Preparing for Today’s SquawkBox Call

If you are unaware every Thursday I run Squakbox on Calliflower talking about regulatory issues.
Jim Kohlenberger and about half of our known relationships are unable to participate in the discussions today.

Part of the reason is because Washington is a buzz with new regime planning.

So I am posting in my blog the important facts.

Here is the news of the week.

The FCC

  • voted to approve the use of WhiteSpace
  • Approved the redistribution of wealth I mean assets between Sprint and Clearwire
  • Approved Alltel’s Tad and the Mr Wizard going to Veriizon Wireless
  • The Intercarrier Compensation discussion is in total disarray

California Voters approved taxing VoIP in Los Angeles County, Sacramento, and San Jose

Major changes in Senate have huge implications for us

  • Ted Stevens is probably history is some way one scenario is that he is replaced by Governor Palin, the other is a direct loss.  He is part of the reason the California laws can exist
  • Sununu author of the VoIP Regulatory Freedom Act (2004)
  • Commerce Committee loses Senator Smith and keeps McCain (but will not be the leader)

2)    Here are the speculations

  • FCC Chairmanship has another of candidates the democrats, Commissioners Copps, and Adelstein have been mentioned as well as Lawrence Strickling who is working for Obama already.  Also mentioned are Blair Levin, Don Gips, and Julius Genachowski.
  • Commerce committee chairmanship will probably be Senator Rockefeller but Byrd and Inouye are also speculated.
  • Strong belief that Obama is going to include a Broadband Policy in the economic stimulus strategy.

So that’s the news.  Lets See what else we know about on the call.

A Tale of Three (FCC) Decisions

As the FCC enabled whitespaces for the computing industry the wireless world continued to be advanced with the merger of Sprint WiMAX into Clearwire and the approval of the Alltel acquistion by Verizon.  While I will miss the wizard commercials, I think the more important observation is the question of how wireless evolves.

The Verizon story will be mostly around LTE, Clearwire around WiMAX. But who owns White Space?  Who do you associate with this alternative?  Google and Microsoft have been big advocates, but I am not sure they intend to be a service provider for this space. On the other hand, Cloud Computing is probably going to benefit tremendously from the access the White Space provides.  Should I insert Ebay/Skype and Amazon into this discussion?  Motorola and Phillips for their devices?

Imho the future of wireless is going to be very dynamic.  And as we have seen from the iPhone’s success its going to be more about what you can do than what technology is used.

Truphone & ATT on Squawkbox

Alistair Campbell the CTO of Truphone and Hank Hultquist of ATT were my guests on Squawkbox and I wanted to remind people about the discussion in light of the Intercarrier Compensation discussion.

Alistair does a nice job talking about the new era of communication over wireless Internet devices and Hank helps us see that regulatory reform is required.

The vote on Intercarrier Compensation has been delayed with the following two announcements.

STATEMENT OF FCC CHAIRMAN KEVIN J. MARTIN ON INTERCARRIER COMPENSATION AND UNIVERSAL SERVICE REFORM

November 3, 2008

The issues of Intercarrier Compensation and Universal Service reform have been in front of the Commission for years. Last summer I publicly indicated my intention to put forward concrete and comprehensive proposals to reform the inefficient and outmoded Intercarrier compensation and Universal Service programs. Those proposals have been with my colleagues for several weeks now. I am disappointed that we will miss the opportunity for comprehensive reform. Instead my colleagues have requested that we once again seek public comment on several proposals. As a result such a notice would make little progress and ask for comment again on the most basic and broad questions about reforming the two programs. For example, the Commission would again ask should broadband be supported by the Universal Service Fund and should we move to one uniform rate for all traffic or should that rate vary by the type of company?

I would like to be encouraged by my colleagues’ commitment that they will truly be ready to complete this much needed reform on December 18. The nature of the questions they would like to include makes me doubt they will have found their answers with an additional seven weeks. I believe the far more likely outcome is that, in December, the other Commissioners will merely want another Further Notice and another round of comment on the most difficult questions. I do not believe they will be prepared to address the most challenging issues and that the Commission will be negotiating over what further questions to ask in December.

