AT&T has discovered marketing gold.  What do you do when you run one of America’s worst-rated mobile networks — the one that drops your calls, doesn’t provide uniform reception and is often woefully overloaded — and don’t want to spend what it takes to upgrade?  How about developing a “Home Cell Tower” device that helps solve AT&T’s problems, but adds to yours by charging you $150 for the privilege of owning one.

AT&T’s 3G MicroCell shouldn’t need to exist.  If AT&T had reliable coverage, nobody would need to own a device that helps their bottom line far more than yours.

The MicroCell is sold to customers who are stuck walking their AT&T mobile phone over to the nearest window in order to get a signal from AT&T.  The unit, manufactured by Cisco, plugs into your home broadband connection and effectively creates a tiny “home cell tower.”  Suddenly, you now have five bars of reception indoors and can make and receive calls and reliably use the data features of your smartphone.  AT&T effectively moves your service off their own congested, weak-signal mobile network,  and routes everything over your Internet connection instead.

AT&T 3G MicroCell

It’s a win-win for AT&T.  They get to charge you a substantial markup for a device that costs far less than $150 to manufacture and reduces the urgency to commit to needed upgrades to solve congestion problems.

But AT&T’s marketing department has also figured out a way to earn an even bigger bonus along the way.

Customers who do not choose a special added-cost AT&T MicroCell add-on plan (a ludicrous $19.99 per month plus a $1.25 monthly bill-padding-“regulatory recovery fee”) will be shocked to discover AT&T deducts minutes from your calling allowance even when using the MicroCell to provide you with service.  It takes a special kind of nerve to charge customers for making and receiving calls that don’t even use the company’s mobile network.  It’s like AT&T setting up a kiosk in front of the nearest Verizon payphone and charging you $1 for the privilege of paying Verizon 25 cents to make a call.  The $20 a month add-on plan doesn’t even cover data usage, which means AT&T charges you for accessing data and text messages sent and received over your own home broadband connection.

The Associated Press reviewed AT&T’s 3G MicroCell and seemed unimpressed.

Despite marketing claims it will deliver more bars in more places within 5,000 square feet, the AP found the MicroCell only managed a less impressive 40 feet. AT&T admits concrete or brick walls can also reduce coverage. For all practical purposes, don’t expect the device to provide much help out in the yard.

AT&T also claims MicroCell users can initiate calls from the MicroCell and have them “seamlessly” transferred to AT&T’s mobile network when they walk out of range.  The AP found more times than not, AT&T simply dropped the call, forcing the customer to start a new call.  Even worse, customers initiating a call on AT&T’s mobile network will find the MicroCell can’t take over when they arrive home, making the primary reason for getting the device irrelevant the moment you walk in the door and risk dropping the call.

The only good news is that introductory promotions can knock down the upfront price.  Customers committing themselves to the $20 MicroCell add-on calling plan qualify for a $100 rebate when purchasing the MicroCell.  If you also sign up for new AT&T DSL or U-verse service when buying the MicroCell, you can get an additional $50 rebate, effectively making the MicroCell free to own.  AT&T broadband customers will also get $10 off the MicroCell add-on calling plan.

There is nothing inherently wrong with offering customers these devices, known in the industry as femtocells, but companies like AT&T should be providing them at-cost and be grateful when customers use them.  Instead, the company treats these customers as nothing more than another profit center, ripping them off with a ludicrously priced add-on calling plan to avoid watching call allowances erode away, even when calls don’t travel over AT&T’s mobile network.

[flv width=”586″ height=”310″]http://www.phillipdampier.com/video/ATT MicroCell Demo.flv[/flv]

This video covers how AT&T markets their MicroCell device and accompanying add-on plan and also includes a brief tutorial on how the device works.  (4 minutes)

[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/AP ATT’s Home Cell Tower Delivers an Added Cost 5-5-10.flv[/flv]

The Associated Press reviewed the AT&T MicroCell and ultimately wondered why customers had to pay for a device to improve service you already pay to receive.  (2 minutes)

[Updated 2:30pm — Coverage area correction made.]

