Google and the opening of the cellular network

We discuss the open architecture of the Internet, a "dumb" network, that connects smart devices. Users, not the network operators, decide what hardware to use and which applications to develop. As such, we see rapid innovation and massive investment. We have contrasted this with the cellular telephone network in which the network operators control the hardware and applications that are developed.

The cellular network is beginning to open. New spectrum is being auctioned off and Google is lobbying the to open the cellular network. They are dominant in desktop Internet services and advertising, and would like to exploit an open cellular network to dominate mobile Internet services and advertising.

During the last month, the New York times has published four articles on the opening of the cell network and Google's role in it.

• I, Robot: The Man Behind the Google Phone
• Google Enters the Wireless World
• Cellphone Straitjacket Is Inspiring a Rebellion
• Google Says It Will Bid for Wireless Spectrum

Individuals, organizations and the economy would benefit from an open cellular network, but do you worry that Google, if successful, may become too powerful?

4G cellular is expected to roll out faster than 3G did

We have discussed three generations of cellular technology, and the fourth is beginning to take shape.



It took nearly six years for 3G cellular to reach 100 million subscribers world wide, but market research firm Pyramid Research estimates that 4G Long Term Evolution (LTE) technology will grow faster. They expect a compound annual growth rate of 404% from 2010 to 2014, with 136 million subscribers by year-end 2014.

Note that Pyramid Research expects LTE to rapidly surpass mobile WiMAX.

At 100 Mbps, LTE will not be limited to cell phone service, but will be used for fixed, portable and mobile Internet access.

If you live in a large city in a developed nation, you might look forward to LTE or Mobile WiMAX by 2011. Others will have to wait. (Some for a very long time).

Is 3G cellular currently available throughout the city you live in? Throughout developing nations? What applications and mobile devices do you foresee for 100 Mbps mobile connectivity? What changes may occur in the cellular companies business and billing models?

Ting is looking better -- will allow customers to bring Sprint phones

In a previous post, we described Ting.com, an MVNO (mobile virtual network operator), that resells access to the Sprint cellular network at dramatically reduced prices with no contract. My one complaint was that you could not bring your own phone to Ting. You had to buy a new phone from them, and they offered a limited selection.

Well, that restriction is starting to fade away. Ting announced that during the next quarter, they will begin allowing customers to use their own Sprint phones. That means the selection of new phones will increase dramatically and old Sprint phones will be welcome as well. They point out that, "at first", there will be restrictions -- the iPhone, BlackBerry push to talk and a small list of specific handsets won’t be included.

If you check Ting's prices, you will find significant savings over the major cellular companies. Now that you can bring your old Sprint phone or choose from a wide selection of new phones, Ting (and other MVNOs) seems like a terrific deal for those in areas with good Sprint coverage. The deal is even sweeter if you live in an area which is or will soon be covered by Sprint LTE.

I don’t know how Ting does it. Perhaps Sprint’s wholesale price is very low or perhaps Ting is less greedy and more efficient than the major carriers. Somehow, it offers a better retail deal than Sprint or any of the others. Maybe it is just that it charges more rationally than its competitors. Since 2009, U.S. data traffic has exceeded voice traffic and the gap is growing rapidly, but the cell phone companies still gain most of their revenue from voice.

The cellular and cable companies seem to have arrived at a "gentleman's agreement" to reduce what little is left of Internet service competition. The cellular companies are getting out of the land line business and the cable companies are getting out of the mobile business.

Will the MVNO's like Ting succeed in disrupting the mobile market?

Combination Wifi-cellular phone and service

T-Mobile announced a combination Wifi-cellular phone and service. You make and receive calls using Wifi when at home or at T-Mobile public hotspots. When you are out of range of a Wifi radio, the phone automatically switches to the cellular network. If you leave home while on the phone, the transfer is automatic and the call is not interrupted. T-Mobile has Wifi hotspots in Starbucks coffee shops, Hyatt hotels and other locations.

They are calling this "the only phone you need" because it will work well inside your home where cellular reception may be poor and outside. Calls are unlimited and the cost is fixed.

If you use your telephone for applications other then telephone calls, it may not be the "the only portable device" you need -- they are selling telephone service, not open Internet connectivity.

