Monday, November 21, 2011
The FCC, with support from several cable companies, has announced a new program called ConnecttoCompete. Families that qualify would be able to receive broadband access for less than $10 a month, including no installation or modem rental fees, as well as opportunities to purchase low-cost computers (in the $150-$250 range). To be considered, a household must not be a current broadband subscriber and must have a child enrolled in a federal free- or reduced-lunch program. It’s no secret that access to broadband is a necessary component for underserved kids to stay competitive in future job markets. A recent Federal Reserve study noted that graduation rates for kids with computers and broadband access at home had a six to eight percentage point higher graduation rate than those without these tools. Access to technology is a requirement to compete. But what makes this program so exciting is that it’s funded largely by the private sector. Other current or upcoming programs that use public funds to subsidize the large communications companies have found justifiable resistance. Budgets are already tight and the general public is working hard enough to support themselves. Extra taxes and fees on existing bills tend to make people angry. By delivering ConnecttoCompete via private funds – and because the students who benefit are likely to one day work for these private sector companies – the program is, in essence, a form of investment. Now the key is to see how fast it can be implemented. What do you think about the program?

Labels: Broadband, FCC

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Monday, November 14, 2011
No matter what side of the argument you’re on, the FCC’s decision to redirect funds to subsidize rural broadband access was a step in the right direction. The status quo was no longer working. But a new complaint has now entered the discussion.

Civil rights groups are upset because they feel that some of the money that has been earmarked for the new rural broadband fund should be going to the Lifeline program. Lifeline is a $1.2 billion program that offers low-income citizens credits to help pay for their phone bills. These groups feel that the money to help the poor would, in total, benefit more people than those with broadband needs in rural areas.

It’s an interesting argument. Some statistics indicate that there are a lot more people currently with the wiring necessary to get broadband who just can’t afford it, than those without access at all. But even if they had the money, would they subscribe?

The debate then boils down to what segment of people is in a worse situation. People with low education, low income, and high poverty live in both rural and urban environments. How should the government best spend its money?

Obviously, this is just speculation. The funds have already been approved for rural broadband extension, so the argument is, essentially, too little, too late. But dismissing the complaints of the civil rights groups without full consideration of merit would be flippant. Without politics getting in the way, figuring out which group of people is truly more in need would be a fascinating study.

What do you think?

Labels: Economy, FCC, Rural Broadband

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Monday, November 7, 2011
Last week’s post discussed the FCC’s decision to end the obsolete Universal Service Fun and replace it with a new fund focused on subsidizing increased rural broadband access. One of the new fund’s requirements is that providers create a network that allows for 4 Mbps download and 1 Mbps upload speeds. Despite what some might say, that’s not fast.

Need proof? Consider this: Competitive Companies Inc. (CCI) just announced that it has deployed its 4G+ Mobile Broadband technology with average mobile broadband speeds exceeding 25 Mbps. And that’s a conservative number. Company CEO William Gray said that download speeds could ultimately be more than 100 Mbps, far faster than anything currently on the market.

Here’s how it works: To deliver 4G+ speeds, CCI uses Wytec, Incorporated’s patented Multichannel Radio Frequency Transmission (MRFT) technology. By combining that with cognitive radio and macro-diversity technology,a Group Cooperative Relay, mesh network architecture, and frequency banding, CCI can deliver super-fast broadband.The cost of delivery is also less because CCI manages spectrum use and administers transmission power.

Back to speed. On one hand, the government is pushing old technology that requires certain speeds that many would consider irrelevant. On the other hand, you have companies developing technologies that are faster, cheaper, adaptable, and easier to implement. The bottom line is that there’s a disconnect between what’s necessary and what’s possible. The FCC needs to start thinking more in terms of the latter.

Labels: 4G, Broadband Speed, FCC, Fixed Wireless Broadband

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Tuesday, November 1, 2011
Last week the FCC officially ended the Universal Service Fund, which subsidized traditional phone service, and replaced it with a new fund to subsidize broadband. The FCC bigwigs hailed the change as a history-changing decision.

Unfortunately, it’s not.

Yes, the change was needed. The Universal Service Fund was no longer a viable option because it focused on voice service. But the FCC move is still essentially subsidizing the large carriers, only this time so they can build out more rural broadband capabilities. The problem is that the changes, though positive in spirit, will likely have little impact.

The new fund requires that carriers build out a system that enables 4 Mbps downstream and 1Mbps upstream capability. That’s anything but fast. For the rural broadband user the new regulations are supposed to help, that kind of speed isn’t enough.Four down and one up is already borderline obsolete. Those requirements are also curious when you consider that rural broadband models currently exist at five-to-seven times that speed. The capability is there.