The Federal Communications Commission wants to know how fast your broadband connection is.  The federal agency is now offering consumers and businesses a chance to test broadband speeds to raise awareness about broadband.  But the test results also help illustrate the wide variation between speeds promised by providers and those actually experienced by customers.

The FCC wants to collect this information because broadband providers have often refused to provide it themselves, citing customer privacy or an unwillingness to release potentially useful information to competitors.  By asking visitors to supply their street address and general location, the agency can at least develop anecdotal information about the range of speeds Americans experience.

However, the agency is likely to discover wide variations in the accuracy of the results based not on what service providers deliver, but instead what the speed test itself reports.

The FCC is relying on two speed test providers, randomly assigned to those taking the test.

• Measurement Lab (M-Lab), which provides researchers with Internet measurement tools on a collaborative basis, and
• Ookla, a private company that provides web-based network diagnostic applications.

Stop the Cap! used both providers to conduct three individual speed tests from Broadband.gov.  There were dramatic differences in results.  M-Lab consistently reported far slower speeds than Ookla.  Ookla’s results were closest to the advertised speeds from our broadband provider — Time Warner Cable.

This speed test result from M-Lab was the closest to the average of all three speed tests conducted with this service

Ookla's speed test came closest to achieving the marketed speeds for Rochester, New York Time Warner Cable Road Runner Turbo customers. The download speeds reported also include the effects of "PowerBoost," a temporary burst of additional downstream speed.

Both speed test providers rely on different regional servers to deliver potentially more accurate speed test results, less impacted by the additional “hops” traffic must take when traveling outside of a nearby region.  But considering the enormous disparity between the two tests, these real-world results may not actually represent reality.

Which test comes closest to the actual speeds available here?  Ookla.  But even then, your results may vary.  Ookla provides speed tests for both Time Warner Cable and Frontier Communications, our local phone company.  The downstream speeds reported were widely different, despite both test servers being located within a 50 mile radius.

Time Warner Cable's speed test application is also provided by Ookla. (This result comes from a server in nearby Syracuse -- the Rochester location was not working properly)

Ookla's speed test for Frontier Communications delivered dramatically different results for downstream speeds

The FCC seems to acknowledge the potential disparity in results on their disclaimer page:

Please note that the Consumer Broadband Test in its current software based form may not be an accurate representation of connection quality provided by your broadband provider. The results can be impacted by a range of factors — for instance, the test can vary based on the geographical distance of the user from the testing server, end-user hardware, network congestion, and time of day. However, this application can provide a helpful indicator in comparing consumers’ relative broadband connection quality and in understanding the performance metrics of broadband connections.

What results do you get from Broadband.gov’s provided speed tests?  Share your findings in our comment section.

OnLive puts the processing power to render and play games on their end, and streams the result to you over your broadband connection (click to enlarge)

OnLive, the cloud-based videogame streaming service, was on display during a live dem0 of the service at Columbia University.  The service, which literally streams game play across fast broadband networks, could seriously challenge the videogame console marketplace.  Instead of using an expensive piece of hardware at home to play videogames such as w88, OnLive puts the hardware at their end and streams the results to any computer or television.  If it works, it means consumers won’t need the highest performance videocards or latest new CPU.  They’ll just need a fast broadband connection to let OnLive’s own servers do all of the processing.

The founder and CEO of OnLive, Steve Perlman, shows considerable enthusiasm for the concept, and several major investors including AT&T and Time Warner have backed the venture, which could help guarantee smooth passage on their broadband networks.

