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Can Big Broadband Inspire Innovation?

10:00 AM -- ASPEN, Colo. -- TPI Aspen Forum -- If you bring gigabit-per-second connectivity to a community, will the residents drink from the pipe? Will they pay for the privilege?

The question of how best to facilitate the development of superfast networks -- usually defined by their ability to support download speeds of 1 Gbit/s or more -- raised a small bit of friction during Tuesday’s panel session at the Technology Policy Institute’s Aspen Forum. The issue at hand was: should we simply build gigabit networks in prime locations and see what happens, or should we wait until consumer demand asks for -- and is willing to pay for -- a fatter pipe?

On one side of the tussle was Blair Levin, who sandwiched a telecom analyst career between stints at the Federal Communications Commission (FCC) as chief of staff for Chairman Reed Hundt and more recently as staff director of the National Broadband Plan. Now a fellow at the Aspen Institute, Levin is also executive director of an entity called Gig.U , a coalition of 29 U.S. universities who want to bring high-speed networks to their campuses and surrounding communities, as a testing ground and incubator for applications and future businesses.

Gig.U is meeting with service providers, businesses, nonprofits and any other interested parties to flesh out plans to:

  • Get some private investment to build out the high-speed networks in college towns, where much of the necessary underlying infrastructure probably exists
  • Bring the high-speed connectivity to dorms, houses and businesses in the surrounding community
  • See what kind of entrepreneurship emerges


“Let’s bet on the ingenuity of Americans," Levin said.

Since Gig.U doesn’t yet have any idea on how the service might be priced, it’s hard to say if the idea is at all attractive. Fellow panelist Kathy Brown, Verizon Communications Inc. (NYSE: VZ)’s senior vice president for public policy, said even where high-speed access is available, customers today aren’t buying the super-fast connectivity.

“We put FiOS [Verizon’s fiber to the home network] in areas where there are big universities, and we invested in the networks to offer speeds of 100 Mbit/s or more -- but nobody’s buying,” Brown said. (Verizon is advertising a FiOS package that delivers 150 Mbit/s download and 35 Mbit/s upload for $199.99 a month.) “Our customers are mostly content with [download speeds] of five or 10 megabits per second,” Brown said. “What are the applications [for a gigabit network]?”

Levin says innovation is a chicken-and-egg problem, and that Gig.U doesn’t really have a business plan per se. But he also thinks that there needs to be an ongoing pursuit of different methods of building faster networks, rather than simply waiting for existing service providers to build them, or relying on projects like Google (Nasdaq: GOOG)’s fiber-to-the-home network experiment under development in Kansas City. (See Google's 1-Gig Fiber Winner: Kansas City, KS.)

“There’s not a business model yet for gigabit connectivity, but there are already places where doctors are using gigabit [networks] to do things like look at MRIs in real time,” Levin said. “I’d just like to see it [fast networks] in more places than just Kansas City for people to play around with it.”

— Paul Kapustka is the founder and editor of Sidecut Reports, a Wireless analysis site and research service. He can be reached at [email protected]. Special to Light Reading.

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JasonS 12/5/2012 | 4:55:28 PM
re: Can Big Broadband Inspire Innovation?

If you are interested in this article, you may also be interested in the Think Big Partners Gigabit Challenge business plan competition.  In anticipation of the launch of Google's ultra high-speed broadband network in the Kansas City area, the business plan competition will be open to entrepreneurs and innovators from across the globe. 


www.gigabitchallenge.com

CJSettles 12/5/2012 | 4:55:26 PM
re: Can Big Broadband Inspire Innovation?

Those industry folks who say there's no demand are the same type of short-sightred people who thought in the 90's that a 5 Meg hard drive was all any of us would ever need. Check out this interview with Blair Levin on the Gigabit Nation radio talk show - http://bit.ly/ogSg00. We discuss the purpose and the potential that drives this initiaitive.

DCITDave 12/5/2012 | 4:55:26 PM
re: Can Big Broadband Inspire Innovation?

I don't think the industry folks are short-sighted. They're shareholder-bound. The ONLY companies that have the resources to build these networks are also the ones that get hammered when they don't deliver billions in profits year over year.


