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[Commentary] The Department of Justice released details of Verizon’s and cable companies’ commercial agreements. The DoJ’s Competitive Impact Settlement includes previously confidential details about the deals, which is disappointing to read given the DOJ’s approval and lackluster conditions.
Everything the DOJ mentions in this Statement further emphasizes Public Knowledge’s position that this deal is bad for consumers and potentially crippling for innovation in the broadband and wireless marketplaces. Here are some of the DOJ Statement’s observations about the most anticompetitive consequences of the Verizon/Cable deal. The commercial agreements:
- Harm competition in the video, broadband, and wireless markets because they impair the ability and incentives for Verizon and the cable companies to compete aggressively against each other.
- Contractually require Verizon to have a financial incentive to market and sell the cable companies’ products through Verizon Wireless channels in the same local geographic markets where Verizon also sells FiOS.
- Unreasonably diminish competition between Verizon and the cable companies—competition that is critical to maintaining low prices, high quality, and continued innovation.
- Unreasonably diminish future incentives to compete for product and feature development pertaining to the integration of broadband, video, and wireless services.
- Unreasonably restrain the ability of the cable companies to offer wireless services on a resale basis.
- Unreasonably restrain competition due to ambiguities in certain terms regarding what Verizon can and cannot do to compete in the marketplace.
- The aspects of the JOE unreasonably reduce the companies’ incentives and ability to compete on product and feature development, and create an enhanced potential for anticompetitive coordination.
DOJ Releases Confidential Information; Verizon/Cable Deal As Bad As We Thought
While the Federal Communications Commission provides a substantial amount of data in the latest Broadband Progress Report, it also acknowledges what it doesn’t know. Even as the FCC works to accelerate U.S. broadband deployment through a number of new initiatives, here is some of the information we still don’t have.
- Comprehensive data on broadband access in elementary and secondary schools
- Well-documented information on mobile broadband access
- A complete understanding of how broadband requirements will change
3 things we still don’t know about U.S. broadband
For all the talk about super PACs and nonprofit groups spending millions of dollars on campaign ads, the traditional campaigns still have one advantage: Their money goes farther.
To the viewer, an ad is an ad, but to TV stations, not all ads are created equal. Stations have to provide discounted rates to all qualifying candidates running for public offices. But they don’t have to give those same breaks to the super PACs and nonprofit groups like American Crossroads, Restore Our Future and Priorities USA, which are spending millions of dollars on the election. So that means President Barack Obama and Mitt Romney can stretch their dollar more than Karl Rove or Bill Burton. And the influx of political ad spending from super PACs and outside groups is serving as a boon to broadcasters and their corporate owners.
TV stations love super PACs
Health and Human Services (HHS) Secretary Kathleen Sebelius announced the next steps in the Obama administration’s work to help doctors and hospitals use electronic health records.
Under the Health Information Technology for Economic and Clinical Health (HITECH) Act, doctors, health care professionals and hospitals can qualify for Medicare and Medicaid incentive payments when they adopt and meaningfully use certified electronic health record (EHR) technology. The program is divided into three stages:
- Stage 1 sets the basic functionalities electronic health records must include such as capturing data electronically and providing patients with electronic copies of health information.
- Stage 2 (which will begin as early as 2014) increases health information exchange between providers and promotes patient engagement by giving patients secure online access to their health information.
- Stage 3 will continue to expand meaningful use objectives to improve health care outcomes.
HHS’ Centers for Medicare & Medicaid Services and HHS’ Office of the National Coordinator for Health IT released final requirements for stage 2 that hospitals and health care providers must meet in order to qualify for incentives during the second stage of the program, and criteria that electronic health records must meet to achieve certification.
The requirements announced August 23:
- Make clear that stage two of the program will begin as early as 2014. No providers will be required to follow the Stage 2 requirements outlined today before 2014.
- Outline the certification criteria for the certification of EHR technology, so eligible professionals and hospitals may be assured that the systems they use will work, help them meaningfully use health information technology, and qualify for incentive payments.
- Modify the certification program to cut red tape and make the certification process more efficient.
- Allow current “2011 Edition Certified EHR Technology” to be used until 2014.
HHS announces next steps to promote use of electronic health records and health information exchange
AT&T is vigorously defending its controversial plan to restrict wireless access to Apple's FaceTime app for certain iPhone customers. The heated battle between the carrier and its critics could have broad implications for how cell phone companies can control bandwidth-intensive apps in the future. AT&T's legal justification has a few glaring holes.
The company's tiered data plans are set up so that heavy data users pay more for their usage. So why restrict them from using a bandwidth-intensive app like FaceTime if AT&T already has safeguards in place to manage heavy downloads? If someone gobbles up lots of FaceTime data, they'll be paying AT&T for every bit of it. Other wireless providers have so far stayed mum on the issue. It will come to a head in a few weeks, when Apple is widely expected to release the latest version of its iOS mobile operating system. Apple announced in June that the update would open up FaceTime to cellular networks for the first time. Previously, the app had only been available over Wi-Fi networks.
