02 July 2009

 

Broadband Discussion at Personal Democracy Forum

As mentioned previously, we were attending the Personal Democracy Forum earlier this week. Winding up Monday’s session was a panel entitled “The Obama Broadband Initiative and the Future of the Internet,” with opening remarks by Blair Levin of the FCC (video here) and a discussion, moderated by PDF’s Andrew Rasiej, involving Free Press’ Josh Silver, NCTA’s James Assey, and AT&T’s Hank Hultquist.

The WSJ’s Digits blog offered an accounting of the panel:

Panelist Josh Silver, the executive director and co-founder of Free Press, a media advocacy organization, ripped into his co-panelists, who represented the wireless and telecommunications industries.

He accused them of price-gauging Americans on Internet service and monopolizing the industry rather than engaging in competitiveness and helping provide affordable access to the poor. “We’re looking at industries which are protecting a very lucrative business model, and there are starting to be increasing numbers of people at the gates understanding that the ISP market should be competitive,” Mr. Silver said.

It was a very spirited discussion.

Let me quote a few notable remarks on Twitter:

    @mikemathieu: AT&T and cable industry reps wriggling on stage as Josh Silver points out price protection schemes of broadband providers.
    @zbrisson: One of the best things of the day, Silver from free press calling the cable companies out for their oligarchic greed.
    @abenamer: josh silver points out that the lack of competition with the cable and telephone duopoly keeps prices artificially high
    @jonathanpberger: The hatred for ATT & Cable co.’s is palpable. The people want blood.

Tough crowd.

Among James Assey’s comments, he pointed out that companies are investing significantly in infrastructure, which will encourage faster speeds. As he put it, “We’re leaning forward to the future.” As we’ve said many times, the cable industry along has invested well over $100 billion since 1996. Assey also noted that there is competition in the broadband marketplace; however, it costs a lot to build & maintain robust broadband networks and private capital is generally required. He also pointed to a recent Pew report (Home Broadband Adoption 2009) that found that value & utility beat availability & price when it comes to why respondents did or did not take broadband.

This national discussion of America’s broadband future is important and we’re committed to taking part in the conversation. We look forward to other events like PDF as the process moves forward.

Now Broadcasting from the Personal Democracy Forum

For the next two days Paul and I will be Tweeting, blogging, and otherwise chattering about the annual Personal Democracy Forum (PDF) in NYC. PDF is the premier event for dicsussion of online politics and Cable is a proud sponsor. Cable’s James Assey will be participating on a panel this afternoon focused on the state of US broadband and the Obama Administration’s goals to get every American connected. He’ll share the stage with Josh Silver from Free Press, Hank Hultquist of AT&T, and Blair Levin from the FCC.

PDF explores how we, as a society, are changing the way we interact with issue advocacy and candidate campaigns as well as our governemnt.

If you’re interested, use Twitter Search to follow the discussion.  You can find a full program and schedule for the panels at PersonalDemocracy.com

Big Boost for Online Viewing

Time Warner and Comcast held a press briefing this morning to provide some details about the much anticipated “TV Everywhere” project that Time Warner Chairman and CEO Jeff Bewkes has been discussing for a few months including during a panel at The Cable Show back in early April.  Joining Bewkes for today’s briefing was Comcast Chairman and CEO Brian Roberts.

The main takeaway from today’s briefing is that Comcast and Time Warner will begin a trial to provide 5,000 Comcast customers access to cable programming (TBS and TNT for now) on a platform (the computer screen) where it wasn’t previously available, for no additional charge.  It is no more complicated than that.

The primary details released today include a set of principles that the companies agreed to:

  • Bring more TV content, more easily to more people across platforms.
  • Video subscribers can watch programming from their favorite TV networks online for no additional charge.
  • Video subscribers can access this content using any broadband connection.
  • Programmers should make their best and highest-rated programming available online.
  • Both networks and video distributors should provide high-quality, consumer-friendly sites for viewing broadband content with easy authentication.
  • A new process should be created to measure ratings for online viewing. The goal should be to extend the current viewer measurement system to include advertiser ratings for TV content viewed on all platforms.
  • TV Everywhere is open and non-exclusive; cable, satellite or telco video distributors can enter into similar agreements with other programmers.

You can check out this story from CNET’s Marguerite Reardon – Comcast and Time Warner team up to deliver TV online – for a complete recap.

More details about the trial will undoubtedly be forthcoming, but the immediate knee-jerk negativity by some in the blogosphere was not only predictable, but uninformed.

But thankfully, there are also some more reasoned voices weighing in that recognize the potential of this announcement to bring real benefits to consumers by offering them access to more content in more places.  Will Richmond from VideoNuze boldly declares:

Despite what some skeptics say, consumers also stand to gain.  All that great cable programming that’s been locked to the set-top box in the home would now be available online. It sort of like cable’s version of on demand Sling, but without any upfront or monthly charge (at least that’s what we’re hearing for now).

Richmond takes a more rational view that this model is one that benefits both programmers and consumers, but they still need to work out some of the technical issues:

Comcast and Time Warner are taking a solid step forward in delivering more value to their subscribers who increasingly live their lives online. Now they need to tamp down the hype and just focus on executing in a logical, user-friendly way.

