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New Documentary Reminds Us Why Letting AT&T Grow Bigger is a Bad Idea

Phillip Dampier August 30, 2011 AT&T, Editorial & Site News, History, Net Neutrality, Public Policy & Gov't, T-Mobile, Verizon, Video, Wireless Broadband Comments Off on New Documentary Reminds Us Why Letting AT&T Grow Bigger is a Bad Idea

On September 13, most PBS stations will premiere a new documentary, “Bill McGowan, Long Distance Warrior” exploring the many trials and tribulations of MCI Corporation, the long distance and e-mail provider that was instrumental in breaking up Ma Bell’s monopoly in telephone service.

[flv width=”512″ height=”308″]http://www.phillipdampier.com/video/Long Distance Warrior.flv[/flv]

A preview of PBS’ Long Distance Warrior, which premieres on most PBS stations Sept. 13  (3 minutes)

For those under 30, “MCI” may not mean much.  The company that helped pioneer competitive long distance calling was absorbed into the Worldcom empire in 1997, where it continued to provide service until a major corporate accounting scandal brought Worldcom down in 2002.  Most of what was left was eventually sold to Verizon Communications in 2005.

Remarkably, Microwave Communications, Inc. (MCI) was founded all the way back in 1963, but not as a provider of telephone services.  That MCI sought to build a network of microwave relay stations between Chicago and St. Louis to provide uninterrupted two-way radio service for some of the nation’s largest trucking and shipping companies.

The Bell System

By the late 1960s, William G. McGowan, an investor and venture capitalist from New York won a seat on MCI’s board of directors and part ownership of a newly-envisioned version of MCI — one that would provide businesses with a range of telecommunications products, including long distance telephone connections.  With many American corporations maintaining branch and regional offices, connecting them together was a potentially very lucrative business, especially if MCI could deliver the service at prices cheaper than what the monopoly Bell System was charging.

With their microwave relay network, now expanding across the country, MCI could distribute long distance phone calls cheaply and efficiently, if they could find a way to connect that network to Bell’s local phone system.  After all, it does little good to offer long distance service if you cannot connect calls to the businesses’ existing telephone equipment.

That’s where AT&T and its Bell Operating Companies objected.  For them, only calls originating on and delivered over their own network should be allowed.  MCI, as an interloper, was seeking to use the network AT&T built and paid for.  It’s an argument that has echoed more than 30 years later, when AT&T’s then-CEO Ed Whitacre objected to outside Internet content providers “using AT&T’s pipes for free.”

[flv]http://www.phillipdampier.com/video/MCI First 20 Years.mp4[/flv]

On the occasion of MCI’s 20th anniversary, the company produced this retrospective exploring the difficult times competing with AT&T and the Bell System.  (9 minutes)

MCI's best argument: AT&T's long distance bills

McGowan confronted arguments from AT&T executives who warned that competitive long distance would destroy the business model of America’s Bell System, which provided affordable local phone service to all 50 states, in part subsidized by long distance telephone rates, mostly paid by its commercial customers.  Tamper with that, they warned, and local phone bills would be forced to soar to make up the difference.

MCI called that argument a scare tactic, and suggested instead that AT&T’s monopoly had grown inefficient, bloated, expensive, and resistant to innovation and change.  MCI could deliver a substantially less expensive service and would force AT&T to increase its own efficiency to compete.  AT&T wasn’t interested in that argument and sued, repeatedly, to keep MCI out of its business.

By 1984, federal courts declared AT&T a monopoly worthy of a break-up, and opened the door to MCI’s long distance network.  By that time, MCI was already thinking about evolving itself beyond a business long distance provider, whose network was largely idle after business hours.  Because most Americans were accustomed to making long distance calls at night when rates were substantially lower, MCI developed new residential long distance service plans that encouraged customers to use that idle network at night and on weekends.

[flv width=”640″ height=”447″]http://www.phillipdampier.com/video/crying_mother.f4v[/flv]

One of MCI’s most memorable ads features a sobbing mother who reached out and touched her son over long distance a little too much.  (1 minute)

Thus began more than a decade of heavy advertising and competition for the long distance telephone market.  With equal access rules in place, consumers could choose their own long distance phone company and shop for the one with the lowest rates.  Competitors like Sprint, WilTel, LDDS, RCI, LCI, and yes, even AT&T all pitched their own calling plans.

MCI also pioneered MCI Mail, one of the first commercial electronic mail systems.  The original concept had businesses typing letters on a computer terminal, printed on standard paper at an MCI office closest to the destination, and then mailed in an envelope through the U.S. Post Office.  This poor-man’s version of a telex or telegram worked for businesses that wanted overnight delivery, but not at the prices charged by shippers like Federal Express.  In larger cities, MCI Mail could offer businesses delivery of their electronic communications within four hours, something closer to a traditional telegram of days gone-by.

