and I once believed that myself. Let me clarify something, the Internet is a communications medium and I know more than one company that would probably give up their telephone before they would give up their Internet connection if they were forced to choose.

Yet at least once a month I hear from people trying to start up a WISP thinking that they need to spend $2,000 – $3,000 and they’ll be all set.

Let’s face up to reality here, if you want to start a WISP I am here to tell you that you’re going to need some money, real money, just like the independent long-haul truck driver I mentioned in the example above. If you’re looking to get into a business that only requires a little bit of capital, they’re out there but I think I can speak from experience here, becoming a WISP is not one of them.

The other side of the expense equation is the upstream connection. Let’s face it a T1 is an expensive animal considering exactly what you get for your money. What I can’t understand is how we (this is the greater “we” here) can put up with this. Verizon is rolling out fiber (Fios) into wealthy neighborhoods at a breakneck speed offering their highest priced package at $199/month. This $199/month package provides 30Mbps down and 5Mbps down but yet Verizon can still look you square in the eye and tell you that a T1 should cost you anywhere from $400 up (we’re still paying over $600/month just for the local loop, the IP connection is $600/month on top of that) as though this is a rational price. To add insult to injury, Verizon is selling old technology, using equipment that the price has dropped substantially carrying this circuit across copper lines that have been paid for over and over again.

What can be done about this?

If WISPs were a serious group (and blue pigs could fly) we would be pressuring the larger manufacturers as a solidified group to mass produce something effective for us in large enough quantities so as to drop the price right through the floor.

Alvarion (along with a number of other manufacturers) realized this was the only future they were facing and have now thrown their full weight behind the WiMAX initiative with dramatically reduced equipment as one of its most important features. We’ll see if this will meet the requirements of the WISP community in due time.

As far as the upstream connection, let’s face it, WISPs are not a unified force. In fact, if they were we might be able to put pressure on the FCC or our representatives to do something about the screwing we’re taking but the likelihood of that ever happening probably isn’t keeping anyone at the ILECs awake at night.

8.) We don’t want government/tax money used

This is also an argument that appears to show merit but when examined closely it fails to deliver.

We live in a system, a carefully manipulated, controlled and orchestrated system. The idea that we can independently exist outside of the system is a level of stupidity that really need to be examined.

The ILEC’s infrastructure is supported by tax dollars both directly and indirectly. The cable franchises are also protected by having a monopoly status as does the ILECs. Do I think this is a good idea? Not that it makes any difference at all I do believe it is a necessary evil. We need telecommunications to be dependable and available everywhere. It is simply not acceptable for our communications infrastructure to break down or be unavailable. Given the inability of WISPs to do more than fill in the blanks and then make excuses as to why they can’t do more is why I believe that we either need to step up to the plate and show this country we can do the job without the tax money (that means everyone – EVERYONE – gets connected to reliable service, not some forever breaking down duct tape and bailing wire, cobbled together piece of crap network that is in constant need of repair.

Is it too expensive? Only if you look at what WISPs would deliver – see above!

9.) Telecommunications should be left to the professionals – like the telephone company!

Everyone needs a good laugh every so often and I saved this excuse for last. The telecommunications industry have a shameful history of completely ignoring their customers. Lily Thomlin made a career out of Ma Bell’s incredibly horrendous service. When the Internet was first introduced to the public the ILECs were wholly uninterested in anything that had to do with the service and had it not been for private enterprise the Internet might never have reached where it is today – quite literally a household word.

Even once the ILECs understood the value of providing Internet service they still couldn’t manage to get it out to enough people to make a dent. Heck, if they’d done their job correctly (even half-assed) there wouldn’t even be independent Internet Service Providers let alone WISPs,

You might be tempted to think that the ILECs have learned a thing or two over the last couple of decades but the reality is if that is true the phrase “too little, too late” seems to describe their progress.

If you take a look at their future business model it is pretty easy to distinguish that they are on a crash course to failure. There are too many miles of copper that would need to be replaced with fiber and too little money (and business) to justify the replacement. A wise businessperson would realize that partnering with subcontracting companies might be an option but not these monopoly driven bastards. They want it all and their greed will get the best of them yet.