Still, a product that requires a minimum of a 5Mbps broadband connection for HD-quality streamed game play could consume an enormous amount of data — up to 2.25 GB per hour of gaming.  Although cable and fiber-based broadband connections will suffice, many DSL customers don’t have service fast enough to support OnLive.  Among those that do, any usage caps or allowances will significantly reduce the value of the service to potential subscribers.  Frontier Communications’ infamous 5GB “acceptable use” per month, for instance, would allow just over two hours of use per month, assuming you did nothing else with your DSL service.

Even Comcast’s 250GB usage allowance cuts game play to a little over 100 hours per month.  That’s a ludicrous amount of gaming for most of us, but not for some gaming addicts who may have tried games like 핑카지노.  Besides, it also assumes you don’t use your Comcast broadband service to watch video or other bandwidth-intensive online services.

Time Warner Cable’s proposed 40GB usage limit, shelved indefinitely in April after consumer protests, would permit less than an hour of play per day, assuming your Road Runner service was for nothing but OnLive.

In short, assuming OnLive works as promoted, its biggest threat to success will come from external factors mostly outside of its control — namely cap-happy ISPs that could quickly make streamed cloud computing untenable for all but the wealthiest among us.

What could OnLive do to reduce its risk from caps?  Partner with ISPs in a non-Net Neutral broadband world, of course.  That investment from AT&T, for example, could theoretically pave the way for AT&T to exempt OnLive from any usage limits that come from its own Internet Overcharging experiments in Beaumont, Texas and Reno, Nevada.  That would be a clear violation of Net Neutrality, if enacted into law.

Scenarios like this should drive consumers to support Net Neutrality policies.  ISPs forming “preferred partnerships” with innovative services like OnLive might seem consumer-friendly at first, but not in the long-term because it spells the death of would-be “non-preferred” start-ups, and helps pave the way even faster to Internet Overcharging schemes letting broadband providers pick the winners and losers of the future.

[flv width=”484″ height=”292″]http://www.phillipdampier.com/video/OnLive Columbia University Demo.flv[/flv]

OnLive founder and CEO Steve Perlman demonstrates OnLive and talks about cloud-based, streaming game play at this gathering at Columbia University in New York. (49 minutes)
(If stream stops for buffering, pause it for a few minutes to let a significant amount of the file pre-load, which should reduce re-buffering problems.)

Subscription television providers should relax: Americans are not moving away from watching television on television sets.  Nielsen’s Three Screen Report, issued today, finds most Americans are not fundamentally changing the way they watch TV — they are simply taking advantage of more convenient ways to watch.

The report shows considerable year over year growth in terms of time spent for Digital Video Recorder viewing (up 21.1%) and online video (up 34.9%) since the fall of 2008. Given the consistent spike in usage among the three screens of television, Internet and mobile, consumers are clearly adding video platforms to their schedule, rather than replacing them.

“Americans today have an insatiable appetite for not only content, but also choice,” says Nic Covey, director of cross-platform insights at Nielsen. “Across all age groups, we see consumers adding the Internet and mobile devices to their media diet — consuming media anytime and anywhere possible.”

Nearly 99% of television viewing is spent watching it on a television set, according to Nielsen’s findings.  But consumers are also discovering broadband and mobile viewing can add convenient new options, and are taking advantage of them:

• In 3Q09, the average American watched 31 hours of TV per week, with 31 minutes spent in playback mode with their DVR.
• In addition, each week the average consumer spent 4 hours on the Internet and 22 minutes watching online video.
• The average consumer spent 3 minutes watching mobile video each week.

The biggest fans of mobile video are teenagers, some spending just over seven hours per month watching video on their phones.  Watching television on a broadband connection is a popular trend among those aged 18-44, one noticed by Comcast chief operating officer Steve Burke.  Burke spoke about the trend at the recent Cable & Telecommunications Association for Marketing’s three day conference in Denver.  He noted his own children now prefer to watch their shows on a laptop from one of the free online services and not on the family television.

Allowing young viewers to grow up assuming they can watch anything, anywhere, for potentially no charge is a very dangerous proposition for people in Burke’s business.

