Just six months after the transition to digital television in the United States, proponents for the wireless mobile industry are back before the Federal Communications Commission asking the agency to “free up” additional frequencies by forcing major changes to local television stations.

The CTIA – The Wireless Association, a trade group representing big mobile providers like Verizon, Sprint, and AT&T, and the Consumer Electronics Association have suggested high power television broadcasting should be replaced with networks of lower powered regional relay transmitters serving smaller areas.  With considerably reduced power and antenna height, the groups argue, stations can be compacted into a smaller range of available channels, opening up new opportunities for wireless broadband services.

The number of available channels for television broadcasts has been shrinking since the early 1980s, when UHF channels 70-83 were largely reassigned for mobile phone use.  Today’s UHF band ends at channel 51, as channels 52-69 are reassigned to several interests, including first responders and other public safety uses.  With further compacting of the UHF band, up to 100-180 MHz of spectrum may be freed for mobile broadband use across the country.

How can this be done when the FCC believes many large urban regions of the country have used every available channel?  By reducing the coverage area of individual transmitters.  The wireless association claims interference problems come from high powered transmitters using soaring television antennas to give most television stations 30-40 miles of coverage area from a single transmitter site.  By dramatically reducing both the power and antenna height, and instead using a network of relay transmitters serving smaller areas, television stations can cover their local communities and reduce distant signal reception.  It’s these distant signals, and their capacity to interfere with other stations which requires the FCC to keep stations occupying the same or nearby channels far apart.

KATV-TV Little Rock's transmission tower

The CTIA suggests that with proper engineering of a low-powered network of transmitters, the Commission could reallocate UHF channels 28-51 for wireless communications instead, leaving UHF stations sharing channels 14-27.

The wireless lobby is selling this plan as a “win” for broadcasters, even though they will need to construct a network of lower powered transmitters and antennas to serve essentially every town in their existing service areas.  For most, that would involve constructing 15-20 new transmitter sites.  The wireless group says a more localized ‘cell-tower’ like approach to television transmission would serve areas currently not able to receive reception because of obstacles between the main high powered transmitter and a viewer’s set.  Proper placement of transmission antennas would maximize reception for each transmitter.  The wireless industry is even willing to bear the expense of purchasing transmitters, estimated at up to $1.8 billion dollars nationwide, to help broadcasters make the transition.  That’s actually a cheap price to pay considering the frequencies converted for their use are worth tens of billions more.

The plan got a boost of sorts from the Justice Department, who filed their own comments with the FCC suggesting adding frequency spectrum for wireless-based broadband should be a top priority for the Commission.

“Given the potential of wireless services to reach underserved areas and to provide an alternative to wireline broadband providers in other areas, the Commission’s primary tool for promoting broadband competition should be freeing up spectrum,” Justice officials wrote.

The Justice Department believes handing over additional frequency spectrum will promote competition, increase wireless broadband speeds, and lower prices, despite no evidence that wireless broadband competition would suddenly appear on the scene, or that the prevailing wireless carriers would actually reduce pricing and relax usage limits.

Broadcasters are not thrilled with the wireless industry plan.

The National Association of Broadcasters, to paraphrase, knocked the wireless industry for getting too greedy with its spectrum requests.  The NAB believes wireless providers like Verizon, AT&T, Sprint and T-Mobile are sitting on frequencies already allocated, but not yet used, for mobile communications networks, and they should use them before they come knocking looking for more.

Even more concerning to the NAB is the disruption the CTIA plan would cause for Americans still watching over-the-air free television.  Channel numbers would almost certainly have to be reassigned… again, at least for UHF stations.  That created significant confusion for viewers on the final date of the DTV transition in June when many stations either moved their digital signal back to their original analog channel number or relocated somewhere else on the dial.  Many Americans lost reception until they were taught to re-scan their televisions or converters to find the channels gone missing.

The NAB also questions the reception improvement a network of low power television transmitters could provide, particularly for those just on the edge of one relay transmitter and another.  Anyone trying to watch a low power television station today more than a few miles from the transmitter site can testify it’s not a pleasant experience.  Even greater concerns impact those “distant viewers” who may live between two or more cities, each with their own local stations.  Those viewers, using external antennas, can often watch television from several cities depending which direction their rooftop antenna is pointed, but could end up receiving no signals at all if CTIA’s plan is approved.