Would you consider this service yourself? (Check the prices before answering). What do you use your telephone for beside phone calls? What might you use it for in the future? How did you like the T-Mobile web site?

The New York Times covered the announcement in this article.

Will open WiMax disrupt the closed cellular networks?

As we have seen, WiFi and 3rd generation cellular networks are the primary options for mobile and portable connectivity today. But, WiFi covers only limited areas (though there are millions of them), and cell networks are closed to innovation and focused on a business model of selling voice and other expensive services rather than pure Internet connectivity.

One day, Google and others may force the cellular networks to open up, but it will be a struggle. Another possibility is that a new standard, WiMax, will provide viable wireless Internet access.

We have spoken of WiMax earlier, and the WiMax leader at this time seems to be Clearwire Communication led by industry veteran Craig McCaw. You can read of McCaw, Clearwire, and their possibly foundering negotiations to combine WiMax networks with Sprint in this Wall Street Journal article.

If WiMax sounds promising, you can follow standards and industry progress in blogs written by Glenn Fleishman and Steve Stroh both of whom know a lot about wireless technology and business. Fleishman has just written a positive review of Clearwire's test deployment of pre-standard mobile WiMax in its home city of Seattle.

Do you plan to subscribe to either Stroh's or Fleishman's blog? What industry blogs do you subscribe to?

Senator Kohl questions cellular competition

We discuss the competitive nature of the US cell phone and ISP markets. Generally speaking, ISPs and cell phone companies oppose regulation, arguing in favor of private enterprise and competition. Is there competition in these markets? Let's look at text messaging.

In 2005, each US cell phone company charged 10 cents to send or receive a text message. No doubt they had different cost structures and strategies -- you might have expected one of them to cut their price to try to win new customers. Well they did change their prices -- today they are all charging 20 cents.

Do you find that surprising in this competitive marketplace? Do you suppose their costs rose during those years? Its only fair that they cover their costs, right?

Text messages are transmitted in 140 byte (1,120 bit) packets -- 1,120 bits delivered for 20 cents. How much would it cost to deliver a recorded song at that rate?

Let's be conservative and assume the typical song is 2 minutes long. If it were encoded at 256k bits per second, the rate Apple iTunes uses for premium recordings, that would be roughly 30,720,000 bits -- the equivalent of 27,429 text messages. If a music vendor like Apple charged the same rate per bit as a text message vendor, a song would cost around $5,486 to transmit, yet Apple manages to sell and deliver songs, and make a profit at $1.29 per song.

US Senator Herb Kohl (D-WI), chairman of the Senate Antitrust Subcommittee, recently asked the presidents and chief executive officers of the four largest wireless telephone companies to justify their text message rates. In a letter, Senator Kohl requested an explanation from Verizon Wireless, AT&T, Sprint and T-Mobile, which collectively serve more than 90 percent of the nation's cellular phone users.

Do you think the cellular market is competitive? The Internet access market? What do you think Senator Kohl is planning to do?

-----
Update 3/13/2015

WhatsApp reports that it now has 700 million monthly active users sending 30 billion messages a day. For comparison, the global SMS system sees about 20 billion messages a day.

Here is the decline of SMS in several nations:

Senator Kohl's call for action went nowhere, but he needn't have worried -- no monopoly lasts forever.

Can Google open the celllular network?

As we have seen, the cellular network is closed. On the Internet, anyone can deploy an application, but most cellular operators control applications. This problem was highlighted by John O’Rourke, general manager of Microsoft’s Windows Mobile business, who pointed out that it had taken Microsoft more than half a decade to get to its current level -- doing business with 160 mobile operators in 55 countries. Even Microsoft has to negotiate with mobile operators one at a time.

Mr. O'Rourke was quoted in a New York Times article on Google's plan to provide open-source telephone software and application development tools. They have formed a coalition to develop and promote this software. The coalition, called The Open Handset Alliance, includes a number of large telephone manufacturers and network operators, but others, like Apple, Verizon and AT&T are noticeably missing.

Columnist Robert Cringely predicts that Google will go further and become a cellular operator by bidding in the FCC auction of 700 MHz spectrum which will be freed up by the switch to digital television broadcast. If that happens, he expects them to offer free, ad-supported cell phone service.

Given the Apple iPhone and Google's plans, what do you expect your cell phone and service to be like in five years?

