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Thinking past the I-I boundary

August 13, 2009 in Berkman, Business, Cluetrain, Future, infrastructure, News, Past, Politics | 1 comment

For the form of life we call business, we are at a boundary between eras. For biological forms of life, the most recent of these is the K-T boundary between the  and the Eras. The Mezozoic Era ended when Earth was struck by an object that left a crater 110 miles wide and a world-wide layer of iridium-rich crud. Below that layer lies the Age of Dinosaurs, completed. Above that layer accumulate the fossils of life forms that survived the change, and took advantage of it. Notable among these is a branch of theropod dinosaurs we call birds.

In business we have the I-I boundary: the one between the Industrial and Information ages (which Alvin Toffler first observed in The Third Wave, published in 1980).  Below that boundary we find a communications environment dominated by telecom and cablecom. Above it we find a radically different communications environment that still supports voice and video, but as just two among an endless variety of other applications. We call that environment the Internet.

At this moment in history most of us know the Internet as a tertiary service of telephone and cable companies, which still make most of their money selling telephone service and cable TV. Since those are highly regulated businesses, the Internet is subject to degrees of regulatory capture. Some of that capture is legal, but much of it is conceptual, for example when we see the Internet as a grace of telecom and cablecom — rather than as something that subsumes and obsoletes both of those Industrial Age frames.

Such is the risk with “broadband” — a term inherited by the Internet from both telecom and cablecom, and which is a subject of interest for both Congress and the FCC. In April of this year the FCC announced the development of a national broadband plan, subtitled “Seeks Public Input on Plan to Ensure Every American has Access to Broadband Capability”. In July the commission announced that Harvard’s Berkman Center would conduct “an independent review of broadband studies” to assist the FCC. Then yesterday the center put up a notice that it “is looking for a smart, effective fellow to join our broadband research team”. (This is more than close to home for me, since I am a fellow at Berkman. So I need to say that the broadband studies review is not my project — mine is this one — and that I am not speaking for the Berkman Center here, or even in my capacity as a fellow.)

The challenge here for everybody is to frame our understanding of the Net, and of research concerning the Net, in terms that are as native to the Net as possible, and not just those inherited from the Industrial Age businesses to which it presents both threats and promise — the former more obvioius than the latter. This will be very hard, because the Internet conversation is still mostly a telecom and cablecom conversation. (It’s also an entertainment industry conversation, to the degree that streaming and sharing of audio and video files are captive to regulations driven by the recording and movie industries.)

This is the case especially for legislators and regulators, too few of which are technologists. Some years ago Michael Powell, addressing folks pushing for network neutrality legislation, said that he had met with nearly every member of Congress during his tour of duty as FCC chairman, and that he could report that nearly all of them knew very little about two subjects. “One is technology, and the other is economics,” he said. “Now proceed.”

Here is what I am hoping for, as we proceed both within this study and beyond it to a greater understanding of the Internet and the new Age it brings on:

  • That “broadband” comes to mean the full scope of the Internet’s capabilities, and not just data speeds.
  • That we develop a native understanding of what the Internet really is, including the realization that what we know of it today is just an early iteration.
  • That telecom and cablecom companies not only see the writing on the wall for their old business models, but embrace other advantages of incumbency, including countless new uses and businesses that can flourish in an environment of wide-open and minimally encumbered connectivity — which they have a privileged ability to facilitate.
  • That the Net’s capacities are not only those provided from the inside out by “backbone” and other big “carriers”, but from the outside in by individuals, small and mid-size businesses (including other Internet service providers, such as WISPs) and municipalities.

That last item is important because carriers are the theropods of our time. To survive, and thrive, they need to adapt. The hardest challenge for them is to recognize that the money they leave on the shrinking Industrial Age table is peanuts next to the money that will appear on the Information Age table they are in a privileged position to help build.

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A world of producers

December 13, 2008 in Art, Business, Future, Gear, problems | 7 comments

There’s a good chance that the best picture you can put on your HD screen doesn’t come from your cable or satellite TV company, but from your new HD camcorder. As time and markets march on, that chance will only get larger. That’s because the there is a trade-off between the number of channels carried and the quality of each channel. To squeeze in more channels, the carrier squeezes out picture quality through compression. The result is “artifacts.” See here:

artifacts

The titles get “jaggies,” the football field gets pimples, and everything gets blurred and/or re-painted by he compression algorithm as an approximation of the original image.

Carriers compete more by the number of channels they carry than by the quality of each channel. (There are exceptions to this, but on the whole that’s the marketing think.) Meanwhile your camcorder quality only goes up.

