Net Neutrality Friday

Well, dang it Federal Government! You keep interrupting my plan to write about how I would create incentives to build out the network so we consumers get what we want.

This week the interruption is around FCC Chairman Wheeler saying essentially that he is bringing Title II to the Internet. At the same time, he announced his intention that this decision will not impact the investment by ISPs in the network. This is going to be tricky but my opinion is that Chairman Wheeler’s intentions are on target. I will withhold any detailed commentary until we have an actual proposal.

The model that is being looked at is Wireless. Wireless voice today falls under Title II but does not have some of the other regulations that are associated with Wireline Voice. Those additional regulations include things like Rate Caps (Residential Service can not be more than a specific amount per month) and Unbundling (most copper networks are required to be able to be purchased wholesale). Given the vast investment in Wireless, these lighter Title II rules are presumed to be conducive to investment.

This last bit is not clear to me at all. Wireless voice was built out in a Title II world, but the vast investment over the last 15 years or so (from Edge – 3G – 4G) has been all about data. Initially, the Mobile Network Operators (MNOs) ran “walled garden” data strategies. You could only surf their websites. The iPhone broke all of that and brought regular Internet Service to the Wireless Handset. Let’s remember that the first iPhone only came out in 2007. So it has been less than 10 years at this writing since that was available (and it still seems like we have always had them). I am sure somebody will quibble and find an wireless handset with real Internet before the iPhone. But the iPhone broke the market open.

So, I will say we need to reserve judgement on using Wireless as a model here. We need to look back to the competitive pressures and other issues in Wireless before we say that an equivalent for Broadband is good enough. I myself am unsure on this, as I have not thought the whole thing through well enough at this point. So more to come in the future on this.

The other big thing that happened this week is a sale of lines and cell towers by Verizon to reduce the debt that Verizon took on through the recent auction spectrum. Of note to me was the sale of Wireline properties in California, Texas and Florida. I do not have details on which properties yet. What I can tell you is that those 3 states held some of the earliest and densest deployment of FiOS in the country. FiOS was first rolled out in Keller, Texas and Orange County California had the highest take rate while I was still at AFC/Tellabs. Frontier is the purchasing company and they have bought FiOS properties in the past. These properties were not treated well from my understanding so we shall have to see what happens this time.

Anyway, have a great weekend!

Jim Sackman
Focal Point Business Coaching
Change Your Business – Change Your Life!
Business Coaching, Sales Training, Marketing Consultant, Behavioral Assessments, Business Planning

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