In the past, there has always been a caring government that would bail them out but I believe the times are changing. As more and more independent communications companies start to deliver reliable (and less expensive) communications services the need to the ILEC will diminish. In a word, we have options. This is already starting to happen and to be quite frank with you I believe the ILECs might be looking at this as a chance to shift their total monopoly status from one of “owning the entire country” to “owning just the wealthiest neighborhoods” something that is flawed thinking from my perspective.

The situation (as I read it) is that wealthy people aren’t fools, they understand value, they demand the cutting edge products and services while expecting their providers to be able to bring it to them ahead of the game. This is something that in the entire history of the ILECs they have never been good at.

What will happen? I’m not sure anyone really knows but some of the indications are that the dynamics are changing and as we all know, those that adapt will survive and flourish. Charles Darwin never had experience with an ILEC but his observations can certainly be applied, survival is based on successful adaptation. I don’t see the ILECs as being able to pull that one off!

Disruptive TechnologyA technology, that when implemented as a product or service, eliminates existing markets, creates new markets, and/or drastically modifies market(s) structure(s).

In the last couple of days I have seen a curious set of somewhat unrelated incidents that have caused me to wonder of I am not seeing the beginning of a trend.

While trying to get 22 things accomplished in the time it should take to get three things done (this is my usual time management technique) I stopped by the Deli in our local supermarket to pick up a few things before I headed home. The woman who worked there asked me if I had any recommendations as to where she might get a good deal on a new LCD monitor for her computer.

She is pretty “net-savvy” and had checked out some of the usual sites (Ebay, Buy.com, Overstock.com, etc.) looking for a deal but she thought I might know somewhere she hadn’t checked so she asked me for some recommendations. Coincidentally, when I got home a customer stopped by with a dead computer. After taking a quick look at it we determined that the hard drive had died and as the computer was a little over three years old it didn’t seem like a good idea to put any more money into it.

In both of the above cases I sent these people to one of my favorite resources, Techbargains.com. Techbargains is a site I check almost daily to see who has what for pricing on tech goods. To a lesser extent I also glance through FatWallet and a few other similar sites for this kind of information. I have found PriceWatch and Froogle to be a huge help on different occasions.

A little later in the day I got a call asking me to come up and deal with a few problems at an automobile dealership we service. While I was there dealing with a few “customer inflicted” computer issues one of the salesmen started complaining about a sale he had lost due to a customer who had researched the vehicle they were interested in buying on the net before they went to the dealership. Apparently, the customer had managed to get the vehicle’s dealer invoice off of the net and used that document to negotiate the price they were willing to pay on the vehicle – a price the salesperson was not willing to sell the truck at.

He then launched into a tirade about how Ebay was messing up the used car industry (I’m not sure anyone other than the industry themselves is too upset about that) because people could now go to one place and buy a used vehicle conveniently – oftentimes for about the same price he could buy these vehicles at the dealer’s auction for.

“If this keeps up I’m going to find myself out of a job!”


Out of the mouths of babes…

It seems to be commonly accepted that technology along with society as a whole are moving forward at ever-increasing speeds. This trend is likely to continue and even accelerate as the future advances. What does this mean? Is there any way we might be able to predict which industry will become the next buggy whip or electric typewriter to disappear in a relatively short timeframe?

What kind of effect will distinct industries see when the average Internet user has the ability to quickly, conveniently and easily gather whatever information they need about price and availability? What impact will this have on the Real Estate field as well as automotive, computer or any other consumer products?

Our economy is one now made up of service professions or put another way, people who will do things for us for a fee. What if the services these people provide become obsolete because their customer can now do the jobs themselves with very little difficulty?

Let’s take a look at the Real Estate industry. What does a Real Estate Broker offer for their commission? From a buyer’s standpoint a Real Estate broker offers a selection of home to choose from, the ability to negotiate with the seller from a third party point of view as well as the ability to assist in the mountain of paperwork that buying a home entails.