MCI Mail’s hard copy deliveries wouldn’t last long, of course.  As the 1980s progressed, the fax machine and the more familiar all-electronic e-mail we think of today became firmly established.  As MCI Mail became less relevant, the company innovated into offering low priced telex services, mass-faxing, and data backhaul services to provide connectivity for online networks.

[flv width=”504″ height=”400″]http://www.phillipdampier.com/video/WIBW MCI Mail 1984.flv[/flv]

WIBW explores a new concept in communications — something called ‘electronic mail,’ a service that bewildered consumers in the early 1980s.  This report from 1984.  (2 minutes)

Bill McGowan: Would not approve of AT&T's plans to restore the glory days of the past.

AT&T, in contrast, was still getting over the loss of its local Bell Operating Companies — the regional phone companies most Americans did business with, and the loss of revenue earned from renting telephone equipment.  For years, AT&T long distance was branded as a quality leader, not a price leader.  It maintained its enormous market share partly through consumer indifference — customers who did not initially choose a new long distance carrier remained with AT&T, the default choice.

It took only about a decade after the Bell break-up for telecom industry lobbyists to begin advocating for enough deregulation to allow many of those former Baby Bells to re-combine through mergers and acquisitions.  The result is today’s AT&T, formed from its long distance unit, BellSouth, Illinois Bell, Indiana Bell, Michigan Bell, Nevada Bell, Ohio Bell, Pacific Bell, Southwestern Bell, Wisconsin Bell, and Southern New England Telephone.  Its largest competitor is Verizon Communications, which itself resulted from a combination of Bell Atlantic, NYNEX, GTE, and what was left of MCI after Worldcom was through with it.

McGowan’s fight was a personally costly one.  A workaholic, McGowan routinely put in 15 hour work days and drank up to 20 cups of coffee daily.  His heart finally had enough and McGowan succumbed to a heart attack in 1992 at age 64.  But he leaves a legacy and two decades of fighting to break up AT&T’s monopoly, which he always believed was bad for consumers and business (unless you were AT&T, of course).  That’s an important message as AT&T strengthens its resolve to acquire one of its significant competitors in the profitable wireless market — T-Mobile.  McGowan would have never approved.

[flv]http://www.phillipdampier.com/video/KCSM San Mateo Electronic Mail 6-18-87.mp4[/flv]

“The Computer Chronicles,” a production of KCSM-TV, spent a half hour in June 1987 showing off electronic e-mail service from MCI and how consumers and businesses using something called a “modem” could connect their home computers with online databases and services to exchange information and communications back and forth.  And for those business travelers on the road, away from their office computers, Speech Plus offered a product that could still keep you “connected,” by reading your e-mail to you over the phone.  In 1987, outside of commercial pay networks like CompuServe, Delphi, PeopleLink and QuantumLink, most Americans with modems used them to connect to typically-free hobbyist-run computer bulletin board systems.  Widespread access to “the Internet” would take another 5-6 years.  (29 minutes)

Li-Fi: Transmitting Wireless Broadband Through LED Light Bulbs

Phillip Dampier August 30, 2011 Video, Wireless Broadband 3 Comments

A British physicist has developed a technology that could one day deliver your wireless broadband connection over any ordinary household lamp equipped with a “light emitting diode” (LED) light bulb.

Professor Harald Haas from Edinburgh University in the United Kingdom says he has developed a super-efficient, super-fast wireless broadband transmission system that uses light instead of radio waves.

Dubbed Light Fidelity, D-Light, or “Li-Fi” for short, Haas demonstrated his invention using an ordinary table lamp that successfully transmitted data at speeds exceeding 10Mbps using light waves from LED light bulbs to a computer located below the lamp.

To prove that the light bulb was the source of the data stream, he periodically blocked the beam of light, causing the connection to drop.

Haas says using light waves for data transmissions could revolutionize wireless communications and end the spectrum shortage plaguing today’s wireless industry.

“The way we transmit wireless data is inefficient electromagnetic waves, in particular radio waves which are limited, they are sparse, they are expensive and only have a certain range,” Professor Haas said. “It is this limitation which does not cope with wireless data, and we are running out of efficiency.”

Haas notes 95 percent of the energy used to transmit electromagnetic waves is wasted through heat dissipation.

Haas added that during today’s spectrum crunch, opening up light waves for wireless telecommunications would increase the amount of available spectrum by at least 10,000 percent, potentially transforming how we think about wireless communications technology.

