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Wireless Internet Access Fact Sheet

Wireless networks have been incredibly successful, from home Wi-Fi networks to the billions of mobile devices in use across the planet. So successful, in fact, that some have come to believe we no longer need wires.

We developed this fact sheet to clarify some misconceptions about what wireless Internet networks are capable of and the importance of fiber optic cables in building better wireless networks as our bandwidth needs continue to increase.

This fact sheet defines important terms, offers some key points clarifying common misconceptions, compares 4G and 3G wireless to wired cable, and more. We also include references to additional resources for those who want to dig deeper.

Download our Wireless Internet 101 Fact Sheet Here [pdf].

If you want updates about stories relating to community Internet networks, we send out one email each week with recent stories we covered here at MuniNetworks.org. Sign up here.

Cox Discourages Internet Use That Competes with Core Cable Product

Another story of frustration as cable companies try to discourage Internet use on their last generation networks.

An article earlier this month in StopTheCap! tells the story of the John Heeley family, long time Cox customers and avid Netflix fans. The Heeley's received a letter from Cox warning them about their "excessive Internet usage." They were more than a little annoyed, considering they fork over $2,400 a year to the cable giant provider so called to express their displeasure:

Heeley’s fiancé Shelley was angry after realizing just how much the couple already spends with Cox.

“I called them on the phone and the first thing they want to do is get you to upgrade and spend even more money with them,” she tells Stop the Cap! “They tried to vaguely threaten our service if we continued to ‘overuse the Internet’ and suggested we cut back or cancel Netflix which they think is the reason we went over the limit.”

Shelley says she was born at night, but not last night.

“How convenient they want you to stop using Netflix, Amazon, or other online video services that their cable TV competes with,” Shelley says. “It is unfair competition.”

Shelley requested a Cox supervisor and threatened the company right back, telling Cox if they sent one more letter like that, the Heeley family would take their business elsewhere.

“He told us quietly we could ignore the letter and any future letters and they will add a note on our account,” Shelley tells us. “He confided they have customers going over the limit all the time and the letter is really about educating customers about usage.”

Ketchum, Idaho: No Tolerance for Cox Push Polls

Cox pushed Ketchum one step too far. The community of 2,700 formed a broadband advisory committee in November, 2012, and included a representative from Cox on the committee. Brennan Rego of the Idaho Mountain Express recently reported on happenings in Ketchum.

When residents in Wood River Valley started receiving push poll telephone calls from Cox to poison any possibility of a community owned network, Mayor Randy Hall and city leaders reacted promptly. They booted Cox off the broadband advisory committee.

Consistent with Cox push polls in other places, questions were leading:

 “The questions were so outrageous, I didn’t want to continue with the survey,” [Valley resident Sarah Michael] said. “I got offended. They were inappropriate and misleading.”
 

Michael said that, in essence, one question asked: Would you support Ketchum’s broadband initiative if you knew the city would cut police, fire and other essential services to pay for it?
    

“Who’s going to answer yes to that?” she said.

Michael and other residents who received the calls contacted surprised city staff and Mayor Hall. 

 “As the mayor, I can’t stand by and let somebody imply that I’m going to compromise the Police Department and the Fire Department by taking money away from them and putting it toward a broadband initiative,” Hall said. “That’s insane. I would never do that. I think the survey was trying to create fear.”

Cox claimed the questions were designed to "learn more about the public's opinion" but would not divulge the wording of the survey questions.

The city posted a disclaimer on its website to ensure residents knew the survey was not associated with the committee. 

“Cox is a very valuable member of our community,” Hall said. “But to imply that the city is willing to compromise the health and safety of its citizens by funding a broadband initiative is false and irresponsible.”
    

Hall said he considers Cox’s “unilateral action” in deciding to conduct the survey a “breach of trust,” but that the city would welcome a new representative of the company to the committee.

This behavior from Cox should be unacceptable in any community. Unfortunately, such polls are a common tactic from Cox, which we wrote about in our case study of Lafayette. In that situation, someone recorded the poll phone call, a very smart move that allowed everyone to hear how Cox had worded the questions to turn the community against the project with lies.

Even After Omaha, Communities Cannot Count on CenturyLink For Connectivity

CenturyLink is a massive telephone company struggling to remain relevant as we transition to mobile phones and require connections much faster than DSL delivers. Though the Omaha gigabit announcement may seem to be a monumental shift for this company, it actually is not. It is a blip on the radar - an important blip but a blip nonetheless.

