Submitted by acohill on Tue, 06/26/2007 - 06:59
It is every economic developer's nightmare. On the front page of today's USA Today (no link online), there is a list of the five states with the slowest broadband in the country. Who wants to be on that list?
In Australia, slow broadband has been recognized as a major economic development issue. Officials there have said that slow broadband hinders the ability of commercial, manufacturing, and agricultural businesses to be fully integrated into international supply chains. In other words, if your businesses don't have the right kind of affordable broadband services available to them, they are going to lose business.
Submitted by acohill on Sat, 06/16/2007 - 09:37
A Mach 10 (ten times the speed of sound) test of a scramjet took place in Australia, where a rocket carried the scramjet into near space, then ignited the scramjet to return to earth. Scramjets are special jet engines that work at very high speeds and at high altitudes, and research has continued on them for decades with mixed success. A successful and reliable scramjet design would allow travel between London and Sydney, Australia in as little as two hours.
Submitted by acohill on Fri, 06/15/2007 - 09:26
According to the latest international study on broadband use, the United States has fallen from 16th to 24th in number of households with broadband (53%). South Korea is the world leader, with more than 90% of homes connected. Japan, Germany, France, and the U.K are all well ahead of the U.S., so we cannot just dismiss South Korea's lead as simply a factor of household density.
Unfortunately, the U.S. also has the most expensive broadband at the lowest speeds. While it is true that the size of the U.S. makes broadband deployment a bigger challenge than in many other countries, the real problem is outdated business models for telecom services. The incumbent providers have stubbornly resisted reforming or changing their business models for telecom, which has led to very slow deployment, and a rather circular red herring argument about broadband.
The argument goes something like this: "There is no money in broadband. So we cannot afford to invest in high performance fiber and wireless systems." The circular part is "we would invest if there was money in broadband, but there is not any so we can't." The red herring part is blaming "broadband" when in fact that has nothing to do with the problem. A correct statement of the problem would be, "Our current business model stinks, so we have no money to invest in better networks."
That would be honest, and would lead naturally to a sensible discussion about changing business models. But there are some local governments that are not waiting. Expect to see new open services networks emerging from local government and regional projects in the next year or two that will have viable business models. These new business models will help create enormous new community and economic development by offering businesses high performance networks with a wide variety of service offerings from many providers, not just one or two.
These open service network projects have the right business model and will transform the local economies that make telecom essential public infrastructure.
Submitted by acohill on Tue, 05/29/2007 - 08:04
The electric utility that provides the power for the Oslo, Norway region (Norway's biggest city) has chosen an open services network architecture. The electric utility will build a single digital road system and let multiple service providers use it to deliver a wide variety of broadband services that will go far beyond the old Manufacturing Economy "triple play" model.
A key advantage of the open services network approach is the financial stability of the business model. The old style triple play caps overall revenue, but the open services network has nearly unlimited revenue potential, with many providers paying use fees, rather than just three.
Design Nine specializes in open services network design. Give us a call if your community would like to see what kind of economic development and revenue benefits an open services network could bring to your region.
Submitted by acohill on Wed, 05/23/2007 - 08:55
Compared to other major industrialized countries, the U.S. "enjoys" some of the world's slowest broadband. Even worse, when you factor in price, we pay more and get less than countries like Japan, South Korea, France, Canada, and Sweden. Over the past decade, the U.S. has gone from being the world leader in broadband to 16th in the world.
Communities and regions waiting for the Federal government to solve this problem are going to fall farther and farther behind economically. To be fair, it is important to remember that places like South Korea and Japan are not much bigger than some regional trading areas in the U.S. (that is, 2-4 rural counties in size). Are we really going to settle for an economic development slogan of "Our region...broadband almost as good as some tiny countries from overseas?"
The good news is that the technology and systems needed to take high performance fiber and wireless connections everywhere in a region (every single home and business that wants service) are mature, affordable, and available off the shelf. It is time to just roll up our sleeves and get the job done.