“Light is part of the electromagnetic spectrum. Wouldn’t it be great to use it for wireless communications?”

Haas believes as we begin to replace energy inefficient traditional light bulbs for LED bulbs, which are becoming increasingly affordable, using them to piggyback data transmissions of all kinds could make staying “in range” of a wireless signal as simple as flicking on a light switch.

“For me the applications of it are beyond imagination,” Haas said.  “All we need to do is to fit a small microchip to every potential illumination device and this would combine illumination and data transmission, and this could solve the problems facing us in wireless communication.”

[flv width=”512″ height=”308″]http://www.phillipdampier.com/video/Harald Haas Demos Light-Fi.mp4[/flv]

What if every light bulb in the world could also transmit data? At TEDGlobal, Harald Haas demonstrates, for the first time, a device that could do exactly that.  (13 minutes)

Hurricane Irene Did Its Worst in North Carolina, Upstate NY, and New England

Hurricane Irene did its worst damage in inland areas of New England and Upstate New York

While hardly the “storm of the century,” damages from Hurricane Irene’s whirlwind tour up the east coast cannot yet be estimated because flood waters in the northeast are still rising this afternoon.

But while millions remain without electricity, some for up to several weeks, telecommunications infrastructure has fared better than expected in a number of areas hardest hit by the Category 1 hurricane.

A review of media reports finds the most substantial damage to cable TV and landline telephone service, mostly due to downed trees and flooding which brought down utility poles in a number of states.  The Federal Communications Commission also reported 1,400 cell sites along the coast were down, and several hundred were running on backup power.

North Carolina & Virginia

The most substantial wind-related damage impacted the states of North Carolina and Virginia where hundreds of thousands are still without electricity, cable, and landline telephone service.  Time Warner Cable, which dominates North Carolina, had 160,000 customers without service Saturday evening, primarily due to power outages and line damage.  As of this morning, 38,000 were still without service with the most damage in Wilmington, Newport, Morehead City, Jacksonville, Havelock, Elizabeth City, Murfreesboro and Ahoskie.  Outage information is available from 1-866-4TWCNOW (1-866-489-2669) for residential customers and 1-877-892-2220 for business customers.

Landline service outages are impacting more than 100,000 customers, and the wind damage has made the outages most severe in these two states.  CenturyLink, AT&T, and Verizon all report substantial damages to their respective networks in several areas.

At least 500 cell towers in North Carolina and Virginia are now operating on battery backup power, which guarantees cell phone outages will only grow worse as the hours progress.  Once battery power is exhausted, cell phone carriers either have to go without service or provision generators to deliver emergency power until normal electrical service can be restored, which is expected to take several days.  Physical damage to cell sites was reported to be minimal, however.  The biggest impact is loss of electricity.

[flv width=”670″ height=”380″]http://www.phillipdampier.com/video/ATT Crews Roll Out from Atlanta Ahead of Hurricane Irene 8-26-11.flv[/flv]

AT&T released this video to the news media showing the company’s preparations for Hurricane Irene, including putting trucks containing temporary cell sites on the road from Atlanta heading into North Carolina to restore wireless service knocked out by the storm.  (3 minutes)

Downed poles in neighborhoods are responsible for most of the outages impacting cable and phone companies. (Courtesy: WNYC)

Maryland, Washington, DC, Delaware, Southern New Jersey

A mix of wind and water damage has left sections of this region without electrical service, but damages are reportedly less severe than in North Carolina and Virginia.  The biggest impact is loss of electrical service which has left cell phone towers on battery backup and cable systems offline.  The more urban areas have less infrastructure damage due to underground wiring, but flood waters have created outages on their own.  In southern New Jersey, water damage is still occurring because of slowly rising rivers continuing to flood their banks.

Pennsylania, Northern New Jersey, New York City & Long Island

Substantial damage from excessive rain and downed trees, especially on Long Island, will leave some customers on lengthy waiting lists for service restoration.  Verizon on Long Island is telling some customers it will be at least two weeks before service calls can be completed to restore phone or FiOS service. Substantial neighborhood outages are impacting Cablevision customers on Long Island as well, mostly from downed trees.  At least 700 trees fell in Oyster Bay alone.  In Pennsylvania, the worst damage was actually further inland.  Suburbs of Philadelphia were particularly hard hit.  Electric service repair has been given top priority.  Cable service restoration will probably take longer, especially where utility poles have been damaged.

