Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : The *NEW* Frank Coluccio Technology Forum -- Ignore unavailable to you. Want to Upgrade?

To: Frank A. Coluccio who wrote (7211)	5/18/2004 11:06:03 AM
From: ftth	Read Replies (1) \| Respond to of 46821

Hi Frank, it is true that in the US the FTTH deployments only offer data bandwidth that is marginally better than DSL and cable, at about the same price points. Even in the best case, when you look at speed tests for zip codes within the Grant County FTTH network, 20-30Mbps seems to be the max attainable performance: dslreports.com But many other ISP's on the Grant County network are only offering low megabit broadband. In the US, triple play is the misguided obsession, and FTTH bandwidth is targeted at supporting me-too TV video, in competition with satellite, and often also with the local cable co. In the rest of the world, triple play has less emphasis. For example many of the high bandwidth data offerings in Korea and Japan are data-only. TV is via a different network and provider. The industry structures and levels of vertical integration are different too. There were some 2003 documents from the ITU that did country studies on Japan and Korea that discussed this. But in the US--where the controlling interests (i.e. cable MSOs and RBOCs) don't want to be open bit pipes, and own the physical bottleneck resources to assure that outcome--we will continue to get a network that almost exclusively is dedicated to walled garden entertainment services. They own the store and they control what products get put on the shelf. Even with a laundry list of E-Learning, E-Government, E-commerce, E-Work, and E-health application flavors that require >10Mbps to be usable, those controlling interests will continue to discount the value of providing these since they do not have core competency in these areas, and therefore would just serve as a bit pipe if they were to promote and encourage them. Transporting those applications over their networks would just consume their precious bandwidth that they want to allocate to more entertainment services which they serve as middleman and gatekeeper for. As well, just providing the option for people to consume the new applications means that less of people's discretionary time and money would go towards their walled-garden entertainment offerings. So it's a double-whammy: they'd have to add more capacity (i.e. CapEx expense) to support the new apps, and the payback would be that they would have less revenue (fewer subscribers to their current walled garden entertainment, and less viewing time, which in turn reduces their value to advertisers). So it's pretty clear the US is on a guaranteed path to be a broadband laggard. The entrenched legacy industry structure virtually assures it (and all the data to-date reinforces this). The controlling interests see a financial disincentive in doing what other parts of the world are doing. The only way to fix this is to break the vertical ties between content and connectivity. That tie is the root-cause of the disincentive, as well as the mechanism to hold it in place. The (perceived) result from such a break scares the daylights out of telcos, and especially the cable MSO's. They are highly outspoken against such a break. They can provide the financial "proof" that it would destroy them, but that "proof" is heavily slanted with their own predictions and expectations of doom if that path is taken. Yet, if the US doesn't take that path we are doomed in comparison to other countries. "What to do" is, literally, the trillion dollar question. Is broadband an unfettered capability with broad economic growth as its central goal, or is broadband just a distribution channel for entertainment-centric businesses? The current thinking on the part of those carrying the big sticks is that it's the latter. They will claim it's the former too, but it is not possible to get both under the current incentive structure of the industry. It's just not possible.

To: Frank A. Coluccio who wrote (7211)	5/19/2004 12:22:22 AM
From: Peter Ecclesine	Respond to of 46821

Hi Frank, Some business case for 100 Mbps of Internet at $40 a month: Prediction of Communications Crisis Prompts Japan's Telecom Ministry to Take Action neasia.nikkeibp.com February 23, 2004 (TOKYO) -- Japan's Ministry of Public Management, Home Affairs, Posts and Telecommunications (MPHPT) is taking the initiative to establish a study group in order to circumvent a potential communications crisis that could occur in Japan due to a sharp increase in data communications traffic. Predicting that the spread of broadband communications may cause capacity shortages in existing communications infrastructures as soon as five years from now, and strong possibilities of triggering interruptions, the MPHPT plans to launch countermeasures aimed at reinforcing the communications infrastructure. The study group expects to release a midterm report this summer. According to the report, data communications traffic across the country has been expanded nearly 1,000 times as large as that observed in the last 10 years. If it continues to increase at this pace, the domestic data communications traffic should reach as much as 1,024 times the current volume in the next 10 years. With the current facilities as they are, a simple calculation shows that actual communications traffic will exceed the backbone's maximum capacity as soon as five years from now. That is not the only problem. Capacity limits of devices -- routers and switches that constitute communications networks -- are coming within sight. In order to handle huge communications traffic without any delay, large-capacity routers of more than 10Tbps are required. To deal with growing data communications traffic, it is imperative to reinvest in the communications infrastructure, such as an expansion of relay-network capacities by adding new optical fibers and communications equipment.