Additionally, I have instructed the Bureau to draft a narrow order to address the Court’s remand. However, I remain skeptical that such an order which retains artificial and unsupported distinctions between types of Internet traffic will be seen any more favorably by the Court than the Commission’s two previous attempts.

I recognize that few other issues before the Commission are as technically complex and involved, with as many competing interests, as are reforming the Intercarrier Compensation and Universal Service programs. But neither of those two realities are an excuse for inaction.  They will be true in one month, in one year or as we have now seen at the Commission, in ten years. I too remain committed to tackling the most difficult issues, providing answers to the toughest questions, fixing broken and outdated government programs and providing broadband to all Americans including those living in rural areas. I look forward to completing these long overdue and much needed reforms as soon as possible.

FOR IMMEDIATE RELEASE

November 3, 2008

JOINT STATEMENT OF COMMISSIONERS MICHAEL J. COPPS, JONATHAN S. ADELSTEIN, DEBORAH TAYLOR TATE AND ROBERT M. MCDOWELL

Below is a Joint Statement from the above-reference commissioners in response to the decision to remove the intercarrier compensation and universal service proposals from tomorrow’s agenda:

“Three weeks ago, Chairman Martin first shared with the Commission his proposals to fundamentally reform the intercarrier compensation and universal service systems.  Four Commissioners provided the Chairman bi-partisan, constructive and substantive suggestions, and stated that notice and comment should be sought on the proposals, with an understanding that we would all be prepared to vote on December 18.  We also have asked the Chairman to narrowly address the ISP-bound traffic remand and the Joint Board’s Recommendation.  We therefore are disappointed that the Chairman has withdrawn the fundamental reform item from tomorrow’s agenda.

“We approached this proceeding with the common goal of modernizing our universal service and intercarrier compensation policies, and commend the desire to tackle some of the most important issues facing this Commission.  It is equally important to ensure that any reform proposal receive the full benefit of public notice and comment – especially in light of the difficult economic circumstances currently facing our nation.

“We remain committed to fulfilling our obligation to tackle these difficult issues, and have set forth a reasonable path for completing comprehensive reform.  We remain hopeful that the consensus process we have pursued regarding this issue will ultimately lead to a thoughtful, well-reasoned item that will inure to the benefit all Americans.”

G! this Phone is giving the Internet a bad name.

I have my gphone and I am playing with it, but so far its not a wow.  The iPhone has the benefit of  a billing system behind it and I am not sure what Android has done to win over market place.  I watched the Android message board and it was clear that lots of what my friend David Jodoin,calls technocrud was about to be launched upon us.  So far on the phone, I find very fews apps even of that stuff.

But this is a very strange experience.  When I google for the videos to watch it asks me do I want to do it in the browser or via YouTube.  From what I can tell there is no difference in the experience.
I am not sure if I have restrictions on this phone or not, but based on the lack of a VoIP client, I am assuming I do.

So here I am wanting to sing the praises of the G1 and at the sametime, not sure how.

What I know is this.  The phone is an improvement from my sidekick for browsing.  It does have better connectivity to the Internet via WiFi and the browswer is more interactive.

Its also the first of several Gphones coming out in the market, so I expect, I am going to suffer from Gealousy at some point.

Right now, I have iEnvy.

Verizon Game Changing from my Google Watch

Will Verizon Wireless Give Away The BlackBerry Storm For Free?
InformationWeek, NY – 2 hours ago
Verizon Wireless’s UK-based partner, Vodafone, recently announced that it will give the BlackBerry Storm to users for free if they sign up for new contracts
Verizon mulls heavily-discounted BlackBerry Storm
CNNMoney.com – 2 hours ago
By Scott Moritz Free. That’s Vodafone’s (VOD) recently-unveiled price for the hotly-anticipated touchscreen BlackBerry Storm from Research in Motion (RIM)
Verizon considering crazy cheap Storm pricing?
engadget, CA – 36 minutes ago
by Chris Ziegler, posted Oct 31st 2008 at 5:33PM Any Storm hopeful in the colonies who’s taken a gander at Vodafone’s pricing scheme this week is probably
blackberry® storm™ 9530 smartphone
Mobile Computing News, UK – 21 hours ago
By Wilson • Oct 30th, 2008 • Category: Features, Smartphone News The much awaited BlackBerry Storm is finally out for smartphone lovers.

