Supercomm Notebook
Regulators attending Supercomm seemed to have 2 things to say about the show floor: (1) It was far more active with new products and ideas than in the past, offering proof that there was an industry turnaround. (2) The new products were cool. FCC Chmn. Martin said he was “struck by how much it has changed from the first time I was here [4 years ago], when it was focused on the back office. Today it feels more like CES.” He said he saw a lot of video deployment and got the indication “this is a very exciting time.” Martin also raved about a Motorola product that enabled seamless transfer between a wireless LAN and cell phone. Comr. Abernathy said during a panel discussion that 4 years ago a lot of investment had pulled back and “people were down.” She said: “Now it’s fun again.” Speaking on the same panel, Cal. PUC Comr. Susan Kennedy said she got a “sense of maturity” viewing IP products on the show floor. There are now high-tech products that “are on the verge of being really useful in my house,” she said.
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The “real problem” for video services providers is proliferation of varying digital rights management (DRM) systems, said Movielink CTO David Beddow, ex-Liberty Media. He said firms like his must maintain files of each video product in each DRM format, significantly boosting cost and complexity, and then sort out payments. “There are ways to make these systems interoperable and compatible,” he said, “but in a free enterprise system it takes a lot of time.” News Corp. still is concerned about the analog hole, which lets even DRM-protected digital content be copied in analog, said Rick Lane, the firm’s vp-govt. affairs. He said News Corp. takes DRM interoperability “very seriously,” but agreed achieving it will take a long time. News Corp. doesn’t want to overturn Betamax, Lane said, but Grokster allows “a whole business case based on theft.” He also said fair use, as the CE industry and others envision it, is like buying and installing locks and then giving everyone the key.
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BellSouth methodically is transforming itself into a broadband IP services company by following a 3-part formula, CEO Duane Ackerman told a Supercomm audience Wed.: “Listening to technology, listening to customers and listening to shareholders.” Ackerman said BellSouth’s philosophy is “winning is not only about getting bigger; it’s about being the best.” He said technology has told the company to use more fiber, “deeper into the network,” while customers say “give us easy to use integrated solutions.” Simple solutions often are the hardest to provide, he said, but “we must all focus on easy-to-use applications if we are going to scale this customer market.” Striving for integrated solutions for customers is leading to a trend toward “innovative alliances,” he said. As for listening to shareholders, “they help us stay disciplined,” he said. Shareholders “don’t care for wishes [or] hype.”
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FCC’s deadline to make VoIP services E-911 capable will be difficult to meet in less-populous areas, and Vonage may seek an FCC waiver of the deadline because it can’t get done in all areas on time, Vonage CEO Jeffrey Citron said in an interview Tues. at the Supercomm show here. The FCC last month said VoIP providers must support E-911 within 120 days after the agency’s order becomes effective. The period won’t begin until 30 days after the order is published in the Federal Register. The timing is a challenge - “It’s hard and it’s expensive,” Citron said. VoIP providers will have to negotiate separate contracts with 6,000 public service answering points (PSAPs), arrange with Bell companies for needed facilities and get phone numbers needed to devise emergency calling systems. Pseudo ANIs (automatic number identifications) and Pseudo ALIs (automatic location identifications) must be loaded into selective routers and databases, he said: “That’s a challenge; you have to put in the right codes.” In addition, “what do you do in markets where you have a handful of customers,” such as rural areas? Citron asked: “Does the Commission give waivers where it’s economically and technically not feasible yet [to provide full E-911] or do you not serve those markets and cut off rural America?” The Commission hasn’t shared its views on such problems so Vonage and other providers may have to raise them, he said. “I don’t know anyone who can get their whole network online in 120 days,” Citron said. “I know we won’t; it’s not possible.” The FCC needs to provide guidance, he said. Nonetheless, the FCC edict is positive for Vonage because it eliminates “a competitive disadvantage,” he said. The company has been trying nearly 2 years to gain access to local incumbents’ facilities to provide such capability and the FCC order clears the way, he said. While another approach would be through CLECs, even the biggest, Level 3, doesn’t cover more than 60% of the country, he said. Asked if Vonage lost customers after publicity about harm to customers who couldn’t reach 911 dispatchers, Citron said he wasn’t sure. He said he thought much of the discussion was positive “because it raised awareness.” - EH