Unless Canada deregulates the media industry further, a “technological storm” by “audiovisual Wal-Marts” will harm or destroy Canada’s media companies.  No doubt looking directly at Netflix, those were the views of Quebecor CEO Pierre Karl Peladeau at the outset of hearings held this week by the Canadian Radio-television and Telecommunications Commission on media ownership and vertical integration issues.

Canada’s media landscape is rapidly consolidating at a rate that will allow even ordinary Canadians with a passing interest in the issue to recognize the handful of remaining media moguls and identify them by name.  Phone companies that own major Canadian television networks, cable operators that own cell phone companies, and mergers among the dwindling pack have left consumers soaking in Shaw, Rogers, Bell, and Quebecor — whether they flip on their televisions, make a cell phone call, read a newspaper, or download something from the Internet.  Talk about vertical integration!  Now the supersized are back for more deregulation so they can trade programming rights between themselves, fend off the devil — Netflix, and of course continue to buy each other out.

There is one exception, of course.  Allowing party crashers.  While all of the incumbent players want the rules loosened up on their respective media and telecommunications operations, they are hellbent on keeping foreign competition out of Canada — the only real deep pockets sufficient to break up a convenient cartel of phone and cable companies.  Rogers and Shaw stay on their respective sides of a line dividing eastern Canada’s turf for Rogers and western Canada’s territory for Shaw.  Bell and Telus do much the same.  Quebecor provides cable for Quebec, and a handful of much smaller players fight for any remaining crumbs.

For Americans, it would be the equivalent of turning over your telephone, broadband, cable, television, newspapers, magazines, and radio stations to Rupert Murdoch or ex-media baron Ted Turner.

For Canadians, these hearings come just a tad too late.  Shaw Communications is absorbing their latest buyout — Canwest Media’s TV assets, which are hardly meager.  Shaw will run more than two dozen local broadcast TV outlets, 30 cable and satellite networks, and Global — a major broadcast network.  Bell is still popping Rolaids over its digestion of the enormous CTV and smaller upstart A-Channel network.  When it’s finished, “A” will become “CTV Two.”

The Globe and Mail notes between them, Bell, Shaw, Rogers and Quebecor control:

• 86 per cent of cable and satellite distribution;
• 70 per cent of wireless revenues;
• 63 per cent of the wired telephone market;
• 49 per cent of Internet Service Provider revenues;
• 42 per cent of radio;
• 40 per cent of the television universe;
• 19 per cent of the newspaper and magazine markets;
• 60 per cent of total revenues from all of the above media sectors combined.

As far as growth goes, as Alan Keyes used to proclaim, “that’s geometric!”

But it’s still not enough now that Netflix has arrived in Canada.  Despite the fact the operation has been challenged by punitive usage caps restricting viewing (or lowering its video quality), Netflix and new technology companies like it are the 21st century boogeymen for these multi-billion dollar media corporations.  The only way to defend against it?  Deregulate to allow them to trade viewing rights, grow larger, and charge whatever they like.  Somehow that seems to miss the point: Netflix is popular because it costs less, allows people to stream the shows they actually want to watch at a time of their choosing, and let’s families drop some overpriced premium channels and video rental fees along the way.

Bell’s dollar-a-holler researcher expanded on why large media conglomerates miss the point, even if he did so unintentionally.

According to University of Alberta economics professor, Jeffrey Church, “vertical integration is beneficial for consumers.” Sit down as you read why:

• it reflects efficiencies, spurs competitive innovation and is a global trend;
• telecom, media and Internet markets in Canada are “highly competitive;”
• our ‘small media economy’ needs a few deep-pocketed national champions to compete globally and invest heavily in innovation at home;
• instances of harm are mostly imaginary and few and far between;
• it helps keep “consumers . . . within the regulated system” (Shaw’s submission, p. 4).

Like cattle.

Billboards sprinkled across Ft. Wayne, Ind., telling residents, “Frontier is pulling the plug on FiOS — Switch to Xfinity,” has infuriated Frontier Communications, who says it will continue to provide FiOS service in the area, at least for broadband, indefinitely.  Now the independent phone company has sent a “cease and desist” letter to Comcast officials demanding the billboards come down.

Frontier spokesman Matt Kelley accused Comcast of spreading false rumors in an effort to drum up business.

“Frontier is not planning on pulling the plug,” Kelly told WANE-TV. “We are going to continue providing FiOS service in Allen County and we have no plans to remove it.”

WANE-TV in Ft. Wayne led its newscast with the dispute between Frontier Communications and Comcast over fiber optic television.  Is the plug really being pulled? (Loud Volume Alert!) (3 minutes)

But Comcast officials note Frontier has been pushing existing customers hard to switch to satellite television service, and Frontier earlier announced dramatic rate increases for its fiber cable television service — rates much higher than other competitors.

Comcast issued a statement about the dispute:

“Comcast continues to invest in these markets, while Frontier has taken a number of steps to discourage new customers from signing up for its service and encourage current customers to seek alternative services from satellite. We are using these ads to make consumers aware of our Xfinity TV service as a better choice for consumers.”

HissyFitWatch: Oooh... Comcast!

From our own Stop the Cap! investigation, both companies are partly correct.

We called Frontier this afternoon posing as a new FiOS customer in Ft. Wayne trying to sign up for television service.  The only option available, we were told, was satellite television service.  While Frontier was happy to sign us up for telephone and fiber broadband, the company representative told us she could not take our order for FiOS TV because, “it’s not available in your area.”

But Comcast’s claims about FiOS lack the very important detail that FiOS broadband and phone service will be offered by Frontier without any interruption — only television service appears to be at issue, and remains available to current customers.

