Tuesday, November 28, 2006


Quote of Note: Rupert Murdoch

"They do it in Japan, they do it in South Korea. We should be able to do it here. We are being left behind and we will pay for it . . . When you have broadband - real broadband, not the type they're talking about here - where you get, say, 20Mbps of data into your home, it changes everything . . . Broadband certainly is going to become ubiquitous around the world, and if you don't have it, you're left behind . . . I think it's a disgrace . . ."

Rupert Murdoch, at NewsCorp's 2006 shareholder meeting, quoted here. Also see this and this. He was talking about Australian Internet access, but if the shoe fits . . .

Hat tip to Ben Scott for the pointer!

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Thursday, November 23, 2006


New Network Neutrality Notions

There's a spate of news about Network Neutrality to report.

Item 1: UPDATE: As of December 12, the video below is no longer available. But there's a new, delightfully detailed, much improved version here! [Thanks to Mark Smith for this!]

Have you seen this YouTube video from Andrew Babington?

It's a brilliant remix of stuff we've seen before, proof that remix adds value! If you know somebody who doesn't quite get it yet, send them this video's URL the link to the new, improved video. Thanks to Scott Bradner for pointing this out!

Item 2: Outgoing email filtering. Seems that every ISP blocks Port 25 these days! Back when Optimum Online (Cablevision) started blocking my Port 25 (used for outgoing email) some years ago, I switched carriers. I was lucky enough to have a second broadband carrier! Finally other folks are starting to agree that port blocking is a form of Net Discrimination, a violation of Net Neutrality!

Now, Gene Hirschel, writing for Internet News, says that Microsoft is using another form of email blocking -- it won't let anybody send mail from its sites unless it's from name@msn.com or name@hotmail.com. He writes,
. . . why [does Microsoft] bother with the additional filtering? Revenue. For each e-mail that goes out, MSN and Hotmail both add a tagline to the bottom of all e-mail. So even after paying a premium for MSN, you still have to advertise their products to all of your e-mail recipients.
Exactly. Net Discrimination is all about the revenue stream. If you have a problem understanding this, or if you disagree, read Andrew Odlyzko's Privacy, Economics and Price Discrimination on the Internet (.pdf).
Email is one of those "applications and services of [our] choice, subject to the needs of law enforcement," that we're supposed to be able to run according to the Martin FCC's Four Principles.

Thanks to Robert Cannon at cybertelecom for the pointer to the Hirschel item!

Item 3: Tom Evslin asks, "how do we know if ISPs are violating the principals of network neutrality?" and proposes that an extension to the SIP standard that allows loopback to test connections (and other monitoring software) might help. In the same vein, Bill St. Arnaud (acking Gordon Cook) passes along a pointer to NETI@home, a distributed software package that monitors Internet performance from the home computers of numerous volunteers. (I think I'll join!).

Internet performance is a slippery beast at best and deserves much more research. So such efforts are very worthwhile. But they are NOT antidotes to the violation of Net Neutrality! If we're not upset about Port 25 blocking, which is impossible to hide, which everybody knows about, why would we get upset by a little more NETI-detected packet jitter?

Net Discrimination, in its most pernicious form, will not be stealthy! Net Neutrality will be openly violated. It will be done explicitly, "to fight spam," or "to make network performance better for the rest of us," or "to fight terrorism," or "to protect the children." It will be done explicitly, to exact application-specific "quality of service fees." It will be done explicitly because, e.g., Google, "is using our pipes for free."

When Net Discrimination happens, it will not be a secret. We Internet users will be willing dupes or complacent, slightly disgruntled customers. For the most part, we won't know what we're missing, just as your average CNN watcher thinks she's "getting the news."

I've pointed out to Tom that, e.g., Verizon, whenever it requires you to take its telephone service to get its DSL service (or whenever it gives a price break for the bundle) is already guilty of application discrimination! That is, when you have Verizon voice, you're less likely to use Skype or Vonage than you'd be without it. It's monopolistic tying, pure and simple.

Network monitoring software is great, but it is not an effective antidote for Net Discrimination!

Item 4: Gordon Cook writes that the entire Net Neutrality debate is a "dangerous side show," designed to distract us from the Real Action, which, Cook says, is a state-by-state campaign by the ILECs to drive up the costs of interconnection, thereby driving the few remaining CLECs, i.e., mostly the cablecos, out of business.

Gordon Cook has it partly right. For sure, the telcos are pushing up the prices of interconnection using a wide variety of tricks. But he is not thinking far enough ahead -- the telcos actually want to buy the cablecos. Why? (a) They're bad at starting new businesses. (b) They want the cable revenue stream. (c) They want to eliminate their last big competitor. And if the telcos make the cablecos financially weaker, they'll be able to buy them cheaper.