Submitted by acohill on Thu, 05/03/2007 - 09:12
This article notes that the number of cellphone calls has declined in the UK for the first time ever, suggesting that the "newbie" period for cellphones is over. Since 1993, I have been able to observe the "newbie" phenomenon firsthand as new systems and technology are embraced by the public, and in fact, it is a well known process that is often ignored, strangely enough, by many in the IT business, who want to believe in endless growth and by extension, endless profits.
It never works that way, and the dot-com bubble was fueled by large numbers of new Internet users and a naive belief that there was a never ending supply of new users. Of course, there was not, and we all know how things turned out. Companies that had built vacuous business plans based on fantasy-based market growth collapsed.
It is good news that cellphone use is starting to level off. Most people that need or want cellphones have them, they work in most places, and the number of cell towers will start to level off. The article notes that text messaging is still picking up as many find that a useful alternative to the phone--less obtrusive and more immediate than leaving a voicemail.
It also means that the etiquette of using cellphones appropriately will start to solidify. With a decreasing number of new users who don't know the rules, we have a better chance of actually using cellphones more sensibly over time.
Submitted by acohill on Mon, 04/30/2007 - 10:02
India has announced an ambitious plan to provide free wireless broadband throughout the country.
It is not at all clear that "free broadband" is sustainable. The longstanding problems with free services (in any market, not just broadband) include market distortion and low quality service.
Market distortion occurs because "free" services suggest to users of the service that supply is inexhaustible, and so users use as much as possible. Not everyone thinks this way, but a small number of users who hog bandwidth can consume all available supply.
This leads to low quality of service, in part because there is no pricing feedback to users (see above), and in part because the lack of revenue makes it difficult to expand capacity as demand increases.
In fact, fees alone do not guarantee a sustainable business model. In the U.S. and most other markets, the current broadband business model is upside down. Service providers enjoy maximized profits when customers, paying a fixed fee for Internet access, don't use the service at all. Service providers make the least profit if customers
like the service and use it a lot.
From an economic perspective, charging a fixed fee no matter how much bandwidth a customers uses is exactly the same as giving the service away for free. Neither one provides the funds necessary to expand capacity, increase service areas, pay for proper maintenance and upkeep, and add new services.
A solution is to move to a service oriented architecture (a different network architecture AND a different business model) that conveys a clearer relationship between supply and demand to customers. Customers pay for services, rather than buying a bucket of bandwidth. Service fees are based on the real cost of providing the service, thus providing information to customers about supply and demand. This can be done easily with both wired and wireless networks.
If the Indian government is going to build a digital road system and let private companies use the road system to sell services in return for a share of revenue, the system could work very well.
Providing a free 2 megabit connection but no services is very similar to the way roads are managed--governments build roads but allow businesses and customers to use those roads for entirely private business transactions.
Submitted by acohill on Thu, 01/25/2007 - 09:23
For the second year in a row, no American city made the list of the world's "Intelligent Cities," which is compiled by the Intelligent Community Forum. This highlights the longstanding regulatory and leadership problems we have in the U.S. when it comes to telecom. Some state and Federal regulators and legislators still think re-monopolizing the telecom industry (well under way with the re-forming of AT&T) is the answer to the country's long term economic development challenges. Other elected officials just keep hoping that the problem will go away, even though each passing year makes the businesses in their regions less and less competitive globally.
Submitted by acohill on Fri, 01/05/2007 - 08:08
Getting fiber to the premise (FTTP) is always a challenge. In many communities, there is not space available on aging telephone poles, or the incumbents try to charge exorbitant make-ready fees to hang a thin fiber cable. Trenching is an alternative, but that can be more expensive and disruptive. CableRunner now offers an interesting alternative, which is to use existing sewer and stormwater drain infrastructure to run fiber through neighborhoods and into homes.