Broadcasters are also concerned about the impact lower powered transmitters will have on the forthcoming Mobile DTV service, which will bring programming to devices on-the-go.

The war over frequencies continues, as the broadcasters and mobile providers fight over who ultimately controls airwave real estate estimated to be worth $36-65 billion dollars.

New Zealand Telecom

New Zealand’s Telecom is the latest company caught with a defective broadband usage meter that overbilled 150,000 of their 500,000 customers for Internet usage never utilized.  The problem was tracked to a “technical problem” involving the company’s network upgrade in preparation for the introduction of TiVo.  Telecom’s engineering partner Juniper was held responsible for introducing the error which resulted in more than one hundred thousand customers finding their broadband speeds reduced for “excessive usage” to near-dial-up or billed steep overlimit penalties for the months of November and December.

On December 23, Telecom sent out letters to around 150,000 customers informing them of the error.

“Our reports show us that you will have experienced slowed internet speeds earlier than expected in your billing months,” said the letter, signed by Telecom’s general manager of broadband, Ralph Brayham.

Telecom spokeswoman Emma-Kate Greer told the New Zealand Herald all customers who had been affected by over-charging or slowed internet speeds had been identified.

They had been refunded and credits had been given to “customers who may have been incorrectly slowed.”

Customers shocked by their November and December bills were initially stuck taking Telecom’s word for the overbilling, resulting in lots of finger-pointing in New Zealand households.  The Herald reported:

Sarah Broughton, from Herne Bay in Auckland, said she had been frustrated by the slow broadband, and had accused one of her flatmates of downloading too many movies.

“There are six people living in our house. We all suspected everyone else was downloading heaps,” she said.

“We were blaming other people.

“I never suspected it was Telecom. You think when you give them money they are going to use it properly.

“It’s just been so annoying.”

Usage meters, a vital component of Internet Service Providers seeking an enhanced payday from Internet Overcharging schemes that bill customers based on how much data they consume, have been controversial because of questions regarding the accuracy of their measurements.  Most providers do not permit independent verification of the accuracy of their meters, despite their accounting for a significant portion of a customer’s monthly broadband bill.

It took a concerted, organized effort by members of the Geekzone website to “out” Telecom’s erroneous billing practices and get the company to issue compensation to impacted customers.

Brain Trust: Time Warner's Gerald Levin (left) and AOL's Steve Case (right)

Gerald Levin, the former CEO of Time Warner, who presided over the company’s disastrous merger with the AOL online service confessed “I presided over the worst deal of the century, apparently.”

Appearing Monday on CNBC with Steve Case, former head of AOL, the two lamented the blockbuster wealth destruction vehicle on its 10th anniversary.

“I’m really very sorry about the pain and suffering and loss that was caused. I take responsibility,” Levin said. “It wasn’t the board. It wasn’t my colleagues at Time Warner. It wasn’t the bankers and lawyers.”

“It’s a little hard to exercise compassion, connection, and love when the market is very unforgiving,” Levin added.

The striking admission that a corporate master of the universe exercised flawed judgment was rare enough, but to apologize for it is near unprecedented.

The Times-Online called it “a tad late,” coming a decade after the deal, noting the deal was only made possible because of the Dot.com Boom launching AOL stock value into the stratosphere.

“In the US, there have been no apologies from the chief executives who steered Wall Street banks on to the rocks, notably Dick Fuld of Lehman Brothers. Given he is likely to spend the rest of his life defending legal actions, that is hardly surprising,” the newspaper adds.

The Financial Times notes corporate apologies come with some rules of etiquette:

There are – rightly – limits on what responsibility a business can accept until it has talked to its lawyers. Executives whose contrite words turn out to contain too great an admission of liability may soon end up apologising all over again.

But there are a few straightforward rules for an effective corporate apology, and the first one is to keep it simple. Expressions of penitence that come with explanations of how the event was not a total catastrophe or was partly someone else’s fault lose their impact. Equally, a statement that equivocates on the extent of remorse will fail to convince. The apology must also be clearly directed at those adversely affected by what has happened, rather than aimed at making those responsible feel better about it.