We heard from several Ft. Wayne customers who are unhappy with Frontier’s handling of FiOS.

“While Comcast is being clever, the fact is Frontier wants TV customers to switch to satellite, which is simply a stupid idea,” says our reader Kevin.  “Why would I want a satellite dish when I have fiber.”

Lee, another Frontier customer, believes the company broke its promise of no rate increases after buying out Verizon’s local operations.

“They promptly raised the TV rate by around $30, and if you are a new FiOS customer, expect to pay hundreds and hundreds of dollars for installation,” he says.

Last week, Frontier’s deadline for Comcast to pull down the billboards passed, but as of today those billboards are still on full display.  Comcast’s response to Frontier?

“We received their letter.”

WANE-TV in Ft. Wayne updates viewers.  Frontier’s unilateral deadline for Comcast to pull down their billboards came and went.  The billboards are still there.  Now what? (2 minutes)

Cramming

After years of mystery phone charges for long distance services, ringtones, software backup, and phone entertainment customers never signed up for, the Federal Communications Commission today announced it was getting tough with more than $11 million in fines against some of the companies responsible.

Phone cramming — the practice of signing you up for paid services you never ordered, wanted or needed, has been a perennial problem ever since telecommunications reform allowed third parties to charge for their dubious services on monthly telephone bills.  In return, phone companies collect a substantial piece of the action, leading some critics to charge Ma Bell has a financial interest in keeping phone cramming alive and well.

Helping increase the confusion, most cramming charges are listed under innocent-sound names like “long distance discount plan,” “protection plan,” or “ring choice.”  Most are buried under “other charges” found on the back of the bill or somewhere on the second page.  The monthly charges can range from $2-20 — the smaller the amount, the less likely it will be questioned by a cramming victim.

Some of these charges have been collected from unsuspecting customers for years.

Now FCC Chairman Julius Genachowski has proposed fining the worst offenders $11.7 million for violating the agency’s cramming rules.

“We’ve seen people getting charges for yoga classes, cosmetics, diet products, and, yes, psychic hotline memberships,” Genachowski said. “These mystery fees are often buried in bills that can run 20 or so pages, and they are labeled with hard-to-decipher descriptions like USBI.”

The targets of the fines: Main Street Telephone; VoiceNet Telephone, LLC; Cheap2Dial Telephone, LLC; and Norristown Telephone, LCC.

Customers who do ferret out cramming charges run into roadblocks trying to get their money back.  Telling customers they themselves authorized the charges, several crammers refuse to provide refunds or only agree to stop future charges, while keeping the money they already collected.  Other customers seeking refunds from phone companies find themselves in a loop of “buck-passing,” as companies like Qwest redirect callers to the crammers to get charges credited back.

The Senate Commerce Committee will hold hearings on phone cramming soon and issue a report on the ongoing problems this practice causes customers, according to Sen. Jay Rockefeller (D-WV).

WISH-TV in Indianapolis has spent years tracking the exploits of former-local businessman Tim Durham, who allegedly wiped out the savings of thousands of people, was blamed by one victim for the death of his elderly mother, and was implicated indirectly in a phone cramming operation.  (13 minutes)

KSTP-TV in Minneapolis provides raw video of Greg Carlson of Eagan and Matt Rohn of Northfield sharing their stories about being crammed by USBI for long distance on their Qwest bills.  (6 minutes)

A major scandal in one of the nation’s most important gay civil rights organizations has inadvertently exposed AT&T’s public policy skunkworks – a dollar-a-holler operation to advocate for the company’s merger with T-Mobile, complete with pre-written advocacy letters, traded favors and promises of support from other board members, paid for with big financial contributions.

When it was all over, the president of Gay & Lesbian Alliance Against Defamation (GLAAD) resigned, his ties to a Republican operative board member connected with AT&T were exposed, and the progressive gay and lesbian media outed the whole sordid affair — painting one of the clearest pictures yet of how civil rights groups get into the unenviable position of trading their good name for a piece of big business action.

As Stop the Cap! has reported for nearly three years now, there is a cottage industry in the non-profit sector collecting favors and contributions in return for letters on organization letterhead supporting the public policy agendas of their corporate sponsors.  Honest non-profit groups won’t engage on issues that have little or no connection to their mission statements, but other groups have relaxed those standards to meet fundraising goals or to deal with internal board politics.

The latter appears to be the most prominent reason for GLAAD’s poorly managed entry into the debate on Net Neutrality and AT&T’s merger targets — the first time the group has ever spoken up about a corporate merger.  Because so many in the gay, lesbian, and transgendered community are politically aware, it came as quite a shock when GLAAD suddenly dove into two issues most assumed were not relevant to the group’s mission:

GLAAD Net Neutrality Intrigue: On January 4, 2010, GLAAD President Jarrett Barrios signed a letter to the Federal Communications Commission expressing “concern” about the implementation of formal protection of the open Internet through Net Neutrality.  At the time, nothing about Barrios’ letter seemed suspicious.  In fact, it was typical of the type and tone of concern trolling by certain groups that could pay a stiff price if rank and file members ever found out.  But several members did and raised hell with GLAAD’s leadership over the issue.  Barrios evidently panicked, quickly sending a follow-up letter to the FCC claiming his signature was forged and begging the ‘fake’ submission be withdrawn.  Ironically, he added the views in the original letter, unclear as they were, did not represent GLAAD’s position on Net Neutrality, whatever it was.