Petition to open the cellular networks

In a recent post, we noted that Apple had succeeded in negotiating some control over application and hardware design from Cingular wireless. Now Skype has petitioned the FCC to open cellular networks. If they prevail, we could see a wireless end-to-end network, with Internet like innovation. Wouldn't that be cool?

My guess is that the cellular companies will fight this vigorously, but that might be short sighted. If they provided competitively priced Internet access, they would take the wind out of the municipal network and hotspot movements. More important, an open wireless network would be an important piece of infrastructure, providing a much needed boost to the US economy and our sagging Internet.

There will be powerful companies on both sides of this important issue -- make your voice heard by signing an FCC petition.

The Skype petition is not yet posted on the FCC Web site, but we will update this post with a link when it is.

Video of a Google Android cell phone prototype

We have seen that a dumb, open network encourages investment and hardware and software innovation. We have contrasted this with the telephone and cellular networks, where application and hardware innovation are controlled by the network operators. We've also followed Google's efforts to open the cellular network by possibly purchasing spectrum and by developing and distributing Android, an open source mobile phone operating system bundled with Google applications like maps and mail.

Google has released some videos demonstrating prototypes of Android phones. For example, the following video shows a touchscreen phone reminiscent of the Apple iPhone.



(You can find other Android-related videos at the Android Web site linked to above or by searching on Youtube).

The most important feature shown in the video is not clever hardware or software -- Apple already did that with the iPhone -- but the open platform. The video begins and ends with Google co-founder Sergey Brin inviting developers to build Android applications. Based on his Internet experience, he feels that openness will be critical to the success of Android, and has kicked things off with a ten million dollar contest for application developers.

If he is right, third party applications will spur Android sales, and each Android phone sale will spread Google applications -- and ads. Not satisfied with being on your desktop, Google also wants to be in your pocket.

After viewing the prototype video, can you think of applications you would like to have on your next cell phone? Would you be willing to watch targeted advertisements in return for free cell phone service?

President Obama selects Tom Wheeler as FCC chairman

The President has selected Tom Wheeler, former lobbyist for both the cellular and cable industries and a major contributor to the Obama campaign to head the FCC, and AT&T and Comcast are both lauding the appointment.

That smacks cronyism -- the revolving door between industry to government.

I signed a petition to name Susan Crawford next head of the FCC, but will keep an open mind.  Wheeler may have been a lobbyist for the cable and cellular industries, but he was also an Invited Expert by the The President's Council of Advisers on Science and Technology (PCAST), which issued a report calling for the use of smart radios in sharing federal spectrum. He presumably endorses (or at least understands) the report of the PCAST Spectrum group.

His October 2011 blog post Updating Spectrum Policy provides further evidence that he "gets" IP and unlicensed spectrum. Here are a couple of quotes from that post:

"Exhibit A for 21st century spectrum planning is WiFi. Operating in unlicensed spectrum, WiFi is a cacophony of competing claims for use of the spectrum. The characteristics of Internet Protocol (IP) packets allow WiFi in a Starbucks hotspot, for instance, to operate more efficiently that the licensed spectrum on the sidewalk outside."

and

"It is time to abandon the concept of perfection in spectrum allocation. The rules for 21st century spectrum allocation need to evolve from the avoidance of interference to interference tolerance. We’ve seen this evolution in the wired network; it’s now time to bring the chaotic efficiency of Internet Protocol to wireless spectrum policy."

Don't forget that fiercely anti-Communist Richard Nixon, opened US relations with China. Perhaps Dark Side lobbyist Tom Wheeler will modernize wireless IP communication.

-----
Update 11/11/2016

This post has turned out to be true -- Tom Wheeler has acted against the wishes of his old industry friends. He turned out to be something of a sheep in wolf's clothing. There is speculation that Donald Trump will reverse Wheeler's stance on network neutrality and I will be pleasantly surprised if his FCC appointees pursue his proposal for a standard TV-interface box that combines the functions of today's set-top boxes and Internet interfaces.

Portable devices -- innovation and form factors

In discussing mobile and portable connectivity, we talked about competing device form factors and innovation. We have also discussed new devices which may influence future form factors and user interfaces: the One Laptop Per Child Foundation (OLPC) laptop, the Apple iPhone, and, most recently, Amazon's Kindle.