CableRunner's highly automated technology to mount fiber cables and junction boxes to the sides of sewer and drain pipes was pioneered in Vienna, Austria, where they have been doing this successfully for fifteen years. Vienna has a major project underway right now to provide fiber to every home and business in the city, and many of the cable routes are through existing infrastructure. Paris is also beginning to do the same thing
And there is one more thing. Vienna's project is an Open Service Provider Network (OSPN) that will offer the city's residents and businesses a wide choice of services with multiple providers in most service categories. It is just one more reminder of the global competition today: a city taking fiber to every home and business using an open access model. Vienna's goal is to be the best connected city in the world.
What is your community's telecommunications goals?
Submitted by acohill on Wed, 12/20/2006 - 10:09
I think there are some interesting new job opportunities that are going to emerge in the next ten years, and one would hope K12 schools and colleges start now with new and revised curriculums to meet demand.
The first hot job is going to language specialist. Linguists who can speak at least four languages and ideally six or more are going to be able to write their own ticket in the work world, and will be able to command high dollar salaries. As the world economy continues to heat up, more and more businesses are going to be able to grow only by expanding into international markets, where they will have to be able to speak languages other than English. If six languages sounds like a lot, it really is not. Once you get past three, it is pretty easy. Languages that are going to be important include Chinese, Japanese, and Russian, among others.
The other hot job is going to be information manager. Traditionally, "information management" has been relegated to IT departments, where geeks build complicated databases and systems that usually require users to cram information into often convoluted and rigid formats, because that is the way IT people think. The new information manager will NOT be part of an IT department, but will work alongside business managers, salespeople, and project team members to keep information flowing between team members and clients. The information manager will have a high degree of skill using a wide variety of information tools, and will be able to craft custom solutions for individual projects using lots of off the shelf applications and judicious (and limited) use of scripts and small amounts of programming. This job will be the antithesis of the IT department approach to information management.
How about your local schools? Are they looking ten to twenty years ahead and trying to identify where job demand is going to create opportunities and needs? If not, why not?
Submitted by acohill on Tue, 12/12/2006 - 09:34
BusinessWeek has an article on outsourcing that has some useful insights in it. The good: Outsourcing does not always save time or money. As many of knew when the outsourcing craze began to heat up, it is a lot of work to manage workers on the other side of the world who are 10 or 12 hours out of sync with your own office hours. In India, where IT outsourcing has helped fuel the economy, rapidly rising salaries and very high turnover (often above 50% a year) is driving U.S. businesses away. Some of that work is coming back to the United States, and there are opportunities in low cost of living rural areas to capitalize--if you have a tech-savvy workforce and affordable broadband.
The bad news is that even though some outsourcing is moving out of India, some jobs are being moved to other low wage countries. What that means for the U.S. is that IT salaries are flat, and are likely to stay flat for some time. But I have maintained that many IT jobs have been priced too high for years--an artifact of the rapid growth in IT in the nineties. Some adjustments are not necessarily bad. But overall, we are in a world economy, like it or not, and your community is competing with other countries, not just the next county or the next state. And no matter how much local leaders may not see that or deny it, it is a fact. Every community in America has to be looking over its shoulder at the world economy now. We aren't in Kansas anymore.
Submitted by acohill on Tue, 11/07/2006 - 07:53
In a victory for personal privacy, a German court has ruled that if a customer requests it, an Internet Service Provider (ISP) must delete the IP log data that shows what a customer has been doing on the Internet and when. In the U.S., unfortunately, we are headed in the other direction, with the Federal government anxious to make ISPs responsible for retaining such information--forever! It is a huge and costly burden, with little justification, since most of us will never commit a crime that might require such data, and in my opinion, it is intrusive and an invasion of privacy.
Submitted by acohill on Thu, 10/26/2006 - 10:01
The magazine Killer App has a must read article on how fiber infrastructure has turned the rust belt economy of Wales (abandoned coal mines and steel mills) into a global powerhouse. The key: a steady investment in fiber over a period of years turned into a magnet for Knowledge Economy businesses looking for a reliable workforce, reasonable cost of living, and affordable broadband.