From a seller’s perspective the Broker offers the ability to ascertain a realistic price for the dwelling as well as an infrastructure that allows the home to be showcased to a number of potential buyers. Once a client is interested the broker can assist the seller negotiating the best price for their home and wade through the necessary paperwork to make the deal go through.

In each of the above cases every single one of these services can be replaced by the Internet for significantly less cost to both the buyer and the seller. Yes, under the present system the buyer doesn’t “pay” the broker but there is a very real cost assumed by the buyer because the 6% commission is figured into the sale price of the home. It seems to be safe to assume that if the seller is willing to accept an offer of $100K (meaning that they will net $94K after paying the commission) the buyer probably could have bought that very same property for $94K if the broker hadn’t been involved.

As far as the paperwork is concerned there are certainly ways of automating that process. In fact, I’m sure most Real Estate offices as well as Attorneys have already done so.

If this is true, what does this say for the Real Estate Broker’s industry as it is currently thought of? What does this mean to the long term value of an established Real Estate Broker’s office? I don’t think it will take a crystal ball to draw some conclusions based on the above premises.

What about the New/Used automobile industry? Are there parallels to the Real Estate industry? I think there definitely is. As the big three US automobile makers are starting to really hurt (starting to?) they need to begin to question the value of keeping the traditional dealership open. (Actually, the automobile manufacturers need to question a lot more than just that but that is an entirely different rant.)

In the next decade many of the things we believed were unshakable will begin to disappear. The question will be who will be able to take advantage of these changes and who will get burned.

The reality is that it is through the mental exercises like these that we can try to interpret the signals we are being provided and form a plan as to how we should react.

It never was the strong that survived, it was those that had the ability to adapt.

According to the most recent study published by the International Telecommunications Union (ITU) the US has dropped again in our world ranking to 16th place from an embarrassing 13th place last year.

With only a little better than 10% of our population connected to broadband (remember, broadband as defined by 200Kbps) we are behind such international powerhouses as; Finland, Norway and Iceland.

Several countries have made great strides in connecting their populations including, the Netherlands, (which rose from 9th to 3rd) Switzerland (moving from 10th to 6th) and Israel. Conversely, Canada dropped from 3rd to 5th which is still pretty impressive overall as it certainly demonstrates that countries with large areas of land can deploy broadband effectively and at a reasonable cost.

Om Malik, someone I certainly respect, published his take on the issue here bringing an interesting slant to the discussion. Should we be looking at overall adoption rates or should the focus be on overall users connected to broadband? If we look at the total number of users per country the US is first in the world as far as people connected. For the life of me I cannot understand how this would be an important metric to measure.

Would it be valid to rank ourselves in the total number of users that have telephone? After all, the US has nearly a 100% telephone availability rate compared to India is somewhere below 1%. The same holds true for electricity. the US has almost 100% availability to electricity to every resident as compared to a country like China. China has approximately 1 billion people and while I don’t know what the total number of people living in China have electricity I believe the numbers are probably on par with the US if we were to look at the number of residents that have electricity available. I would also like to point out that there are 1 billion people in China that eat food and a little less than 300 million people living in America that eat. Does this mean that China is ahead of the US by a three to one margin in population being fed?

If anything, this is a perfect application of the old Benjamin Disraeli quotation, “There are three kinds of lies: lies, damn lies, and statistics.”

The amazing thing about this report is that no matter how you interpret it this is one hell of an opportunity for anyone in the business of providing high speed Internet. I believe it is a given that at some point in the future nearly the entire population of the US will need to be connected leaving something like 90% of the total available market waiting for a reasonably priced solution to be offered to them even if a significant portion of those people haven’t realized it yet.

If you are willing to accept the premise that our entire population will eventually need to be connected then the next question that comes to mind is what is the best technology to use to connect these people? By “best” we also need to look at the overall cost versus performance equation, the required time necessary to build the infrastructure along with how these people can best be served.

This is certainly something that is not going to have one set answer for every situation – period.

I think we can all readily understand that the technology employed by the ILECs and the cable companies has one inherent flaw, there needs to be a minimum number of users per wireline mile in order to maintain any kind of profit margin in an operational network. WISPs also see a similar paradox by needing a certain number of clients in a coverage area with the major difference being that WISPs do not need these potential users located all in a line on a contiguous road.