Each has hardware and user interface innovations that may become standard fare on future portable devices. For example, the Kindle and OLPC laptop have low power displays that are legible in daylight, and the iPhone has an elegant touch screen interface and can be programmed to automatically switch between displaying documents in landscape or portrait mode if it is rotated. The OLPC laptop automatically forms a mesh network with nearby machines; the Kindle is directly connected to Amazon via Sprint's cellular network; and the iPhone can move between WiFi and AT&T's cellular network. The list goes on.

They each deliver different functions. The Kindle is a book reader, period. The iPhone a phone, Internet browser, email client, camera, etc., and it is now open to third party developers. The OLPC laptop is a PC running Linux. It comes preloaded with applications and there are tools for what I hope will become a vibrant developer community. It was conceived of as a computer for school children in developing nations, but in many ways it is more attractive than a "serious" compact laptop like a Sony Vaio for a business traveler.

Each is physically different:

	iPhone	Kindle	OLPC
Height (in)	4.5	7.5	9.5
Width (in)	2.4	5.3	9
Depth (in)	.46	.7	1.25
Weight (oz)	4.8	10.3	51
Pixels/inch	183	167	200
Resolution	420x320	600x800	1200x900
Screen diag (in)	3.5	6	7.5

The iPhone is a smart phone with a bright and large enough screen to browse the Web and read email fairly comfortably. The Kindle is designed for easy reading, and the OLPC laptop's high resolution display may be even better.

Which form factor do you favor? Are you willing to carry around a 3 pound OLPC laptop? Is the iPhone screen large enough for your portable applications? Would you rather carry a Kindle or a paperback book and a magazine when you board a plane?

Virgin Mobile gets the iPhone -- is the wireless oligopoly starting to fade?

AT&T has articulated its vision of a concentrated wireless market with few carriers that control a lot of spectrum. They foresee a gradual, controlled shift from voice minutes to all-data during the next few years, and hope to charge enough for that data to maintain carrier revenue and profit.

But one of those carriers, Sprint, seems to be doing something radical -- competing.

Sprint is competing by partnering with mobile virtual network operators (MVNOs) that sell access to the Sprint network. Users have to buy their phones up front, without subsidy, but they get flexible, cheap voice and data plans in return. The MVNO gets less revenue per user than AT&T or Verizon charge, but I assmue they and Sprint are profiting or they would not do it.

The net result is that wireless is cheaper and customer bills more accurately reflect the fact that voice calls, text messages and data are all bits.

Since the user pays full price for a phone, the MVNOs do not require two year contracts, but they lock you in by insisting that you buy your phone from them -- you cannot bring your own. Phone portability should improve with market pressure and the widespread adoption of fourth generation cellular technology.

MVNO phone selection is limited, but that may be breaking down. Sprint recently picked up the iPhone and today they announced that Virgin Mobile, one of their MVNOs, would also get the iPhone. I suspect that eventually Sprint MVNOs will offer all Sprint phones.

Virgin is not Sprint's only MVNO. One, Ting, has effectively done away with the concept of tiered service -- you pay for what you use. Virgin and Ting are early, but there will be others. One that is in beta, Republic Wireless, hopes to charge even less by automatically substituting WiFi for cellular connectivity whenever possible.

AT&T has their ideal vision of the future, and I have mine -- the ability to own my own phone, use it on anyone's network and only pay for the bits I send and receive.

Truephone -- mobile Skype (almost)

We have seen that cellular network operators control applications and devices in order to preserve their business model, which centers on selling service like SMS messages and phone call minutes rather than unfettered Internet access.

But, newer phones with both Wi-Fi and cellular radios can run VoIP software when using their Wi-Fi connections to the Internet.

Consider, for example, Truephone.com. Truephone software runs over Wi-Fi connections on the Apple iPhone, iPod Touch and other phones. As with Skype, calls to other Truephone users are free, but they charge for calls to landline and mobile phones. Truephone's rates are much higher than Skype's. For example, the per minute rate from the US to a Chilean mobile phone is $.70 on a Truephone while Skype is only $.243. The difference for landlines calls is much greater -- $.68 versus $.024.

Regardless of their rates, Truephone illustrates two points we have discussed: innovation occurs rapidly on "dumb" end-to-end networks and the Internet is a highly leveraged platform on which to develop businesses.