4G Wireless Evolution.

Moderating conferences for the last decade has been a wonderful experience and I have grown in the process.

Last night we announced a 4G event that is being organized with TMC.  The team at TMC has been wonderful and I am looking forward to working with them.

Looking at the infrastructure they have put in as an organization they have a great many abilities that were left undone in my previous experience.

The most fascinating thing to me is there ability to embrace the industry and help deliver the message.  The editorial staff is dedicated and they are very good at gathering all the data.

So where do we fit in? Crossfire Consulting is a trusted name in the IT industry that often develops and delivers projects that are either critical to our customers or are adopting new concepts that need to be proven.  We worked with telcos on their Internet strategies and did technical due diligence on many acquistions.  Crossfire Consulting success has helped in other industries as well.

So we are in a position with TMC to not only deliver the news, but put together the appropriate people in the industry.

In my favorite book, “Fifth Business” the character in opera is explained as neither protagonist nor antagonist, but the keeper of the secrets.  While publicly moderating I have been very good, (though it would be hard for you to know) in keeping company council and progressing the story.

Crossfire Media is dedicated to progressing the story of what happens next for telcos and the wireless Internet.  That is the story behind the 4GWE conference and it’s the story we will follow on the portal.

As 3GPP progresses there are several issues that make Long Term Evolution uncertain.  Remember the Internet was built to overcome any one network’s weakness and we are seeing these same concerns expand the applications providers network.  So high speed services are going to be a continuously evolving mixture of applications being implemented in new ways, consumers adopting them virally and access providers (telcos) trying to profitably connect them.

The Father of SIP on the Perils of P2P.

Henning Schulzrinne was at Illinois Institute of Technology VoIP event last week.  (It would have been great to have him in Boston, but alas.)

A few years ago at a SIP Summit I ran I thought I understood him to say that Peer 2 Peer had scaling problems, this conference I understood why.

First of all, as any good discussion he defined the term peer 2 peer and explained that a peer 2 peer system had to have these attributes.

  • Each peer must act as both a client and a server
  • Peers provide computational or storage resources for other peers
  • Self-organizing and scalling

They also Include the ability to

  • Traverse NATS,
  • replicate the service and
  • provide data storage.

He pointed out that P2P systems are not causing backbone congestion as has been widely publicized the backbone has stayed a steady 20% utilization for P2P systems. P2P systems are great for building new services that have little infrastructure cost and great flexibility.

He then looks at the issues of the cost of power and processing and determined that Client server is greener.  For security, the system is more vulnerable and for network management harder to troubleshoot.
Other issues being faced are the unfriendly nature of mobile environments and video streaming.

Henning’s most interesting comment was that P2P was probably going to take over some home and office based solutions.  I also got the sense that a P2P network management client could be a very interesting project.
It was a very interesting discussion. And I recommend tracking Henning and his student’s activities.

The day Jeff Pulver would have spoken

If I were in Boston, we would be hearing about Social Networks and new ventures from Jeff Pulver, but I would want him to talk about the Pulver Order at risk.

To be clear no one in Washington is saying that the Pulver Order is at risk.
Imho, the Pulver Order, which I thought was redundant because of the Enhanced Service Provider exemption, is going to be isolated.
Here is a reminder of the background.  Back in the days when data communications was mostly dial up and before the Internet became commercial, companies like IBM ran the communications lines for their customers.  For some bell heads, this meant that the computer operators should be treated as telcos and subject to different rules.  The FCC decided that was not the goal and made the distinction that data networking, which almost always consisted of some storing of data in the network, or some change in the format in the network (have times changed!) was exempt from having to file tariffs, being treated like a telco since it was an enhanced service.
Decades later Jeff tells me he is filing this petition and I tell him he does not need it.
The Code of Federal Regulation [CFR] in 61.38 protects VoIP, but he files anyway.
At VON in describing what has been filed Bob Pepper (who is a PHD) is intrigued at the order and goes back to the FCC.  The petition becomes an order, but it shakes my world.  From my perspective it should be the law of the land already.  From the commissions perspective its not so clear and it wins by 3.5 votes.  (viva la half vote!).

Jeff of course was happy.

