Recently the Supreme Court made a ruling on a case involving Brand X Internet that will have major implications for the future of broadband in the U.S. If you aren't aware, the U.S. lags behind many other countries in broadband adoption and the last research data I saw put us somewhere around 15th in the world.
If you are reading this magazine it is safe to say you understand how important broadband access is. I know I do. If you think about it for a while you realize that recent uptake in broadband connections has been a driver for e-commerce and VoIP. Dig deeper and you realize broadband is also a driver for companies like Google specializing in search. Keep digging and you realize the proliferation of blogs are in part due to increased broadband penetration and this in turn has enhanced free speech and reduced the plain vanilla news stranglehold a few large media companies have in the U.S.
Think about craigslist, a site that has democratized entire industries. There is Monster for jobs, iTunes for music, etc.
The point is broadband is really changing the way we live work and play in the U.S. and obviously everywhere else in the world. Waves of companies are looking to sites like eBay as a place to sell directly to consumers without the need for a middleman such as a reseller or distributor.
You could probably fill this magazine with industries that are being changed for the better due to broadband proliferation.
President Bush understands this and in April of 2004 he made a speech at the American Association of Community Colleges (tmcnet.com/142.1) where he said, And I want to talk about affordable broadband technology so that America can stay on the leading edge of technological change. On its face, this statement is magical. Not as magical as the latest Harry Potter book mind you but for those of us who rely on broadband technology to make a living, it is exactly what we want our president to say.
This gets us back to Brand X, a company that fought to have access to cable lines to provide Internet service to its customers. The Supreme Court ruled against Brand-X and in so doing backed up the FCCs decision.
If you think about it, why should the cable companies share anything with anyone? After all the government doesnt have the right to say that TMC has to share its magazine pages with competitors.
The difference is that cable companies enjoy government sanctioned monopoly status in the U.S. There isnt competition for cable service. I either purchase it or I dont. I cant go to a cheaper cable company to get cable service if I would like. Sure there is satellite you might argue but it isnt as good as cable for a variety of reasons.
Cable companies have used this monopoly position to invest into their broadband networks. Is this fair?
It seems obvious that if cable companies were forced to share their lines, consumers will get access to cheaper broadband service. I am unclear of any scenario where decreased choice is good for consumers.
Whats happing behind the scenes is that cable companies and ILECs are upgrading their networks and they tell the government that if they are forced to share, they wont upgrade anymore. The government is buying this argument hook, line, and sinker.
While I understand this position, these companies owe us. They owe the government, they owe consumers, and they owe the community They owe everyone. Having no competition for so long means they were able to gain many advantages in the market. Now they are using these advantages to influence politicians, run TV ads, and do other things to protect their existing monopolies and grow them into other areas such as broadband.
The government has an obligation and of course has tried to increase telecom competition. The Telecom Act which is now almost a decade old didnt work as planned so they have decided that having just the cable and phone companies competing is adequate with the hope that power line and WiMAX (or some variant of broadband wireless) will add extra competition.
But what about the small ISP? Small companies are the backbone of the U.S. and some of the really good ones become big companies. Recently, TMCnets Ted Glanzer wrote an article about the Brand X case (tmcnet.com/143.1) and I thought there are some key excerpts worth sharing.
Its a terrible decision, Brand X owner Jim Pickrell told TMCnet. Its bad for consumers and it is bad business . . . [Brand X is] effectively locked out . . . Its an end to competition in broadband and telephone . . . For us its a disaster.
Pickrell added that the U.S. will fall further behind other countries in providing broadband access to its citizens.
Were falling behind, said a frustrated Pickrell, noting that the cost of broadband in Japan is half of what it costs us in the United States. Not surprisingly, Pickrell said, a greater percentage of Japanese citizens have broadband access than those in the U.S.
At the other end of the spectrum are Senator John Ensign (R-Nev.) and Carol Mattey, a former FCC deputy chief of the Wireline and Competition Bureau.
It is my hope that Congress can build on the Supreme Courts decision today on Brand X by updating our nations communications laws, Ensign, who is reportedly redrafting the Telecommunications Act of 1996, said in a statement. It is time that these laws reflect the sweeping changes technology has brought to this critical sector of our economy. Revising the communications laws will remove barriers to innovation. Consumers will benefit from exciting new technologies that get to the marketplace faster and at lower prices.
Many in the government are applauding this decision but the net effect is that this leaves us with a grand total of two broadband choices today. This is not enough for real competition. This leaves no room for new upstarts who want to gain share by lowering prices or those companies that want to differentiate based on service. I also reiterate that it is unfair to allow entrenched monopolies to grow into new monopolies or duopolies keeping the strong corporate identities they were able to build via their monopolistic position in the market.
As I write this, TMCnet is receiving a staggering amount of traffic to its Web site. We have ordered a much faster connection but have to wait for many weeks before we get it. Perhaps the story is different in Manhattan but here in Norwalk, CT, you can wait months for the phone company to move. I had an installer tell me that he will be on vacation for a week and he needs to string fiber for about 250 feet, which he pointed out to me was a very far distance. Due to one persons vacation schedule and a few hundred feet of geography we need to wait months for service from our LEC. Bear in mind TMC is a paying customer. What other non-monopoly business makes you wait so long to buy something from them? The point I am making is that entrenched service providers in general are a laughing stock when it comes to customer service.
Two competitors does not a competitive market make. Allowing two industries with monopoly positions and terrible service levels to continue their monopolies makes little sense.
Perhaps I am an idealist but having less competition doesnt ever seem like a great way to build competition. Politicians are waxing poetic about how now the market needs to be deregulated resulting in more competition. I just dont get it. Its like an episode of Twilight Zone to me. The Supreme Courts says that cable companies dont have to share their lines with competitors effectively putting them out of business and politicians put out press releases telling us it is a great day for telecom competition. I am not sure what to make of it.