Truephone CEO Geraldine Wilson recognizes these points in the following quotes from a BBC article:

"There are a slew of new features we're rolling out for the iPod Touch that will let users call landlines, Skype users or send instant messages. We're talking weeks, not months, before these go live."

and

"We've decided to focus on devices that are wi-fi enabled and have an apps-store. For the consumer, there has to be an easy way of downloading an application."

They are innovating rapidly and will "outsource" distribution and sales to the Apple and Google Android stores.

Do you currently use your cell phone as an Internet access device? Would the ability to make Truephone calls convince you to do so?

Tim Wu on wireless network neutrality

Skype recently petitioned the FCC to open access to cellular networks in the United States. That petition was based on a study by Tim Wu, a law professor at Columbia University. Our class notes cover the Carterfone case which opened the wired telephone network, making the end-to-end Internet possible. Wu feels that a neutral-access cellular network would enable Internet-like innovation and competition on wireless networks.

You can read Wu's paper and see the Skype petition at the New America Foundation. Wu was also interviewed on wireless network neutrality by National Public Radio's On The Media. You can hear the interview (with a rebuttal by an industry representative) or read a transcript at the On The Media Website.

LTE version 1.0. TeleSonora begins 4G cellular service in Scandinavia using Chinese equipment

We cover cellular networks and generations in discussing mobile and portable connectivity.

Today might be considered the first day of the fourth generation -- TeleSonera began offering commercial LTE (Long Term Evolution) service in central Stockholm and Oslo. This is LTE 1.0. It is not built into phones; it is not offered outside of Oslo and Stockholm; there is no competition; it does not fall back to 3G or WiFi; there are no tethering applications for creating portable WiFi hot spots, but it is here.

The service delivers download speeds in the 20-80 Mbps range and will cost 599 Swedish Kronor ($85) per month. There will be no data cap while the service ramps up, but after July 1 2010, they will impose a 30 GB-per-month cap. It also requires a Samsung plug in modem. The current version of the modem is LTE only, but they will soon have one that can fall back to the 3G network where LTE is unavailable.

When TeleSonera began testing in Oslo last June, they said rollout would begin in 2010, but demand for high speed mobile connectivity convinced them to push the start date up.

The equipment is manufactured by Huawei, a Chinese company. You may think of China as a manufacturer of cheap toys and other consumer goods, but they are becoming world leaders in high tech areas like telecommunication. Huawei European equipment sales were $3 billion in 2008, compared to just $160 million in 2003. Forty of the world's fifty largest telephone companies are now Huawei customers and 75% of their 2008 sales were outside of China. Globally, Huawei is the second largest mobile connectivity manufacturer.

Check this short video tour of the Stockholm base station, which has both 3G and the new LTE 4G equipment.

Verizon's FIOS Internet connectivity is $70 per month for up to 25 mbps download and 15 mbps upload. Would you rather have that or TeleSonera portable service in Stockholm?

What new applications and devices might this service enable?

Will low-Earth orbit satellite Internet service providers succeed?

Teledesic animation: a satellite
constellation that would cover
the planet -- routers in space.

In 1990, Teledesic was formed to deliver satellite-based Internet service. Cellular pioneer Craig McCaw, Microsoft co-founder Bill Gates and Saudi Prince Alwaleed bin Talal were early investors and Boeing was both an investor and the prime contractor. Teledesic hoped to offer global Internet connectivity using a constellation of 840 satellites in low-Earth orbit (LEO) at an altitude of 700 km. (The plan was scaled back to 288 satellites in 1997).

Teledesic failed.

Twenty seven years later three companies SpaceX, OneWeb, Boeing and Leosat are trying to do what Teledesic could not do. Will they succeed?

Good news -- a lot has changed since Teledesic tried and failed.

Launches have gotten cheaper -- SpaceX has made landing a 549,054 kg rocket that is 70 feet long and only 3.66 meters in diameter and has reached an altitude of 247 km and fallen at a speed of up to Mach 7.9 within .7 m of the target on a drone barge at sea almost routine. They have had 18 successful soft landings and their next-generation rocket, the BFR is designed for reusability and will be able to launch many satellites per flight.