We need to be aware of all of these things. And others, like the fact that telcos are using CALEA and E911 and Universal Service to raise barriers to entry for financially weaker upstarts. And that they got $200 Billion in rate and tax relief in return for an unfulfilled promise to provide high speed Internet services to America. And that they're trying to deny our cities the right to build their own networks.

That said, Gordon, the Network Neutrality debate is no sideshow! We dasn't stop our advocacy. Net Discrimination is yet another trick of a dying industry struggling to establish in law, and by financial might, what it can no longer do in a competitive, meritocratic marketplace.

To my mind, the big problem with Network Neutrality is that it is a compromise. In reality, we should be talking about Structural Separation. Because as long as it is legal for an entity that sells Internet connections to also have a financial interest in the apps and services that travel on that connection, there will be an insurmountable urge to discriminate. An easier way to fight this is Structural Separation. The harder way is Network Neutrality with the deterrence of Draconian enforcement.

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Breaching the Cellcos' Garden Wall

Bob Lucky likes to complain that his mobile phone (a) won't play self-generated ringtones (you have to buy them from the phone company), (b) won't upload pictures directly (you have to send them over the phone company's network) and (c) won't give direct access to GPS information (without a subscription from the phone company).

Good news, Bob! Several current tidbits hint at the opening of the cell phone, which, in turn, promises to disrupt the mobile carriers' verticalized business model and usher in a whole new set of players in the handset business.

First, there's news of a completely open-source Linux-based mobile computing platform, the OpenMoko. It is different than previous phones that use Linux, in that it provides a truly open interface for developers. There's a good write-up here, and Sean Moss-Pultz, the inspired creator of OpenMoko, has a delightful presentation here (.pdf).

Wonder what an open mobile platform can do that closed platforms don't? Tim O'Reilly has a perceptive posting called Ten Things I Want from my Phone.

A second news item: Om Malik has sniffed out a rumor that Apple is finally building its long-rumored iPod phone. The breakthrough, says Malik, is that Apple is building it UNLOCKED! That is, the new iPhone will be sold by Apple directly, not in partnership with a cellco. (The delay has been due to fights between Apple and the cellcos about how to divide the revenues from a closed iPhone!) The iPod phone will be the first popular unlocked US phone. Om thinks that the iPod won't be mass-market at first, but I disagree! We're already spending US$300 for our non-phone, mass-market iPod. Adding phone capability won't up the price much more.

Both the OpenMoko and the iPod phone will have GSM radios -- so they'll work around the world. In the U.S., they'll work with T-Mobile or Cingular sim cards. Potential problem: it isn't clear that Apple or OpenMoko will have Wi-Fi! Which brings us to the third tidbit . . .

Third, a bunch of mobile Wi-Fi phone platforms are now available, largely (but not exclusively) driven by the success of Skype, and more are on the way! (Note: Skype has a package deal whereby you can buy a Wifi phone and a FONera router for US$159 -- once you install your FON router, you can make free carrier-less calls wherever there's another FON hotspot. Disclosure: I am on FON's US Advisory Board.)

I expect that Wi-Fi soon will be a popular requirement. I strongly suspect that mobile platforms with two radios, Wi-Fi and GSM, will host the really cool apps and outsell the others.

If I were a cellco addicted to the vertical value chain, I'd be worried. (But they're unlikely to feel the threat . . . until the new apps are so popular they're uncontrovertably killing the cellcos' "traditional" revenue stream.) If I were a handset maker, I'd be doing what Nokia does -- building Wi-Fi into all(?) their unlocked devices, and I'd be a very close observer of emerging challengers like OpenMoko.

The wall is starting to show cracks. Do the folks with sledge hammers arrive in 2007?

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Wednesday, November 22, 2006


Quote of Note: Furry Lewis

"They arrest me for murder and I ain't never harmed a man
Arrest me for murder and I ain't never harmed a man
Arrest me for forgery and I can't even sign my name"

Judge Boushay Blues, attributed to Furry Lewis, also recorded as 99 Year Blues by Marc Silber.

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Friday, November 17, 2006


FCC Chair Reconfirmed

This just in, thanks to Washington DC telecom analyst Blair Levin and his colleagues at Stifel Nicolaus:

The Senate reconfirmed FCC Chairman Kevin Martin last night.

I wrote my previous piece urging Congress not to reconfirm Martin without knowing how quickly it could happen. I was expecting it to be something the 110th Congress would take up next year.