Is the issue cut and dry? No it never is. In fact to make this whole debate more interesting, Cablevision Is slowly rolling out 100 Mbps service in and around the New York area. I am a Cablevision customer and shareholder so this prospect is extremely exciting to me. Furthermore, this is the Internet speed that some Asian countries provide routinely. I have been arguing for a while that we need service providers to give us the same speeds as other countries. Now, at least Cablevision is.
So I am torn by this decision. Half of me thinks it is terrible but the other half sees a potentially bright future if we start to see routine implementations of 100 Mbps connections to the home and office.
Perhaps President Bush was planning to kill the small ISPs all along. In the speech I mentioned above, Bush says, The third goal is to make sure that we have access to the information that is transforming our economy through broadband technology. Im talking about broadband technology in every part of our country. I was the governor of Texas for a while. I remember talking about access to information and there was always a group of people saying, thats fine, big cities get it but rural people dont. Im talking about broadband technology to every corner of our country by the year 2007 with competition shortly thereafter.
This last statement seems unusual. Why mention competition unless you are going to make sure to squash it until 2007. It would seem the Brand X case never had a chance based on this statement.
Is our president banking on power line and wireless broadband to be the competition? Does his crystal ball see these technologies being major forces in 2007? One things for sure There is no more exciting time to be in this market as WiMAX and broadband over power line providers come on line. But I have to worry about VoIP. Somehow entrenched providers have found ways to stifle competition and use the political system to their advantage. How long will it take them to come up with a legal way to do the same to VoIP providers? What about video providers (it is a matter of time before a slew of competitive IPTV providers emerge). Stay tuned.
Video Over IP
I received a call from Kevin Shahbazi recently. Kevin used to run a company called Trust Digital that was involved in encrypting information on handheld computers so the data couldnt be used by unauthorized people. He now heads eView Technologies, a company that analyzes and mines real-time video streams. This is important for a few reasons, the first of which is that using this technology you may have been able to foil the London bombing plot. Cameras are great to have but it is impossible for a human to monitor multiple cameras at once and be alert for long periods of time. Technology needs to assist us in these endeavors. The second area is looking at shopping and buying behaviors of customers in retail environments.
There has been a great deal of interest in our Security over IP Summit at Internet Telephony Conference and EXPO this October in Los Angeles and I think companies like eView Technologies will benefit greatly from the interest and growth in this market.
SIP Under Attack
I recently caught up with Rich Medoza who now works for BorderWare in the SIP Security division. Rich used to work for Level 3 and as such has great experience in the product line that his new company produces, namely SIP-aware firewalls. Rich tells me that typical service providers are better at transporting packets than blocking them and this is just one of the reasons that session border controllers do well.
But this can be a problem with SIP messages as they can have nasty payloads that do bad things to your network. They could contain SPIT otherwise known as spam over Internet protocol. Using their SIPassure product they can set up the network to proxy the firewall before it hits the softswitch. If the firewall sees 50 messages from one user inside of a minute it knows the user is a spammer and can block subsequent messages.
Currently there arent too many SIP trunks coming from service providers but that will change soon. In the mean time, SIPassuress products can also protect companies from internal theft of service. In fact Rich cited an example of a company whose softswitch was being used after hours to host a call center without the companys knowledge. The products can also be used to prevent internal denial of service shutdowns, buffer overflows, SIP invite request attacks, and more. You should seriously consider a SIP firewall before deploying VoIP on your network.
VoIP Quality Survey
Recently TMCnet teamed with Keynote Systems to sponsor a webinar on VoIP quality. What is exciting to me is that we broke news during the webinar as they announced their key findings to TMCnets audience. The key points of the study are that VoIP quality still lags behind the PSTN while Vonage and AT&T CallVantage provide the best service. The details are available at (tmcnet.com/144.1).
One Reseller, Many Generations
While INTERNET TELEPHONY magazine often writes about products and the companies that produce them we dont often write about the companies that help get great technology into the hands of the end user. One such company, GBH Communication (formerly GBH Distributing) has been around for well over a decade selling and distributing telecom products. I knew them in 1990 as a major Plantronics reseller and they later they became the first Polycom reseller.
The company has evolved into a full service multimedia reseller and the companys charismatic founder Von Bedikian, who Ive known for a decade and a half, tells me he coined a new phrase to represent the products they sell. The term is CommIP and its short for communications over IP and its definition is VoIP, video, and data collaboration over IP. GBH resells products from lots of companies today from Masergy, Sphere, Radvision, Interactive Intelligence, and Vonexus. I asked Von how big the company is these days and he responded, We have 70+ people and 40 million in revenue, going on 400 million. Now thats confidence.
SIP Speed Boat
SIPquest is a company that seems to be popping up more and more in the industry as an enabler of a number of technologies from WiFi telephony to advanced mobility applications. Dave Hattey, who used to work at 3Com recently decided to take a leadership role at SIPquest as President, Chief Executive Officer, and member of the Board. So I decided it would be a good opportunity to hear from Dave firsthand why he made the switch.
Dave told me the reason he decided to go to SIPquest was that he saw fun, innovation, and vision as well as a unique relationship with Columbia University giving them the rights to the multimedia applications created at the prestigious university.
Dave tells me that managing a smaller company is great because he can reach out to the entire team at once and act more quickly. He says he feels like he is a speed boat. A large company he said can be like a battleship. Where does he see the future of VoIP going? He says SIP is the VoIP solution. I asked him about the growing industry moaning about large vendors adding so many proprietary extensions to SIP that interoperability suffers. Hattey feels that the market is powerful enough to drive us to the end goal of interoperability. I hope he is right. IT