Frontier's Maggie Wilderotter escapes reality

Frontier Communications CEO Maggie Wilderotter has bought a first class ticket to Fiber Fantasy Island, where phone companies dream of delivering fiber-optic broadband service without actually deploying fiber.  They just tell you they did.

In an interview published today in The Oregonian, Wilderotter tries to convince residents Frontier’s arrival is good news, making promises about broadband and service improvements based on a company track record an independent observer would conclude she simply made up.

If Wilderotter’s command of the facts about her own company are reflective of “a distinct, improved image in its new territories,” Oregon is in big trouble.

Let’s review:

CLAIM: “We deploy fiber to the home all across the country. We don’t call it FiOS. We call it high-speed Internet. For our customers, the technology doesn’t matter. What matters is access, speed and capacity.”

REALITY CHECK: Frontier, as far as we have been able to determine, has not deployed fiber to the home anywhere in the country, with the exception of the FiOS network it acquired from Verizon.  Frontier Communications’ deployment of fiber optics to the home is comparable to the amount of fiber found in a box of Cookie Crisp cereal.  In their largest market, Rochester, N.Y., Frontier relies on the same legacy copper wire phone network it utilizes everywhere else.  It is highly misleading for Wilderotter to represent otherwise.  Fiber to the home means exactly that — fiber optic cable brought right to the home.  This is not a case of “you call it corn, we call it maize.”

This kitten is not an iguana.

Fiber optic cable is not also known as “high-speed Internet,” just as the cute kitten on the left is not called an iguana.  For the significant number of customers who ask Frontier to disconnect their service year-after-year, technology matters very much, and this particular phone company lacks it.  Frontier relies on the same DSL technology other phone companies and customers increasingly consider yesterday’s news.

In many Frontier service areas, there is no access to broadband because line quality will not support the service.  In Brighton, N.Y., a suburb of Rochester less than a minute from the Rochester city line, Frontier could only manage to deliver 3.1Mbps DSL speeds, and until recently Frontier was crying it needed a 5GB usage allowance because of the threat higher amounts of consumption might have on its network capacity.  Access, speed, and capacity does matter, which is why Time Warner Cable is picking up the bulk of its new broadband subscribers at Frontier’s expense.

CLAIM: “For high-speed, it means having speed and capacity in addition to reach. We’ll do add-on services. We have a terrific Yahoo-Frontier portal that will be a gateway on our high-speed Internet service. We are in the throes of putting together Wi-Fi hotspots that will be distributed throughout this market for customers.  If you’re a high-speed Internet customer of ours it’s free. We’re looking to put one at Hillsboro Stadium. Typically, we put them in hotels, convention centers, truck stops, trailer parks, outside parks, campuses for colleges, shopping centers, business campuses.”

REALITY CHECK:  Those “add-on services,” such as Frontier’s Peace of Mind, come with a price tag and are often required components of a bundled service discount offer.  As first impressions go, a company still relying on Yahoo! for a front end is not exactly on the cutting edge, nor are “portals.”  It’s like trying to impress new customers with free web space through GeoCities.  Actually, that is something Frontier could offer because GeoCities is now owned by Yahoo!

Frontier’s Peace of Mind Services

• Hard Drive Backup: $4.99 per month
• Hard Drive Backup + Unlimited Technical Support: $9.99 per month
• Hard Drive Backup + Unlimited Technical Support + Inside Wire Maintenance: $12.99 per month
• $50 early cancellation penalty if you get these services with a term commitment

Rochester’s experience with Frontier Wi-Fi has not been very impressive.  Most residents don’t even know the service exists.  The city and several suburbs offer limited Frontier pay-walled Wi-Fi service and a handful of free access hotspots in cooperation with Monroe County.  Unfortunately, many of the fee-based and free hotspots have fallen into disrepair and no longer function.  Signal strength is not impressive either, and many were not usable indoors.  We tested several of the free hotspots and discovered one only delivered a signal into a suburban parking lot, another only into an empty soccer field, and the third was not functioning at all.  Frontier’s record in Wi-Fi delivered more promises than actual service.

Those Wi-Fi services, by the way, are not free for all Frontier broadband customers.  Evidently Ms. Wilderotter is not acquainted with her own company’s products and services, nor Frontier’s own website:

So much for Wilderotter's claim Frontier's Wi-Fi network was free for all Frontier broadband customers.

CLAIM: “We deliver the highest value for the price you pay. We also have excellent customer service. We also don’t raise our rates every 12 months, no matter what.”