And as camcorder quality goes up, more of us will be producing rather than consuming our video. More importantly, we will be co-producing that video with other people. We will be producers as well as consumers. This is already the case, but the results that appear on YouTube are purposely compressed to a low quality compared to HDTV. In time the demand for better will prevail. When that happens we’ll need upstream as well as downstream capacity.

So here’s a piece in Broadband Reports that shows how carriers can be out of touch with the future, even as they increase the capacities of their offerings. An excerpt:

In upgraded markets, Comcast is not only upgrading existing speed tiers ($42.95 “Performance” 6Mbps/1Mbps and $52.95 “Performance Plus” 8Mbps/2Mbps tiers became 12Mbps/2Mbps and 16Mbps/2Mbps), but is adding two new tiers to the mix ($62.95 “Ultra” 22Mbps/5Mbps and the aforementioned $139.95 “Extreme 50” 50Mbps/10Mbps).

One recurring theme we’ve seen in our forums is that the new speeds have many users downgrading. In both forum threads and polls, many customers on Comcast’s 16Mbps/2Mbps tier say they’re downgrading to their 12Mbps/2Mbps tier — apparently because they don’t think an additional 4Mbps downstream is worth $10. Customers used to be willing to pay the additional $10 for double the upstream speed, but there’s no longer an upstream difference between the tiers.

That last line is the kicker. Comcast apparently still thinks that downstream is all that really matters. It isn’t. For anybody producing a lot of photography or video, upstream not only matters more, but supports activities where the user can see the difference.

In fact there isn’t a lot of perceived difference between 12Mbps and 16Mbps on the downstream side. Either is fast enough for a YouTube video. But on the upstream side, you can see the difference. In my case, that difference appears in the progress bars for pictures I upload to Flickr.

A few months ago I upgraded my Verizon FiOS service from 20/5Mbps to 20/20Mbps. The difference was obvious as soon as it went in. The difference will be a lot more obvious to a lot more people once those people start sharing, mashing up and co-producing higher-definition videos.

Just watch.

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Infinite play

November 7, 2008 in Future, Ideas, Past, problems, VRM | 3 comments

Video Is Dominating Internet Traffic, Pushing Prices Up says the headline of a piece by Saul Hansell in the New York Times. Its first three subheads say, File sharing has been usurped by legitimate video services, The very heaviest users drive up network costs and Unlimited data plans may have a limited life.

This is the wrong framing, by the wrong mentality. We’re not far from the day when most of us are “heavy users”, and when voice telephony (which has a relatively low data rate) is just one among countless data applications. It’s already that on laptops and many handheld devices (including mobiles using the likes of Fring).

In time the bulk of radio and television listening and viewing will move from analog to digital, and from broadcast bands to broadband. Some will be live, some will be stored and forwarded. Much will be mashed. Upstream needs will match downstream needs, especially for the millions who now producing as well as consuming video. Some top-down few-to-many asymmetries will persist, but many more any-to-any uses will arise, requiring symmetrical connectivity.

There are services besides raw bandwidth that can help with this — services that assist in mash-ups, that work with customers’ social graphs, that provide actual professional services (instead of higher-priced tiers that do nothing more than punish customers for saying they’re a business … a shakedown racket that should have died along with Ma Bell). There should emerge services that answer to customer-driven choices and preferences, that help demand drive supply, that support service needs in marketplaces opened by easy connectivity and fat capacity.

Carriers need to recognize that in the long run they are privileged to be in the Internet business, rather than cursed by something that undermines their old business models. They need to break out of their “triple-play” mentality and realize that on the Net there are an infinite number of “plays’, especially if those aren’t excluded by connections optimized for television or telephony, or subordinated to those other purposes.

Three things need to happen here.

  1. First, the carriers need to realize that they are Internet companies first, and phone or cable companies second — or will be, soon enough
  2. The carriers need to welcome and partner with independent Net-savvy developers who can help them think outside their own boxes, yet make the most of their privileged positions. We’ve all known there are benefits to incumbency besides charging rents. Now it’s time to find those and start making hay. (Oh, and lining up with Hollywood for lots of subscription distro deals is neither creative nor interesting.)
  3. The Net needs to be moved outside the framework of telecom regulation, to be freed from what Bob Frankston calls The Regulatorium. The Net was unimaginable to the 1934 Telecom act, and barely grokked by the 1996 update of that act. Questions about whether the Net is an “information service” or a “telecommunication service” are wacky, retro and not helpful, unless it’s to liberate it from the telecom trap.

But they shouldn’t wait for #3.

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