The Omaha pilot does not represent a sudden change of CenturyLink strategy or capacity. Part of West Omaha has a unique history that prompted this investment. The vast majority of communities in CenturyLink territory still have no hope for upgrades beyond the basic DSL they offer today. Sadly, this already-outdated technology will only fall further behind in coming years.

First, if you missed it, CenturyLink has announced a 1 Gbps pilot project in Omaha, Nebraska. This is considerably more newsworthy that AT&T's toothless fiber-to-the-press-release response to Austin's Google Fiber.

CenturyLink is a massive corporation in a tough spot. It operates in 38 states and in each one, subscribers are fleeing slow DSL for faster networks and moving from landlines to wireless devices. CenturyLink does not have enough revenue for the upgrades most communities need.

CenturyLink deserves some praise for this gigabit trial because it recognizes the need to upgrade old networks to offer faster, more reliable connections. And it is symmetrical, offering the same upload speeds as downstream whereas the Verizon FiOS network tends to prioritize downstream at the expense of up.

For years, CenturyLink has told communities that basic DSL is just fine. We'll probably still hear that talking point in many communities from CenturyLink's government affairs staff. But this project is an admission that America needs better networks.

Why Omaha?

Qwest Choice Service

The only source we saw reporting on the special circumstances of how Omaha was chosen for this project was Telecompetitor with "CenturyLink enters the gigabit era:"

CenturyLink spokesperson Stephanie Meisse tells Telecompetitor the 48,000 customers who will be eligible for the gigabit network were previously served by pre-DOCSIS hybrid fiber coax that needed upgrading. CenturyLink is upgrading that network to Gigabit Passive Optical Network (GPON) technology to facilitate up to 1 Gig speeds. The gigabit deployment will not cover all of CenturyLink’s Omaha footprint — it will only be available, for now at least, to west Omaha, where the legacy hybrid-fiber coax network was deployed.

Before Qwest was taken over by CenturyLink, it had created a pilot project in this area called Qwest Choice TV and OnLine where it offered triple play services -- adding cable television to its DSL and telephone suite. This approach only got as far as Phoenix, Denver, and Omaha in the old Qwest areas.

To be clear, the Omaha trial is pretty limited. 48,000 households is substantial, but only represents 12% of the metro. And a specific demographic slice according to Phil Dampier at Stop the Cap:

Only around 12% of metropolitan Omaha will have access to the experimental fiber service, primarily those living in West Omaha. The network will bypass residents that live further east. The boundaries of the forthcoming fiber network are notable: West Omaha comprises mostly affluent middle and upper class professionals and is one of the wealthiest areas in the metropolitan region. Winning a right to offer service on a limited basis within Omaha is an important consideration for telecom companies like CenturyLink.

The gigabit price is pretty reasonable, in the way that only a few massive operators can make it: $80/month when bundled and $150/month for standalone.

Nebraska Seal

One unanswered question in all of this is whether the gigabit service comes with data caps, as noted by Karl Bode at Broadband Reports:

The company confirmed to me last March that they impose a 150 GB for 1.5 Mbps service plans, and a 300 GB cap for anything faster. The company also boots excessive users off of their network.

Any expectation that CenturyLink will make more investments of this nature soon are mistaken. They even candidly admit that they will have to evaluate this pilot project before considering expansion. That evaluation would happen in 2014, at the earliest. If they were to expand it, it will take another few years before they get going. In the meantime, the vast majority of CenturyLink customers will be stuck on DSL.

Let's take a look at CenturyLink's capital investment strategy. This is where we get a better sense of the companies true priorities. Thanks to Seeking Alpha, we can read the transcript of the Q4 2012 Earnings Call from mid February.

The call reveals that CenturyLink has placed a major emphasis on getting fiber to wireless towers (a cash cow) and connecting large enterprise customers with cloud services. Neither of these approaches do anything to improve residential or small business Internet access in communties. But they are a very sensible place for a firm to maximize its revenues.

Stewart Ewing, CFO, stated:

Capital expenditures are expected to range from $2.8 billion to $3 billion driven by spending in our key growth areas, data hosting will spend $325 million to $375 million, HSI [High Speed Internet] expansion and HSI capacity will spend between $350 million and $375 million, and our Fiber-to-the-tower will continue to spend about $250 million to $300 million in this area, our Prism TV with the launch of the Phoenix and one other market, we expect to spend $100 million to $150 million.