GLAAD Loves AT&T and T-Mobile’s Merger: On May 31st, Barrios joined the National Gay & Lesbian Chamber of Commerce in penning a joint letter advocating the merger because, apparently, gay people love 4G, artistic use of the Internet, and telemedicine.  Gay groups immediately pounced, some describing the letter bizarre, others potentially offensive.  The second letter ignited an all-out firestorm against GLAAD’s leadership, particularly considering AT&T has donated profusely to GLAAD over the years, and gay people have no more love towards AT&T and its business agenda than anyone else.

Signorile

Head scratching over why GLAAD was obsessed with delivering a helping hand to AT&T was soon followed by detailed investigations which began to uncover the important underlying facts.

One pivotal moment came from Michelangelo Signorile, a long-time gay activist and radio talk show host, who interviewed GLAAD’s former board co-chair, Laurie Perper.  Perper left GLAAD suggesting its board was in turmoil under the leadership of Barrios.  In her words, Barrios’ efforts to shore up his presidency included trading an AT&T advocacy letter for a company-connected board member’s continued support.

Perper also dismissed Barrios’ suggestion that the letter to the FCC about Net Neutrality was forged.  Instead, she claims, Barrios tried to blame it on his administrative assistant, Jeanne Christiano, who he claimed ambitiously sent the letter without his authorization.

Former GLAAD board co-chair Laurie Perper talks with Michelangelo Signorile about the connection between AT&T and GLAAD’s president. June 7, 2011. (11 minutes)
You must remain on this page to hear the clip, or you can download the clip and listen later.

Since that interview, Barrios’ has come clean about who wrote the Net Neutrality letter.  According to Barrios, AT&T sent the talking points to include in the letter and he authorized it:

The letter’s origins lay with AT&T; the telecom giant sent Barrios suggested wording for another letter to the FCC. Barrios’ special assistant used the language verbatim to create the letter, signed his name to it, and sent it in.

Barrios recounts that he was at an airport when his assistant called him to go through some items on his agenda. In a hurry to board his plane, when she told him that “they” wanted him to send in the letter to the FCC, Barrios assumed he needed to resend his first letter again. He authorized her to send the letter without any oversight.

[...] “This was from a letter with language from AT&T suggesting that we support this, and at the time, it was not something I had seen,” Barrios said. “When I saw it, we withdrew it to reflect our perspective.”

Barrios: Now updating his resume

Further investigations uncovered AT&T-connected board member Troup Coronado. Many activists were surprised to learn learn Coronado is or was a paid consultant for AT&T and a Republican operative who used to work for Sen. Orrin Hatch (R-Utah).  While involved in Congress, Coronado worked to install judges hostile to gay and lesbian rights on the federal bench.  Today, he is a board member overseeing one of the nation’s most important gay and lesbian rights groups.

That revelation went over about as well as one could expect, and within a week, Barrios submitted his resignation, and calls for Coronado to leave are growing louder by the hour.

The intrigue has thrown GLAAD into full scale damage control mode, even as former board members like Perper call the group hopelessly brand tarnished and advocate its disbanding.  It also embarrasses AT&T by further exposing the sock-puppetry operations it runs to build phantom support for its business and policy agenda.

How Former and Current FCC Employees Helped Other Gay Groups (Heart) AT&T

GLAAD is not the only LGBT group in the chorus conducted by AT&T.  The National Gay & Lesbian Chamber of Commerce is no more friendly to consumer interests than any other Chamber of Commerce, and their participation in fronting for AT&T was to be expected.  But the National Gay & Lesbian Task Force is now repenting for their own involvement in AT&T’s bought and paid for parade:

“The National Gay and Lesbian Task Force submitted a letter to the Federal Communications Commission on Jan. 5, 2010, about rules and regulations regarding net neutrality. The letter was a response to a request by AT&T,” she said. “However, we quickly realized that we had not gone through an appropriate internal process on such policy matters and that the Jan. 5 letter did not accurately reflect our views and was a mistake. As a result, on Jan. 14, the Task Force submitted an additional letter to the FCC clarifying the organization’s position on net neutrality.”

“The Task Force has established a clearer internal review process that applies to any request for sign-on or policy endorsement from any group, organization or corporate partner. We have not issued any additional letters on net neutrality. Additionally the Task Force has declined requests from our corporate partner AT&T for further action regarding this issue and declined requests to write a letter regarding the proposed merger between AT&T and T-Mobile.”

Perhaps even more disturbing, new evidence is emerging that the FCC itself may be encouraging some of these civil rights groups to participate in discussions about controversial industry events.  The Bilerico Project discovered FCC chief Bill Lake meeting with GLAAD to talk specifically about how the group could become involved in public policy debates:

What’s not disclosed, however, is that Robinson, Barrios and board member Anthony Varona met with FCC chief Bill Lake and Deputy Director Bob Radcliffe in mid-May of last year. Varona is a former FCC attorney.

“Rashad, Jarrett and Tony met with the FCC in May 2010 to discuss GLAAD’s involvement in present and future FCC proceedings (including broadband proliferation items, public interest programming initiatives, etc.),” according to Rich Ferraro, GLAAD’s Director of Communications. The group denies that they took a formal position on any matter pending before the FCC at the time.

If true, this could link corporate astroturfing and dollar-a-holler advocacy to FCC insiders currently at the agency, as well as those who used to work there.

A word to the wise: if your non-profit needs cash, ask for contributions from your members.  Don’t sell out your good name for a billion-dollar corporate merger.  The position you protect may turn out to be your own.

Time Warner Cable CEO Glenn Britt says the cable company is once again testing technology to allow it to implement the same type of Internet Overcharging system consumers immediately rejected in 2009.

Speaking at the Cable Show in Chicago Thursday, Britt said the company has not yet decided whether it will actually introduce the system, but will have the technology in place to quickly implement it.

