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December 27, 2009

Farewell & Adieu, MMIX

Before bidding 2009 a bon voyage, it’s worth noting two recent media commentaries. First, Francis Wilkinson has a warm and wonderful portrayal of the great Jody Powell in today’s New York Times. His portrayal brought back the usual flood of Powell memories (for more, click here and here) as well as reconfirming that while Washington hosts more than its share of phonies, it also catapults to success some truly outstanding, wonderful people.

Next up is Andy Kessler’s oped in Saturday’s Wall Street Journal. Kessler’s usually pretty sharp on technology and telecom which is why this column is so disappointing. For starters, his idea of setting up a nationwide wireless system by linking transmitters to street lights is fanciful. AT&T tried it in St. Louis and backed out in 2007 because the technology just didn’t work.

Moreover, Kessler’s comment about the telecos and employment is just plain absurd. AT&T is the nation’s largest private sector employer of union workers. While Google has a larger market cap than AT&T it employs 10 times fewer people and has a capex budget less than one-eighth as large. So which one seems more likely to start hiring?

That’s it for 2009. Thanks for reading and feel free to sign up for my RSS feed. See you in 2010!

December 14, 2009

From the Sublime To…

Filed under: Net Neutrality,Technology,Telecom,Wireless Pricing — Peter Arnold


(Washington) … the ridiculous:

“This notion that customers must now curb their Internet usage or pay up is not only unfair to consumers, it puts up a roadblock to wireless innovation,” says Craig Aaron, senior program director at Free Press, a nonprofit group that advocates for unfettered access to communications.

The year has three more weeks but it’s safe to say that the competition for the most incomprehensible, illogical statement is over.
Beyond the absurdity in Aaron’s statement, the irony is that Free Press styles itself as a consumer advocacy group. But what sort of consumer advocate could possibly support a uniform pricing system in which serial filesharers are subsidized by senior citizens who use their connection to check email twice a day?

Logic would say that Free Press and a consumer advocate like Craig Aaron should support a lower-priced option for occasional users, instead of deriding it. Wonder why they don’t…

December 13, 2009

For the Record

Filed under: America Online — Peter Arnold


Never let it be said that I didn’t correct the record when necessary. Take my November 1 blog, “Mozilla’s Follies” in which I wrote that America Online’s COO Bob Pittman “was negotiating to merge with TimeWarner.” My mistake. Although Pittman clearly favored the deal, it was Steve Case and Ken Novack who led AOL’s negotiating team.

December 10, 2009

LA Confidential

Filed under: Apple,Net Neutrality,Technology,Telecom,Wireless Pricing — Peter Arnold

(Las Vegas) The award for the year’s most puzzling headline goes to the Los Angeles Times for this doozy on David Sarno’s story about iPhone usage: “AT&T may penalize iPhone users who hog data.”

It’s a great headline, at least to the extent that “penalize” is a shorthand way of saying, “Those who consume a lot of a product should pay more than those who only use a little.” Actually, Sarno’s article is fairly straightforward and is one more example of how the current uniform data pricing structure among wireless carriers is increasingly untenable.

According to the head of AT&T’s wireless division, three percent of iPhone users are chewing up 40+ percent of the company’s bandwidth. Credit the proliferation of mobile video options. But this imbalance should hardly come as a surprise since a similar imbalance has existed on wired broadband for years.

Japan, which led the world in wired broadband, faced a similar issue well before America did. Thanks mostly to P2P, fewer than five percent of subscribers consumed almost half the country’s bandwidth. For a good resource on this, here’s the 2007 report on net neutrality from Japan’s Ministry of Internal Affairs and Communications.

Specifically, look at the usage charts on pages 17-19 and the conclusions on pages 59-66.

December 3, 2009

Mobile Agonistes

Filed under: Telecom,Wireless Pricing — Peter Arnold

(New York) LA Times columnist David Lazarus writes in his column today:

All [wireless] phones should work on all compatible networks — particularly in light of the fact that all wireless companies are building state-of-the-art networks to accommodate increasingly snazzy smart phones.

Figure it like this: If you buy a TV at Best Buy, it’ll work with any cable or satellite provider you pick, anywhere in the country. Mobile phones should work the exact same way.

Well now.

Lazarus is a bright guy and ought to know the obvious problems with this ridiculous comment. First, the four main U.S. carriers (AT&T, Verizon, Sprint and T-Mobile) use incompatible technologies. Second, these technologies operate on different frequencies.

In technical terms, unless your carrier’s cell tower technology and emitting frequencies match the radio in your mobile phone, your call won’t go through. That’s why European 3G handsets have difficulty with the U.S. 3G standard. Even though the technology is basically the same, Europe’s standard for 3G is 2100 MHz, while AT&T operates 3G at 850 and 1900 MHz.

That means that while Lazarus’ dream of a mobile phones that are technology- and frequency-agnostic can be achieved, it won’t be cheap. Nor does he acknowledge that there is the cost. Maybe an additional $60 per handset? Maybe $80.

That said, the market is converging, as the 4G/LTE standard should bring greater technological harmony to the mobile industry. But don’t hold your breath, as it won’t be truly mass-market until 2011.