CenturyLink Map

Of the 38 states it serves, CenturyLink has announced two metro areas that are getting substantial upgrades in 2013. The first is Phoenix with a VDSL product like AT&T's U-Verse. This is faster than standard DSL but barely competitive with cable's DOCSIS 3 standard. And households even within the city get wildly different speed due to the way distance degrades the VDSL signal.

Omaha is the second -- where 12% of the metro will be upgraded to a next-generation network. If I had to put money on the next metro to get meaningful investment, it would have to be Denver because it is the third (and final) former Qwest territory community getting the television product.

CenturyLink is putting $350 million into expanding high speed Internet generally, but separately (from what we can tell) it is spending between $100-$150 million on improve Internet access in just two markets. Of those two, only 12% of Omaha is covered and the VDSL in Phoenix is barely competitive with existing cable. That should give you a sense of the scale of CenturyLink's investment dilemma: High costs and limited dollars.

Put another way, Chattanooga's EPB spent approximately $300 million over three years to deliver FTTH to 170,000 households across its 600 square mile territory. Yet another way: If CenturyLink dumped its entire 2013 capital expenditure budget into FTTH for Minneapolis and Saint Paul, it would be insufficient to bring FTTH to everyone. CenturyLink operates in 38 states.

CenturyLink just doesn't have the money to upgrade most of its communities. Will it in future years? That is a question that Phil Cusick of JPMorgan asked: "Okay. And, so we should look at CapEx as being essentially flat for the next few years?"

CFO Stewart Ewing response:

That's our thinking now. Pretty flat, we could bring it down some, cut it off a little bit depending on. It's really based on the success of these new initiatives, I mean, what we think we can drive in terms of revenue and margins going forward.

CenturyLink is not dumb or evil, it just has different priorities for investment than what communities need. The sooner local governments understand this, the better. Heck, CenturyLink itself has made this point in Minnesota:

CenturyLink Minneapolis Building

We’re a public company. We have shareholders. We have rules and commitments. If you’re smaller, the shareholders are the owners. There’s more flexibility – especially if owners/shareholders are local.

Minnesota Public Radio summed it up:

Noting that CenturyLink wants every customer it can find, Ring pointed out that the company nonetheless needs a return on investment that satisfies shareholders and meets the demands of larger commitments and fiduciary responsibilities.

The lesson is clear. Omaha is a outlier, don't count on CenturyLink to invest in better connections for your community.

And finally, I could not resist but note Julius Genachowski's final hurrah: One of the last acts of former Chairman Genachowski was to rush out a press release praising this limited pilot, though the former Chairman has ignored much more impressive citywide announcements of gigabit availability in other communities including Wilson, North Carolina; Clarksville, Tennessee; Tullahoma, Tennessee; and even a small company doing an apartment complext in Albuquerque, New Mexico: CityLink Fiber.

The federal government remains clueless in this regard, blinding by the lobbying glitz of powerful industries. The big cable and telephone companies will not solve our Internet connectivity problems. Communities are wise to depend on themselves.

The First Honest Cable Company

This video is really making the rounds - I have seen it on multiple lists and many have forwarded it to me. I found it hilarous, but be warned that it features salty language that may be offensive to some and is probably NSFW.

Video: 
See video

Moultrie City Manager Discusses Origins of CNS Network in Georgia for Community Broadband Bits Episode 39

Mike Scott, City Manager of Moultrie in Georgia, joins us for Episode #39 of the Community Broadband Bits podcast to share the origins of the Community Network Services (CNS) network that joins four towns in four counties in rural southwest Georgia.

In this interview, Mike Scott shares some of the benefits of the network for local schools and community savings. Built originally because the existing cable and telephone companies would not invest in their communities, CNS has proved itself an incredibly valuable community investment.

CNS is credited with creating over 6,000 jobs in the communities it serves, a tremendous boon for the communities that joined together to create this network. During our interview (below), we note a video they created to show off some of the benefits of this network. Here it is:

We want your feedback and suggestions for the show - please e-mail us or leave a comment below. Also, feel free to suggest other guests, topics, or questions you want us to address.

This show is 20 minutes long and can be played below on this page or subscribe via iTunes or via the tool of your choice using this feed. Search for us in iTunes and leave a positive comment!

Listen to previous episodes here. You can can download this Mp3 file directly from here.

Thanks to D. Charles Speer & the Helix for the music, licensed using Creative Commons.