Mr Levin mixed his belated apology with a call for today’s corporate leaders to accept responsibility for the financial crisis. Though some bank executives have apologised, expressing regret for this crisis is a harder task than it sounds. People can take responsibility only for their own misdeeds, but explaining this may sound weaselly. At the same time, if an angry public favours ritual sacrifice, then other acts to make amends might seem inadequate. So those executives who pull off an effective apology for the crisis deserve our respect – as long as they do not leave it until 2018.

Amusingly, post colossal failure, the two executives have found remarkably similar career paths divorced from the high tech telecommunications market.

Levin runs the California-based new-agey Moonview ‘addiction-rehab-for-the-rich’  Sanctuary, which markets itself as “a place to revel in the wonder of you.”  New York Magazine said Levin was pitching “brain painting, equine therapy and soul communion with the dead.”

Moonview’s “comprehensive multi-modal mind, body and spirit assessment creates a customized plan of psychological, spiritual, physical healing and optimal performance.”

It had better.  They don’t take health insurance and charge $2,500 for a one-half day and from $5,000 for a full day. Minimum is $15,000.  That makes me depressed.

Steve Case founded Revolution, which claims to: “drive transformative change by shifting power to consumers and building significant, category-defining companies in the process.  Focusing on multiple market sectors, including Health, Financial Services, Resorts, Living and Digital, Revolution’s mission is to give people better choices, more control and more convenience in the important aspects of their lives.”

Looking through their collection of companies, the middle class need not apply.  I especially enjoyed Case’s vision of a getaway with his “Exclusive Resorts” company:

We believe that your Exclusive Resorts membership plan should be designed around your lifestyle, not the other way around.

With Membership Fees starting at $160,000 (75% refundable) and Annual Dues of just under $1,000 per day on all plans, our memberships are designed to be tailored to your individual needs.  A wide range of plans from 10 to 60 days of vacation per year and optional features such as priority holiday access ensure that you will find the unique combination that is right for you.

My last vacation getaway was in Calgary and Kananaskis Country in Alberta in 2007.  The private chef “at your beck and call” at Exclusive Resorts for them was a trip to Tim Horton’s for me.

But then I didn’t preside over the worst deal of the century, requiring a mind, body and spirit assessment and a getaway to the French Alps.

[flv]http://www.phillipdampier.com/video/CNBC 10 Years After AOL-Time Warner, Gerald Levin Says He’s Sorry 1-4-10.flv[/flv]

Gerald Levin and Steve Case revel in the wonder of their failure 10 years ago merging Time Warner with AOL. (22 minutes)

Phillip Dampier

In a remarkable statement to the Federal Communications Commission in Washington, AT&T has joined Verizon in predicting the imminent demise of Ma Bell’s classic telephone network.

AT&T writes in its 30 page comment, “That transition is underway already: with each passing day, more and more communications services migrate to broadband and Internet Protocol (IP)-based services, leaving the public switched telephone network (“PSTN”) and plain-old telephone service (“POTS”) as relics of a by-gone era.”

AT&T claims abandoning the old legacy phone network would help the company devote its full resources into staying relevant by constructing a broadband, IP-based network that would deliver voice, data, and video to consumers, presumably over its U-verse platform.  That, according to AT&T, could help the company achieve universal broadband coverage in its service areas, but only if investment-friendly regulations are supported by Washington policymakers.

The Commission has been charged by Congress with formulating a National Broadband Plan that will result in broadband availability for 100% of the United States. That auspicious goal is within reach, but […] will not be met in a timely or efficient manner if providers are forced to continue to invest in and to maintain two networks. Broadband is dramatically changing the way Americans live, work, obtain health care, and interact with the government. Congress and the Commission have rightly made universal broadband access a core national priority. But achieving this goal will take an enormous investment of capital. Private investment from network operators has brought broadband access to over 90% of Americans, and these operators will continue to play a pivotal role in bringing broadband to the remaining 8-10% of citizens who do not currently have broadband access. It is accordingly crucial that the Commission pursue forward-looking regulatory policies that remove disincentives to private investment and encourage operators to extend broadband to unserved areas.

