Tag Archives: WISP

TURN for the better, but not the worse among CASF hopefuls

by Steve Blum • , , , , , ,

The Utility Reform Network (TURN) likes the idea of making California Advanced Services Fund subsidies available to more than just traditional telephone companies. But not to just anyone, saying “TURN shares the Commission’s concerns…that ratepayer money used to fund the CASF program must be protected from waste, fraud and abuse.”

The Commission’s Division of Ratepayer Advocates (DRA) echoed those concerns, calling for safeguards if CASF eligibility is expanded.

TURN’s answer is to apply the standards set by the CPUC three years ago when it gave CASF matching grants to successful applicants funded by the federal stimulus program (ARRA). It was done under a special exemption granted by the California Legislature.

The CPUC’s solution at the time was simple. All CASF applicants would meet the same qualifications and pass the same background check that traditional telephone companies have to endure when they apply for a Certificate of Public Convenience and Necessity (CPCN).

The existing CPCN application process requires the applicant to demonstrate its financial, technical and managerial competence by submitting information such as the company’s balance sheets proving its liquidity and biographical information on its management team demonstrating sufficient management experience and expertise to operate as a telecommunications provider. The applicant is also required to comply with the California Environmental Quality Act (CEQA)…CPCN applicants are also required to submit information relative to background considerations on the business, its principal owners, and managers to enable the Commission to conduct a background check.

The Commission also required applicants to post a performance bond, submit to financial audits as needed and generally follow CPUC rules, particularly ethics requirements.

Half a dozen ARRA projects were eventually funded in part by CASF, with and without CPCNs. Based on the CPUC’s latest report, none of those have been completed. So there’s no definitive track record to point to yet. But there’s no reason to think they’re doing any worse than traditional telephone companies or that they won’t be able to keep to the schedules established by ARRA.

Digital 395 is one of those projects, and they weren’t able to even begin construction until this past summer because of the challenge of meeting the (sometimes conflicting) regulatory requirements imposed by twenty three separate agencies. Not least of which is CEQA compliance, which is integral to the CASF program. They’re still on track to finish by next summer’s deadline.

Traditional telephone companies are not the only game in town. Many private companies and public agencies are equally solvent, competent and experienced. On the other hand, many are not and the Commission has the tools in hand to weed them out.

TURN is absolutely right to conclude that “a reasonable, rigorous process can in fact deliver results and lead to enhanced availability of broadband.”

Performance, not passion, builds broadband projects

by Steve Blum • , , , , , , ,

Most of the opening and reply comments about expanding eligibility for California Advanced Services Fund (CASF) subsidies, my own included, can be summed up in three words: gimme, gimme, gimme.

Grant writers want to write grants, public agencies want to back fill budgets, independent ISPs want to play like the big boys and the big boys – telephone and cable companies – want to keep it for themselves. No surprise.

The road to broadband is paved with competence. Good intentions lead somewhere else.

Two organizations, though, pretty much make their living commenting on CPUC proposals: the Commission’s own Division of Ratepayer Advocates (DRA) and The Utility Reform Network (TURN). Both filed opening and reply comments, and although they came to opposite conclusions, their concerns were remarkably similar.

DRA opposes expanding eligibility for CASF grants and loans. They don’t like the idea of lowering the bar that applicants have to clear, “especially since such entities likely have no demonstrated expertise in telecommunications or in building broadband facilities.”

After reading everyone else’s opening comments, they were unimpressed with the focus on general benefits rather than concrete projects, noting “the overall lack of specificity underscores DRA’s cautions about opening up CASF eligibility and concern over these entities’ lack of technical expertise to implement broadband projects.”

It’s a good point, if unfairly broad. CASF exists to fund bad broadband business cases. Paying down the capital cost is only half the battle. It takes skill, creativity and experience just to cover operating costs in problematic areas. Good intentions and positive community vibes are not enough.

Many independent ISPs have that kind of managerial horsepower. The expansion of DSL and cable modem service coupled with the natural advantages of scale the big boys bring to the table have put many out of business. But the survivors are the smart and nimble ones.

It also makes sense to look to publicly owned utilities – municipal electric systems and water districts are two examples – for expertise and resources. With secure finances, existing customers, back office systems, skilled technicians, equipment and right of ways, bona fide publicly owned utilities have the kind of assets that can make a difficult business case achievable.