To clarify this, is we look at a typical layout of a rural community we might find a grid pattern that has “X” number of homes dispersed randomly per mile of road. For the typical copper/coax/fiber installation to be profitable we would need a set number of homes per mile – every mile – to justify cabling every single street. What this often leads to is a pattern where connectivity is rolled out down the middle of the main thoroughfare leaving the secondary roads without any connection. Ironically, this now paints the town as having broadband by the FCC while a substantial portion of the population is left without any option other than satellite.

WISPs, on the other hand, can light up a geographical region completely inside of a set radius as long as certain restrictions such as positioning our distribution antennas in such a way as to keep a clear Line Of Site to the customer (no hills in the way) and avoiding foliage if the WISP plans on using anything in the upper frequency ranges. What this means is WISPs have a distinct in many rural deployments because they are not tied to a set number of homes per mile to cover the entire regional area.

This also means that WISPs could potentially connect a huge portion of the country as something like 85% of the country is considered rural. Incredibly, WISPs could also do this rather quickly as a typical WISP deployment can be turned up in a very short period of time given cooperation by the town government and population.

Another interesting battleground is the urban areas of our country. While the population density is certainly well within the necessary requirements for the wireline technology companies want to connect there can be problems with permitting and having the capacity to add more lines onto the poles, which could add enormous amounts of time along with additional cost to any deployment due to construction.

WISPs that can put together a business model that takes advantage of these weaknesses in the competition and can still meet the requirements of the customers could quite easily be deployed profitably in a very short period of time.

So, what’s holding us up? This sounds like a dream come true.

The downside is that the regulatory environment can be one factor. If the FCC would look at strengthening the OTARD rules to prevent real estate owners from holding up their building from being connected we could make dramatic strides forward. The ILECs have guaranteed access to their buildings and we should be accorded those very same rights. The same holds true for community and state governments. I know of one WISP that was begged by a group of residents to light up their community and answered the call only to find out that the town government had different plans. Let me be clear, I am not suggesting WISPs be allowed to erect towers wherever they choose but rather the guidelines be laid out on a federal level for everyone to adhere to.

We have a situation in Vermont where regulations that were passed a few decades ago to prevent massive towers from being erected are now used to prevent anything over 19 feet from being used to connect customers. Imagine, a law that was passed back in the “Dark Ages” meant to regulate one potentially environmentally damaging technology from being implemented now being applied preventing connectivity from being deployed in a totally innocuous manner. This type of embedded inertia will do more damage to this country, in my opinion, now than at any time in the past.

As technology exponentially improves at ever increasing rates we find ourselves in a position that requires we remove these impediments as quickly as possible. Every year that passes by is one more year that we have fallen behind.

Will things change?

Undoubtedly, but probably for the worse before things get better. We, as a nation, have dropped from the top to almost the very bottom and the plummet seems to be continuing at breakneck speed.

For many of us hard core users of the Internet it comes as no shock that having a reliable, high-speed Internet connection can improve the quality of life. Many of us use our connectivity to stream music, watch video content that is unavailable in the mainstream media, learn, research and communicate with people from all over the world – all things we probably could not afford to do (if they were even possible to accomplish) using “traditional” methods.

Finally, we have a report that clearly shows the interdependence of this service to an enriched lifestyle. Released yesterday (April 19, 2005) at Yahoo!’s “It’s a Broadband Life” summit held at the Museum of Television and Radio in New York this report highlights how consumers are using their connectivity to improve the quality of the lives. I thought this article did an excellent job of highlighting the topic and I highly recommend it for anyone looking for more information on this study.

From streaming music across the Internet (instead of using a radio) to reading their news online (Google news anyone?) right through the soon to be ubiquitous availability of IPTV, things are changing and changing quickly. We no longer wait for the top of the hour to catch the news or weather, the information is available anytime we want it. Instead of watching television news, waiting for the one story I am interested is seeing, I can zero in on exactly what I want, when I want it. I can see videos, still pictures or just read the text – my choice – no graphic imagery if I choose not to view it, unlike the TV news networks that seem to fight over how much gore they can slam down our throats in an attempt to grab ratings.