Unlike some other cable companies with a fixed bandwidth limit, once again Time Warner is considering a combination cap and tier system with fixed allowances for different levels of service.  In 2009, Time Warner Cable proposed a usage allowance of just 40-60GB per month for their Standard Service customers.  Customers seeking unlimited use service faced broadband bills as high as $150 a month.

Customers overwhelmingly rejected the pricing scheme in test markets in 2009, and political pressure only hastened the shelving of the test.  But Britt remains undeterred, telling Wall Street investors he remains a true believer in usage-based billing

Wall Street analysts told Bloomberg News they didn’t have a problem with it.  Bloomberg also quoted Netflix CFO David Wells as saying he had no objection to Internet providers covering the cost of increasing bandwidth capacity.  But Bloomberg quoted Wells speaking on a June 1 conference call, not in reaction to Britt’s specific announcement yesterday.  Further, Wells clarified his comments were directed towards network optimization and traffic shaping, not broadband usage caps.

Netflix is among the most likely online services that would expose broadband customers to potential overlimit fees, especially if Time Warner Cable brings back the same usage allowances it proposed in 2009.

In Wisconsin, one protest after another as state legislators deliver results for corporate interests, often at the expense of the public interest. Broadband was the latest close call.

Imagine if you drove down to your local credit union this morning to find the doors padlocked and an ominous sign taped across the front door: “Closed for Anti-Competitive Business Practices.”  Then you return your books on loan from the public library, but find the same padlock and sign on that building, too.  Scratching your head, you then drive home vowing to get to the bottom of this only to be greeted by the mailman, who hands you a letter from your daughter’s school announcing steep and immediate tuition increases required to cover surprising new expenses.

As you try and understand what exactly has happened, it all becomes clear when you switch on the evening news — the Republicans in Wisconsin have launched their version of a “revolution,” — one that originally promised to “restore fiscal sanity,” but instead looks more and more like a statewide pilot project run by the Ayn Rand Institute, with the financial backing of AT&T.

In the fight for better broadband, normally the bad actors can be easily identified and called out from both political parties.  Democrats and Republicans turn campaign contributions and promises of power and influence into favorable, often custom-dictated legislative proposals that come straight from the companies that will benefit the most.  But the last six months of Republican rule in Wisconsin cannot be compared with anything else that has come before.  It’s a wholesale sellout to AT&T, and even statewide protests and media coverage on a massive scale appears to have only delivered a temporary reprieve, with strings attached.  What’s worse, even after the massive call-out against the telecom overreach, some of the proponents of broadband slash and burn politics are completely unrepentant, vowing to try again, perhaps when the public isn’t paying attention.

While some educational institutions believe any deal is better than no deal with the state’s ideologues, they will do themselves no favor if they drop the issue after the “compromise” is reached.  This all-out “war on broadband” cannot be appeased while AT&T’s true believers remain in office.

Let’s catch up.

In the last 48 hours, an ongoing series of “discussions” about the ultimate fate of WiscNet, Wisconsin’s institutional broadband cooperative network, have brought some assurances the network will not have to close its doors, at least not yet.  Yesterday, AT&T’s meddling to make changes to the “compromise” was on display, and one should never underestimate the cleverness of this company at finding ways to tie the hands of its targets with innocuous-looking legislative language.  Those stealthy last-minute additions can deliver a powerful sting only realized later, after the bill becomes law.

Angry phone calls pounded legislators in Madison, as did many newspaper editorials, TV news coverage (which we will review below), and a lobbying counterattack by librarians and educators all working to stop AT&T from winning an all out victory.  But make no mistake, this battle is by no means over.

For at least two years, WiscNet appears to have won the basic right to continue to exist, but only under a form of big government supervision.

The provision to ban award recipients from accepting broadband stimulus money from the federal government has been dropped.  Telecom industry lobbyists fought hard to get Wisconsin to virtually return federal stimulus money awarded to public broadband projects by trying to prohibit winners from accepting the checks.  Tens of millions already allocated to the University of Wisconsin would have had to be forfeit.  Instead, the changes worked out this week allow the university to use those funds to build and expand WiscNet to more state schools, libraries and public buildings.

WiscNet Coverage

Few legislators would openly admit trying to utterly destroy WiscNet, instead preferring “death by a thousand cuts,” writing rules and regulations that threaten the viability of the network’s ability to conduct operations.  While most of the onerous provisions were turned back, including those that would ban participation in Internet2 and limit WiscNet’s expansion, the compromise forces the network to face additional auditing and scrutiny by committed opponents to public broadband.

WiscNet put on a brave face, releasing the following statement:

We welcome an objective review of the relationship between the University of Wisconsin and WiscNet, a nonprofit cooperative.  The amendment allows the University of Wisconsin to continue as full members of WiscNet for the next two years, while the review helps everyone understand these issues better.  We look forward to a healthy dialogue with legislators, telecommunications providers, community partners, and others.  We are confident that those open lines of communication will be fruitful.

Don’t count on it.  Having followed these legislative battles for the past several years, one thing is certain: AT&T and their industry friends like Access Wisconsin will be back to try again and again and again.  As long as the current legislature includes members who are not only amenable to AT&T’s world views, but openly espouse them (and occasionally exceed them), WiscNet and public broadband in general is hardly safe.

Let’s remember who and what we are dealing with here:

The War on Broadband: At the core of the Republicans’ argument against public or institutional broadband is that it competes unfairly (somehow) against private corporate providers.  That argument ignores the fact WiscNet, among many other public and institutional networks, is essentially a cooperative, and one that existed long before phone and cable companies got into the Internet Service Provider business themselves.  Members pool resources to sustain a service that first and foremost delivers benefits to its users, not to external banks or investors.  Many institutional networks like WiscNet might even be compared to credit unions, delivering service to a pre-determined constituency that also happens to have a voice in how that network is run.