REALITY CHECK:  In Rochester, the out-the-door price Frontier charges its broadband customers is actually higher than that charged by Time Warner Cable, which delivers far faster connections.  In West Virginia, the state’s Consumer Advocate put together a chart depicting Frontier’s broadband prices.  Determine for yourself if it delivers the “highest value for the price you pay.”

Comparing Prices: Frontier's pricing doesn't look as exciting as Wilderotter would have you believe, as the West Virginia Consumer Advocate discovered

CLAIM: “If I look across the board at our basic service pricing, I don’t think we’ve raised prices anywhere in the last four or five years.”

REALITY CHECK: We looked and found Frontier demanding the right to increase basic service rates in New York by $2 a month each year for up to two years.  In fact, last November, the New York State Public Service Commission, at the request of Frontier, sent the company a letter authorizing a rate hike of $2 a month for customers in the state.  Even more enlightening was Frontier’s filing in August 2005 with the PSC demanding near-complete deregulation and rate relief allowing Frontier to raise rates up to $1 per month annually indefinitely for basic service.  Frontier also wanted consumer protection rules “relaxed” and ban the PSC from investigating consumer complaints.  One of the reasons they cited is that basic phone service is not the same critical service it used to be because people can communicate through blogs instead.

In fact, consumers should be asking why Frontier’s rates haven’t decreased.  From that same filing: “Frontier believes that with the decreasing costs and increasing bandwidths of new technologies and the acceleration of intermodal market entry, the market will cause rates for non-basic services in all parts of the State to decline.”

CLAIM: Local regulators tell me they did see a spike in billing complaints after Verizon took over. Any thoughts on why? — “Whenever there’s a change — you change the name on the bill, you change the format — customers tend to look at it more closely. We always expect a spike in billing calls whenever we’ve done acquisitions. It has already (settled out).”

REALITY CHECK: As Stop the Cap! has reported, Frontier’s takeover in West Virginia has hardly “settled out.”  Service interruptions, forgotten service calls, and other problems have plagued the state to the point the PSC needed new hearings to review the situation.  Many of Frontier’s billing complaints come from customers choosing to cancel Frontier service, only to find unjustified early termination fees added to their final bills, even when customers never agreed to a term contract.  That problem was so serious in New York, the state Attorney General fined the company and ordered customer refunds.  Changing a customer’s bill by adding $100 or more to the total amount due will always get a customer to look at the bill more closely.

CLAIM: “One of the big opportunities that we’re working on is the ability to display Internet content and video on the television set.”

REALITY CHECK: That “big opportunity” has been available to broadband users for several years now.

CLAIM: We also have a new site that’s called myfitv.com. We carry over 100,000 titles of free television content on this site. It’s a little bit like Hulu on steroids. It’s provided free of charge to all our customers.

REALITY CHECK: MyFitv is not “a little bit like Hulu on steroids.”  In fact, it is Hulu.  Frontier simply used Hulu’s “embed” feature to take content, slap the Frontier logo on it, and add Google ads in an attempt to rake in a few extra dollars.  You can do exactly the same thing yourself.  Meanwhile, the service is added to customer bills showing an amount of $0.00, a very inexpensive way to try and impress customers with content Frontier never developed, deployed, or created — just like their phantom fiber to the home network.

CLAIM: “We think over time the Internet will also provide different packaging, different prices, different ways to buy content than the traditional viewing platform. We also think that mobility is important. We want to make sure that whatever you do you’ll be able to take it with you.  The Sling technology is interesting, too. It’s something we’re talking about DISH Network with.”

REALITY CHECK: Every time Maggie has talked about “different packaging and prices,” it has been in the context of an Internet Overcharging scheme — limited usage allowances, extremely high rate increases for those deemed to have consumed too much, etc.  And yes, Sling technology is interesting.  A company conceived of the idea, built it, developed a marketing plan, and sold it.  That’s a concept Frontier needs to understand.  You cannot transform a legacy network with words alone.  Here’s an idea.  How about conceiving of a real fiber-to-the-home network, build one, develop a marketing plan, and then sell it.  For those in markets like Rochester, it’s the only way Frontier Communications will avoid becoming the horse and buggy carriage maker of the 21st century.

CLAIM: You’re around Seattle, around Portland, but not in them yet. Is there any possibility that Frontier would build into another company’s market? — “There’s always a possibility. It’s not a priority for us. And the reason why it’s not a priority is we’ve got a lot to do, just in the service areas that we own today. When I’m humming on all cylinders there, and I’ve been able to do everything I possibly can in those areas, then I might look to extend service areas out.”

REALITY CHECK: Translation — “when pigs fly.”  Frontier would be laughed out of the Seattle and Portland markets.

