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WHP-TV in Harrisburg, Penn. has been running several stories about the FCC’s Lifeline program, which hands out free cell phones to those living below the poverty line.  While the FCC defends the Lifeline cell phone program as delivering needed phone service for job-seekers and as a landline replacement, some citizens who consider cell phones a luxury are upset the federal government is subsidizing the project at a cost of $1.3 billion a year.  Even more disturbing to some is the reported amount of waste, fraud, and abuse that may be delivering free phones to those who don’t deserve them.  The anchor’s thinly-disguised editorializing leaves little doubt he considers the program a waste of money at a time of skyrocketing budget deficits. (Warning: Loud Volume)  (2 minutes)

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WHP ran this follow-up story about the FCC’s forthcoming involvement in “free broadband” for the poor.  In fact, the subsidized Internet program would likely deliver 1-3Mbps basic Internet service for around $10 a month.  The WHP anchor doesn’t seem too impressed with this part of the Lifeline program either.  (Warning: Loud Volume)  (2 minutes)

Chattanooga’s investment in community fiber broadband is beginning to pay dividends as the city benefits from an increase in high-paying, high-technology jobs.  Unfortunately for cities like Knoxville, Chattanooga’s gains are their loss.

“In a lot of places, you can get the same kind of high speed service as Chattanooga.  The difference is the price,” Dan Thompson of Knoxville-based IT company Claris Networks told Knoxville TV station WBIR.  “Connectivity there for us is about eight to ten times cheaper in Chattanooga than it is versus Knoxville or other cities.  That’s a huge deal when you’re comparing $100 a month or $800 a month.”

As a result, Claris is skipping the pricey service on offer from AT&T and Comcast and is moving jobs down I-75 to the city of Chattanooga, where publicly-owned EPB Fiber has invested in a fiber-to-the-home network that beats the pants off the competition.  Claris has found gigabit broadband in Chattanooga that can be installed in days at a fraction of the price charged by the companies they deal with in Knoxville.  Now Claris can invest the savings in bigger data centers and the jobs that come with them.

“Here in Knoxville and other cities, you may have to pay a premium to get speeds fast enough to support that,” Thompson said.

While companies like AT&T, Time Warner Cable, CenturyLink, and Comcast have had Chamber of Commerce support opposing community broadband in other states, Chattanooga’s local Chamber knows a good thing when it sees it.  Garrett Wagley, vice president of policy and public relations for the Knoxville Chamber, tells the Knoxville station investment in infrastructure is important when recruiting new businesses to town and keep existing ones growing.

Investment in high technology networks is an important topic for the evolving economies of the mid-south region.  Formerly dependent on tobacco farming, textiles, and manufacturing, states like Tennessee and the Carolinas are now investing to compete for high-technology, digital economy jobs.  Public investment in broadband comes as part of that effort, and typically only after appeals to existing commercial providers fail to bring necessary upgrades.

That “other places first” upgrade mentality continues to this day in states like South Carolina, which waited years for Time Warner Cable and local phone companies to deliver broadband speeds states further north have been receiving for several years.

For companies like Google and Amazon.com, the choice of where to locate regional data and distribution centers is often dependent on available infrastructure.  Chattanooga is in a strong position to argue it already has a broadband network in place that can meet the needs of any high-tech company, at prices too low to ignore.  Economic investment, jobs, and tax revenues follow.  Even better, much of the revenue earned by EPB Fiber stays in Chattanooga, paying off network construction costs and allowing the public utility to invest in smart-grid technology, which could benefit electric ratepayers as well.

Christopher Mitchell at Community Broadband Networks notes Chattanooga is not alone seeing significant job gains from investment in public broadband.  Just 100 miles to the northeast is Bristol, Virginia, another city that is transforming itself to support 21st century knowledge economy jobs.  Bristol’s public fiber network delivers service across most of southwestern Virginia, across an area long ignored or under-served by larger commercial providers.

For cities stuck with whatever AT&T, Comcast, and Time Warner Cable decide to offer, the trickling job migration to better-wired cities could eventually become a fast-running stream.  That’s why WBIR-TV questioned Knoxville city officials about why they abandoned consideration of their own public fiber network.