So they take shortcuts and don't invest in potentially rewarding projects like Gig.U.


 


 

<div style="font-size: 10px; text-align: center; width: 220px;">Listen to internet radio with cjspeaks on Blog Talk Radio</div>

Also, I'll try to embed your podcast. Not sure if it'll work on our boards.

DCITDave 12/5/2012 | 4:55:26 PM
re: Can Big Broadband Inspire Innovation?

Thanks for the link. Will &nbsp;you let us know some &nbsp;of the more interesting pitches you get? I'll be there are some good stories in there.

paolo.franzoi 12/5/2012 | 4:55:25 PM
re: Can Big Broadband Inspire Innovation?

http://www.wired.com/epicenter...


&nbsp;


Seems like adding bandwidth to residences is exactly the same as building stadiums to me.


seven


&nbsp;

rjmcmahon 12/5/2012 | 4:55:25 PM
re: Can Big Broadband Inspire Innovation?

I really see this as a public infrastructure problem.&nbsp; The solution, or lack there of, also falls in the pervue of local governments.&nbsp; The U.S. has spent the last few decades building many, many sports stadiums, some in the neighborhood of $1B, all with the promise of creating new jobs.&nbsp; I have a peer from college earning nearly $1M to coach a modest sized football program at a State Univeristy in the south where the per capita median wage is $15K.&nbsp; It's really sad that our society can't tell the difference between long term infrastructure investments and overpriced entertaimnet as well as why those investments will be beneficial to us and to future generations.

rjmcmahon 12/5/2012 | 4:55:24 PM
re: Can Big Broadband Inspire Innovation?

I'd agree if it were only adding bandwidth by incumbents.&nbsp; (It's kinda like paying the football coach $2M to improve the education level of the community and state around him giving him the bloated salary.)&nbsp; I'd measure success based upon things like the availabilty of new applications, connectivity, carrier neutral colos, etc.&nbsp; So it needs to be built for more than one dimension.

kaps 12/5/2012 | 4:55:16 PM
re: Can Big Broadband Inspire Innovation?

Like Phil said, it's hard to blame Verizon for not building FiOS to the world if Wall St. is going to hammer the stock for doing so. What makes me wonder is why Verizon execs seem to think that the current levels of bandwidth use are going to stay stable -- you hear the same thing on the wireless side, where Lowell McAdam said on the last quarterly call that most of their users are fine with 2 GB per month.


I would wager that most of us here expect user demands to continue to soar... so why wouldn't Verizon execs at least start warming Wall St. to the idea that more buildouts are going to be necessary? To at least convince some of them to see the light?


Or should we have another AT&amp;T iPhone meltdown? Seems strange to predict that fast networking won't sell. Maybe it's because Verizon is charging too much.

kaps 12/5/2012 | 4:55:16 PM
re: Can Big Broadband Inspire Innovation?

Like Phil said, it's hard to blame Verizon for not building FiOS to the world if Wall St. is going to hammer the stock for doing so. What makes me wonder is why Verizon execs seem to think that the current levels of bandwidth use are going to stay stable -- you hear the same thing on the wireless side, where Lowell McAdam said on the last quarterly call that most of their users are fine with 2 GB per month.


I would wager that most of us here expect user demands to continue to soar... so why wouldn't Verizon execs at least start warming Wall St. to the idea that more buildouts are going to be necessary? To at least convince some of them to see the light?


Or should we have another AT&amp;T iPhone meltdown? Seems strange to predict that fast networking won't sell. Maybe it's because Verizon is charging too much.

Scott Raynovich 12/5/2012 | 4:55:15 PM
re: Can Big Broadband Inspire Innovation?

Hey, don't economics matter?


I mean if FioS costs $2,000 per house to install and they only get back a few bucks per month is it worth it?


What people don't realize is that telcos have been doing this for years and years accumulating debt for infrastructure that is becoming increasingly difficult to monetize. And the technology is accelerating.


Here's a question I often have: You business was originally built on a copper plant that lasted 75 years. But then you start building technology that can be obsolete in five years. Tough game!


&nbsp;

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