verizon

Huffington Post…

WASHINGTON — Rep. Darrell Issa’s Oversight Committee may have violated House ethics rules by streaming a hearing Friday that included commercial advertising. The committee, holding a field hearing in North Charleston, S.C., on the National Labor Relations Board, apparently did not transport the gear it needed to stream the hearing with government resources. So it resorted to the commercial UStream site to feed the hearing, and hosted the feed on the official Oversight Committee homepage. But that comes with ads, which government watchdogs say is prohibited. And Chairman Issa (R-Calif.) knows it. “Members are prohibited from doing anything that has an implied commercial endorsement,” said Melanie Sloan, the head of Citizens for Responsibility and Ethics in Washington. When the Huffington Post clicked to watch the hearing, an ad for Verizon popped before the stream of the official proceedings would begin. As the hearing went on, ads served by Google for various services popped up, including one offering help with government bids and another aid getting Pell grants. Refreshing the page after a brief recess brought up an ad for United Healthcare. Also, the logo for UStream was carried across the top of the page for the entire hearing. See the Verizon ad below: “It’s an implied endorsement,” Sloan said. And she added that Issa should know better because she once pointed out to him that it was an issue when a web designer touted work done on Issa’s website. “He took care of it,” Sloan said. The committee did not immediately respond to a request for comment, but apparently decided to make use of the streaming service used by the local county government, perhaps saving money and effort on the part of the federal government. Sloan said expediency was not an adequate defense. “Maybe they just didn’t want to deal with the rules, but that’s not an excuse,” she said. Perhaps complicating the issue, at least one of the ads featured a company — Verizon — that has a history with the National Labor Relations Board, which ruled against the phone service provider in a noted 2007 case. Verizon’s president at the time, Denny Strigl, has since retired and recently become a vocal critic of the NLRB and the very topic that Issa was addressing, a recent ruling against Boeing. In that case, the NLRB alleges that Boeing started a production line in South Carolina as retaliation against unionized workers in Washington State who have gone on strike in the past.

Read the original here:
Oversight Committee Overlooking Ethics Rules?

Find our Weekly Commercial Real Estate, Private Equity and Fund Newsletters at www.WeeklyBrief.net

{ 0 comments }

Huffington Post…

By Sinead Carew and Diane Bartz NEW YORK/WASHINGTON D.C. | Tue May 31, 2011 5:08pm EDT (Reuters) – Sprint Nextel has formally asked U.S. regulators to block AT&T Inc’s proposed $39 billion purchase of T-Mobile USA, saying the deal “has no public interest benefit” and would harm competition even if it comes with conditions. Sprint — the most vocal opponent of the deal, which would create a new leader in the U.S. wireless market — said that even if the Federal Communications Commission forced AT&T to divest assets as a condition, that would not be enough. “The proposed transaction would produce no tangible public interest benefits and would impose serious anti-competitive harms that cannot be remedied through divestitures or conditions,” Sprint said on Tuesday, the deadline for initial responses to AT&T’s application to the FCC. Smaller rival Leap Wireless and advocacy groups like Free Press have spoken out against the deal, as have many individual consumers in FCC filings. On the flip side, AT&T said in a statement on Tuesday that it had support from groups including “community, civic and minority organizations,” as well as 13 governors. The deal requires FCC and Justice Department approval. AT&T argues that it needs T-Mobile USA’s spectrum to expand high-speed services faster and improve its network performance, which has been criticized by consumers. But Sprint, the No. 3 U.S. mobile operator, took issue with that argument, saying that AT&T has no lack of spectrum. Instead Sprint said AT&T’s problem is that it has “simply failed to upgrade or invest sufficiently in its network.” It said AT&T already has enough spectrum to cover 97 percent of Americans with high-speed mobile services. But Sprint argues that it may be come more difficult for consumers to pay for such services as smaller companies like itself would have less power to moderate service pricing after the deal as the two top carriers, AT&T and Verizon Wireless, would then control about 80 percent of the market. Like Sprint, T-Mobile USA — a unit of Deutsche Telekom — tends to appeal to more cost conscious consumers than AT&T so the worry is that the cheaper prices would end up being phased out over time. Sprint also argued in its lengthy filing with the FCC that AT&T’s control of wireline assets such as connections to mobile broadcast towers would “exacerbate the anti-competitive effects of the takeover.” A merger of AT&T and T-Mobile USA would increase AT&T’s share of the market to 44 percent from 32 percent, with Verizon continuing to hold 35 percent, according to Sprint, which estimated its own market share at 15 percent. As a result, manufacturers would have less incentive to build mobile devices for Sprint after the deal because of its smaller scale, the company said in its filing. Verizon Wireless is a venture of Verizon Communications and Vodafone Group Plc. (Editing by Matthew Lewis and Steve Orlofsky) Copyright 2011 Thomson Reuters. Click for Restrictions .