Satellites are now cheaper, smaller and lighter. OneWeb and their manufacturing partner Airbus say automation and re-design will enable them to manufacture three satellites per day at a cost of less than $1 million each and launch cost per satellite will be low since they are small and light. In a talk at the opening of the SpaceX satellite engineering office in 2015, CEO and Lead Designer Elon Musk expressed confidence that they would be able to mass produce satellites and also pointed out that the failure of one or a few satellites in a constellation of thousands was relatively unimportant. If a satellite fails, the remaining satellites will route around it and increased tolerance of failure reduces manufacturing cost.

Consumer ground-stations will also be small, cheap and easy to install "pizza boxes." Since the signals will be weak, the antennae will have to be outside, but end users will be able to install them because, unlike today's TV and Internet dishes, they will not have to be aimed precisely at a single, geostationary satellite. Modern phase-shift array antennae will follow a satellite as it moves and switch to another in microseconds or a few milliseconds when it goes out of site. Similarly, satellites will be able to transmit a beam that is fixed on one area on the ground as it moves over it.

Communication technology has improved dramatically. Today's radios are smart -- rapidly changing power, frequency, modulation scheme, etc. under program control. Teledesic belonged to an era of dedicated spectrum allocation, but smart radios are ushering in an era of unlicensed spectrum and spectrum sharing. This is a fundamental shift -- like the introduction of packet switching -- and it will lead to efficient use of spectrum (on Earth and in space).

The terrestrial fiber network has grown exponentially since the time of Teledesic. making Internet gateways attractive targets. Satellites may compete favorably with long undersea and terrestrial cables. Elon Musk says SpaceX satellites will communicate optically among themselves, forming a low-latency, highly interconnected mesh that will carry the majority of our long-distance traffic. Google, a billion dollar SpaceX investor, might be their first long-haul customer.

The market for Internet connectivity is larger today than it was at the time of Teledesic because more people are aware of the Internet and many are trained to use it with mobile devices. Furthermore, applications are varied and powerful today. The Teledesic project was during the Web 1.0 era when the Web consisted of static sites with text and small, compressed images. Today, the U. S. Federal Communication Commission (FCC) defines "broadband" as at least 25 Mbps download speed and some fortunate people have gigabit connections in their homes. The low latency of LEO satellites is well suited to interactive applications that require error checking.

While increasing numbers of people are online with mobile devices, the digital divide has widened. A slow connection using a phone is not the same as a fast connection that can support modern applications on a computer. I can consume content, make purchases and chat with friends using a mobile phone, but I could not have written this post or done the research that went into it without a laptop and a fast Internet connection. High-speed connectivity to homes, schools, libraries, clinics, etc. will be in demand and narrow the qualitative digital divide.

Today's satellite company executives have different backgrounds than Teledesic's. Bill Gates had built a software company, Craig McCaw a cellular phone company and Boeing had experience with the technology of the time. I know nothing about Boeing's people today, but they have the benefit of the lessons the company has learned since Teledesic. OneWeb CEO Greg Wyler created a successful satellite-based company, O3b, which provides Internet service using a constellation of 12 mid-Earth orbit satellites. (O3b is now owned by SES).

Given his track record, Elon Musk deserves special mention. For a start, he is CEO and Lead Designer at SpaceX -- actively involved in engineering decisions -- Jobs and Wozniak in one package. He is also unfettered by outside investors, giving him more latitude and the ability to reassign personnel -- relatively free of shareholder's pressure to pursue their applications or maximize short-run profit. (Of course, he needs to make money in order to continue his business and invest in journeys to the Moon and Mars). While I hope the market is large and varied enough to support others, SpaceX will succeed if anyone does.

Unknowns and possible glitches

The above changes improve the outlook for today's satellite projects, but there is still uncertainty. For example, it is hard to know what the true capacity of these systems will be -- the number of users and the user mix they will support. They speak of serving individual users, local area networks like schools, libraries or public-access hotspots, Internet gateways, cell phone backhaul, ships, airplanes, automobiles, Internet of things (IoT) devices, etc. One can even imagine a space-based content-delivery network using solid-state drives.

