In June, the net neutrality debate took an unexpected turn when the Netherlands leap-frogged the USA to became the first country to legislate for mobile net neutrality. Business models for fixed and mobile networks must shift toward volume charges. The net neutrality debate has been seen not having much relevance outside the USA because the plight of carriers there was aggravated by unlimited usage.
The OECD held a "high-level" meeting in June 2011 that was intended to build upon the OECD Ministerial on The Future of the Internet Economy held in Seoul, Korea in June 2008. I was invited to attend this meeting as part of the delegation from the Internet Technical Advisory Committee (ITAC), and here I'd like to share my impressions of this meeting. This 2 day meeting, "The Internet Economy: Generating Innovation and Growth", had the objective of exploring a number of current issues in the public policy space...
New developments that have been announced by the FCC in the United States have rekindled the decade-old debate on the use of the so-called 'white spaces' in broadcast spectrum that are to be used for telecoms purposes. In September 2010, the FCC adopted a Second Memorandum Opinion and Order that updated the rules for unlicensed wireless devices that can operate in broadcast television spectrum at locations where that spectrum is unused by licensed services. This unused TV spectrum is commonly referred to as television 'white spaces'. The rules allow for the use of unlicensed TV devices in the unused spectrum to provide broadband data and other services for consumers and businesses.
The FCC's recent decision allowing license-exempt access to TV White Spaces, i.e. unused TV channels, is a small but very important step in spectrum policy. But, more important than the TV bands, is the policy approach and the fact that it was adopted in the face of extreme lobbying by well established vested interests.
I never thought I'd see the day when the difference in capability between a wireless and a wireline Internet would become a core policy differentiator in a national election, but this has now happened in Australia. ... It seems that everyone has an interest in a ubiquitous, fast and cheap internet. Now that interest has been taken up as a major policy differentiator by both sides of the political spectrum in the recent Australian election. What was this all about?
Making a telephone call in London has become more difficult for early adopters of the new iPhone 4. First of all the reception is rather poor. And it is not just that it is not showing the bars correctly; many users in congested mobile areas such as London receive the message 'server not available'. (As a matter of fact, this doesn't apply only to the iPhone -- it is also experienced with other smart phones.)
In the wake of the unprecedented boom in mobile broadband, pressure is building around the world for governments and regulators to act quickly and decisively to the frantic demand for more spectrum. The telcos are leading the charge, but the broadcasters are lobbying for their case equally vigorously. The broadcasters do not necessarily need all the spectrum they currently have, but they view mobile broadband and telcos as competitors to their monopoly on video entertainment, so they will do everything to keep them out of that market for as long as possible.
The fact that businesses around the world are knocking on the doors of their governments asking for spectrum is a clear indication that this telco real estate market is hotting up. The reason for this is not too hard to guess -- the enormous growth in the demand for mobile broadband. There is a large amount of pent-up demand as the mobile operators didn't want to open up this market while they were in the middle of adding new customers to their mobile voice services.
The tremendous demand for, and profitability of mobile telephony supports legislative and regulatory efforts to refarm spectrum with an eye toward reallocating as much as possible for wireless telephony and data services. But there is a downside that no one seems to acknowledge. In light of past FCC practice and the behavior of incumbent wireless carriers I expect two anticompetitive outcomes to occur with the onset of any more spectrum.
Sure the iPhone has problems, but John Stankey of AT&T thinks restoring a $2B capex cut will fix them. It may take a little more money than that, but Glen Campbell of Merrill Lynch has confirmed he's on track. In a 50 page report that's one of the best I've read in years, Merrill destroyed the common belief that wireless has a significant spectrum shortage.