DRA’s closing advice is to recommend “added oversight and safeguards to help guard against fraud, waste, and abuse of ratepayer funds” if the Commission expands CASF eligibility. TURN has some ideas for accomplishing that. More tomorrow.

Verizon says chill out, only a million California homes have crap Internet

One million homes.

AT&T, Verizon and a posse of community broadband advocates joined the debate over eligibility requirements for California Advanced Services Fund (CASF) grants and loans. The advocacy folks want fewer or no restrictions on who can apply for broadband infrastructure construction subsidies. The telcos like the current rules which limit the money to, well, telcos.

Like the cable lobby, the big telcos are most offended by the idea that the California Public Utilities Commission (CPUC) might give money to competing providers in underserved areas, where broadband service doesn’t meet the minimum standard of 6 Mbps down and 1.5 Mbps up. In particular, Verizon doesn’t understand what all the fuss is about…

Underserved areas have 1,099,883 households, but only 62,887 of these households do not have broadband available under the 3/1mbps standard.

The 3 Mbps down and 1 Mbps up benchmark Verizon awkwardly cites was declared inadequate by the Commission back in February when it relaunched the CASF program.

AT&T (seconded by Verizon) hyperventilated about the danger local governments pose to honest competition…

Local governments administer rights-of-way in their jurisdiction. If they also are building broadband networks with CASF funds, the potential to discriminate against another provider exists and must be prevented as a condition of receiving funds.

As The Utility Reform Network (TURN) pointed out in its reply to similar comments by the cable lobby

This concern is overblown given that such actions by a governmental entity would be patently illegal. It is significant that CCTA provides no case citations or other evidence to prove its assertion.

Hey, if you can’t trust Comcast, AT&T and Verizon to safeguard the free market, who can you trust?

Two out-of-state organizations – the Rural Broadband Policy Group and the Institute for Local Self-Reliance – joined the California Broadband Policy Network in adding their enthusiasm for open access grant money to the discussion. The national wireless ISP association, WISPA, prepared draft comments, but I haven’t seen any indication yet that those were actually filed.

In addition to TURN, returning commenters included Access Humboldt (in favor of eligibility expansion), a group of small, rural telephone companies, and the CPUC’s own Division of Ratepayer Advocates (both against). Including Tellus Venture Associates, there’s a total of ten reply filings and one draft, although it’s likely that one or more won’t make it into the official record because of various technicalities.

All the first round comments, including the ones that won’t go into the official record, and yesterday’s replies, including WISPA’s draft, can be downloaded here.

Congresswoman Eschoo pushes for more broadband spectrum

Silicon Valley congresswoman Ann Eschoo wants to shake up the way that Washington manages and assigns spectrum. The goal is to free up a total of 500 MHz for wireless communications purposes. Much of that would come from turning over frequencies held by government agencies to public use. But some of it would come, willingly or not, from the private sector.


“We have to make freeing up spectrum a top priority,” she said at Joint Venture Silicon Valley's second annual wireless symposium, held on 2 November 2012 at Marvell Semiconductor Inc. headquarters in Santa Clara. “So many companies and broadcasters think it belongs to them. We know that the airways belong to the American people.”

Eschoo pointed to an FCC decision to move ahead with buying back television channel assignments from broadcasters on a voluntary basis and auctioning it off to wireless carriers. She said it would account for 120 MHz towards the final goal, and raise $25 billion dollars, although some of that would go to broadcasters who gave up their channel assignments.

The FCC has given itself a June 2014 deadline to hold the auctions. There are a lot of different interests to balance in the process. Wireless Internet service providers are worried that unlicensed frequencies will be sold out from underneath them.

Spectrum policy “must be balanced with both licensed and unlicensed spectrum,” Eschoo said, adding that wireless technology generates $50 billion in revenue in the U.S. every year.

Some government agencies are fighting plans to clear them off of some frequencies and turn the bandwidth over to the private sector, preferring instead to work out some way of sharing. But that idea is not very popular with wireless broadband advocates.

Eschoo believes that federal agencies can be more efficient in their use of frequencies, and wants Congress to step in and “scrub” the way the executive branch holds and uses spectrum. The bottom line, she said, is that the airwaves are an engine for job creation.