I've been corresponding with another Washington DC insider, Harold Feld, who sees a more merit in Martin's reconfirmation than I do. He points out, correctly, that Martin has been a strong advocate of innovation, especially in the form of telco competition, in the video entertainment field. And surely the FCC decision favoring Continental vs Logan Airport, where the FCC slapped down landlords who prohibit their tenants from installing their own Wi-Fi hotspots, would not have been taken if Martin had fought it. And, Harold points out, Martin is "the devil we know" (my own paraphrase).

It is a little known fact that the FCC is an agency of the Legislative Branch, not the Executive. Congress is the FCC's boss. So it is my hope -- and expectation -- that Congress will offer the FCC closer guidance in the next two years than it has offered in the last six!

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Thursday, November 16, 2006


2.0 is tired

Web 2.0, Telco 2.0, and now Tim O'Reilly has bought Release 1.0 from Esther Dyson and renamed it . . . zzzzzzz . . . never mind.

If the best they can do is call it X 2.0, nothing's changed.

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Newspapers crater

Democracy Now, in this article, pulls a lot of facts together:

On Tuesday the executive editor of the Washington Post, Leonard Downie, Jr., announced plans to shrink the newsroom staff as part of a major transformation of the paper.

On Monday the St. Paul Pioneer Press in Minnesota said it would cut 40 full-time positions at the paper. Last week the new owners of the Philadelphia Inquirer forced out the paper's editor Amanda Bennett. Employees at the Inquirer fear the paper's new owners will layoff as much as much as a third of its newsroom staff.

In California, the owners of Los Angeles Daily News recently laid off the paper's publisher and 20 other employees. 101 jobs are being eliminated at the San Jose Mercury News. Another 111 at the Dallas Morning News. The Cleveland Plain Dealer plans to cut 17 percent of its staff.

But the most turmoil might be at the Los Angeles Times . . . [LA Times publisher] Johnson was ousted in October. [Editor] Baquet was forced out last week. A columnist for the trade magazine Editor & Publisher said about Baquet's firing "It is a sign that no editor who makes news first and big profits second is safe."

Not a good time in the paper biz.

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Bruce Sterling's last Wired Column

Bruce Sterling, who wrote the cover story for Wired 1.01, has published his last column. In Wired 14.12 he writes,
. . . futurism itself has no future. Once confined to an elite group, the tools and techniques of prognostication are all widely available. As for pundits: The world used to be full of workaday journalists, with just a thin sprinkling of opinion mongers. Now a TypePad account is a license to deliver nose-to-the-pavement perspective with an attitude.
Well, yeah, but Bruce had better perspective -- and more attitude. Without him Conde will be a wee bit Nastier.

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Quote of Note: Kofi Annan

"A few diehard sceptics continue to deny “global warming” is taking place and try to sow doubt. They should be seen for what they are: out of step, out of arguments and out of time."

U.N. Secretary General Kofi Annan, in speech (read the whole thing) yesterday to U.N. Climate Change Conference.

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Tuesday, November 14, 2006


Tom Evslin reviews _Collapse_

Tom Evslin has just blogged a thoughtful review of Jared Diamond's most recent book, Collapse: How Societies Choose to Fail or Succeed. I've read Guns, Germs and Steel, and Diamond's earlier and under-recognized The Third Chimpanzee -- Tom's review has now moved Collapse up my to-read stack.

Tom writes:
Diamond . . . although tremendously worried about human civilization in the next fifty years, considers himself a “cautious optimist”. I’d much rather be lectured about the environment by Jared Diamond than Al Gore any day.

It’s possible that clever use of resources would support twice the world’s current population of humans, Diamond says, but continues by calculating that we will be using twelve times as much resources as we are now if people in third world countries achieve their aspiration of first world life styles – even if there is no population growth at all. Whoops. Can’t do that.
Tom then summarizes two examples from the book, one where a society undermined itself and collapsed and another where collapse was avoided. He winds up observing

Globalization puts us all on the same island, says Diamond. He’s not railing against globalization, just citing a fact. But he’s mildly optimistic that we can make the right decisions . . .
When I look at the consequences of making the wrong decisions -- and the rampant stupidity that passes for governance these days -- I find it hard to remain mild. My hat is off to Tom Evslin for a great review, and to Diamond for a lifetime of thought-provoking exposition of humanity's place on this little blue sphere that, so far, has borne and nurtured us.

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Monday, November 13, 2006


Congress should hold hearings on Universal Service

In the best case, Universal Service is corporate welfare that supports older, less relevant telco services. In a more Reality-Based view, Universal Service has become an ineffective, corrupt slush fund for the minions of a dying industry.