Even better, I don’t have to listen to the carefully scripted slant of the story. I can choose to read several sites, browse the pictures, and discuss the issues with my peers instead of having the content “spoonfed” to me – try that with FoxNews!

At any given moment I have a complete library of almost anything I could want to know, any subject is available to me at a moment’s notice, cataloged for me in any one of two dozen ways and probably available at the level I need – from beginner to expert – it’s all there, all the time just for the asking.

This holds true for shopping, all kinds of shopping lined up in order by price, availability and with a way of comparing consumer opinions if I want them. I can click, order and have any number of products shipped right to my door without ever having to drive anywhere. No crowds, no problems parking and never the issue of having to deal with the weather – something that in the middle of the winter, here in northern Vermont is a blessing.

If you’re reading this, you probably had already figured this all out by now for yourself but now there is a study that confirms what you already knew.

In a departure from what I usually talk about I thought I would spend some time and discuss one of the problems I see as neglected to a large extent by many of us. I would like to thank TechDirt for bringing up this subject in another of their very well written articles located here.

As a parent and someone who loves technology as well as our country, I am appalled at the apparent callous disregard for the failure of our country to continue to lead the way in connectivity – let alone fall to almost dead last in terms of education, affordable health care and overall quality of life. This is far more than a political issue or the mention of how one political party is better than the other – this decline has been happening steadily regardless of which party held office.

Speaking directly to the educations issue, I have heard all of the excuses, it’s the educator’s fault, it’s the parent’s fault, the children nowadays are different from kids when we were growing up (Man, that one never gets old. I think I remember reading about how the ancient Romans complained about that one!) and that it is the government’s fault for not throwing enough money at the problem.

We now have a similar situation with broadband as the excuses are coming out fast and furious. There is the ever-popular, “We’re too big of a country and all of those other countries are smaller.” argument, the “It would cost too much.” comeback and my all time favorite, “We have just a Good Enough network for our needs.”

When did our country change from a nation of “We make the best of everything!” to “We make the best excuses!” Did I miss another damn memo?

Here’s a little random reality check – this is an issue that society has created and only society is going to fix. In keeping with that above statement, here’s a clue, looking for someone to blame is largely a waste of time and effort. We can look in the mirror and see exactly who is to blame. Perhaps that isn’t fair to some people but I feel as though I can state with some certainty they are few and far between. Applying the old 85/15 rule that states that 85% of the work is done by 15% of the people and we can clearly see that the largest part of our nation is doing squat to fix this problem.

What do we need to do?

Techdirt has a few suggestions that I would like to pass on. How about if we start treating kids that work toward improving themselves through education with a higher level of respect than kids that throw a football? The was a spelling bee in Canada recently where the winner was given a $10K scholarship. No kidding! Damn, if the kid had been a hockey star she would have gotten a full scholarship to the university of her choice.

When we as a nation wake up and realize that encouraging out children to educate themselves is as important – no MORE IMPORTANT – than shooting hoops or sinking baskets we will then start the long and hard road to recovery.

Who do we hold up to our children as role models? How many kids can name the scientist who developed the test for HIV as opposed to which sports star hit the most home runs? How many of those same kids can understand the importance of mastering technology as opposed to faking their way to pop stardom as the next Brittany Spears?

When do we reallocate our priorities so that the kid that gets picked on for being a computer nerd now takes on the status of a NASCAR driver? When will it be cool to be interested in science as opposed to being able to rap?

The funny thing is, this is what I thought a leader was supposed to do. I guess I was raised in a different time. I remember John Kennedy inspiring an entire generation to bettering themselves. I don’t think I have seen anything like that since. That is a shame and I actually get sick to my stomach when I think of the example our leaders have set since that time.

They say an addict must sink into the depths of desperation before they can turn themselves around. I wonder if the same holds true for a nation.