AT&T's FaceTime fight is a very slippery slope
They're in vending machines, parking meters, home security systems, and even healthcare devices for the elderly. They are wireless sensors, a key component of the burgeoning machine-to-machine (M2M) industry where devices use wired and wireless connections to communicate with each other. Though far from new, M2M technology is expanding its reach at a dramatic rate. M2M connections will grow to 2.1 billion by 2021, up from roughly 100 million last year, according to research firm Analysis Mason. The dramatic growth of global smartphone usage is a major factor in M2M's popularity, of course, as are industrial applications in the transportation, emergency services, security, and retail sectors. A good chunk of M2M hookups are done via fixed lines, including DSL, ISDN, cable modem, and Ethernet connections. But the real growth is in the wireless arena, and it's being spearheaded by cellular carriers. "Faced with diminishing rates of growth in handset sales and declining residential ARPU (average revenue per user), these mobile operators have latched onto a new area of device growth: the connecting of all things in the world, rather than all people," wrote Analysis Mason analyst Steve Hilton in a November 2011 report.
When Wireless Sensors Meet Big Data
With Comcast, Verizon and other broadband providers beginning to offer broadband Internet services with download speeds of 300 Mbps and faster, the Federal Communications Commission says it may need to change the definition for what it considers broadband.
Since 2010, the FCC has said that Internet service providers had to offer download speeds of 4 Mbps and upload speeds of 1 Mbps for their products to be considered broadband. In a notice of inquiry issued on Tuesday, the FCC said that the threshold may need to be raised to reflect the demands required by consumers relying more on broadband services to download high-definition video and to access the Internet on multiple devices in their homes. The commission, which released its Eighth Annual Broadband Progress Report on Tuesday, said it is also considering whether to gauge the impact that broadband usage caps and tiered data plans in next year's report. "If we add a data capacity threshold for fixed broadband in the next report, what data capacity threshold or thresholds should we adopt," the FCC asks in the notice of inquiry. "What data capacity limits do most fixed broadband providers offer today? How often, and under what circumstances, do consumers exceed these limits?"
FCC to study data caps, and may raise broadband speed threshold Have an opinion on broadband caps? Speeds? Tell the FCC (GigaOm)
Anyone with a smartphone or tablet computer knows the drill: When you need a fast connection to the Internet, you find a Wi-Fi hot spot. That's fine with Duran Johnson, the well-traveled president of DragNFly Wireless Inc. of Eden Prairie (MN), who puts free Wi-Fi hot spots in restaurants, athletic clubs and shopping centers, and this year will provide free Wi-Fi at the Minnesota State Fair. Last week, Johnson was in midtown Manhattan visiting a customer -- Equinox -- an athletic club chain that offers DragNFly's Wi-Fi service free to its customers. Never afraid to hustle business, Johnson's nine-year-old company made a bid to install Wi-Fi at the Minneapolis-St. Paul International Airport earlier this year. He was passed over for a Miami firm with previous airport experience. But that unsuccessful bid caught the eye of State Fair officials, who agreed to have DragNFly provide a free Wi-Fi hot spot near the grandstand for fairgoers.
Wi-fi guy gets a fair chance
Bringing universal Internet access to the entire planet is an audacious goal, but one that isn’t entirely out of place at Singularity University’s graduate studies program, where students are asked over the course of a summer to come up with projects that could affect 1 billion people in 10 years. Universal Internet access--a project idea from some of this summer’s Singularity students--certainly fits the bill. The project, dubbed WiFli, wants to use empty wireless frequency spectra along with cheap hardware to bring the Internet to the world’s poor on the cheap. "[We want] Internet connectivity at low costs for the disenfranchised. It’s a way of stopping poverty and job loss," says team member Federico Pistono.
WiFli Wants To Bring Internet Access To The Entire Planet
The Congressional Budget Office provides estimates of American Recovery and Reinvestment Act’s (ARRA) impact on employment and economic output in the second quarter of calendar year 2012 (April 2012 through June 2012), as well as over the entire period since February 2009.
CBO estimates that ARRA’s policies had the following effects in the second quarter of calendar year 2012 compared with what would have occurred otherwise:
- They raised real (inflation-adjusted) gross domestic product (GDP) by between 0.1 percent and 0.8 percent,
- They lowered the unemployment rate by between 0.1 percentage points and 0.6 percentage points,
- They increased the number of people employed by between 0.2 million and 1.2 million, and
- They increased the number of full-time-equivalent (FTE) jobs by 0.2 million to 1.3 million. (Increases in FTE jobs include shifts from part-time to full-time work or overtime and are thus generally larger than increases in the number of employed workers.)
CBO estimates that the legislation will increase budget deficits by about $833 billion over the 2009–2019 period. By CBO’s estimate, close to half of that impact occurred in fiscal year 2010, and more than 90 percent of ARRA’s budgetary impact was realized by the end of June 2012. The effects of ARRA on output peaked in the first half of 2010 and have since diminished, CBO estimates. The effects on employment are estimated to lag slightly behind the effects on output; CBO estimates that the employment effects began to wane at the end of 2010 and continued to do so through the second quarter of 2012. Still, CBO estimates that, compared with what would have occurred otherwise, in 2012 ARRA will:
- Raise real GDP by between 0.1 percent and 0.8 percent, and
- Increase the number of FTE jobs by between 0.2 million and 1.2 million.
Estimated Impact of the American Recovery and Reinvestment Act on Employment and Economic Output from April 2012 Through June 2012