Ms. Wilderotter needs to be a lot more open and forthcoming with the press.  Frontier’s business plan makes it clear the company’s future is serving uncompetitive rural markets that will be forced to tolerate the products and pricing Frontier delivers.  Where competition exists, let’s face facts.  Frontier is not gaining market share — it is losing it, eroded away year after year by uncompetitive, substandard products at high prices.

That’s a reality you are bound to miss if you spend too much time with Mr. Rourke and Tattoo.

Advertisements for Road Runner Extreme, Time Warner Cable’s DOCSIS 3 “wideband” service, began running in Rochester, N.Y., this week despite the fact Time Warner Cable has no intention of providing the service in the area anytime soon.

The ad offers Road Runner subscribers the chance to obtain 30/5 Mbps service “for just $20 more per month” and invites viewers to “call now to order.”

So that’s what we did.

Time Warner Cable representatives in Buffalo confirmed the service is not available in Rochester, but figured if they were advertising it here it must be coming soon.  Even they were surprised with the answer they got ‘from upstairs’ when inquiring further.

“No, it’s not coming to Rochester anytime soon,” we were told.

We asked if there was any timetable to bring DOCSIS 3 upgrades to the area.  The response was both illuminating and candid:

“I wouldn’t hold your breath.  We’ve had some issues in the Rochester area and, for now, we feel comfortable offering the service only in the Buffalo area in western New York.”

When we asked why the company was now heavily advertising a product on Rochester TV screens that isn’t available here, we were told Time Warner Cable was increasingly consolidating its operations in western New York through its Buffalo office, which is where “most customer service” and “local advertising you see on cable channels” is now originating.  Since Road Runner Extreme is available in Buffalo, Rochester viewers are accidental witnesses to a service intended for residents of The City of Good Neighbors.

So what are “the issues” in the Rochester area?

Time Warner Cable bypassed Rochester for promised upgrades after the defeat of their proposed Internet Overcharging plan, which would have tripled broadband prices for an equivalent level of service.  Consumer outrage and political headaches combined to kill the experiment.

Meanwhile, Time Warner Cable isn’t compelled to hurry DOCSIS 3 into an area underserved by Frontier Communication’s slow speed DSL service.  Neighboring communities in Buffalo and Syracuse have access to Verizon’s fiber-to-the-home service FiOS, which has driven Time Warner to enhance services in both communities to avoid losing customers.

Despite the slow pace of upgrades, Time Warner Cable previously stated it intended to upgrade a significant number of its cable systems to DOCSIS 3 technology by the end of the year.  So it will eventually reach the area.  As Time Warner Cable recommends… just don’t hold your breath.

[flv width=”490″ height=”380″]http://www.phillipdampier.com/video/Time Warner Cable at the NYS Fair.flv[/flv]

The closest residents of the Flower City will get to Road Runner Extreme is at the New York State Fair in Syracuse, at the Time Warner Cable booth.  (Their advertised ‘celebrity’ is Mike O’Malley.  Who???)  (1 minute)

Three years ago, Bush Administration FCC Chairman Kevin Martin championed an initiative to offer free national Internet access across the United States via wireless access.  Martin’s idea was to take a portion of unused spectrum and auction it to a company that agreed to set aside 25 percent of the 2 GHz “AWS-3” band for a free, slow speed Internet service.  The winning bidder could underwrite the free service with online advertising and sell access to the remaining 75 percent of the spectrum, presumably for faster access.  Think NetZero for the 21st century.

That proposal just happened to coincide with a nearly identical plan offered by M2Z Networks Inc., a politically-connected start-up backed by Kleiner Perkins Caufield & Byers partner John Doerr and loaded with former FCC people.

M2Z had everything the FCC wanted from an applicant:

• a minority owned business that would raise the percentage of minority-owned telecommunications businesses;
• a willingness to agree to Martin’s demands that the free Internet service be censored to remove adult content;
• sufficient financial backing to win the spectrum auction;
• political connections that could help drive the plan through a political minefield and objections from incumbent commercial providers.

John Muleta, co-founder and CEO of M2Z Networks, also headed the FCC's Wireless Telecom Bureau between 2003 and 2005.

M2Z planned to offer free Internet access below the definition of broadband speeds defined in America’s National Broadband Plan — 768kbps, and would also include web advertising injected by M2Z.  Premium, paying customers could access faster speeds and avoid the extra advertising.