While broadband usage – and the importance of broadband to Americans’ lives – is growing every day, the business model for legacy phone services is in a death spiral. Revenues from POTS are plummeting as customers cut their landlines in favor of the convenience and advanced features of wireless and VoIP services. At the same time, due to the high fixed costs of providing POTS, every customer who abandons this service raises the average cost-per-line to serve the remaining customers. With an outdated product, falling revenues, and rising costs, the POTS business is unsustainable for the long run.

AT&T cites a growing number of Americans cutting their wired phone line service — 22% according to the National Center for Health Statistics.  Craig Moffett from Bernstein Research pegs it closer to 25%, with an additional 700,000 phone lines being disconnected every month.  With a shrinking customer base, the viability of companies providing only wired phone service has come into question.  Verizon and AT&T, the nation’s largest phone companies, have made the judgment it’s a dying business.  Conversely, Frontier Communications and a few other independent phone companies remain believers in rural copper wire phone networks, and are willing to buy the discarded, mostly rural regions their bigger counterparts can’t wait to exit.

But AT&T’s advocacy for an end to “plain old telephone service” is just a tad self-serving when one explores their “To-Do” list for Washington regulatory agencies and lawmakers.  AT&T suggests their future plan benefits all Americans.  Critics would contend it mostly benefits AT&T and its shareholders, especially in light of AT&T’s future revenues being directly impacted by customers disconnecting their AT&T phone lines.  AT&T themselves note collective industry revenue for basic phone service fell from $178.6 billion in 2000 to $130.8 billion in 2007, a 27% decrease.

AT&T’s Action Plan to Avoid Obsolescence Explored

At the heart of AT&T’s proposal for 21st century telephone service is an end to analog telephone service, designed more than 100 years ago to carry voice calls, and the launch of broadband-based service to every home in their service area.  From this new platform, AT&T can deliver telephone, television, and Internet service over a single network.  In fact, they already do in several cities where AT&T’s U-verse has launched. Instead of getting one revenue stream from basic phone service, AT&T can now earn from any number of services a broadband platform can support.

AT&T compares their plan with the transition from analog to digital television, except you won’t have to trade in your existing phones or attach converter boxes to every telephone in the house.  Just like the switch to digital television, AT&T wants a date certain to pull the plug on Ma Bell’s old phone network, the sooner the better.

But AT&T’s plan has plenty of strings attached.

First, the company believes the only path to private investment and a successful transition is a near-complete deregulation of the telephone industry.  It wants the federal government, specifically the FCC, to take control of oversight of phone companies across America, if only to end a patchwork of state regulations and service requirements.  Remember, the Ma Bell most Americans grew up with was a regulated monopoly.  In return for guaranteed profits, phone companies agreed to meet service obligations, provide service to any home or business that wanted it, serve the disabled, and provide discounted phone service to the economically disadvantaged.  Rural customers were assured they would have access to phone service and at reasonable prices, and if something stopped working, government oversight ensured problems would be repaired to the customer’s satisfaction.

In AT&T’s view, such requirements are quaint and outdated, and it wants to bear few of those burdens going forward.  Indeed, in a too-cute-by-half aside, the company argues that since it will design the network to operate under the same protocol the unregulated Internet uses, it should be unregulated as well.

Such deregulation could impact a myriad of policies governing phone service that most Americans take for granted — minimum service standards, requirements that telephone companies complete calls between one another – even if competitors, and reasonably priced basic phone service even in the most remote locations.  But AT&T is asking for even more – a comprehensive review and possible elimination of any regulation that could be interpreted as interfering with the transition to an all-broadband telephone network.  AT&T includes everything but the kitchen sink in this category, ranging from service quality requirements, reporting, recordkeeping, data collection, accounting, and depreciation and amortization rules governing how quickly the company can write off obsolete equipment.

Ma Bell's network is due for a retirement, advocates AT&T

Ironically, AT&T wants deregulation -and- access to public taxpayer dollars to construct their new network.  The company advocates government-funded award programs to promote universal broadband access.  One would provide money for wired broadband service, perfect for companies like AT&T that want to build those networks, and another for wireless mobile projects to expand service into unserved or underserved areas, also perfect for AT&T Mobility — the same wireless carrier slammed by Verizon Wireless for largely ignoring rural America with 3G wireless data upgrades.