There are big banks and their supporters who detest credit unions because they represent “unfair competition” for them, because they can afford to deliver more service for less money.  It’s a familiar argument when you listen to some Republican senators in Wisconsin argue that the very existence of WiscNet represents anti-competitive behavior, harming fellow networks like Badgernet (another state institutional network).  It should not be a surprise to our readers to learn Badgernet is a network largely serviced by AT&T, and charges radically higher prices for its service because of what the phone company charges them for access.

The conservative movement in Wisconsin has been largely content dismissing broadband support in Wisconsin as a luxury perk, despite the fact the state scores 43rd out of the 50 best-wired states.  In addition to the purposeful distortions coming from those opposing networks like WiscNet, some have been reduced to arguing academia simply wants these networks for fast access to porn and copyrighted content.

Can Wisconsin afford their asking price?

“Help” from Dollar-A-Holler Mouthpieces like Access Wisconsin: This group, funded by the commercial telecommunications companies it represents at the expense of ordinary consumers, claims it is a helper in delivering an improved broadband experience in Wisconsin.  So helpful, in fact, it joined with AT&T and the state Republicans in calling for federal broadband stimulus money to be returned and not spent in the state for improved service.  While Access Wisconsin attacks government subsidies it doesn’t like, its member companies run to the bank with over $90 million annually in federally-mandated Universal Service payments.  The group is even upset the University of Wisconsin didn’t use state-based providers and contractors to build their expanded fiber network.  That comes as little surprise considering the University reached out to several of Access Wisconsin’s member companies (and AT&T) and found none interested in helping out.

The War on Libraries, Schools, and Taxpayers: The proposed cuts in library spending are deemed so dire by many patrons, they have begun to suspect the Republican majority would rather see people buy books at Wal-Mart than check them out for free at the town library.  On top of the budget cuts, broadband costs for schools and libraries would explode if these institutions were forced to buy access from Badgernet.

The party of “fiscal sanity” supported killing off cost-effective, money-saving broadband from WiscNet to fulfill a rigid ideological framework that would ultimately deliver less service for a lot more money.

Let’s compare prices for a moment.  Badgernet, which gets wholesale access from AT&T, charges prices that are far higher than WiscNet charges.  Badgernet itself is not the problem, its wholesale supplier is.  To defray the costs, the state of Wisconsin subsidizes Badgernet to the tune of nearly $17 million annually, to keep prices affordable for libraries and schools.  That $17 million effectively goes straight into AT&T’s bank account.  But that subsidy only gets you so far.  Badgernet charges $6,000 a month for 100Mbps service because that is the price required to recover costs charged by AT&T.  Many institutions rapidly outgrow this level of service and can upgrade to 1,000Mbps service, so long as they have a spare $49,500 a month laying around for broadband.

In contrast, clients on WiscNet can purchase 1,000Mbps service for about $10,000 a year.  Is that price disparity worth raising a ruckus over?  Apparently so.

The AT&T Dilemma: While AT&T did not win everything it wanted this year, prior evidence shows the company will be back to try again, just as it did with its statewide video franchising legislation that was supposed to deliver a competitive market for cable in the state.  In fact, it delivered higher prices instead.  Negotiating defensively with companies like this assures a war of attrition, as public providers find themselves compromising away core features of their network to protect whatever is left.

A much better idea for Wisconsin broadband is to launch an all-out counteroffensive.  Instead of stalemate compromises that constrain public networks, let’s demand they expand.  If there can be a co-op for dairy products and a credit union for banking, there certainly can be a community broadband cooperative that delivers service not just to institutions, but to members of the public and any independent provider who wants access — publicly owned for the public good.  That may not be WiscNet, designed under an institutional model, but it certainly need not be yet another overpriced offering from AT&T.

Before that can happen, Wisconsin residents need a cleanup — an upgrade — of the caliber of elected officials working on their behalf.  Thus far, a good percentage of Wisconsin’s current majority party seems far more interested in turning the state into a corporate lab experiment of their version of the free market done their way — for their benefit, at your expense.  The proof was at hand this week when the state nearly adopted a “cost saving” measure for broadband that would have cost Wisconsin taxpayers considerably more, all for the benefit of a handful of telecom companies.  Let’s help those legislators find a new day job sooner rather than later.

After that, WiscNet needs a legislative advocate of its own to introduce measures that undo the damage and then build on WiscNet’s success by expanding its reach and keeping it affordable.

Timeline: Tracking Wisconsin’s Awakening of the Wisconsin Republicans’ Broadband Agenda

Too often, broadband policy debates are too arcane for the general public to grasp.  Most people in the state probably never heard of WiscNet, and don’t realize when they might be using it.  But what they do understand is pay-for-play politics that hits them in the pocketbook.  As state residents learned the Republican majority wanted to ban the provider that delivers the most service for the least amount of money in favor of AT&T, they got involved and helped temporarily defeat the plan.