Today, the commission is exploring the idea of eliminating the enhanced service provider [ESP] exemption.  What do we care right?  The Pulver Order is in place so things like Skype are safe!
Well, here is the thing, the impact can be very harmful to the rest of the community for a couple reasons.
1) The distinguishing characteristic is being based on numbers (or equivalents).  If you use a phone number to reach someone, the assumption is that a number is connecting to the phone network.  Is that correct? What if the URI does the routing? What happens when you use Internet Technology in a closed network that uses phone numbers as identifiers?
2) If the phone number is being reached via the Internet, or vice versa, will the entire call be subject to regulatory rules.  Right now the way it works, is that the local gateway is consider part of the regulatory regime.  But many of the battles about “phantom traffic” stem from a desire to determine the source and charge rates based on origin.
Do we really want to create an Internet Wheatstone Bridge on the gateways so that end points are quantified?  Skype’s supernodes do not pay any attention to anything other than traffic management and ignore geography.  The impact is that I could be connected to a supernode in Estonia while touching a gateway in my same neighborhood. Should Skype have to track me to charge me differently?
Imho the Pulver Order has lost its legs.  Where before it was table stakes and the service gateways between the PSTN and the Internet were undefined, now they are considered part of the PSTN and only the Pulver Order is left isolated as the only regulatory ambiguous area.
As Jeff would say “addition by subtraction”.

The Week that would have been VON

I am no where near Boston this week.

Its a pity.

Last week, I was in Chicago at the IIT VoIP Conference and Expo and I was very impressed with the level of discussion.

Rick Jones and Henning Schulzrinne were part of the discussion about NG911.

Henry was singing the praise of Web 2.0 VoIP and Peer to Peer.

I advocated for a Presence over Everything.

I will be adding to this recap.

The team at IIT did a great job and I was glad to see the community active in Illinois.  As for Boston…

I hope to be up there in the next few weeks

The Problem with the Embarq Petition

Aswath,

Thank you for looking at what I sent you.  I must apologize for not making things clear.  I will ask you to revisit the Freedom2speak website.

The FCC has several petitions and actions going on simultaneously and it’s easy to lump them all together, but they deal with different aspects of what it means to provide service.

The Embarq petition has nothing to do with VoIP per se, but everything to do with Intercarrier compensation.

As you know the history of telecom was that long distance subsidized the cost of the local loop with termination charges to local terminating carriers.

Before VoIP came along the rates for these settlements were put in place.  They had much more to do with regulatory objectives than real costs, both on the local loop side and on the interoffice, interLATA, International side.

The FCC had done excellent work, at one point, harmonizing the International settlements rates and many local rate plans benefitted as well.  It is one of the key reasons bucket of minute pricing is available on all phones services.

The issue is that traffic rates for local and state termination have stayed stagnant since before the VoIP revolution.  The termination charges with these local tariff rates are out of sync with the market realities today.

Whenever there is an anomaly like this the opportunity exists for arbitrage.  The traffic that is terminating into these local carriers represent more than the volume that VoIP traffic represents and includes traffic from wireless and wireline services.  However, often the traffic origination is not known since it is coming based on clearinghouse and competitive carrier relations and may be deliberately masked for competitive reasons.

The Embarq petition would want all traffic to be terminated at the rates that were set before the advantages of fiber, VoIP and competition came into being. And the rate has no relevance to cost.  In fact, the cost of per minute billing systems is often considered not worth the hassle especially if bucket of minute pricing is applied.

The hope would be that a cohesive nationwide rate would apply based on real costs.  Major carriers are advocating bill and keep and or a nationwide rate that is in keeping with the overall market and their experience of cost recovery.

If the Embarq petition is allowed to stand the implication is that competition may again be reduced by the cost prohibitive nature of compliance with per minute billing being applied to all carriers.

Of course the legacy carriers, have these systems so the status quo will get to stay that way.  The more things change the more you get the same old POTS.

And that is the issue that Freedom2speak is all about.  Like you, Regulators see the services that “quack like a duck” and want to apply the standard rules.  The issue is that the revocation of the enhanced service provider exemption lumps everything that is displayed Freedom2speak.org as telecom.  And given how many jurisdictions are looking for someone to tax, it is going to become burdensome.  This is the point of reaching out.

Please reconsider and add your voice to show that VoIP is more than another duck.