Unfortunately for the project’s boosters, Martin’s maverick proposal met a roadblock of opposition, including from his boss, President George W. Bush.  Commercial providers, especially AT&T, Verizon, and T-Mobile immediately attacked the plan.  AT&T and Verizon did not want a competitor giving away free wireless access when they were charging top dollar for it.  T-Mobile objected, fearing interference to spectrum it owned nearby (fears that proved not credible).  Civil rights and consumer groups objected to Martin’s insistence that adult content be blocked using imperfect filtering software.  Still others thought M2Z would never be able to cover 95 percent of America within a decade, as required by Martin’s proposal.  Some speculated M2z would launch service, deploy it to major cities, and then petition the FCC to forget about the 95 percent requirement.

Philosophically, many industry groups also objected to the Commission sticking its nose in private company business plans, dictating the services offered by the winning bidder.

Despite some willingness by M2Z to compromise on issues like the “smut filter,” with the remaining parade of opposition it came as no surprise the FCC left M2Z’s proposal on the back burner for the remainder of the Bush Administration.

With the arrival of the Obama Administration, Kevin Martin was out at the FCC.  In came Julius Genachowski and a National Broadband Plan.

The concept on offer from M2Z just didn’t fit the vision of America’s broadband transformation.  Although wireless 3G and 4G networks remained hot topics, other wireless projects have simply not gotten as much attention outside of rural areas.  As many community-owned Wi-Fi services shut down, the concept of free, slow-speed broadband just wasn’t a hot topic any longer.  Even worse, approving a plan offering speeds well below the FCC’s proposed definition of broadband threatened to muddy the message America needs faster access.  Last week, the FCC quietly sent word to M2Z that they had rejected their proposal, effectively killing the venture.

How broadband advocates frame broadband expansion can be critical to the plan’s success.  Critics already opposed to broadband stimulus programs could argue M2Z offered a free market, privately-funded solution to Internet adoption without spending billions of taxpayer dollars.  Although 768kbps would offer little to solve the digital divide, totally free access isn’t something easily ignored, even if M2Z was never capable of extending service to 95 percent of the country.

But in the end, vociferous objections from AT&T, Verizon, and T-Mobile were probably the primary reason for the plan’s ultimate demise.

After all, if you could get free wireless access at speeds comparable to what several carriers realistically deliver to their 3G customers today for upwards of $60 a month, would you remain a paying customer?

[flv]http://www.phillipdampier.com/video/C-SPAN M2Z Networks The Communicators 10-11-07.flv[/flv]

In October 2007, C-SPAN’s “The Communicators” spent 30 minutes discussing the state of competitiveness in American broadband and how M2Z planned to shake up the duopoly.  Three years later, the duopoly remains and M2Z’s plan is dead.  (29 minutes)

Phillip "It's Haunting Time for AT&T, Verizon and their good friends at Digital Society" Dampier

Imagine if you lived in a country where broadband competition actually delivered real innovation and savings, overseen by a consumer protection agency that made sure providers in a barely competitive marketplace actually delivered on their “highly competitive” rhetoric.

Australia’s National Broadband Network (NBN) will deliver exactly that, with a check and balance system that makes sure advertiser claims meet reality and that “robust competition” means… robust competition.

One industry-backed front group, Digital Society, doesn’t think that idea is fair to big telecom companies (like those funding its operations), and wants none of that here in the States.

Nick Brown doesn’t object too much to Australia’s plan to deliver fiber-to-the-home connections offering 100/50Mbps service to 93 percent of residents.  He just doesn’t want the Australian government overseeing how private providers use (and how much they can charge to access) the publicly-owned network:

Internet Service Providers in Australia will be forced to compete with each other via the “Competition and Consumer Commission”.  The problem with this is that a supposedly ubiquitous commission deciding what is and what isn’t competition and fair pricing stands a fair chance of not actually playing out in any other fashion than simply being a price fixing commission.

[…]Because the NBN will only act as a wholesaler and treat all ISP retailers equally, ISP’s no longer have the ability to develop their own unique contracts that would reduce costs to consumers.  All backhaul would be priced to all ISP’s at the same rate.  So realistically no company has a significant advantage over the other.  That does potentially create a good deal of choice, but that does not necessarily ensure competition.  This would be akin to going to the grocery store and on the shelf were 5 different brands of soft drink, but every single brand tasted exactly like Coca-Cola.  You would have a lot of choice in that situation, but there would be no real competition between those 5 brands, because taste is the competitive factor.  For the Australian, this means that ISP’s will likely be forced to start bundling services to gain advantages over one another.  Something that is not always considered attractive here stateside.

NBNCo is responsible for the deployment and installation of Australia's fiber to the home network.