As anyone who is even vaguely in touch with this field knows, Muni Broadband projects are a really inflammatory issue right now. This has created some pretty interesting dynamics that move past amusing. We have the ILECs squarely against any kind of project they see as a threat to “their” business in agreement with many WISPs (if that isn’t unusual, I don’t know what is!) in that the use of tax money to set up communications infrastructure is something the ILECs are squarely against. If this isn’t the definition of ironic, I can’t find a better one and if the ILECs wanted to convince more of us as to their sincerity in this matter they could certainly start refusing the acceptance of any tax credits themselves.

We have the Heartland Institute (a name that invokes a warm, American sound, doesn’t it?) taking one side of the issue as you can see here. We all want to hear all the sides of any issue but I also believe it is important to understand motivations as this can help us to understand the perspective of the opinion.

According to Glenn Fleishman of WiFiNetNews, the Heartland Institute has a rather interesting history and some unusual ties that make me want to question their perspective. In fact, Glenn did an excellent job “connecting the dots” to see where the financing for the Heartland Institute actually comes from.

Personally, I think I might have felt a little better about this perspective if right from the start Steven Titch (the author of these articles from the Heartland Institute) had mentioned his financing was courtesy of the ILECs. To give you a little more of an understanding of the important work the Heartland Institute has done, here’s an interesting article about how they feel cigarette smoking, something that simply has to be read. I don’t have any clue who financed this opinion but based on what I have read I could make an assumption.

The funny thing is, I tend to fall on the side of the ILECs and the Heartland Institute on the Municipal Broadband issue – under a set of very strict circumstances. What’s worse, if these concerns had looked at issues that are behind the situation and told the hard truth instead of slanting their presentation as best they could, they might have picked up some serious support. However, this is probably something that would be difficult to do unless you are well versed in the business and are willing to lay it all out in the open – something that organization are sometime reticent to do.

So, what I is my take on the debate?

Well first, let me provide you with the obligatory disclaimer – something the Heartland Institute apparently overlooked, as they probably didn’t think it was prudent.

I am a businessperson deeply involved in this industry both from the owner’s standpoint of a very small ISP/WISP and someone who has invested a lot of time and money in this field. If the concept of Municipal Broadband did take off and become commonplace I would stand to lose a significant amount of money but more importantly I believe I would lose the ability to have access in many of the places I would choose to live. This is exactly the point I wish to address. One more thing, just to be clear, I am not being paid by anyone, anywhere, including the ILEC, the cable companies or any other entity on the face of the earth for this opinion – go ahead and check in you have that kind of time!

What nobody seems to want to tell you is that this business is all about numbers – sorry, I would love to tell you it’s about bringing broadband to “our communities” or bridging the “Digital Divide” but the reality is, from just about everyone’s perspective from the giant ILEC right down to the single end user, it is all about the numbers.

I don’t care who you are or where you fit into the spectrum of the broadband world, you need to understand one thing there is a cost to bring broadband to the customer. With the possible exception of satellite (a technology that in its current state isn’t considered broadband by either the FCC or myself) every single delivery method of broadband I can think of depends on a certain level of population density. To put it another way, we need a certain number of people per mile in order to deliver service at a price you (the end customer) will be willing to pay.

From the perspective of the ILEC or the cable company, if there aren’t a set number of customers for every mile of wire or fiber they have to roll out, there is never going to be a return on the investment. The same holds true for a wireless deployment but we aren’t necessarily bound by the same restraints as in having to follow the roads. We still need to have a fixed number of customers inside the radius of our coverage area or the cost to deliver per subscriber climbs proportionally.

It stands to reason that densely populated areas serve as the best locations to deploy service – the more people that live in a square mile, the less wire that has to be installed to service them. Conversely, is a rural or sparsely populated area, the situation is exactly the reverse.

This is where the problem starts to become apparent. Where are the Municipal projects looking at rolling out? Why, the densely populated areas! Okay, so what? Well the problem starts to be that once you have deployed in the densely populated areas and then you deploy in the suburban areas there is no business model that will do the same thing for rural areas! A different way of saying this is to say if we have a huge project that gets built in the big city that is financed by the big city there is a very good chance if it is well designed, deployed correctly and managed efficiently, it will succeed. In fact, it should be able to be a profit producing revenue stream for the city.