An Internet gateway requires more bandwidth than an IoT sensor that is read every hour and, during the day, a school needs more bandwidth than a home. Will the companies end up with different customer mixes? For example, SpaceX has singled out long-haul Internet exchanges and home connectivity as target applications and, given Elon Musk's other interests, we can imagine him targeting autonomous vehicles and power distribution. OneWeb is also going after homes and buildings, but a key investor, Softbank, is focused on the Internet of things. OneWeb CEO Doug Wyler's first satellite service, O3b, serves mobile network operators, ship lines, governments, and enterprises. Perhaps OneWeb will focus on large customers.

A related question -- how will these companies handle sales and service? Will they have online sales, global offices, dealers, partner with ISPs and mobile companies, etc.? (OneWeb backer Softbank tried to merge with Intelsat, but the merger, which would have provided OneWeb with global offices, failed).

There are regulatory as well as technical challenges. The FCC has delayed acting on SpaceX's launch application pending negotiations on spectrum-sharing techniques between them and other satellite companies using the same range of radio frequencies. These will be global networks and they will have to satisfy the spectrum regulators of all nations they wish to serve as well as the International Telecommunication Union. At the very least, that means dealing with a lot of bureaucracy.

Standards also come to mind. SpaceX, OneWeb, Boeing, and others are working on methods of spectrum sharing. The Ethernet standard grew out of joint work by Intel, DEC and Xerox -- will SpaceX, OneWeb and Boeing create satellite spectrum standards one day?

Regulators also worry about falling debris. These satellites have a useful life of about five years after which they are de-orbited and burn up in the atmosphere. SpaceX hopes to launch over 4,000 satellites in their first constellation and they are in discussion with the FCC over the likelihood of human injury from falling debris. SpaceX eventually hopes to be able to economically recapture spent satellites using the BFR.

There are also political and cultural barriers. Will nations like China or North Korea allow citizens to install home ground stations and connect to the Internet? Will Saudi Arabia tolerate access to pornography? Cuba will not allow citizens to connect to expensive, slow geostationary satellites -- allowing connections to fast, cheap Internet satellites would require a political shift.

(That being said, Cuba would be a prime candidate for this service if the government would allow it. They have very little infrastructure, an educated population and since it is an island, the constellation "footprint" would not be densely populated).

There may also be a need for international anti-trust and consumer-protection regulation. What if one or all three of these companies succeed in establishing global networks that become monopolies or oligopolies in some nations or regions -- for example in central Africa. That could have significant consumer protection and political implications.

Teledesic planned to offer service through local service providers, but OneWeb and SpaceX plan to sell services and easily installed ground-stations directly to consumers. Will terrestrial Internet service providers fight them by lobbying governments and in court the way they have fought publicly-owned terrestrial Internet service providers?

Manufacturing, launching and operating these constellations seems like an immense engineering task. It is hard to imagine an organization capable of such a feat, but let's put these efforts in perspective. If humans can manufacture, launch, deploy and operate the James Webb Space Telescope or the flood-control and water-distribution system in ancient Petra, a constellation of "low-tech" satellites in low-Earth orbit seems like a piece of cake -- the question is whether the business model will work out.

Will these companies succeed?

Sorry to disappoint, but I don't know enough about their coverage and business models to say "yes" with certainty, but I am hopeful because smart, experienced business people, entrepreneurs, and investors are betting they will succeed.

More remarkable -- last year, Tom Wheeler, President Obama's FCC chairman, summed up a talk on the impact of improving technology, saying:

The pace of innovation is accelerating, and with new technological advances, satellites now have the opportunity to play a much more important role in bringing broadband to underserved and unserved areas around the world.

This year, Trump's FCC chairman Ajit Pai stated:

Today, the FCC updates the framework that will govern non-geostationary-satellite orbit satellite systems. And it’s high time: It’s been over a decade since we first adopted rules for these types of constellations. In the years since, innovation has brought exciting potential to connect consumers across the nation, especially in rural, remote, and tribal areas. The rules we adopt will promote the next generation of non-geostationary satellite systems, which could expand broadband access where it’s needed most.

Do Obama and Trump's appointees agree on anything other than this? Let's hope all the projects succeed and we have some decent competition.

An early WiMAX deployment

We have talked about mobile and portable connectivity. The two choices today in the US are WiFi hotspots and third generation cellular service, but WiMAX service is just beginning and may become competitive.