Brown’s bitter-tasting public-broadband philosophy is based on the inaccurate notion that incumbent private providers are just itching to deliver state-of-the-art broadband service across Australia.  If the darn federal government didn’t get in the way and steal their thunder with a nationwide fiber network, Aussies would be enjoying world class Internet access over copper phone wires and usage-limited wireless 3G networks right now.  Even worse, the Australian government that will finance the entire operation also has the temerity to set ground rules for private companies reselling access to consumers and businesses!  How dare they oversee a network bought and paid for by Australian taxpayers (he objects to the funding as well.)

Brown must also still be living in Australia if he missed the parade of American providers repricing services to push people into “triple-play bundles” whether they want them or not.  And we don’t even get the fiber to go with it.  For most Australians, they no longer care whether it’s Diet Coke, Pepsi One, Cherry Coke, or even RC Cola for that matter — as long as it arrives on a fiber network built by and for their interests (instead of Telstra’s), it’s far better than what they have now.

In reality, broadband issues hold a front-and-center position in Australian politics, and the Labor Government which supports an aggressive national broadband plan that puts America’s proposed broadband improvements to shame was -the- issue that keeps that government in power today.  Why?  Because Australia is well behind others in providing broadband access at reasonable speeds and prices.  Australian private providers maintain a nice little arrangement delivering sub-standard, near-monopoly service at some of the highest prices around, all usage-limited and speed throttled. Despite years of negotiations with big players like Telstra, the privatized phone company, broadband improvement has moved at a glacial pace (too often by their design).

The development of the National Broadband Network for Australia was driven by private provider intransigence.  Even Brown recognizes the logistics of the proposed fiber network is “very smart and very common sense” for a country like Australia, which he considers a close cousin geographically to the United States.  Brown also admits the use of fiber straight to the home “‘future proofs’ Australian networks and would allow for easier improvement in the future.”

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/ABC Radio Battle of the broadband 8-11-2010.mp4[/flv]

ABC Radio National offered a comprehensive review of the competing plans from Australia’s political parties to address broadband issues as the country drops to 50th place worldwide in broadband excellence.  (9 minutes)

While Australia ponders a fiber future, today’s broadband picture across the country is less idyllic.

The minority of Australians receiving service over cable broadband, available mostly in the largest cities, continue to face usage-limited service and higher prices than American providers.

Most Australians get their service from DSL connections offered by Telstra and third party companies leasing access to Telstra facilities.  Telstra’s network is based almost entirely on aging copper wire that cannot deliver broadband to most rural populations.  Telstra’s long term broadband plan for Australia depends on milking every last cent out of those copper wires while raking in even bigger profits from usage limited and expensive wireless data plans.  Just last month, Telstra was fined $18.5 AUS million dollars for monopolistic behavior by impeding competitive access to its telephone network.  No wonder the country had enough.

Brown labeled the Australian government’s buyout of Telstra’s copper wire network a “negative,” as if they were stuck with a pig in a poke.  That suggests Brown does not understand the actual plan, which relies on reusing existing infrastructure like poles and underground conduit to install fiber at an enormous savings — both in billions of dollars in reduced costs and deployment time.  The alternative would require the government to obtain agreements with Telstra-owned facilities to share access or construct their own facilities from the ground up.  Telstra has no incentive to spend money to upgrade their networks, much less decommission them.  Logistically, the plan cuts through enormous red tape and guarantees Australians no one will be stuck waiting decades for the eventual retirement of copper phone wiring.

Call it Fiber Optic Broadband for Copper Wire Clunkers — the government has not nationalized the phone network — it wants to buy it a fair price, from a willing seller who will be able to use the new network to deliver some of its own services.

The horror show for groups like Digital Society is the thought private companies will actually be forced to deliver the competition and real savings they routinely proclaim in press releases, but never actually deliver to consumers.  The Australian people will own the fiber playground private companies will play on, so why shouldn’t they have the benefit of oversight to make sure the game is played fairly?

Australia’s Competition & Consumer Commission is equivalent to the Consumer Product Safety Commission, the Federal Trade Commission, and a state Attorney General all rolled into one.  The ACCC is an independent statutory authority that works for consumers.  It promotes and enforces real competition and fair trade.

The ACCC’s involvement in broadband regulation includes: stopping false advertising, helping intervene and resolve disputes over access and billing issues, and being an impartial observer about broadband uptake and measuring how competition actually delivers better service and savings for consumers.

What Brown dismisses as “a price fixing commission” is in reality a consumer protection agency with enforcement teeth.  The ACCC has a solid track record.  For instance, the broadband industry in 2009 itself admitted the ACCC stopped a “race to the bottom” in wild advertising claims:

In August last year, we sat down with the CEOs of the major telecommunication providers, Telstra, Optus and Vodafone Hutchison Australia. They acknowledged that there was a problem, exacerbated by a “race to the bottom” by industry participants in their advertising practices. The CEOs showed a ready willingness to resolve the issue on an industry-wide basis.