The main argument for rural broadband access is that extension of the networks to the underserved areas will open up economic opportunities. Studies already conducted indicate that outcome is unlikely. As much as someone might enjoy living the rural lifestyle, businesses still need to be able to compete. Old technology isn’t going to spur entrepreneurial ventures and job creation.

So what’s the solution? Is it increased governmental change? Or is it wiser to bet on the private wireless and cloud-based providers? Considering it took years to dissolve the Universal Service Fund, I’d put my scratch on the leaner organizations.

Labels: FCC, Fixed Wireless Broadband, Rural Broadband

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Tuesday, October 25, 2011
Minnesota’s LocalLoop announced last week that it has developed, in partnership with Israel’s Runcom Technologies, a new 4G product designed to deliver Internet access to those in underserved rural areas. LocalLoop believes this new cloud-based, turnkey solution will revolutionize the industry. Rather than rely on the established notion that carriers need localized, on-site equipment to distribute the service, LocalLoop says its’ cloud-based, Software-as-a-Service (SaaS) platform avoids the limitations of the existing systems, and at a reduced cost.

Meanwhile, political candidates and the established providers are fighting over money and ideas to extend the old networks. Do they not realize that the rules of rural broadband are changing?

While the old guard remains bogged down in stale battles, the upstart companies are redefining the game. Cloud-based, wireless internet service providers (WISPs) are developing new technologies that make the “last mile” talk irrelevant. Companies like LocalLoop and PowerCloud™ Systems are creating new, forward-thinking business models that capitalize on cutting-edge technologies. Perhaps even more noteworthy is that these companies are doing so using private funding. The push and pull of governmental finance options becomes irrelevant.

The Federal Communications Commission (FCC) issued a statement recently that it is close to revising the Universal Service Fund (USF), which determines how rural companies are subsidized. The new rules are supposed to add emphasis to broadband communications. Based on what’s happening in the private sector, you have to wonder if the changes are even going to be effective.

Labels: Local Loop, Rural Broadband

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Tuesday, October 18, 2011
The 2011 WISPAPALOOZA conference was held in Las Vegas last week. The event is dedicated to Wireless Internet Service Providers (WISPs), which are entrepreneurial ventures – often privately funded – with a goal of building a wireless
infrastructure to support broadband internet access to underserved markets. Unlike the traditional telecommunications companies that are slow to market, WISPs are agile organizations that can adapt and roll out services quickly and efficiently.

One of the big announcements at the conference was PowerCloud™ Systems unveiling of its CloudCommand™ OPEN Software as a Service (SaaS) platform. The new platform will support access points from the Ubiquiti Networks' Unifi family and the Arada Systems' MaxR family. Ubiquiti, in particular, is one of the growing players in the burgeoning equipment provider market, with plans for an Initial Public Offering.

PowerCloud’s announcement is significant. Ubiquiti Networks and Arada Systems supply affordable hardware that, when combined with the CloudCommand OPEN platform, enables services providers to supply all the tools necessary to operate and manage Wi-Fi networks. More important, the cost is significantly less than the traditional systems.

The established telecommunications companies and government entities that are providing funding need to take notice. One of the key arguments in the debate to close the rural divide has been the cost of establishing networks in remote areas. As WISPs spread, the point becomes moot. And because WISPs are privately funded and adaptable ventures that can provide service at a fraction of the cost, rural broadband no longer becomes a political issue.

Labels: Entrepreneurship, Rural Broadband, SaaS, WISP

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Tuesday, October 11, 2011
Omnicity, a Southern Indiana rural broadband provider, filed for Chapter 11 bankruptcy last week. Just two years ago, with the governor at the official press conference, the company announced plans for expansion in Ohio while promising job opportunities. At the time, Omnicity provided rural broadband access to more than 30 Indiana counties with plans to be one of the primary sources of connectivity in the country. What happened?

The problem was bad business – the company secured loans they were unable to repay. The most infuriating part, however, is that these were government loans that now have little chance of being repaid. Was the company in solid fiscal shape before acquiring the loans? Was the government, so caught up in the idea of economic development via rural broadband expansion, blinded by the reality that Omnicity wasn’t financially viable?

Omnicity’s bankruptcy filing is a prime example of why government should reconsider involving itself in rural broadband expansion. If the need is there, people will buy the product. But all the effort – as well as the political grandstanding – is for naught if the demand isn’t strong enough. And if those in rural communities are in such dire need of broadband access, perhaps they need to consider whether they’re living in the right place.

To be sure, Omnicity isn’t the only company trying to recognize the potential in a relatively open, untapped market. But companies need to grow the right way. If the government insists on being involved, they need to do their homework.

What do you think?

Labels: Economy, Omnicity, Rural Broadband

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