Oh, and there was one more thing. Wales had excellent electrical power because of the former demands of the steel mills. The region was able to attract large data centers because Wales had an unbeatable one-two punch: world class fiber infrastructure AND reliable electric power.
Finally, Wales has adopted an open access model, meaning they did not try to create a new government monopoly on telecom services. Instead, they are encouraging competition among service providers to ensure a rich variety of services that can meet any business need as well as keeping prices low (because of competition).
This is an article you may want to print out and send to every local elected official and economic developer--especially those that think telecom is somebody else's problem. It is an excellent case study of a region that pulled its economy out of a nose dive and successfully created economic prosperity.
Submitted by acohill on Mon, 10/16/2006 - 07:21
Microsoft's MSN search and news site is trying to avoid Google's fate in Belgium, where a court told the search company to stop filching newspaper articles from the Web sites owned by the newspapers. Google would show the first few paragraphs of an article, and then provide a link to the rest of the article, claiming fair use. But of course, there were ads on the Google page and so Google was benefiting from someone else's copyrighted content. The Belgian courts told the company to cut it out. So Microsoft, which apparently does the same thing, is negotiating with the newspapers over the issue. The obvious solution is to share ad revenue with the papers. Less money for the search sites, but then, they would be doing things fairly and legally, which should not be difficult concepts.
Submitted by acohill on Tue, 08/29/2006 - 19:11
Swedish-Finnish telecom company TeliaSonera has started selling hybrid phones that will automatically make phone calls via the Internet when in range of a WiFi hotspot, and use the normal cellphone network when not in a hotspot. Some other dual mode phones have been available, but this is the first phone (manufactured by Samsung) that will switch automatically between the two. The firm is targeting in home use first, which is clever, because we make a lot of calls from home. If you have a wireless router in your house, the phone will automatically make VoIP calls, saving money.
Devices like this illustrate the need to design communitywide broadband networks that offer BOTH fiber and wireless connectivity. We are going to want and need both, and communities should plan and design for both.
Submitted by acohill on Thu, 08/10/2006 - 11:46
Here is a very short article about the falling price of DSL service in the U.S. Usually, when prices fall, it is a possible indicator that people are not buying enough of whatever is for sale, or that they supplier has "too much" of something. In the case of DSL, both is probably true. The phone companies have been investing heavily in upgrading their local phone systems to handle DSL, but with limited success, apparently, or they would not be cutting prices.
Part of the problem is that the cable companies beat them to the punch several years ago. The cable companies got an early start not because they really believed the Internet thing was going to catch on, but because digital cable systems let them sell a lot more TV. It really did not cost much (relatively) to build systems that could also deliver Internet service. So a majority of broadband users in the U.S. have cable modem service rather than DSL. And it is often difficult to get your computer working with a new ISP, so most people tend to want to avoid switching unless there is a really compelling reason. And a $4.27 price differential is not enough, it seems, to get people to switch from cable to DSL.
Anedotally, almost everywhere I visit in the U.S., people tell me that cable modem service is faster, more reliable, and tends to have better service than DSL provided by the phone companies.
But the sad news is in the last paragraph of the article. While many communities are happy just to any broadband Internet service delivered over slow, last century copper systems, broadband prices in Japan also continue to drop. Service providers there are offering 100 megabit fiber service for $25.90 a month--less than we are paying for copper broadband 100-200 times slower.
Submitted by acohill on Wed, 08/09/2006 - 12:18
Ireland's research and higher education network, HEAnet, is getting configurable lightpaths. What are configurable lightpaths? It means that ordinary network users can configure a single wavelength of light on a fiber network from their computer or server to another computer or server on the same network (the computers could be hundreds or thousands of miles apart). A single lightpath can provide many gigabits of bandwidth with very little network delay, because the photons have a single path (lightpath) through the network. Much of the pioneering work was done in Canada and in Chicago, and a similar project has been underway in North America, called Starlight. Starlight already has fiber across the Atlantic and Pacific, and more schools, universities, and research labs are joining the effort.