The City of Knoxville’s chief policy officer, Bill Lyons, told 10News there has been some discussion about constructing network infrastructure in the past.

“We did discuss this general topic very briefly early in the last administration and did not pursue it,” wrote Lyons.  “There was no systematic assessment, but rather a sense that the associated investment in infrastructure was not needed given the service that was already available.”

[…] “The question we as citizens need to ask is this something we’d be willing to spend money on,” said Thompson.  “I think you’d have to ask if you built this kind of network would more businesses come here.  And if they would, do the tax dollars [gained by attracting news business] offset the cost that we as citizens would have to pay.”

Good-enough-for-you broadband at take-it-or-leave-it sky high prices has been the state of broadband across the mid-south for years.  Unfortunately for Knoxville and other cities in Tennessee and the Carolinas, high-tech businesses are quickly discovering they don’t have to take it anymore.  What cities like Knoxville lose, Chattanooga gains.

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WBIR in Knoxville explores Chattanooga’s success in broadband, which is now starting to come at the expense of other Tennessee cities who don’t have the infrastructure to compete.  (3 minutes)

In CenturyLink's corner....

The Fox station serving southwest Florida has a love affair with CenturyLink’s Prism service — a fiber to the neighborhood service comparable to AT&T U-verse that CenturyLink is introducing in some of its larger service areas.  WFTX in Cape Coral/Naples devoted nearly seven minutes of airtime on its “FOX4 Morning Blend” show to a thinly-disguised infomercial/interview pitching the service to unsuspecting viewers who may not have realized CenturyLink bought their way on the morning show.

FOX4 Morning Blend is supposed to be a “lifestyles” information and entertainment talk show, airing weekdays at 8am on the Fox affiliate.  Viewers who thought they were getting the local equivalent of LIVE! With Kelly are really getting a series of paid placement interviews and features disguised as feature-oriented journalism.

Visitors who dig deep on WFTX’s website might raise an eyebrow when discovering the section that explains the show:

FOX4 Morning Blend features a variety of community organizations, businesses, and happenings in Southwest Florida. This entertaining talk show format offers a great opportunity for sponsors to reach potential customers.

A few minutes into the interview, the station cuts to a blatant commercial for CenturyLink Prism it calls “a video.”  Show host Bill Wood can’t help but gush over Prism’s features.  Viewers confused about whether the show represents paid placement advertising or actual journalism can be forgiven.  Both show hosts — Bill Wood and Carley Wegner — have extensive reporting and anchoring backgrounds, and Wood is particularly familiar to the station’s viewers as the weekday morning news feature reporter.  Now he sells CenturyLink, among other products and services.

What viewers won’t find is a comprehensive listing of all of the sponsors.  CenturyLink does not appear in the list.  At one point, the station provides a tiny on-screen explanation labeled “Sponsored by CenturyLink” as a list of store locations flashes by.

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Give us seven minutes and we’ll sell you CenturyLink Prism.  FOX4 Morning Blend mixes actual reporting with disguised advertising.  (7 minutes)

Assurance Wireless, owned by Sprint, delivers Lifeline cell phone service to low income Americans.

Low income Americans may soon be able to obtain substantial discounts on broadband Internet service as part of an expansion of the Lifeline program, which currently provides subsidized landline and cell phone service.  The Federal Communications Commission is considering the future of the program, which currently focuses on basic telephone service, but could soon be expanded into broadband.

But before that can happen, the Lifeline program itself must undergo a comprehensive review process, according to FCC Chairman Julius Genachowski.

The FCC admits the program is overdue for reform. Recent investigations found billions in potential savings from the elimination of significant waste, fraud, and abuse.

The most costly problems appear to be coming from the recently introduced subsidized cell phone program, which hands out free or extremely low-cost cell phones to poor Americans, paid for by other ratepayers as part of the “Universal Service” surcharge.  Recent audits found many recipients double-dipping or worse, signing up for free cell phones for individual family members while already receiving a separate landline discount.  Under FCC rules, Lifeline recipients are supposed to receive a single subsidy per household, either for cell phone or landline service, not both.  But in several cases, informal audits found families with multiple cell phones, some handed out to children.

