Philip Falcone of Harbinger Capital Partners is a step closer to his American dream: a national open access, wholesale-only, net-neutral LTE network. He first unveiled the plans in March and now the venture has a name (LightSquared), a management team (headed by former Orange CEO Sanjiv Ahuja) and a supplier (Nokia Siemens Networks). Falcone brought a number of assets into the company (SkyTerra, Terrestar), giving LightSquared generous spectrum resources of 59 MHz. The assets are valued at USD 2.9 billion, and the company said it has an agreement for another USD 1.75 billion in debt and equity financing.
NSN won the contract to build a network of 40,000 base stations within five years, to cover 92 percent of the US population, with the remaining coverage to be provided by satellite. The project is expected to create around 100,000 direct and indirect jobs. The order is worth USD 7 billion (EUR 5.5 billion) over eight years to NSN. The company’s sales were EUR 12.6 billion in 2009, so the contract adds an average 5.5 percent to sales each year. After acquiring Motorola’s networks business for a nice price, this is another good deal for NSN.
Telstra realizes that it is better for them to support this effort than try to compete. If they chose to compete against service providers using the NBN, they would burn capital needlessly and still not achieve the results of their competition. They would be offering less HD and 3D programming and slower Internet speeds than their competition. So to participate in NBN, Telstra gives up its ducts and existing mid-mile fiber, and the government will operate its phone services, emergency services, and payphones. Although I applaud the creation of an open-access fiber infrastructure, I think that the Australian government has encroached too far into private enterprise. The government is essentially entering the telecommunications business through the creation of USO Co. which takes them back to the days of Telecom Australia when they were the PTT.
Australia’s going all-in with its government-run fiber network. The government has now convinced the country’s dominant telco, Telstra, to sign on with the scheme, get rid of its copper and cable lines, and transition its subscribers to the open-access national fiber program. When the project is complete, Australia will have taken an almost unprecedented step for a country of its size: legacy telecommunications infrastructure will be almost gone.
Although Australia had planned to move forward with its AUS$43 billion fiber network with or without Telstra, Telstra’s decision to join the party is a significant one—the company could have held out and fought to keep its customers from defecting to fiber, setting the stage for a long platform war. In the end, though, there just weren’t many benefits to doing this; a recent report from McKinsey and KPMG reemphasized the fact that the new fiber buildout would “accelerate the evolution of the industry,” and it would be hard to compete with open-access fiber-to-the-home on speed.
I agree with the premise of the report that net neutrality as it is currently defined will stifle competition. AT&T has publicly stated that it will halt U-verse deployments if net neutrality is passed. Verizon has already capped its FiOS project. The warning signs are already there. The Internet is a vital component to the U.S. economy as it transitions from a manufacturing-based to knowledge-based economy. Any potential threat to its vitality must be stopped. There are several assumptions in this study that I believe are overstated or flawed. Even if they are corrected, the result will be that as the FCC has defined net neutrality, jobs will be lost in our economy. The Internet must remain open and accessible for all users despite methods of access. On the other hand, the FCC must not be heavy-handed in regulating it as not to impede innovation. All of these points bring me back to my assertion that open-access municipal networks will go a long way to continue the freedom and innovation of the Internet.
Broadband experts warn of depressed network investment, limits on new business models, and deterred rollout of broadband-enabled services
NEW YORK–(BUSINESS WIRE)– According to research released today from Charles M. Davidson, director of The Advanced Communications Law & Policy Institute at New York Law School, and Bret Swanson, president of technology research firm Entropy Economics, new regulations for providers of broadband Internet service could result in the loss of hundreds of thousands of jobs. The new Internet regulations, the report estimates, could also reduce U.S. Gross Domestic Product (GDP) by tens of billions of dollars per year. The report, “Net Neutrality, Investment & Jobs: Assessing the Potential Impacts of the FCC’s Proposed Net Neutrality Rules on the Broadband Ecosystem,” examines the extent of likely damages to investment, jobs, and U.S. GDP resulting from the implementation of the Federal Communications Commission’s (FCC) proposed net neutrality regulations.
The sponsoring cities and UTOPIA have the right concept. UTOPIA is now being better managed, and the network penetration is increasing. I know that they can start meeting their objectives and eventually be profitable, but their members need to continue to invest in them. The $54,000 that the city of Brigham needs to contribute to keep UTOPIA going is a small price to pay for the economic and consumer benefits the network brings. I’ve seen cities blow that much money on studies that are never implemented and just sit on a shelf. I hope Brigham residents and the council have the foresight to continue investing in this valuable asset.
By Nancy B. Fuller (Standard-Examiner correspondent)
BRIGHAM CITY — After months of rumors, the Brigham City Council had its first formal meeting with UTOPIA executive directors on options for implementation and long-term commitments for the city to continue with the fiber-optic network.
The meeting was held one hour before the regular city council meeting, which didn’t leave enough time for council members to address their concerns, so the council requested another meeting with UTOPIA.
How The Online Giant’s Fiber Project Could Change The Future Of Internet Access
As the scrutiny intensifies over the United States’ inability to keep up with the broadband efforts of other countries, a potential savior has emerged. With its upcoming Fiber For Communities project, Google will deliver Internet connections of more than 1Gbps to one or more trial communities, in turn spawning hope across the rest of the country that ultra-fast broadband could soon be a reality for almost everyone.
Published: Sunday, April 18, 2010 12:04 a.m. MDT
I was not an elected official when my city committed to the Utah Telecommunication Open Infrastructure Agency (UTOPIA). But now as mayor of the largest UTOPIA city, I find that what to do with our city’s network has become one of the greatest challenges I face — not just because of West Valley City’s enormous commitment ($147 million between 2010 and 2040), but importantly because of the enormous potential benefits. I find the question is not, “Was UTOPIA a good idea or a bad idea?” The question is: “Looking at our hand today, what is our best way forward?”