June 7th: WISC-TV in Madison explains to viewers the plan to kill WiscNet would carry a pricetag of at least $70,000 in Madison alone, with potentially millions more at stake, all for the industry’s claim of a “level playing field.” (2 minutes)

http://www.phillipdampier.com/video/WAOW Wausau Library Internet 6-08-11.mp4

June 8th: WAOW-TV in Wausau discovers what the war on WiscNet would do to Internet access in area libraries.  (2 minutes)

http://www.phillipdampier.com/video/WFRV Green Bay WiscNet Deleted 6-12-11.mp4

June 12th: WFRV-TV in Green Bay tells its viewers the cost to procure Internet access in area universities could increase from $70,000 to more than $400,000, all to benefit private providers who want to compete at much higher price points.  (1 minute)

http://www.phillipdampier.com/video/WXOW LaCrosse Pulling the Plug on WiscNet 6-13-11.mp4

June 13th: LaCrosse residents are told they’ll pay more for less if large telecommunications companies get their wish to knock out inexpensive broadband through WiscNet.  WXOW-TV lead the 5pm evening news with news the bill was a last minute addition that received full support from state Republicans.  (2 minutes)

http://www.phillipdampier.com/video/WEAU Eau Claire WiscNet 6-14-11.mp4

June 14th: WEAU-TV in Eau Claire reports Sen. Terry Moulton (R-23rd District) got an earful from area hospitals about the terrible impact the shutdown of WiscNet would have there, which concerned him.  The station also reports on the threat to broadband funding in rural Chippewa Valley.  (Loud Volume Warning) (2 minutes)

http://www.phillipdampier.com/video/WQOW Eau Claire WiscNet Targeted 6-14-11.mp4

June 14th: Eau Claire station WQOW-TV reports university students and academia generally faced the end of unlimited bandwidth if the state proposal to do away with WiscNet were to pass into law.  A telecom industry lobbyist claims the bill would allow private providers to deliver comparable service to institutions, but one local institution found an amazing price disparity: $2,500/yr with WiscNet or $1,000,000/yr with a private provider.  (2 minutes)

http://www.phillipdampier.com/video/WXOW La Crosse New Amendments 6-15-11.mp4

June 15th: Newly elected Rep. Steve Doyle introduces amendments to turn back Republican proposals in the legislature that would harm statewide broadband networks, reports WXOW-TV in La Crosse.  (2 minutes)

http://www.phillipdampier.com/video/WKOW Madison WiscNet will stay the same in budget 6-16-11.mp4

June 16th: WKOW-TV in Madison reports a compromise deal which will keep service running as-is for now, but subject WiscNet to government approval of any expansion efforts.  (1 minute)

As political pressure over Usage Based Billing continues to keep providers from gravitating towards more stringent Internet Overcharging schemes, western Canadians are enjoying significant victories as providers relax usage caps and increase speeds for broadband service.

Weeks after Shaw Communications announced new packages with increased usage allowances and a few unlimited use plans, Telus has now followed Shaw’s lead and doubled usage caps on many of its Internet plans, slashed overlimit fees by more than half for some, and plans to increase upload speeds for one of its premium plans:

Among the major changes are dramatically increased usage allowances and the reduction of overlimit fees.

Telus customers receive their service from the phone company in various flavors of DSL.  Some older suburban and rural areas still receive speeds averaging 3Mbps, but those lucky enough to be served by VDSL can comfortably achieve the company’s fastest broadband speeds.  The increased usage allowances are welcome news, even if Telus has never strictly enforced any of them:

• High Speed Turbo 25 increased to 500GB, was 250GB;
• High Speed Turbo increased to 250GB, was 125GB;
• High Speed increased to 150GB, was 75GB;
• High Speed Lite increased to 30GB, was 13GB;
• The overlimit fee for High Speed Lite has been reduced from $5/GB to $2/GB;
• Unofficial reports suggest upload speed for Turbo 25 is being increased from 2Mbps to 3Mbps, to be rolled out gradually.

Is Telus following Shaw's lead?

The reduction in the overlimit fee for High Speed Lite was predictable in light of recent political events.  It is difficult to sustain the argument that overlimit fees and usage caps are priced to control network congestion when the lightest users face the most draconian limits and penalty fees.

But unlike their cable competitor Shaw Communications, Telus has not seen fit to offer customers a truly unlimited plan, which presents a problem for some.

“Telus needs to remember they cannot win a speed race with Shaw so they should be lowering prices, taking the usage caps off, and competing with something they can actually win — delivering customers the unlimited service they want at a reasonable price,” says Stop the Cap! reader Abel from Burnaby, B.C.

Separately, Telus also quietly introduced a rate increase for basic home telephone service.  What used to be $21 a month is now $25, an increase of four dollars.

The dramatic plan changes underway in western Canada come in response to political pressure and consumer ire against Usage Based Billing (UBB).  Bell, which provides much of Canada with wholesale broadband access, was seeking to force independent providers to abandon unlimited, flat rate pricing in favor of ubiquitous UBB.  The provocation brought a half million Canadians to sign a petition against metering broadband.

For eastern Canada, thus far little has changed as Bell, Rogers, and Videotron continue with business as usual.

The Rochester, Minn. Amateur Radio Club spent months documenting potential interference from another problem technology: Broadband Over Power Lines.

Back in 2004, the Federal Communications Commission was looking for ways to expand broadband competition.  Borrowing from a mild success story in Europe, the Washington regulator, with the help of a well-financed lobbying campaign, approved new technology that would deliver broadband service over power lines, known as BPL.  The promises were great — fast access over an extensive, already-wired network that reached virtually every home in the country.  Glossy brochures promising a new generation of broadband and new competition were sent to every member of Congress.  Dollar-a-holler groups like the New Millennium Research Council produced “research reports” claiming the technology would advent a broadband revolution.  Some investors used to sleepy returns from utility companies dreamed about the promise of a rich new revenue stream pitching broadband service.

But there was a slight problem.  The technology worked better on paper than it did in real life.  Even more importantly, it carried more baggage than USAir.  Delivering wideband broadband signals over unshielded power cables never designed to carry radio frequencies meant interference — a lot of it, to any radio band the broadband signal occupied.  That meant a horrible listening experience on AM, and practically no listening at all over the shortwave bands, designated for military communications, international broadcasters, and the amateur radio community.