By the end of January, Congress should subpoena the principals of the Universal Service Administrative Company and the heads of the remaining telcos to explain themselves. Then they should hear from a representative sample of people who actually could use affordable Internet access (and other) services. They should question them all until the truth comes out. Then they should act.

Susan Crawford speaks definitively on this issue in a recent blog entry:
. . . If Congress takes a hard look at the state of universal service today they'll be horrified. Graft, bloat, corruption -- paying for services that haven't been provided, paying more to more recipients by raising assessments, funding old stagnant service providers. . . lots of material here for dramatic camera-covered hearings. Lots of good Perry Mason moments. And, at the end, we'll have to decide that what the US should really be funding is broadband access, not access to traditional telephone services.

Traditional voice telephone services are quickly being taken over by much less expensive internet services, so it makes little sense to continue funding the former as a national policy matter . . .

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Boucher for Chair of House Intellectual Property Subcommittee

Chris Taylor, in this piece in Business 2.0, says
Rep. Howard Berman, a Hollywood Democrat who may end up as chair of the subcommittee on intellectual property, once sponsored legislation that would have let the studios and record labels legally hack into peer-to-peer networks like LimeWire and disrupt them . . . Berman isn't the only contender for that subcommittee post. Rick Boucher, a pro-Silicon Valley Democrat, may get the appointment. In contrast to Berman, Boucher has indicated he'll try to soften the DMCA. Boucher believes privacy trumps copyright.

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Don't reconfirm FCC Chairman Martin

Now that Democrats control both houses of Congress, netheads have a somewhat better (but hardly ironclad) likelihood that their issues will see daylight. My top suggestion for 2007 Congressional action is . . .

. . . fire FCC Chairman Kevin Martin!

Martin's appointment to a second term as FCC Commissioner is pending Senate confirmation. I like Kevin; he's personable, he's articulate, he understands the issues in deep detail. But he shouldn't be confirmed.

Martin has not championed the Internet or its future; he seems intent on strengthening the old telco business model. Under his leader chairmanship, U.S. Internet connectivity has fallen ever further behind the rest of the world. U.S. citizens pay more for less Internet connectivity than most developed nations.

Martin favors (a) big telecom mergers without conditions, (b) weakened common carrier obligations for Internet access providers, and (c) expanded FCC regulation of speech on the Internet. He has implemented major regulatory barriers to new ISPs and VOIP providers (e.g., CALEA, E911-on-VOIP). He's evidenced no personal enthusiasm for any of the new communications technology. He has weakened the FCC by purging its most knowledgeable bureau chiefs and replacing them with political fellow-travelers. And he has stalled initiatives to open new spectrum for unlicensed uses, stalled FCC rethinking of spectrum re-regulation, threatened to put obstacles in the way of TV's Digital Transition, and failed to champion innovative technology except for telco video.

Congressional leadership -- Dingell, Boucher, Markey, Inouye, Leahy, Wyden and the congressional netheads of both parties -- should give the President a short list of candidates for FCC Chair who believe in competition based on marketplace merit (over incumbency and size), who appreciate the transformative power of disruptive technology, and who want the United States once again to lead the world in Internet development. A few plausible (necessarily Republican) candidates like this should be findable. One should be nominated and confirmed.

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Quote of Note: Rene Obermann

"This industry is not just about growing any more. It's about managing efficiencies."

Rene Obermann, current head of T-Mobile, soon-to-be-unimaginative-boss at Deutsche Telekom, quoted here. He's replacing Kai-Uwe Ricke, who -- get this! -- was ousted because he failed to stem losses in DT's domestic landline business.

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Sunday, November 12, 2006


Has competition broken out?

I don't see any dominant players here . . . do you? Looks like the US communications market is doing just fine; what were those net-neut-kooks so worried about? [Original source.pdf]

This must be the communications competition that Herman Alfred Kahn was talking about. [Thanks to David Burstein for the above correction.]

The real story would be in the first difference -- the relative rates of growth of various companies and services -- but that slide wasn't in this deck. -- based on the data shown below, imagine how the above pie chart could look in a few years. [ibid.pdf]

Friday, November 10, 2006


Most Censored Story of 2006: Network Neutrality

Project Censored has just released its most censored story list for 2006. Network Neutrality is #1 Censored story of 2006. More here.

Quoting from this:
. . . despite important legislative proposals and Supreme Court decisions throughout 2005, [Net Neutrality] was almost completely ignored in the headlines until 2006. And except for occasional coverage on CNBC's Kudlow & Kramer, mainstream television remains hands-off to this day.