Hint of daylight for CASF community broadband funding

by Steve Blum • , , , , ,
Pretty much any organization would be eligible for broadband infrastructure subsidies from the California Advanced Services Fund (CASF) if the California Public Utilities Commission (CPUC) follows through on a decision made last week and if the California legislature agrees.

Right now, funding is limited to companies that sell telephone lines (very broadly defined) and hold either a Certificate of Public Convenience and Necessity (CPCN) or are registered wireless telephone carriers.

Cities, independent Internet service providers, non-traditional telecoms ventures, community organizations and others can’t get funding directly. Some, for example ISPs, could apply for CPCN status, although it’s a complicated and costly process. Applicants should have $100,000 in the bank and expect to pay legal fees of $5,000 or more. Others, such as cities, can’t.

The CPUC voted last week to begin the process of changing its rules to allow “any commercial provider of broadband access or any nonprofit entity, including government entities or community anchor institutions that elect to provide facilities based broadband service” to apply for CASF grants and loans. The full text of the commission’s order is here.

When it updated CASF rules earlier this year, the commission rejected requests to broaden the eligibility requirements. This change of direction is the result of lobbying by the California Emerging Technology Fund and a wide range of non-profit and government organizations. It also reflects some frustration at the CPUC with the lack of CASF projects from eligible applicants. Only three projects (an FTTH proposal in the California desert, a DSL project in Mendocino County and a satellite-based service for Monterey County) were submitted in the most recent application round, and more than $150 million in funding authorization is sitting idle.

If it happens, change won’t come quickly and certainly not before the next round of CASF applications are due on 1 February 2013. The first step is to define what the proposed new rules would encompass, which will take anywhere from six weeks to a few months. Then, the commission estimates it’ll take 18 months to get it done, and it might be longer. And CPUC can’t do it on its own: before anything can take effect, the California Legislature needs to pass a law permitting it.

Then the Governor has his say. How long will it take? Ask Linda.

Update: Brown signs SB1161, no new Californian regulations for Internet services

by Steve Blum • , , , , , , ,
California governor Jerry Brown signed Senate Bill 1161, which prevents state agencies, particularly the California Public Utilities Commission, from extending regulations and oversight to “Internet Protocol enabled service”, including specifically VoIP, until at least 2020.

In his signing message, the governor said “this bill encourages the continued growth of these and other innovative services that have become a hallmark of our state.”

The language of the bill is broad, covering any service that “enables an end user to send or receive a communication in existing Internet Protocol format, or any successor Internet Protocol format through a broadband connection, regardless of whether the communication is voice, data, or video.”

The fear or hope, depending on your point of view, is that incumbent telecoms companies will use this loophole to largely escape regulation altogether.

When she’s good, she’s very good; when she’s bad, she’s better

by Steve Blum • , , , , , , ,

Governor Jerry Brown has until this Sunday, 30 September 2012, to approve or veto Senate Bill 1161, which would prohibit the California Public Utilities Commission or any other California state agency from regulating “Voice over Internet Protocol and Internet Protocol enabled services” until at least 2020.

The bill is controversial and the debate has been emotional. Advocates say it would clear the decks for continued high tech innovation in California, opponents say it would deregulate big cable and telephone companies and allow them to bully consumers and bury smaller competitors.

CNET has a good article telling the case for the bill, Wired has a good one on the case against. The actual bill is here.

From my perspective, any time you keep regulators out of a business, particularly one as fast moving and dependent on innovation as IP services, it’s a good thing. I am very much a free market advocate.

In the near term and the long, long term, keeping regulators out of Internet-enabled or other 21st Century sectors is a good thing. Limiting regulatory authority to legacy services and providers will prevent a lot of future political mischief. At all levels of government, there are good regulators and there are some that you would not want poking their noses into the business of an independent ISP or a new media start-up.

The downside comes if the big carriers move out of a regulated environment too soon – and like many who have written on this topic I believe that’s what they intend to do – it could create serious, maybe fatal, competitive issues for smaller companies that have to buy service from incumbents and compete against them.

Another possible effect – good or bad depending on your perspective – is that PG&E could get into the lit service business. They sell dark fiber now, when they have it to sell, but that’s all. They don’t put much in themselves because there’s not a lot of profit in dark fiber. When they do, it’s either because they need it to run their electric business or a telecoms utility has installed it for other purposes. But take away regulatory limitations, and the equation changes. PG&E and other private electric utilities might want to move up the value chain as far as full Internet connectivity.