The FCC approved and supported the technology anyway, promising filters and other mitigation for those impacted by interference — a notion scoffed at by the American Radio Relay League, a group representing amateur radio operators.

So why don’t we have that third choice for broadband today?  BPL technology buried itself as its woeful performance could never match the high-flying marketing promises found in the brochure.

Fast forward to 2011 and manufacturers of satellite navigation devices, popularly known as GPS units, are terrified America is about to embark on another dreadful mistake.

LightSquared, a new entrant in the telecommunications marketplace, is constructing a nationwide 4G wireless broadband network with traditional ground-based antenna towers supplemented with a satellite system providing coverage in rural areas.  The company’s new network will occupy a frequency band just adjacent to that used by global positioning satellites, the backbone of the GPS system that some LightSquared critics contend will be crippled if the company’s 4G network is ever switched on.

LightSquared released this promotional video talking up their future network.  (2 minutes)

Early interference tests conducted by a federal working group show those critics may be right.  Because satellite signals are so weak, manufacturers like Tom-Tom and Garmin must create highly sensitive GPS receivers to handle the faint signals.  Because these units are not always selective enough to reject adjacent signal interference, a neighboring transmitter delivering a much more powerful signal — such as that from LightSquared — could overwhelm them.

Independent testing found serious interference problems even for professional grade GPS units used by civil aviation, ships, and emergency responders.  A sampling:

• GM’s OnStar system received significant interference, making it difficult to identify the location of crashed vehicles and disrupting turn-by-turn directions and other navigation services;
• In recent tests in New Mexico, LightSquared caused GPS receivers used by nearby police, fire and ambulance crews to lose reception;
• John Deere’s agricultural equipment incorporating GPS technology failed to receive signals during the LightSquared testing;
• Both the Coast Guard and NASA reported significant interference to their GPS receivers;
• The Federal Aviation Administration reports their GPS receivers completely failed while the tests were conducted.

The red box identifies the spectrum assigned to LightSquared. Its immediate neighbors are faint signals from communications satellites. (click to enlarge)

With complaints like that coming after a small-scale test, the thought of 40,000 ground-based LightSquared towers obliterating the nation’s access to GPS is more than just a little concerning to users and manufacturers.

“LightSquared’s network could cause devastating interference to all different kinds of GPS receivers,” Jim Kirkland, vice president and general counsel of Trimble Navigation Ltd., told the Washington Post.  Trimble manufactures GPS devices.

The Radio Technical Commission for Aeronautics advised the FAA its own independent tests of the LightSquared system found the consequences of turning this 4G wireless service on would be cataclysmic for GPS signals, making most satellite navigation equipment completely useless in most major metropolitan areas.

LightSquared executive vice president Jeffrey Carlisle told the Post he remained confident that the two systems could co-exist, even admitting he expected to find interference issues.  Carlisle says the real question is how to mitigate it.

This is not the first time interference issues have come before the FCC.  Nearby spectrum neighbors often don’t get along, especially when one licensed user relies on weak signals from space and the other utilizes more powerful ground-based transmitters.  The Commission has even fielded complaints over garage door openers interfering with certain military radios.

LightSquared’s network concept isn’t by itself the problem.  XM Radio manages to operate its mix of satellite-delivered radio and 900 ground-based repeater transmitters without creating interference for other users.

Deere Companies produced this diagram showing a comparison of the respective power levels of LightSquared signals vs. satellite navigation signals.

Unfortunately for LightSquared, it has several problems to contend with, the most significant being its “zoning problem.”  The souped-up 4G network is simply not in character for the spectrum neighborhood it calls home.  It’s a McMansion being built in a neighborhood of cottages.  LightSquared’s neighbors are low powered satellite signals in the 1-2Ghz range, including those from the satellites which provide GPS.  In certain cases, receiver equipment can be designed to reject the adjacent interference a network like LightSquared could create, but with millions of existing GPS units already in use, that may prove impractical.

LightSquared has tried to rope off its channel space as much as possible, trading spectrum with other nearby users to create a nearly contiguous 20Mhz slice it can dedicate to its signals, in hopes of reducing interference.  But the recent tests suggest this may not be enough.  General Motors suggested LightSquared needs to find a better neighborhood — one more suited to the kind of signal it wants to offer.  That could come from a spectrum trade or a frequency reallocation by the FCC.

The FCC is taking a “wait and see” approach so far, claiming further tests are needed.  But the agency earlier pledged it would not allow LightSquared to operate its network if it created major interference problems for other spectrum users.  Some GPS manufacturers think that commitment is too vague, because “major interference” is in the eye of the beholder.

Those concerns may be warranted, considering the FCC earlier found its way clear to ignore the documented interference Broadband Over Power Lines created over both the AM and shortwave radio dial.  Even after a blizzard of lobbying and campaign contributions won support for BPL in Washington, the ultimately inferior product that resulted couldn’t win the support of the group that ultimately mattered most — paying customers.

Sanjiv Ahuja, chief executive officer of LightSquared, talks about the company’s efforts to build a wireless broadband network as other spectrum users challenge the company’s potential to create interference.  (7 minutes)

The U.S. Cattlemen’s Association this week took some time out to go all out for AT&T’s proposed merger with T-Mobile.  In addition to successfully navigating the FCC’s arcane comment filing system to submit their comments in favor of the merger, the group also penned a lengthy, favorable guest blog for Washington, D.C. inside-the-beltway-favorite, The Hill newspaper:

The expansion of next-generation wireless broadband envisioned by the T-Mobile and AT&T merger, for example, is critical for the next stage of rural America’s evolution and success. It will allow ranchers, farmers, and all rural residents who have been traditionally underserved to finally gain access to the best that mobile broadband has to offer, including faster and more reliable connections. We strongly encourage the Federal Communications Commission to support these developments as an investment in both the current and future generations of agricultural producers and small communities across rural America.