Most coverage of the issue framed it as an argument over regulation, but the term "regulation" in this case is somewhat misleading. Groups advocating for net neutrality are not promoting regulation of Internet content. What they want is a legal mandate forcing cable companies to allow ISPs free access to their cable lines (called a "common carriage" agreement). This was the model used for dial-up Internet, and it is the way content providers want to keep it. They also want to make sure that cable companies cannot screen or interrupt Internet content without a court order.
The next nine stories were:
2. Halliburton sold key nuclear reactor components to Iran.
3. The world's oceans are in extreme danger.
4. Poverty is increasing in the US despite "improved economy."
5. Six to seven million dead in Congo as US companies seek control of natural resources: diamonds; tin; copper; gold; cobalt, an element essential to nuclear, chemical, aerospace and defense industries; and, more significantly, coltan and niobum, two minerals necessary for production of cell phones and other high-tech electronics.
6. Whistleblower rights virtually eliminated for US Government employees.
7. US Troops still torturing detainees.
8. Pentagon exempt from FOIA; operational files "fully immune."
9. World Bank funds Palestine isolation wall.
10. Iraq troop drawdown accompanied by increased aerial bombing.

You've gotta love The American Way. The government doesn't censor because it doesn't need to; the media does it for us.

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Let's leave the Internet with the big corporations

A 30-second spot on Network Neutrality -- worth watching!
"A better Internet? More restrictions."

"Let's leave the Internet with the big corporations, where it belongs."

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Monday, November 06, 2006


Tubular Confusion

The Universal Tube & Rollform Equipment Corp., a 17 employee company, is the most popular industrial website in the world, reports the WSJ (paid subscription required). The company's website got 68,000,000 hits in August. Universal Tube's url is utube.com.

David Weinberger's new book, Everything is Miscellaneous (no Web site yet), which covers issues like this, is due in early 2007. It won't be a moment too soon.

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Friday, November 03, 2006


Things that "happen" in conference committee

An article in today's New York Times shows what can happen to a bill in the U.S. Congress on its way to becoming law. This could be the telecom bill . . . and it's not even Lame Duck time yet.

The article says that the public has just become aware of a surprise in the Military Appropriations Act, passed by Congress and signed into law some two weeks ago. The surprise provision eliminates the Office of Inspector General for Iraq Reconstruction. Senator Susan Collins (R-ME), who followed the bill closely because she chairs the Senate Homeland Security Committee, "still does not know how the provision made tis way into what is called the conference report, which reconciles differences between House and Senate versions of a bill."

The article continues, "Neither the House nor the Senate version contained such a termination clause before the conference, all involved agree." Senator Collins told the NYT, "I looked at what I thought was the final version of the conference report, and that provision was not in at that time."

Neither Collins nor Senator Warner (R-VA), who chairs the Senate Armed Services Committee, had any idea where the provision came from. The article goes on to pin the blame on the staff of Duncan Hunter (R-CA), who chairs the House Armed Services Committee.

Nice Work, Representative Hunter. Your actions cheapen congress and pervert the practice of representative democracy.

Let's watch the telecom bill carefully. The law might not bear any resemblance to the current House or Senate versions.

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Korea: Wholesale breach of Net Neutrality

From today's (Oct 31 - Nov 3) issue of Dave Burstein's DSL Prime newsletter:

. . . in Korea we have the first large scale breach of network neutrality . . . Two million cable modem subscribers and one million LG Powercomm broadband customers are being blocked from watching video from video on demand service HanaTV, Korea Times reports. Korea’s innovative Hanaro, #2 to Korea Telecom in broadband, has signed up 60,000 customers for video on demand in the first three months. KT Vice President Shim Ju-kyo tells Korea Times ``We are 100 percent ready to introduce Internet TV services and we will do so next year as soon as the legal framework is set up,’’ LG’s sister company, Dacom, has an IPTV offering of their own in the works. Hanaro is controlled by U.S. investors AIG and Newbridge, while Goldman Sachs and Bill Kennard’s Carlyle Group have been investing in Korean cable companies.
The Korea Cable TV Association is maintaining “IPTV is a broadcasting, not a telecommunications service” and boycotting the Hanaro offering. Cable networks have been fighting a regulatory battle to keep telcos out of the TV business.

This may be the first large scale breach of network neutrality **for commercial purposes**, but many countries that practice political censorship violate the dictum, "Consumers are entitled to access the content of their choice," every day. Of course, the Kevin Martin FCC added the important modifier, "lawful," which makes blatant censorship, and probably even these Korean shenanigans, OK.

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Wednesday, November 01, 2006


Picture>1k Words

Original source. Thanks to Doc for pointing Hugh's work out to me!

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