While there is some justification for a review of federal and state rules that may no longer realistically apply to today’s telecommunications marketplace, AT&T goes out of its way to be self-serving in its recommendations.  It dangles the bright and shiny object of a 21st century broadband-based telephone network, but only if they get to run it essentially “no questions asked,” with little oversight and an infusion of public taxpayer dollars to compliment private investment.

AT&T may be correct that the days for Ma Bell’s “plain old telephone service” are indeed numbered.  But for a company that earns billions in profits and answers to shareholders demanding maximum return, shouldn’t their long term well-being first be a question between AT&T management and shareholders?  Are they incapable of a private course correction that makes their future relevance more secure?  AT&T’s U-verse did not require public tax dollars to be successful, and the company spent generously on lobbyists and astroturf campaigns to smooth the way forward with “statewide franchising,” bypassing local government oversight.

The real question on the table is how far does the Obama Administration and the FCC want to go to achieve universal broadband?  AT&T suggests that only massive deregulation will entice private investors to step up and make the investments required to help achieve whatever definition of “universal broadband” the Commission comes up with.  But that price is way too high to pay.  AT&T answers first and always to its shareholders.  If they want public tax dollars funding, even in part, their transition to an all-broadband future, they must also answer to the other “stockholders,” namely the American people helping to foot the bill.

Cable companies, U-verse, and FiOS aren’t alone in raising prices in the New Year.  Satellite provider DirecTV has mailed a rate hike notice to its subscribers effective February 9, 2010.  Many of their packages are being streamlined, and some existing subscribers to packages not noted below are also impacted with price increases.  Most will see an increase averaging $3 a month.  Thanks to The Gadgetress at The Orange County Register who put it all in chart form.

DVR fees will also increase, from $5.99 to $7 a month.

Those on promotional price packages or a contract term will see no change in pricing until their promotion or contract expires.

For those who are curious, the 2010 prices are between 9.5 percent to 60 percent higher than 2008’s prices:

DirecTV E-Mail to Subscribers:

Dear DIRECTV Customer,

Your business is important to us. We want you to know about any changes to your DIRECTV® service as far in advance as possible. That is why we are writing to let you know of a potential change to your DIRECTV bill.

On February 9, 2010, new pricing will be applied to DIRECTV programming packages and services.

DIRECTV is the leader in satellite television and will continue to bring you the best in entertainment:

New Rates for DIRECTV® Service: New prices take effect February 9, 2010, and will appear on billing statements issued after that date. See the detailed information below as it relates to your service. If your current DIRECTV base package price is part of a national promotional 12-month or “Lock in Your Price for 12 Months” offer, you will continue to receive this price for the remainder of your offer period. As of next month’s bill, your promotional price will be shown on your statement as the new price along with a credit. Note: if you change your current base package, you may no longer be eligible for the credit.

Base Packages: Base packages include local channels, where available. Packages and their new prices: CHOICE™ $58.99/mo. CHOICE XTRA™ $63.99/mo. PREFERRED CHOICE™ $38.99/mo. PREMIER™ $114.99/mo. TOTAL CHOICE® MOBILE™ $63.99/mo.

The following legacy base packages* and their new prices: BASIC $15.99/mo. BÁSICO™ $35.99/mo. DIRECTV LIMITED $27.99/mo. FAMILIAR™ $51.99/mo. FAMILIAR ULTRA™ $60.99/mo. OPCIÓN ESPECIAL® $35.99/mo. OPCIÓN EXTRA™ $43.99/mo. OPCIÓN EXTRA ESPECIAL® $52.99/mo. OPCIÓN PREMIER® $108.99/mo. OPCIÓN ULTRA ESPECIAL® $54.99/mo. OPTIMO MÁS PLUS DVR $53.99/mo. PLUS DIRECTV $36.99/mo. PLUS DVR™ $69.99/mo. PLUS HD DVR™ $79.99/mo. SELECT CHOICE® $41.99/mo. TOTAL CHOICE® $57.49/mo. TOTAL CHOICE® LIMITED $48.99/mo. TOTAL CHOICE® PLUS $61.49/mo. SELECT will increase $3.00/mo. DIRECTV® DVR Service fee $7.00/mo.

*These packages are no longer available for sale. Customers who currently subscribe to these packages may maintain them as long as their account is in “good standing”, as determined by DIRECTV in its sole discretion. For complete pricing and packaging information, visit directv.com/packages.