After analysing complaints, the ACCC identified the 12 most prevalent types of potential misleading conduct made in telecommunications. Some of these included:

• use of terms such as “free”, “unlimited”, “no exceptions”, “no exclusions” or “no catches” when this is not the case;
• headline price offers in the form of “price per minute” for calls made using mobile phones and phone cards when there are other fees/charges which are not clearly disclosed; or
• headline claims relating to price, data allowances, total time allowances, speeds and network coverage, where the claims cannot generally be achieved by consumers.

The three industry leaders have provided a court enforceable undertaking to review and improve advertising practices so that consumers are better informed about the telecommunications products they purchase. They have undertaken that their advertising will not make these claims in circumstances where they are likely to be misleading to consumers.

Further the majors have also agreed that they will take reasonable steps to ensure that this commitment will extend to any other players with whom they have commercial agreements which allow them to control the advertising and promotion of goods or services.

Australians are starting to receive consent forms for free installation of fiber broadband in their homes.

I can see why Digital Society, a group partly funded by telecommunications companies, would object to the ACCC stopping Big Telecom’s ill-gotten Money Party-gains.

ACCC also put a stop to promotions that tricked consumers into signing up for mobile data plans that included “free” netbooks, high value gas gift cards, or cash rebates.  The Commission discovered these “promo plans” weren’t giving away anything at all — they simply added the retail cost of the “free” item to the plans’ charges.

The ACCC received a court enforceable undertaking from Dodo Australia Proprietary Limited for the advertising of some of their mobile plans. Dodo had advertised that consumers would receive either an Asus Eee PC, a fuel card or a cash payment when they signed up to a ‘free offer’ plan.

However, cheaper mobile cap plans that did not include the ‘free’ offers were comparable in value and services. After raising these concerns with Dodo, they promptly ceased publishing the ‘free offer’ advertisement and undertook to ensure the affected customers would receive the goods for free, either by way of cash refund or by reducing the monthly charges for the ‘free offer’ plans.

That mean and nasty ACCC, ruining all of the fun for providers delivering tricks and traps for their customers.  Caveat emptor, right?

But the most ludicrous claim of all comes towards the end of Brown’s piece, when he claims the National Broadband Network will leave Australians with even higher priced, usage-capped access:

Australia traditionally has had low bandwidth caps.  Even just five years ago while most Americans were enjoying unlimited bandwidth with their broadband connections, I was living in Melbourne, Australia and was limited to a 1GB cap per month via my Telstra connection.  The likelihood of seeing 100Mb uncapped connections is highly suspect.  Australians may enjoy these speeds, but they will likely be extremely expensive with low bandwidth caps or limited to high priced premium tiers.

Brown can’t blame the private company that delivered his abysmal Internet service without his “free market knows best” philosophy falling apart.  It wasn’t the Australian government that provided him a 1GB monthly usage allowance — it was Telstra, and five years later the company is still usage-limiting Australian broadband consumers.  The National Broadband Network was designed to tackle that problem once and for all.  Brown apparently doesn’t realize the last argument private providers have used to justify usage caps — insufficient overseas capacity — is being addressed by new super-high-capacity undersea fiber cables stretching across the Pacific.  The issue of “usage cap” abatement is among the top bullet points for constructing the NBN.

Brown would be right when he suggests that Australians may enjoy faster speeds, but with low usage caps and high prices — if Telstra was the only company providing the service.  The new network will provide speeds faster than most Americans enjoy, with enormously expanded capacity.  Providers like Telstra have an incentive not to deliver the unlimited service that fiber network can deliver, as it will reduce their profits.  But since any company can access the network and compete, Telstra’s loss in market power will also erode their pricing power.  When a consumer protection mechanism is added, Telstra won’t just be answering to their shareholders’ demands for greater value.  They’ll also answer to the ACCC and the consumers who will pay for and maintain the network.

That may not add up to mega-profits for Big Telecom, but it certainly makes a whole lot of sense to consumers and small businesses who will finally be able to get 21st century broadband at a reasonable price.

Even worse for Digital Society’s friends — AT&T and Verizon — who fund the group through its connection with Arts+Labs, it might provide a blueprint for how America’s broadband future should be built.