Which do you trust more: the good intentions, judgement and restraint of regulators, or the ability of the market to keep legacy natural monopolies under control? If you see regulatory agencies as a benefit to your business, or at least don’t see them as a potential danger, then SB1161 looks like a bad idea. On the other hand, if you see government as a greater threat than AT&T, Comcast and friends, it’s a good idea.

AT&T wants to get out of the POTS business, particularly in rural areas. Anything that accelerates that trend – as SB1161 likely will – might be a good thing for an independent ISP in some areas. Or it could throw things into such a turmoil that everyone drowns.

For good or ill, SB1161 opens the door to unexplored territory. Personally, I agree with Mae West: when it comes to a choice between the lesser of two evils, pick the one you haven’t tried before.

Mesh WiFi coverage depends on what you mean by coverage

by Steve Blum • , , , ,

WiFi is great as the last link between the network and the user. It’s high enough bandwidth that it’s not a bottleneck, people know to look for it and the available hardware and clients are well advanced. Consumers will pay for casual access, but in that case they expect performance. They love free WiFi and will put up with a surprising amount of hassle to access it. Companies like Meraki have made it very cheap and easy to get a “drinking fountain”, amenity grade WiFi service up and running, on a paid or free basis.

On the other hand, WiFi is problematic when used as core network technology, even in a small city. Meshing is fine for linking a hotspot to a network gateway, but it falls down when you try to use it for blanket coverage of a metro-sized area. You need to do two things to make a metro scale WiFi system work: get traffic off the WiFi nodes and onto landlines or point to point wireless as quickly as possible, and have some control over the CPE, which should be specialized, relatively high powered units.

Eight years ago, when metro WiFi was just getting started (Cerritos, in Southern California, was the first), manufacturers were saying you needed 16 nodes per square mile to make a mesh network work with laptop-grade equipment. Two years later, after months of re-engineering, we finally got it work in Lompoc with about 40 nodes per square mile and (costly) high-power CPE. Today, the talk is about 70 or more nodes per square mile.

It’s a losing battle, for two reasons. First, as more people use more unlicensed devices, the environmental RF noise floor keeps rising, even with the addition of a new frequency band. Adding nodes is a short term fix but in the end just adds to the problem. Second, customer expectations and demand keep rising. What was good enough five years ago is hopeless today. Expectations and performance trends are heading in opposite directions for metro WiFi.

Amenity grade WiFi service works in stadiums and airports, and for hotspots around cities. In a concentrated location, like a stadium, it’s better not to use mesh for backhaul, except in the most hard to reach spots. You have so many people hitting any given node, that adding traffic from another node to that router slows things down for everybody. When users are more spread out, mesh will work better. But it will never work as well as a 1:1 node to gateway ratio, which is not so difficult to achieve in a controlled environment like a stadium or airport or mall.

Redefining municipal wireless

Municipal wireless was declared dead at the Wireless Communications Association’s recent symposium in San Jose, but the picture that emerged from three days of discussion, debate and presentations at the European Wireless and Digital Cities Congress in Barcelona this week was more comprehensive and nuanced. And optimistic.

The difference lies how you define municipal wireless. Older, more familiar models are certainly dead. No one expects a private company to invest in building a city-wide WiFi network to provide public Internet access, whether free or for a price. Cities are moving away from building general purpose wireless broadband systems, of any sort, and are increasingly cautious even when considering specialized networks, such as those dedicated to public safety applications.

Big ticket municipally funded wireless infrastructure projects in the developed world are dead for all practical purposes. It’s a big planet, and if you look hard enough you can probably find an exception or two. More than that in the developing world, where needs, resources and governing assumptions are different. But cities in the U.S. and Europe won’t be spending their own money to build ubiquitous wireless broadband pipes. Private capital won’t be available, either.

National governments might still fund some projects, particularly specialized ones focused on public safety and security or development projects for rural or other underdeveloped locales. Gradually though, even that kind of funding will no longer be allocated to basic broadband infrastructure.

Going forward, the emphasis will be on developing, deploying and supporting network-agnostic applications. In some cases applications will be initially developed to ride on a particular network, because that’s the network that happens to be available. Even then, extending applications to other systems will just be a matter of creating interfaces. Municipal wireless applications will not be captive to a given technology or network operator.