The rest of Richmond’s post is available here and he also aptly highlights some of the challenges that this trial will face including the necessary business model issues that the free lunch crowd tend to ignore.

Broadband Connections Up, But Broadband Stimulus Efforts Can Reach More Households

Rarely a day goes by in DC without a panel discussion, new report or legislative hearing on the importance of broadband. Yesterday, the Pew Research Center’s Internet & American Life Project released a lengthy survey on Home Broadband Adoption. Not only does the study delve into the importance of Internet in the everyday lives of Americans, but it also shows a noteworthy rise in broadband usage over the last year.

The study notes that now, “63% of adult Americans now have broadband internet connections at home, a 15% increases from a year earlier.” That is up from 54 percent in 2007.

In addition, Pew’s study also looked at specific populations, like seniors, rural Americans and lower income households. Some key statistics from the report include:

  • “Respondents reporting that they live in homes with annual household incomes below $30,000 experienced a 34% growth in home broadband adoption from 2008 to 2009.”
  • “Broadband usage among adults ages 65 or older grew from 19% in May, 2008 to 30% in April, 2009.”
  • “Adults living in rural America had home high-speed usage grow from 8% in 2008 to 46% in 2009.”

The broadband adoption numbers have definitely moved upwards in recent years and we should take a moment to applaud this progress. At the same time, there is still work to be done. We should ensure that all American households have access to some kind of broadband connection.

Broadband can be engine of job creation, a facilitator of educational and health care opportunities, and a means of shrinking the distances between isolated communities. Yet, without access, some folks are left behind.

This is why a broadband stimulus package (part of the American Recovery and Reinvestment Act) is so important. The stats demonstrate while broadband usage is going up, there is still a clear need to increase broadband adoption and use.

How these stimulus grant funds are used is critical. Earlier this year, we laid out a few ideas on how program should be structured around the following priorities:

  1. Extending broadband facilities to unserved areas.
  2. Supporting programs that enable underserved populations to acquire and to make effective use of broadband service where it is already available.
  3. If funds remain, extending broadband facilities to underserved areas defined in terms of below-standard speed and other qualitative measures relative to today’s current-generation broadband services.

We’ve talked about the broadband stimulus package several times of the past few months. A white paper we released back in March provides our perspective on how funds should be implemented. And NCTA President & CEO Kyle McSlarrow shares his thought on this issue in this video. We also posted a White Paper from the U.S. Chamber of Commerce about the impact of broadband on senior citizens.

DTV Transition Weekend: A Look Back

The trends for cable from “DTV Transition weekend” continued into the work week with no major issues on the horizon.  A wrap-up call with our industry-wide “DTV War Room” group at mid-day today found cable engineers mopping-up a few remaining challenges with broadcast station signals in a handful of markets.  By and large, cable customers weren’t being affected.  There were some isolated concerns – and we would stress “isolated” – about possible broadcast interference to the cable plant in a few places that may have resulted from changes in transmission frequencies among broadcast stations.  Cable and broadcast engineers were continuing to work together to solve those problems.  We have learned also that some broadcast stations in major markets are struggling with challenges around signal strength and contours.  That seems to be having some impact on over-the-air viewers, but not cable subscribers.

Cable industry customer care professionals reported only marginally-higher levels of consumer phone calls to cable call centers.  They said that while call volume was up on Friday and Saturday, it had begun to tail-off on Sunday and was returning to close to normal levels by mid-day Monday.

We don’t think the transition is “over” yet, probably for millions of Americans.  Broadcast stations in many markets are working now to adjust technical parameters and “ease in” to their new frequencies and digital formats.  Hundreds of thousands of Americans are still waiting to receive government discount coupons for over-the-air converter boxes – in order to retrofit their analog TV sets for over-the-air reception – so they’ll still be installing hardware, hooking up boxes, and evaluating reception of their new digital pictures for some time to come.  Likewise, some over-the air households may still reach out to cable companies, or our satellite and telephone company competitors, in order to sign up for multichannel video service…which we still think is a good option for any consumer who wants to see broadcast television on an analog set.  As an industry, we’ll need to stay vigilant as the transition winds down, to ensure that our customers and other consumers get the most from their cable service.

If there’s any lesson to be learned from the DTV Transition of 2009…it’s that preparation pays off.  It was probably helpful when the President and Congress pushed the culminating transition date from February to June, and we appreciate what the FCC did to coordinate the activities of the many disparate stakeholders in the transition.  But even before that time, we believe the quarter-of-a-billion-dollar investment the cable industry made in consumer education for cable customers starting in 2007 – paired with the billion dollars of commercial airtime that the broadcasting industry kicked in for public service advertising – raised awareness of the transition to virtually universal levels and gave consumers some clues about how to get ready.  Our industry-wide contribution of call center support for the FCC from February through April 2009 not only helped fill the gap in meeting the need for consumer response efforts; it too became a consumer education tool and helped our own companies better understand the questions on the minds of consumers as the transition played out.  And the low-cost digital basic tiers that some of our companies rolled out also have proven to be a great way to introduce over-the-air viewers to multichannel video while serving the public good by helping local broadcast stations preserve their base of viewers.

Despite any hiccups, the effort to prepare American consumers for the age of digital broadcasting is likely to be remembered as a healthy public-private partnership that brought together both collaborators and competitors in a common cause.