[flv]http://www.phillipdampier.com/video/ABC TV National Broadand Network 8-15-10.flv[/flv]

ABC-TV (Australia) debated the merits of competing broadband plans from the incumbent Labor government, which supports a National Broadband Network delivering fiber to the home, versus a cheaper plan from the coalition opposition which promoted a private industry-favored initiative delivering improved broadband only to rural areas.  The Labor government initiative won the day when two rural independent members of Parliament, Rob Oakeshott and Tony Windsor announced they’d support Prime Minister Julia Gillard, giving her the 76 votes required to form a minority Labor government.  Windsor is an enthusiastic supporter of the NBN, telling Sky News “’you do it once, you do it right, you do it with fiber.”  Oakeshott said Labor’s plan to deliver real broadband for the 21st century was a major reason he backed the Labor government.  For the first time ever, fiber optic broadband was the key factor in determining who would govern a country.  (5 minutes)

When Alltel announced the sale of its wireless business to Verizon in 2008, few Alltel customers could have foreseen they’d technically end up changing cell phone providers not once, but twice.  That’s because the federal government ordered Verizon to sell off Alltel’s assets in communities where Verizon already had a substantial market share.  For the sake of competition, the majority of Alltel customers in 18 states affected by the federal government divestiture order will become AT&T customers shortly.

That poses a problem because Alltel’s network and phones use CDMA network technology.  AT&T uses a different standard called GSM.  The two standards are not compatible.  Since AT&T has no intention of operating a CDMA network for Alltel customers, once AT&T converts Alltel’s cell sites to operate on its own network, every Alltel customer will be left with phones and equipment that will no longer work.

To make the deal work, AT&T has agreed to provide, at no charge, comparable brand new phones and other equipment to Alltel customers being moved to AT&T’s network.  No new contract is required, and customers will not be forced to extend one to receive the new AT&T equipment.

But that deal doesn’t extend to handing out free iPhones to Alltel customers.  If you want one of those, you will have to pony up the same money every other AT&T customer pays, and sign a new two-year contract.

This week, AT&T announced it was speeding up the transition, and many customers will be choosing new free phones around the end of this year or in early 2011.  Originally, AT&T expected it would take until mid-2011 to complete network conversions.  Complete details can be found on the AT&T-Alltel Transition Website.

For residents in the north-central United States, the iPhone craze has been something other Americans have experienced.  For much of the Dakotas and Montana, the transition will bring the first opportunity to get the popular smartphone at the subsidized price AT&T offers all of its customers on contract.

The implications of AT&T’s imminent arrival in the area doesn’t seem to bother the other dominant provider – Verizon Wireless.  In South Dakota, AT&T’s entry into the market may cause some to switch to AT&T, if only for the iPhone.  But Karen Smith, spokeswoman for Verizon Wireless in the Great Plains region, says Verizon is confident with the lineup of phones it already offers and remains the nation’s largest wireless carrier even without the iPhone.

Current Verizon customers like Jill Garrigan of Rapid City told the Rapid City Journal she’d consider switching to AT&T to grab the iPhone, but she’d much prefer buying one from Verizon Wireless.

“If Verizon carried the iPhone, I’d probably consider getting it from Verizon,” Garrigan said.

Many other South Dakotans share concerns about the higher monthly wireless bills the iPhone brings, and they’re not interested in paying a lot more just to own one.

Garrigan’s friend, Jessica Simon, said she’ll keep her current Samsung phone, thank you very much.  The reason?  “It’s all the additional money and all the surcharges,” she told the newspaper.

But local cell phone dealers believe the arrival of Apple’s iPhone will cause a sensation across the region, and they’ve already fielded calls from customers anxious to acquire one.

Stop the Cap! has created a map showing the areas due for early conversion for your convenience.

Areas shaded in red are scheduled for early conversion to AT&T's GSM Network (click to enlarge)

[flv width=”640″ height=”500″]http://www.phillipdampier.com/video/Alltel ATT Transition Ahead of Schedule 9-4-10.flv[/flv]

Stop the Cap! has compiled news reports from across the region regarding the AT&T-Alltel transition and its impact on states including the Dakotas, Montana and Wyoming.  Clips courtesy of WDAY-TV Fargo, N.D., KGWN-TV Cheyenne, Wyo., KECI-TV Missoula, Mont., and KFYR-TV Bismarck, N.D. (4 minutes)

Upgrade Specifics

The following counties are on AT&T’s early upgrade list (RSA=Rural Service Area):

Alabama: Greater Dothan area and RSA 7 including Butler, Coffee, Covington, Crenshaw, Geneva and Pike Counties.

Arizona: RSA 5 including Gila and Pinal Counties.