In Georgia, Monroe Muni Network Created Jobs, Lowered Bills

As we monitored Georgia's HB 282, a bill to limit the capacity of local governments to invest in Internet networks that spur economic development, we learned of many existing networks that have helped communities to thrive.

Brian Thompson, Director of Electric and Telecommunications in Monroe took some time to tell us a little about their city network.  Located in the north central section of Georgia, with a population of 13,000, the network now offers triple play services to residents and businesses. Its network started in the 1970s with a municipal cable tv network. Today, the network is a hybrid with fiber having been added as an expansion to its cable network.

Monroe's investment in its fiber began as a way to improve connections for education. The Walton County School District could not find a private provider willing to collaborate on an affordable network between school facilities. The city took on the challenge and built a point-to-point network which the School District paid for in 10 years. In the mean time, the city expanded its network in other areas. Now, the Walton County Schools have gig service between facilities and to the Internet. The District pays only $500 per month for a service that would cost five times more from a private provider.

Thompson also confirmed what we hear from other communities with publicly owned networks - prices for business and residential services are very competitive and service is superior. He notes that customers often express appreciation for local representatives, rather than dealing with a huge bureaucracy like those at Verizon or AT&T. New connections can be created in a matter of hours or days instead of weeks.

Residential service for Internet access from MonroeAccess.Net includes affordable basic service (1 Mbps / 256 Kbps) for $21.95 per month. Two faster tiers include $34.95 (6 Mbps / 512 Kbps) and $44.95 (15 Mbps / 1 Mbps). Cable tv rates vary from $15.50 to $62.95 per month and residential phone service starts at $29.95 per month. Thompson notes that, when Monroe added phone service, rates dropped for every one regardless of carrier. 

There are over 100 fiber customers and the network has been critical for economic security. T1 connections for businesses used to go for $1,000 per month; now higher capacity connections cost $250. Notable customers include Minerva, a beauty salon supplier with a large showroom and distribution center in Minerva. The multi-million dollar salon equipment company has headquarters in China but has nearly 30,000 customers in the U.S. Company owners required a fiber connection to communicate with the facility in real time. Monroe was happy to oblige.

Hitachi Logo

Monroe is also home to a Hitachi plant that makes parts for several auto companies. The fiber network allows the plant to communicate efficiently with the Hitachi headquarters located in Harrodsburg, Kentucky. The plant employs about 250 people.

Monroe never borrowed or bonded to build out its network. Thompson tells us the network has always progressed slowly and community leaders leverage partnerships with local interests along the way. The city used its capital investment fund for initial construction and continues to expand slowly with revenue obtained from offering services. Thompson tells us that their approach works for Monroe and shudders at the thought of legislators in Atlanta claiming otherwise.

Monroe's network travels well outside the city limits, over a nine county area, and HB 282 could have put an end to its expansion. Fortunately the bill was defeated on the House floor and for at least one more year, this community does not have to worry that the state will revoke its power to encourage economic development locally.

Broadband 101 Fact Sheet

We are pleased to announce our most recent Fact Sheet - Broadband 101! Most of the people following our work already know these key details but you also know people who are confused and perhaps intimidated by Internet issues.

Enter, the Broadband 101 Fact Sheet [pdf]!

We cover basic terminology, traditional technologies to deliver broadband, and common policy goals. We also explain why fiber optic connections are so popular lately and why neither we nor Wall Street expects robust competition in telecommunications.

This publication joins our previous fact sheets that explained how community owned networks have led to new jobs and tremendous savings for community anchor institutions.

Please share it with elected officials, local policymakers, friends, enemies, and those people you aren't sure you really know on Facebook. If you have some thoughts on what we missed or what should be included in Broadband 201, let us know in the comments below.

Bandwidth Caps are Unnecessary and Counterproductive

The Open Technology Institute at the New America Foundation has released a report on data caps in the U.S. The report, Capping the Nation's Broadband Future, was authored by Hibah Hussain, Danielle Kehl, Benjamin Lennett, and Patrick Lucey.