Next down on the scale is the suburban areas that surround the city. They can form their own broadband projects which while will not have the scale of economics to draw from will also be successful providing the project is run well.

Now we need to look at the next ring of the population, the rural areas that fall outside of the suburban areas. This is where the problem appears, there aren’t enough people per mile to support a project like what has been built in the city or the surrounding suburbs. Since each of the projects are owned and financed by the location they are in, the rural areas cannot effectively “piggyback” on those projects because it would raise the average cost per user to the “host” municipality. People, being what they are, usually won’t go for that kind of a proposal, in effect, leaving the more rural areas in a position where they either cannot get broadband or they have to pay significantly more for the same level of service.

This also explains why the ILECs are concerned about these projects. Without the “cash cows” (the larger metropolitan areas) the suburban and rural areas simply are not worth servicing. This also holds true once the broadband network starts to replace the copper telephone network. If there isn’t a lot of people paying to support the copper network in the city, there isn’t enough money to bring dialtone to the very rural areas. Opps, their business model just started to crumble. In all fairness, it isn’t the ILEC’s business model, the deal is that they get a monopoly if they will provide service universally. Every single one of us pays for the customer in areas of the country that are not profitable. Now, if the profit making areas leave the ILEC’s network, who is going to pay for the areas that will never turn a profit? Carrying that to the logical conclusion, if every metropolitan area were to start a municipal broadband project and a fair amount of the customer base then switched to VoIP as their standard communications, where does that leave the ILEC?

The next issue that needs to be looked at is why would I care and more importantly to you, why would you care?

Like many WISPs I live in a rural part of the country, northern Vermont. As I explained above I need a certain amount of customers per mile for me to support my business. Just like any astute businessperson, I am going to set up my business to service the market that will bring me the highest return first. Once I have maximized my investment in this community (that would be the most densely populated area, as you recall above) I will then have to look for other markets to expand into if I want to expand.

Next up, suburban locations (such as they might be in my area) will probably get brought in and when they are connected to the maximum saturation rate I will then look to rural areas that have a sufficient population density to justify deploying in this area. This cycle will continue until I have exhausted the process where at that point I will either choose to repeat the process in another area or try to continue to filling in customers on my existing network.

At this point, you should clearly be able to understand that the process is interdependent, no big city, no suburban deployment and the rural area hasn’t got a prayer in hell of ever seeing service at a reasonable price. Yes, I realize that some of the rural areas are where the very wealthy choose to live and that these people would be willing to pay significantly more for service but I submit this is the exception – not the rule.

This isn’t rocket science here, it is an easily definable business model that is pretty easy to understand once you understand the dynamics. If the city chooses to build a municipal broadband project, there is not population base that will sufficiently support the rest of the area.

Our state (Vermont) has a different way of killing broadband, we give out grants! You would think this might be a good thing but the reality is, it kills the deployment of independent broadband faster than anything else I can think of. Would you want to deploy in the next town over from a company that just got $50K with next to no strings attached? No? Why, it’s not like this would be a threat to your business or anything right? What happens when this money is introduced into an industry? I submit that is kills the industry dead. Why? Would you invest in an industry that at any moment could create a competitor out of nowhere that has no cost of goods? I wouldn’t think you would put your money up against that kind of opponent. The funny thing is Investors are just like you and me, they won’t invest in a venture that could one day have to compete with a company that has no cost of money or goods.

What about these “state-financed” businesses? Won’t they use the money wisely to roll out broadband to other areas? I doubt it because in order to qualify for these grants you need to deploy in an area that has no other form of broadband – read sparsely populated. Wait a minute, sparsely populated areas, don’t they need to have sufficient population density to support such a project?

The reality is, this (in my opinion) is simply a way of the political establishment to tell their constituents that they are doing something. Does it need to be something effective? Apparently not, but remember, the people who award these grants don’t understand this business – not even the basics. They do appreciate a well written paper and a carefully crafted presentation.

What scares me in the realization that a lot of our tax dollars are being spent in very much the same way.