The cattlemen’s group has had a lot to say about telecommunications issues, especially mergers and acquisitions.  It was cited by Verizon as a supporter of its merger with Alltel in 2008, signed a joint letter in 2008 from industry-connected Connected Nation for a broadband plan compatible with the interests of the nation’s largest cable and phone companies, wrote a letter to the FCC opposing Net Neutrality in 2009, and submitted two pages of comments in May favoring the merger between AT&T and T-Mobile.

Apparently there is plenty of free time on the ranch to ponder billion dollar telecommunications mergers.

The argument from the group is that permitting mergers and blocking open net policies like Net Neutrality will convince carriers to provide enhanced service in rural areas where cattle ranches predominate.  But facts in evidence illustrate how wrong-headed that argument is:

• Verizon’s merger with Alltel has done nothing to bring its LTE network to rural America.  Verizon is focusing LTE upgrades on the markets where it makes the most business sense, and that does not include rural Texas or Oklahoma;
• The National Broadband Plan has directed stimulus funding for rural projects that are most likely to reach their ranch members — wireless ISPs and rural DSL.  The cattlemen’s group has nothing to say about either provider;
• Net Neutrality and the policies of an open and free Internet have no real impact on rural broadband deployment.  The same companies refusing to provide service yesterday are still refusing to provide service today, and that includes completely exempted wireless providers;
• T-Mobile’s urban-suburban focus is a mainstay of its business plan.  T-Mobile has never prioritized rural America as a viable service area, relying on roaming agreements to fill in service gaps.  Combining its urban-focused wireless infrastructure with AT&T will add nothing to the rural wireless experience.

The Washington Post finds financial connections between AT&T and the cattlemen group.

Advocating for a merger with T-Mobile makes about as much sense as the group advocating for a T-Mobile merger with Leap Wireless’ Cricket or MetroPCS.  All have a record of indifference about providing service in rural areas themselves.

So why does the group persist in fronting for AT&T’s public policy agenda?  Cecilia Kang at the Washington Post tweeted the obvious answer — they receive support from AT&T.

The piece for The Hill was penned by Jess Peterson, the cattlemen group’s executive vice president.  But Peterson has a second career: president of Washington, D.C.-based Western Skies Strategies, a lobbying firm that promises “success and profitability to our valued clients every time.”

The concept of dollar-a-holler public advocacy is not new, but AT&T is the Master of the Astroturf Universe.  The Center for Responsive Politics notes that from 1989 to 2010, no single company spent more on campaign contributions than AT&T.  Since 2008, more than $1.25 million has been “donated” to politically-connected charities and those willing to lend their name and reputation to back the company’s public policy agenda.

Facts have a hard time penetrating piles of cash, but here are some anyway:

1. T-Mobile’s combination with AT&T may create additional capacity for the combined company, but almost entirely in urban and suburban areas that will do nothing to help rural wireless.
2. No telecommunications company has a track record of providing service in areas unprofitable to serve or fail return on investment demands.  No merger will change that.
3. Promises for network upgrades already committed in long-range business plans do not sweeten a bitter deal for Americans concerned about competition in the wireless marketplace.
4. T-Mobile’s track record as being the most market-disruptive in pricing and innovation will be eliminated in a merger with America’s lowest rated wireless carrier.
5. Any excitement for rural wireless broadband from AT&T is tempered when would-be customers realize the company enforces a 2GB usage cap with an overlimit fee on their smartphone data plans — an Internet Overcharging scheme more punishing than either Verizon or Sprint.

Get government subsidized satellite "broadband" at speeds up to 1Mbps, as long as you honor strict usage limitations.

With much fanfare, ViaSat’s WildBlue has unveiled a special discounted satellite “broadband” offer that comes courtesy of United States government taxpayer funding:

WildBlue’s same great service at an ultra-low price, courtesy of the U.S. government.

WildBlue, through the U.S. Recovery Act brings a special offer for high-speed Internet to areas unserved by wireline providers. It’s the most affordable deal we’ve ever offered, and the monthly price for this special package is guaranteed for as long as you remain a WildBlue customer. Take advantage of government funds to get High Speed Internet at discounted rates.

For $39.95 per month, WildBlue will provide the satellite equipment to deliver qualified subscribers up to 1Mbps service, subject to a monthly download limit as low as 7.5GB per month for downloads, 2.3GB per month for uploads.  Customers who exceed the limits will have their 1Mbps service throttled to near-dial-up speed until usage falls below the company’s “fair access policy.”

WildBlue explains the limited-time offer is made possible by funding from the American Recovery and Reinvestment Act of 2009.  Through a grant from the Department of Agriculture’s Rural Utilities Service (RUS), certain rural customers might qualify for the discounted pricing.

WildBlue only received authorization to deliver the discounted service to locations west of the Mississippi — specifically those not within an existing RUS project zone, are located in a defined rural area, and cannot receive service from a telephone, cable, or fiber provider.  Current WildBlue customers also do not qualify.

The grant funding covers installation and equipment charges, the client only pays for the service itself.  But would-be customers are required to commit to at least one year of service or face an early termination penalty and must pass a credit check.

WildBlue customers, as well as those of other satellite providers, have given satellite Internet access low satisfaction scores, primarily because of speed and usage limitation issues.  But for some without any other choice, it is a service they live with for basic web access.