Colorado:  RSA 4 includes Chaffee, Custer, Fremont, Lake and Park Counties. RSA 5 includes Cheyenne, Elbert, Kit Carson and Lincoln Counties. RSA 6 includes Dolores, Hinsdale, La Plata, Montezuma, Ouray, San Juan and San Miguel Counties. RSA 7 includes Alamosa, Archuleta, Conejos, Mineral, Rio Grande and Saguache Counties. RSA 8 includes Bent, Crowley, Kiowa, Otero and Prowers Counties. RSA 9 includes Baca, Costilla, Huerfano and Las Animas Counties.

Michigan: Greater Muskegon area and RSA 5 includes Benzie, Lake, Leelanau, Manistee, Mason, Missaukee, Osceola and Wexford Counties. RSA 7 includes Gratiot, Isabella, Mecosta, Montcalm and Newaygo Counties.

Montana: Greater Billings and Great Falls areas and RSA 1 includes Flathead, Glacier, Lake, Lincoln, Pondera, Sanders and Teton Counties. RSA 2 includes Blaine, Chouteau, Hill, Liberty and Toole Counties. RSA 4 includes Daniels, Dawson, McCone, Richland, Roosevelt, Sheridan and Wibaux Counties. RSA 5 includes Granite, Lewis and Clark, Mineral, Missoula, Powell and Ravalli Counties. RSA 6 includes Broadwater, Deer Lodge, Jefferson, Judith Basin, Meagher, Silver Bow and Wheatland Counties. RSA 7 includes Fergus, Golden Valley, Musselshell, Petroleum, Stillwater and Sweet Grass Counties. RSA 8 includes Beaverhead, Gallatin, Madison and Park Counties. RSA 9 includes Big Horn, Carbon, Rosebud and Treasure Counties. RSA 10 includes Carter, Custer, Fallon, Powder River and Prairie Counties.

New Mexico: Greater Las Cruces area and RSA 1 includes Cibola, McKinley, Rio Arriba, San Juan and Taos Counties. RSA 5 includes Grant, Hidalgo and Luna Counties. RSA 6 includes Chaves, Eddy, Lee, Lincoln and Otero Counties.

North Dakota: Greater Fargo, Grand Forks, and Bismarck areas and RSA 1 includes Burke, Divide, McLean, Mountrail, Renville, Ward and Williams Counties. RSA 2 includes Benson, Bottineau, Cavalier, McHenry, Pierce, Ramsey, Rolette and Towner Counties. RSA 3 includes Barnes, Dickey, Griggs, LaMoure, Nelson, Pembina, Ransom, Richland, Sargent, Steele, Traill and Walsh Counties. RSA 4 includes Adams, Billings, Bowman, Dunn, Golden Valley, Grant, Hettinger, McKenzie, Mercer, Oliver, Sioux, Slope and Stark Counties. RSA 5 includes Eddy, Emmons, Foster, Kidder, Logan, McIntosh, Sheridan, Stutsman and Wells Counties.

South Dakota: Greater Sioux Falls and Rapid City areas and RSA 1 includes Butte, Harding, Lawrence and Perkins Counties. RSA 2 includes Campbell, Corson, Dewey, Potter, Walworth and Ziebach Counties. RSA 3 includes Brown, Edmunds, Faulk, McPherson and Spink Counties. RSA 4 includes Clark, Codington, Day, Deuel, Grant, Hamlin, Marshall and Roberts Counties. RSA 5 includes Custer, Fall River and Shannon Counties. RSA 6 includes Bennett, Gregory, Haakon, Jackson, Jones, Lyman, Mellette, Stanley, Todd and Tripp Counties. RSA 7 includes Aurora, Brule, Buffalo, Charles Mix, Davison, Douglas, Hand, Hughes, Hyde, Jerauld and Sully Counties. RSA 8 includes Beadle, Brookings, Kingsbury, Lake, Miner, Moody and Sanborn Counties.RSA 9 includes Bon Homme, Clay, Hanson, Hutchinson, Lincoln, McCook, Turner, Union and Yankton Counties.

Virginia: Greater Danville, Norton and South Hill areas and RSA 1 includes Buchanan, Dickenson, Lee, Russell, and Wise Counties and Norton City. RSA 8 includes Amelia, Brunswick, Lunenburg, Mecklenburg and Nottoway Counties.

Wyoming: Greater Casper area and RSA 1 includes Big Horn, Hot Springs, Park and Washakie Counties. RSA 2 includes Campbell, Crook, Johnson, Sheridan and Weston Counties. RSA 4 includes Albany, Goshen, Laramie, Niobrara and Platte Counties. RSA 5 includes Converse County.