“An entire generation is growing up with that preference,” Burke said. “If we don’t do something to change that behavior so they respect copyrights on the side of content provider, and cable subscriptions or satellite subscriptions or telco subscriptions on the side of the distributors, we are going to wake up with a lot of ingrained habits going the wrong way and we will see cord-cutting.”

Comcast has two ways to make sure viewers learn their lessons about paying for what they watch:

1. The formalized introduction of the forthcoming usage meter, better enforcing Comcast’s 250GB monthly limit for their broadband service.  Watching a lot of online video will take a major bite out of your broadband usage allowance.
2. The launch of Comcast’s Fancast Xfinity TV, a service that will allow only existing Comcast cable-TV package subscribers access to many of their favorite shows online, on demand, for no additional charge.  That new name comes courtesy of Comcast’s marketing gurus, to replace what readers better know as: TV Everywhere.
   

The usage meter and “authenticated subscribers-only” pay wall are Comcast’s one-two punch to keep subscribers from eventually dropping their cable-TV package to watch television exclusively over their broadband connection.

Cable operators already treat companies like Netflix, which use broadband to deliver an increasing number of movies and TV shows on-demand to subscribers, as a major threat.  Insight Communications CEO Jamie Howard called Netflix the equivalent of the third largest cable operator in the country in terms of content delivered.  That’s content not owned or directly managed by Insight or other cable providers.

Some in the industry believe who owns and controls online video will eventually decide the winners and losers in the subscription television business.  Derrick Frost, founder and CEO of Invision.TV, an Internet video search engine, warned the outcome of the battle can’t come soon enough.  Otherwise, consumers “will find other ways — legally or illegally — to access it.”

Sir Michael Rake

Hambleden residents who have fought for years to obtain broadband service from British Telecom are boiling mad over their discovery one comparatively recent arrival to the Oxfordshire village near Henley-on-Thames managed to get service shortly after moving in a year ago.  It turns out the “lucky” resident chosen to participate in a very limited trial of so-called “broadband enabling technology” is none other than the chairman of the company providing the service.

Sir Michael Rake managed to obtain the only broadband connection in the rural community as part of what the company called a pilot trial to test out the commercial feasibility of new technology to extend broadband service to more rural locations across Great Britain.

Of course, the “new technology” is reportedly little more than an extender for DSL service that is capable of delivering 1Mbps service on Britain’s aging copper telephone wiring.

The neighbors are furious anyway.

Some have been trying to get broadband service installed for at least five years to no avail.  Hambleden is just one of many rural communities bypassed by BT broadband.

Hambleden is just 35 miles northwest of London

Gary Ashworth, head of Abacus Recruitment told the Daily Telegraph: “It stinks of corruption. The chairman of BT is given preferential treatment over long-serving customers. I run a business and we probably have 1,000 BT lines. Clearly there is preferential treatment if you happen to be the chairman. I think it is a disgrace.”

Ashworth inquired if he could participate in the “BT trial.”  BT promptly said no, saying he’d have to wait until 2010 at the earliest.

“Sir Michael Rake is the only person allowed to participate in the trial in our area. He moved into the village a year ago and surprise, surprise, he has got broadband,” Ashworth complains.

Although Rake can enjoy the benefits of broadband as a trial participant, BT was willing to extend Ashworth broadband service, if he ponied up £68,000 for the installation.

While the chairman of BT browses the web today at his Hambleden estate, the company admits wiring the entire community would not be profitable.

The Daily Mail interviewed Paul Goodman, the Tory MP for Wycombe, who said “the lack of broadband in the Hambleden Valley is a very serious problem for my constituents.”

“Unless all BT staff members are entitled to participate in the trial on exactly the same terms, I think some of my constituents will find this very strange,” he told the Daily Mail.

The government has promised to underwrite broadband expansion into rural areas by 2012 with revenue earned from a 50p surcharge on phone bills.