The paper looks at the growing prevalence of monthly data caps by massive ISPs like Time Warner Cable, AT&T, and others. Authors conclude that data caps are effectively discouraging Internet usage with restrictions and limits that can be expensive. From the summary:

As this paper documents, data caps, especially on wireline networks, are hardly a necessity. Rather, they are motivated by a desire to further increase revenues from existing subscribers and protect legacy services such as cable television from competing Internet services. Although traffic on U.S. broadband networks is increasing at a steady rate, the costs to provide broadband service are also declining, including the cost of Internet connectivity or IP transit as well as equipment and other operational costs. The result is that broadband is an incredibly profitable business, particularly for cable ISPs. Tiered pricing and data caps have also become a cash cow for the two largest mobile providers, Verizon and AT&T, who already were making impressive margins on their mobile data service before abandoning unlimited plans.

The increasing prevalence of data caps both on the nation’s wireline and mobile networks underscore a critical need for policymakers to implement reforms to promote competition in the broadband marketplace.  Data caps may offer an effective means for incumbents to generate more revenue from subscribers and satisfy investors, but making bandwidth an unnecessarily scarce commodity is bad for consumers and innovation.  The future is not just about streaming movies or TV shows but also access to online education or telehealth services that are just starting to take off. Capping their future may mean capping the nation’s future as well.

The paper also looks at the technical challenges of capping data usage. Additionally, the authors delve into the many ways data caps are turned into profit for a few big providers while harming users. This resource brings relevent data into focus along side long term policy implications and offers some advice:

Data Cap Myth

For the Internet to continue to serve as a catalyst for economic growth it is imperative that consumers and entrepreneurs not feel constrained online. In a recent speech, former FCC Executive Director and Chief of Staff Blair Levin highlighted the links between broadband abundance, innovation, and economic growth.

"When it comes to the wireline access network, instead of talking about upgrades, we are talking about caps and tiers. Instead of talking about investment for growth, we are talking about harvesting for dividends,” …  “[policymakers] should recognize that our progress demands an investment environment that creates the conditions that allows us to invent the future, not just harvest from the past."

An uncapped Internet environment gave rise to a host of innovative and popular applications. Broadband and bandwidth must continue to be thought of as an abundant resource, not a rationed commodity, to ensure the vibrant online ecosystem can continue to flourish.

Shortly after this report was published, the lead lobbyists for cable interests in Washington, DC, admitted that the bandwidth caps are not designed to solve any congestion problems, which Karl Bode covered with his usual smart analysis.

Except the argument that usaged pricing is about fairness has been just as repeatedly debunked. If usage caps were about "fairness," carriers would offer the nation's grandmothers a $5-$15 a month tier that accurately reflected her twice weekly, several megabyte browsing of the Weather Channel website. Instead, what we most often see are low caps and high overages layered on top of already high existing flat rate pricing, raising rates for all users.

Any argument that caps for wireline service are necessary is refuted by the fact that the fastest networks in the US, whether publicly owned, Google, or even Verizon's FiOS, see no need to cap monthly transfer amounts.

The big cable monopolists don't care about fairness, they care about boosting profits while investing as little as possible. Unfortunately, their overcharging lack of investment is harming every other industry in our country.

Susan Crawford's Captive Audience Book Reviewed

I quickly read the just-released Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age, and came away quite excited by Susan Crawford's new book.

Susan Crawford has been supportive of community owned networks and a loud voice against the poor policies that have allowed a few massive cable and telephone companies to monopolize our telecommunications. Her new book is a good resource for those just getting interested in this issue.

After the book was released last week, Susan Crawford appeared on the Diane Rehm show -- an excellent 50 minute interview that comes highly recommended. Be aware that the cable/telephone industry is engaging in character assassination to prevent Susan's message from reverberating around the country.

The book led to Sam Gustin's article in Time, "Is Broadband Internet Access a Public Utility?"

State and local laws that make it difficult — if not impossible — for new competition to emerge in broadband markets should be reformed, according to Crawford. For example, many states make it very difficult for municipalities to create public wireless networks, thanks to decades of state-level lobbying by the industry giants. In order to help local governments upgrade their communications grids, Crawford is calling for an infrastructure bank to help cities obtain affordable financing to help build high-speed fiber networks for their citizens. Finally, U.S. regulators should apply real oversight to the broadband industry to ensure that these market behemoths abide by open Internet principles and don’t price gouge consumers.

Art Brodsky also reviewed the book on the Huffington Post. He leads with a reminder of the damage done by the NFL's replacement refs, an apt comparison given how poorly the FCC and Congress have protected the public.

Susan will be our guest for the Community Broadband Bits Podcast (episode 29) on Tuesday, Jan 15, and I will be offering periodic thoughts on passages from the book in coming days/weeks.