Bedforshire Police, in Britain, is giving Blackberries to its police officers, so they can run specialized applications such as crime and identity database access or computerized dispatch in the field. About half of the impressive list of applications are browser based and could be accessed by just about any recent mobile device. The other half make use of the Blackberry operating system and network protocols, but could be adapted for use on other devices or networks with appropriate front end software.

In the U.S., Tualatin Valley Fire and Rescue, in Oregon, is using several overlapping networks, both commercial and in-house legacy systems, to tie field units into a comprehensive information system. Having multiple layers allows them to cover a very large geographical area with redundant access, and prevents a single network operator or equipment vendor from monopolizing their budget. The applications are all network-agnostic, the field equipment is cheap and commercially available, and the relatively low cost of switching wireless broadband providers keeps the market competitive.

Municipalities and other local agencies will still be buying public safety radio systems, and those systems will provide an increasing level of digital bandwidth. Cities will also fill in network gaps where necessary or saturate relatively small areas that have a critical (and budgeted) need. But those systems will be one element in a diversified network strategy and, except for the most critical and specialized applications, will be dumb pipes. Those systems will not be bespoke, vertically integrated packages that quickly turn into legacy technology.

The creativity and funding will be focused on building the applications, generating and managing the data that feeds those applications, and developing management and operational strategies that maximize the benefit of this abundance of information. Right now, much of that work is being done on a city by city basis, but the next step – and the next opportunity – will be to create robust, high level applications that can be carried via any standard network protocol and accessed by any mobile device.

Going forward, municipal wireless will be vibrant and alive, and will mean something very different from the dead and dying concepts of the past five years. The truly municipal elements will be applications and data. The wireless part, indeed pipes of any sort, will be a commodity, to be purchased as a service for the most part and only built in limited circumstances for specific needs.

The future of wireless internet service

Forget trying to build a wireless Internet business with any idea of serving people in their homes or businesses. In general, wireless technologies don’t work as well as the hard-wired options. Wireless Internet service will succeed where wireless technology holds an advantage.

Wireless broadband technology has three advantages over landlines:

  1. It is ubiquitous.
  2. It can be rapidly deployed for a far lower initial capital outlay.
  3. It excels at delivering the same bit stream to many people at the same time.

Future success will come where business plans maximize one or more of these advantages, and three opportunities stand out:

  • Rural and other underserved areas. Once the demand for broadband service in rural areas catches up with that found in urban and suburban regions, 4G or similar technologies will be an excellent way to address that market. However, over the long run, business plans will have to provide for at least a partial transition to wired facilities, otherwise wireless companies will see their best customers cherry picked by landline players eager to take a free ride on the money invested to build this market. Without a transition to landline service, this opportunity is only good for the near to medium term. One source of assistance (or danger!) is the potential for government subsidies. It’s nice to have someone help with the bills, but the market-distorting effects can be substantial and dangerous.
  • Broadcasting. Take one signal and deliver it, maybe even sell it, to thousands and even millions of people at once. Sounds a lot like television. Unfortunately for entrepreneurs, this opportunity is largely spoken for – by television stations. They’re slowly learning how to maximize the value of their digital bandwidth. One growing market segment is mobile viewers. Expect to see mobile telecom and media companies save their own bandwidth by integrating broadcast signals into devices and service offerings. It was a nice idea while it lasted, though.
  • Mobile Internet and the Internet of Things. A coke machine and a commuter have some things in common. Both can be hard, if not impossible, to reach with wired Internet service (although I expect some kind of a data over powerline solution will eventually take care of the coke machine). And both lean towards relatively thin stream applications – credit card transactions for the coke machine, and email and simple web-based activities for the commuter (assuming the bulk of mobile rich media needs are handled by broadcast delivery and on-board storage). The mobile user, in particular, will be a long term growth opportunity as small form factor devices multiply and the range of applications and services grows.

Try to launch a wireless broadband business that goes head to head with the landline players or isn’t fundamentally built around exploiting the inherent advantages of wireless technology, and you’re swimming against the tide. And the tide won’t change, ever. But build it on the competitive advantages that wireless does enjoy, and you still have a shot at a winnable business case.