DSL Prime News Briefs

DSL industry news from around the world plus e-mail and a correction.

by Dave Burstein of DSL Prime and Future of TV [November 30, 2004]

e-mail

• Because she had just run for Congress soliciting funds from the Bells, DSL Prime recommended Becky Klein for dogcatcher, not FCC commissioner. A reader I know is independent writes "I worked closely with her... I was sufficiently impressed with her that I did something I've never, ever done before made a contribution to a Congressional candidate. I suppose that the telcos, etc. made contributions for the reasons you outlined—and I share your concern about the 'FCC for sale'—but I think she would be very 'neutral' and having a 'connection' to the President could be useful in getting things done." I've heard from others she's been an effective commissioner. To make it clear I was writing based on the money trail and not her record or skills, I made another recommendation for the slot, Dick Notebaert, CEO of Qwest and before that Ameritech. That amazed readers who think I have a blind hatred of the Bells, but in fact I have enormous respect for the competence of many at the telcos. That same reader, who has senior FCC experience, adds, "Your suggestion for Notebaert for the FCC, however, is inspired. Becky Klein—like Kevin Martin, Michael Copps, Jonathan Adelstein, and probably Michael Powell—suffer from two problems: they are 'political' and they have no relevant industry experience. That is a deadly combination all problems and solutions have a major 'political' component when you see the world through 'political' glasses and, when you have no other relevant experience, all the solutions have primarily a 'political' cast, since that is all you know. The lack of relevant experience also makes you extremely vulnerable to lobbyist 'spin'." That matched my thought—better to have a commissioner who knows enough to tell whether a supplicant is lying.
  
  
• "Dave, for what it's worth department... I wrote to my Congressman (Jay Insle) and my Senators (Patty Murray and Maria Cantwell) with a strong protest about Becky. Thanks for your tip."
  
  
• From Kentucky came a welcome note "I enjoyed your presentation at the National Association of State Utility Consumer Advocates conference in Nashville, Tennessee." The canyon is wide between the discussions in policy circles and what's really going on in the industry. I'm glad to play a small role bridging that gap.
  
  
• Ariel Shuper writes ECI is shipping to Scandinavia an application that minimizes delay/jitter troubles in moving from IP backhaul to DSLAM ATM. Problem packets cause problems for IPTV, including screen blocking and freezing. I call them "Jennie flickers" because she hates them on our VOD. That's one reason SBC is spending $100 million to replace routers for their video net.

Correction

• Dick Notebaert took the Qwest job not out of "retirement" from Ameritech, but after already being lured to run Tellabs, Richard Lytle reminds me.

Ain't necessarily so

• Claim: DSL networks are open to competitive ISPs, not de facto dominated by the carriers.
  
  
• Refutation from BellSouth: Justifying a new regulation that would limit ISP access, Kevin Curtin points out "The change would not reduce competition because more than 90 percent of DSL users in Bellsouth's area are BellSouth retail customers and only 10 percent are served by other ISPs. He says it would also save the telco millions that it now spends providing infrastructure to support separate access to its networks for ISPs." Reported by Charlotte Wolter in XCHANGE. I wrote in 2000 that Bell prices effectively eliminated the independent ISPs, and I've since reported that neither AOL nor mighty Microsoft could overcome that. The bells almost never gave out the percentage they controlled, which went from less than 10 percent in dial-up days to domination today. The 90 percent figure matches a comment from Ed Whitacre when ISPs were going broke that he needn't worry because so few customers actually were served by ISPs.

Briefs

• "Since 1999, the year the law lifted the price cap on standard cable, the average Bay Area rate jumped 34 percent, by $126 per year. That's nearly three times the rate of inflation, which increased 12.7 percent during that period." James Temple in the Contra Costa Times
  
  
• Congratulations to Brian Hinman and team at 2Wire on delivery of two million gateways.
  
  
• Lalaland is going HD "Subs love HD and tell you that if you want to take HD away, you'd have to pry it out of their cold, dead hands. The demand among upscale or high-end users alone is so strong." Mariann Belmonte, L.A. cable exec, to Simon Applebaum of CableWorld.

Press

• The WSJ has the best telecom team in the world, and one hundred times as many readers as DSL Prime. So while I can only speculate on some SBC issues, they get the opportunity to ask SBC's Ed Whitfield questions directly. Wondering about the technology risk in SBC's video, Almar Latour asked, "Some say your approach isn't proven. Isn't that risky?" Big Ed replied, "I think it takes some trust. It also takes some experience. And in my experience, these things have a way of being worked out technically. There's somebody smart enough to figure this out. The first iteration or first version may not work—or even the second or third. But you eventually get there pretty quick."
  
  
• Om Malik, whose blog breaks more telecom stories than most major metropolitan newspapers, now is writing a two columns for Business 2.0 online. Free subscriptions here. A colorful example: "Someone at SBC Communications has to be nominated for the best media strategist of the year award. What a masterful strategy! Announce VoIP plans, then to layer it thick, announce IP-TV plans, and while the whole world was gushing over you (SBC) embracing the future, stick a knife in the back of every potential VoIP rival with a simple, relatively little know yet lethal regulation. ... Listen up guys: when Bells livelihood is threatened they firebomb the opposition. As simple as that."
  
  
• So you think, it is over. Think again. Many overlooked the fact that Cisco bought a company called P-Cube recently. One of the things P-Cube can do is prioritize the traffic flows on an IP network. SBC could use it and lower the priority of the traffic coming from say Vonage or AT&T. Priority and other "purely technical" problems will be the primary strategy to close the internet. Walled gardens are really prisons.

People

• Dick Martin makes me laugh out loud with Tough Calls, his new book of adventures as PR chief during the decline of AT&T. The book is loaded with fascinating "inside baseball" style tales, told artfully and with humor rarely found in a business book. Martin still has a Panglossian take "history will show [Mike Armstrong] had the right plan for AT&T ... he might still have recovered if the company's biggest competitor had not engaged in three and a half years of fraud," but tells the story with minimum spin and maximum candor.
  
  
• For job ads, visit the DSL Prime website.

Wall Street

• "Within the U.S., investors are unlikely to fund infrastructure buildouts by startup carriers, having witnessed the CLEC debacle and the failure of Wi-Fi hotspot service providers, such as Cometa Networks," notes Rich Church of Unterberg. If new investment is impractical to incent, policy needs to focus primarily on the investment levels of the current carriers.

Copyright 2004 Dave Burstein.
The DSL Prime Newsletter is reprinted with permission.

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