The FCC only recently decided to create an Accountability Database to track Lifeline program benefits.  Scammers have used loopholes to sign up those unqualified to participate, and some customers have obtained cell phones from multiple providers, a violation of the rules. Ratepayers could save nearly $2 billion annually once ineligible accounts are closed and the double-dipping has been stopped.  Some of those savings can be used to help defray the costs of Lifeline broadband, a potential new program that could deliver basic broadband service to low income households for around $10 a month.

Currently, a handful of cable and phone companies offer a similar service to those families who qualify for subsidized school lunches.  The FCC is analyzing data collected by providers like Comcast to help build a model program not affiliated with any single provider.

Genachowski said the program will not only help defray the costs of broadband service, but also get low-cost computers and training into the hands of needy families.

One of the most commonly-reported reasons why consumers do not adopt broadband service is its relatively high cost.  Most low-income broadband programs deliver basic 1-3Mbps service, but only to families with school-age children.

[flv]http://www.phillipdampier.com/video/FCC Lifeline.flv[/flv]

The FCC produced this video explaining the Lifeline program, who is eligible, how it works, and how to sign up.  (8 minutes)

The successful launch of ViaSat 1, the new satellite broadband satellite.

ViaSat, the parent company of satellite Internet service provider WildBlue, will introduce new pricing and speed packages Tuesday for its satellite broadband service.

WildBlue has offered satellite-based Internet access for several years, but the speeds and heavily-restricted “fair access policy” have left many customers looking for something better.  But for many satellite Internet customers, DSL or cable broadband is miles away and will be indefinitely, so any improvement in satellite broadband is good news.

“Are the days of satellite fraudband finally over?” asks Stop the Cap! reader Madeline who lives in rural Idaho. “I was a customer of WildBlue and Hughes in the past and both were not worth bear spit.”

Madeline and her family are potato farmers, and have been for three generations.  She remembers when the phone company started selling dial-up Internet access and got hooked on the Internet to get updated weather reports, trade farming information, and stay in touch with relatives.  But as the web has grown more multimedia-oriented, dial-up has progressively become an intolerable way to experience it.

“In the 1990s, web ads and pages were simple and they’d load quick,” she says. “Now it’s all video ads and other things that take five minutes or more to appear, so you become stuck waiting until you give up.”

WildBlue’s new satellite, ViaSat 1, may change the perception of a satellite Internet experience that is only slightly more tolerable than dial-up.  With speeds up to 12Mbps, WildBlue’s new speed packages will finally deliver something more than the 1.5Mbps “Pro” service the company currently sells for $80 with a 17GB usage cap.

“The key words with satellite are ‘up to‘ because you never get the speeds they promise, especially at night when everyone is on,” Madeline says. “If you use what they consider to be ‘too much,’ your speeds are cut further.”

ViaSat 1 has a total capacity of 140Gbps, double that of the company’s other satellite — KA-SAT.  That wireless pipeline will eventually be shared by commercial, government and residential customers.  With several hundred thousand anticipated users, WildBlue will continue to restrict usage even with the new capacity.  No word on what specific limits will be put in place, but it is likely customers will at least enjoy a speed boost from the new satellite.  ViaSat hopes to economize using web compression technology and other traffic management techniques to make efficient use of the satellite’s broadband capacity.

Madeline remains unconvinced, however.

“You don’t choose satellite Internet because you want to, you choose it because you have to,” she says. “My guess is WildBlue will continue the same low caps — especially to make sure we steer well clear of web video — and will still charge us a lot of money for service you can’t use all you want.”

Madeline went back to dial-up and frequently visits some nearby relatives who receive Internet from a Wireless ISP.

“While everyone else in the country is talking about Netflix and making video calls to relatives, we are still sending e-mail and setting egg timers to make sure we don’t stay online too long and get throttled before the month is out.”

WildBlue’s Existing Packages (Company-supplied information)

WildBlue’s Acceptable Use Policy.

*A “threshold” (a/k/a “usage cap”) is the amount of data that you can upload or download in a 30-day period before WildBlue’s Fair Access Policy (speed throttle) applies.

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WildBlue produced this demonstration to show off web browsing over its new ViaSat 1 satellite.  Keep in mind this browsing session took place before the satellite was available for general customer use and the company avoids mentioning its usage limits, which are extremely small in comparison to wired broadband.  (3 minutes)