Upstate New York & New England

The worst damage of all is expected to be in upstate New York and New England, particularly in western Massachusetts and Vermont, unequipped to deal with the floodwaters which have set records in several areas.  A resident of Prattsville, New York escaped with his life and managed to finally reach emergency responders to report the entire community had been washed away in unprecedented flooding.  A great deal of utility infrastructure has gone with it, and the damage for New England’s FairPoint Communications, particularly in Vermont, is still being assessed.  Some communities in the region have been told it may take up to a month restore electrical service, longer for telephone and cable service.  Because large sections of the region are rural, there are fewer cell towers to cope with power outages, but the impact is much more readily apparent.  In some areas, there is only one provider delivering any significant service, and when battery backups fail, no cell service will function.

Verizon and Time Warner Cable all report service problems in the region.

Communities or infrastructure positioned near rivers are most at risk, and flood waters are still rising in many locations.  The damage, according to emergency officials, is likely to become worse before it gets better.

Although winds only achieved tropical storm-force in the region, they came in unusual wind patterns.  The National Weather Service issued high wind warnings as far west as Rochester in western New York in part because trees are unaccustomed to strong northerly winds and were much more likely to be damaged or uprooted from them.  Nearly one million New Yorkers, mostly east of Syracuse, remain without electricity this afternoon.  Some will wait 1-2 weeks before service can be restored in the most difficult-to-reach areas.

Service Credits Are Yours, But Only If You Ask

Telecommunications providers are notorious for providing service credits only when customers ask for them.  If your service was interrupted by the storm, make a note of when the outage occurred and remember to contact your provider for a service credit after service is restored.  In virtually all cases, providers will not automatically reimburse you for lost service and you will lose the chance to request it 30 days after service is back up and running.

If you’ve been affected by a serious storm, consider tree removal Raleigh NC to clean up the debris.

[flv width=”640″ height=”372″]http://www.phillipdampier.com/video/Verizon Wireless Emergency Plan.flv[/flv]

Verizon Wireless encourages its customers to create a natural disaster response plan that includes the use of cell phones to stay in touch with loved ones and employers.  (4 minutes)

Landline Decline: NY Woman Dies After Verizon Phone Service Remains Out for Days

Phillip Dampier August 25, 2011 Consumer News, Verizon, Video 6 Comments

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/WABC New York Woman Dies After Phone Service Not Restored 8-20-11.mp4[/flv]

While AT&T and Verizon invest billions in their increasingly profitable wireless services, their landline networks have languished across the country.  While that can inconvenience customers who may wait days or longer for service to be restored, one New York family is blaming Verizon for the death of their mother, after the company left their all-important phone line unrepaired for days, even after being notified of its critical need for medical reasons.  Now the family is asking, what does it take to get Verizon to repair basic phone service these days?  WABC has this exclusive report of one family’s anguish.  (4 minutes)

WBBM Radio: Give Us 22 Minutes, We’ll Read You AT&T Press Releases As “News”

Phillip Dampier August 25, 2011 AT&T, Audio, Consumer News, Editorial & Site News, T-Mobile, Wireless Broadband Comments Off on WBBM Radio: Give Us 22 Minutes, We’ll Read You AT&T Press Releases As “News”

Small town media, always eager for an easy story to tell, is notorious for rewriting industry press releases and calling it news, but when a major “news radio” station in Chicago does it, it’s simply sloppy and embarrassing.

WBBM Radio decided AT&T’s merger with T-Mobile, announced several months ago, has suddenly become newsworthy.  Why?  Because AT&T has been sending out press releases touting the merger’s benefits for Illinois customers.

News that a merger with America’s fourth largest wireless carrier would suddenly bring widespread 4G coverage to communities large and small has become catnip for lazy reporters who never bother to research the claims.  Even AT&T’s attorneys are on a different page from AT&T’s public relations department.

But the extent of WBBM’s investigation by reporter Alex Degman began and ended with a proposed AT&T coverage map:

A coverage map of the proposed network coverage shows most of the state would indeed be covered, minus large sections of the Shawnee National Forest in southeastern Illinois and scattered pockets in west central Illinois. The merger is expected to be approved in January.

Degman’s report was little more than a disguised advertisement for AT&T, completely reliant on the company’s claims and ignorant of the fact AT&T would bring 4G service to anyone in WBBM’s local coverage area with or without T-Mobile.

Apparently there was no time for merger opponents.

WBBM Reporter Alex Degman “covers” the impact of the merger between AT&T and T-Mobile on Illinois. August 22, 2011. (1 minute)
You must remain on this page to hear the clip, or you can download the clip and listen later.

Listener Seth Weintraub was not impressed.

“Are you kidding?” Weintraub wrote. “Is AT&T writing your copy now?”

“How about reporting on the FCC document filings instead of unsubstantiated claims made by the company,” writes listener Patrick Dailey. “This is what is wrong with media today.”

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