Clearwire just led off with early WiMAX deployment in their 44 local markets. With their PC card in a laptop, one will have portable (not mobile) connectivity for $59.99 a month for speeds of up to 1.5 megabits per second down and 256 kilobits up. (Mobile WiMAX will be available when the standard is soldified).

How do those speeds compare to what you have at home today? Who might be interested in this service?

Wireless data coverage is uneven

We discuss evolving cellular data generations. Today's third generation equipment provides for speeds of up to 2 mbps, but, as shown in this figure, download speed varies considerably from one city or neighborhood to another. The download speed to your iPhone 3G might be as low as 400 kbps or as high as 1,600 kbps.



The plot was generated by ARCchart, a wireless market research firm, and described by Brough Turner in a blog post. ARCchart monitored over two million performance tests using iPhone, Blackberry and Android phones, then filtered them to focus on major cities. This graph is based on 648,374 downloads from major cities in 103 nations between August 2008 and June 2009.

(Gizmodo performed a more limited test of Sprint, AT&T and Verizon 3G networks in eight US cities and also found considerable variance in download speed).

Of course, in some places there is no GSM coverage. Consider the coverage by AT&T, the GSM provider supporting the Apple iPhone in the US -- there is no coverage in the light-colored regions:



This map was taken from AT&T's coverage viewer in early September 2009, and coverage has continued expanding since then.

However, AT&T states that the maps are only an approximation, not a guarantee, of their coverage, which may be effected by terrain, weather, foliage, buildings and other construction, signal strength, customer equipment and other factors. There are many anecdotal reports of inability to use an iPhone in parts of San Francisco and the bay area.

Mobile service in the UK is cheaper than in the US

Minh Uong
New York Times

We've looked at the bad deal US landline Internet users get compared to places like Korea, Sweden, Japan or Latvia. (The list could be longer). How about mobile connectivity?

The New York Times just published a short article comparing the price charged by UK Cellular company UK Three (UK3) to that of Verizon in the US. The article compared prices for a two year contract with a subsidised Apple 5s phone.

UK3's price in this example is over $40 less than Verizon's. Furthermore, UK3 allows unlimited data transfer while Verizon has a 2 GB per month usage cap. Since UK3 is a low-cost carrier, I checked the prices of Vodafone accounts in the UK. A 3G Vodafone account with a 2 GB cap costs $72.31 per month. A 4G plan with a 4 GB cap is $79.60.

The author of the post cites one significant difference in explaining the price differences between the two nations:

Britain has forced companies to lease their networks to competitors at cost. The United States has not, allowing a formidable barrier against competitors.

The US Congress tried to spur competition in a similar manner with the Telecommunication Act of 1996, but the incumbent operators and their lobbyists defeated that attempt in courts and state houses.

William Kennard, who, as chairman of the United States Federal Communication from 1997-2001, was charged with implementing the Telecommunications Act, stated near the end of his term that “all too often companies work to change the regulations, instead of working to change the market,” and spoke of “regulatory capitalism” in which “companies invest in lawyers, lobbyists and politicians, instead of plant, people and customer service.” He went on to remark that regulation is “too often used as a shield, to protect the status quo from new competition -- often in the form of smaller, hungrier competitors -- and too infrequently as a sword -- to cut a pathway for new competitors to compete by creating new networks and services.”

The cellular network is broken -- two examples

As we discuss, the Internet was designed to be an end-to-end, dumb network. The large ISPs would like to break that principle in order to give higher priority to certain users and applications, and, as we have seen, the cell phone network is even more restricted.

Developers cannot create and use cell phone applications without permission from cell phone carriers. We had a graphic example of this recently when Verizon would not permit an abortion rights organization to use their text messaging service. They later reversed the decision, but this illustrates how badly broken the cell phone network is.

Along the same lines, a software upgrade to Apple's iPhone renders phones with third party applications installed inoperable. This was not inadvertent. Apple CEO Steve Jobs said it was done to protect carrier networks and to make sure the phone was not damaged.

His first reason -- protecting the network -- was what AT&T claimed before the 1968 Carterphone decision that allowed people to connect equipment to their network as long as it did no harm. His second reason -- protecting the phone from damage -- is exactly what he has done -- turned them into worthless "bricks."

People are working on an open cell phone, and perhaps Wimax will lead to open network access one day.