This new kind of network system (it is entirely compatible with the Internet) is starting the same way the original Internet started, with schools and universities. It is already moving out into industry, with companies like Cisco developing off the shelf equipment to implement lightpath networks.
Lightpaths are one more reason for communities to start investing in fiber, now. Old-fashioned copper cable modem, telephone, and DSL networks don't support lightpaths and never will. Do you want your schools and businesses to be left behind?
Submitted by acohill on Wed, 07/26/2006 - 09:58
Prepare to be depressed. French Telecom has just announced that it is rolling out fiber service in major cities with download speeds of 2.5 Gigabits/second and upload speeds of 1.2 Gigabits/second. The cost? Seventy Euros, or about $85 US.
Meanwhile, in the U.S., the heads of the major telecoms are patting us on the head and telling us we don't need superhighways to our homes, that DSL sidwalks are just fine. A typical DSL connection in the U.S. is about two thousand times slower than the Gigabit service being rolled out in France.
This article is in French, but you can see the speeds discussed in the second paragraph.
Submitted by acohill on Mon, 06/05/2006 - 08:03
In an interesting tale of two companies, Apple has dumped its experiment in offshoring telephone support to India after just one month. Meanwhile, Dell is rapidly expanding its offshore tech support. What's going on? Apple, while not perfect, consistently gets high ratings from consumers for support. Dell, on the other hand, has been receiving a steady stream of criticism lately for poor customer support.
I attribute the difference to finances. Apple is extremely profitable, and seems to have figured out that taking good care of customers pays off over the long term. Dell, on the other hand, is on the ropes financially and appears to be trying to save its way out of a money hole. In my experience, cost-cutting at the expense of highly visible parts of the company like customer service never works out well. Dell's slide will likely continue.
Personally, I have rarely had a good experience with offshore customer support. I've observed two chronic problems. First, the heavy accents, even with someone who might speak English as a first language, often makes conversations quite difficult. And second, offshore staff seem to be often stuck following a script when trying to figure out what the customer wants. If the problem doesn't match the script, they can't adapt. I find that less so with American-based customer support (though not always).
Submitted by acohill on Wed, 05/03/2006 - 06:32
Skip Skinner, the forward-thinking administrator of Wise County, Virginia, suggested do it yourself fiber to me three years ago. I've proposed it to many other groups since then, and everyone thought I was crazy.
So I was gratified to hear from Matt Wenger of Packetfront about a wildly sucessful do it yourself fiber project at the Digital Cities conference last week. A rural community in Sweden got potential broadband customers to dig a trench across their own property and install conduit (cheap plastic pipe) to the rural road, where the fiber was then blown in using compressed gas.
It worked extremely well. The effort was started and led by a single determined community member who observed, correctly, that most rural folks have or have easy access to tractors, plows, and trenching equipment, and know how to use it.
A major cost of installing fiber in rural communities is getting the fiber from the paved road up to the house, which in this Swedish community was as much as 3/4 of a mile from the road. By sharing costs across a large number of users, the cost of getting the fiber installed was greatly reduced, and the primary focus of the effort was centered on just getting the fiber down the main back roads--a much simpler problem than dealing with the logistics of installing duct to every household.
The local credit union also pitched in by agreeing to add the average $600/household cost of duct and parts to the property owner's mortgage, which increased the take rate for fiber by 25% to 40%. The credit union realized that fiber infrastructure increased the property value by several times the cost of the materials, and worked with their customers to develop a simple, streamlined process for providing the funds. A U.S. study last year showed fiber to the home adds $7,000 to $14,000 of value to a home.
The combination of shared investment, self help installation, and new forms of financing minimized the capital risk on this project and got state of the art fiber into a rural community.
So my question today is this: Are the Swedes smarter than the rural residents of the U.S.? Why not do this in your rural community? We are talking about digging shallow holes in the ground and dropping plastic pipe in the hole, then covering the hole up with dirt. I'm pretty sure we can handle that.
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