See the article here:
Why Sprint Wants To Block AT&T’s T-Mobile Buy

Find our Weekly Commercial Real Estate, Private Equity and Fund Newsletters at www.WeeklyBrief.net

{ 0 comments }

Video: Hilliard Lyons’s Burks Says AT&T Results `Fairly Solid’

April 20, 2011

April 20 (Bloomberg) — David Burks, an analyst at Hilliard Lyons Inc., talks about AT&T Inc.’s first-quarter profit. Burks, speaking with Carol Massar on Bloomberg Television’s “In the Loop,” also discusses the company’s competition from Verizon Wireless and AT&T’s planned acquisition of T-Mobile USA. (Source: Bloomberg)

Read the full article →

Timothy Karr: Five Things Wrong with AT&T’s Mega-Merger

March 24, 2011

AT&T’s $39 billion takeover of T-Mobile USA is yet another in the series of large telecom mergers that over time are slowly reassembling the Ma Bell monopoly of old. It’s now left to federal regulators at the Department of Justice and the Federal Communications Commission to decide what’s really best for Americans. Should they let two national wireless carriers dominate our mobile world? Would giving AT&T and Verizon near complete control benefit smart phone users, create more jobs, make broadband access widespread and affordable, and fuel our sputtering economy? It seems unthinkable to suggest that taking one of the most innovative sectors ” back to the future ” would help us. Consolidation of the scale proposed by AT&T and their boosters in Washington resembles the old railroad and oil trusts of the 19th century. Why go there? Yet AT&T wields unparalleled political power in Washington, and stands a good chance of “convincing” regulators and Congress to discard with common sense , stand aside and let this mega-merger sail through on approval. Here are five reasons that all Americans – and not just T-Mobile and AT&T customers — should be concerned by the return of the new, old Ma Bell: 1. The merger would further erode what little competition exists in the wireless market. The merger hands two companies, AT&T and Verizon, control over nearly 80 percent of the wireless market. That translates to widespread abuses of market power, something AT&T is already known for. In any other industry, allowing this much concentration, especially without any meaningful oversight or regulatory protections, would be unthinkable. By comparison, the top 10 oil producing firms combined control less than 80 percent of the U.S. market, but this merger will give that level of market dominance to just two companies. Imagine if ExxonMobil were to merge with BP, Shell, Chevron-Texaco, and Citgo. That would net ExxonMobil the same level of market control as AT&T will have with this deal. And unlike the gasoline market, where consumers can just drive another block to choose another station, wireless users are locked into long-term contracts. 2. The merger would result in higher prices and fewer choices for wireless consumers. AT&T and Verizon currently control nearly two-thirds of the market and have a long history of raising prices in concert, as they both did early last year by requiring all customers on feature phones to add data plans. Sprint and T-Mobile (the third and fourth largest of the four national carriers) were meant to exert some competitive discipline on the big two. The average fee for AT&T users ($63 per post-paid subscriber) is some 20 percent more than the amount T-Mobile users pay ($52 per T-Mobile &T subscriber). You take T-Mobile’s lower cost structure out of our wireless equation and the remaining providers have even fewer checks against raising prices on every user. And prices have risen steadily, according to J.D. Power and Associates . In December 1998, the monthly Average Revenue Per User (ARPU) for wireless companies was $39.43. By the end of 2010, this has risen to more than $49. This steady price increase comes despite the fact that carriers’ own operating costs have declined substantially, as their profits have risen. This change will be particularly acute for the 34 million people who now subscribe to T-Mobile. Even if AT&T agrees to honor their existing contracts for their remaining length, they will surely see higher prices when those contracts expire or when they need to buy a new handset or make changes to their contracts. 3. This merger will kill tens of thousands of U.S. jobs. When was the last time a merger actually created jobs for Americans and not more pink slips? This merger is no different. And yet that hasn’t stopped AT&T from wrapping itself in the flag by noting that T-Mobile is a subsidiary of a German company. But T-Mobile USA is based in Bellevue, Washington and employs nearly 40,000 U.S. citizens. The plain fact is that AT&T plans to put these American jobs at risk. Their executives say the plan to save $40 billion through merger “synergies.” This means that many of the T-Mobile jobs at retail stores and call centers will be eliminated. The planned shuttering of thousands of wireless towers will result in the firing of an untold number of technicians. And there will be more jobs lost as the cost-cutting effects of this merger ripple through the broader economy. 4. This merger is a raw deal for American innovation. AT&T has a history of making handset manufactures cripple features like WiFi on devices, and of blocking the use of certain applications like Google Voice and Slingbox. The merger would stifle innovation both in devices and on the network. The combined carriers would be able to leverage an unfair amount of market power to prioritize which handsets get used, what technologies work on those handsets and which Apps you’ll be able to upload from the network (Imagine AT&T prioritizing it’s own inferior voice recognition and navigation applications over those offered by Google or a innovating startup). According to the Wall Street Journal , handset manufacturers are remaining mum on the deal, possibly out of a “fear of angering a powerful customer” in AT&T, which can make or break a device by simply deciding to allow it on its network. Would a merged AT&T permit any device innovation that challenges its bottom line? Using history as a guide, the likely answer would be, “no.” 5. The merger is a threat to free speech and openness on the wireless web. AT&T along with Verizon has fiercely opposed any wireless Net Neutrality requirements, with AT&T brokering a deal with the FCC to ensure they have the legal right to block online content and charge application developers additional tolls just to reach AT&T customers. The FCC’s weak Net Neutrality decision was the result — exempting mobile services from openness protections based on Chairman Julius Genachowski’s assumptions that competition existed in wireless. With further consolidation AT&T and Verizon will be in an even stronger position to play gatekeeper on the wireless web, picking winners and losers, limiting our ability to connect and share information and ultimately slowing the pace of the mobile Internet innovation. The fact of this merger shows how the U.S. must have strong Net Neutrality rules, according to Sen. Dick Blumenthal of Connecticut: “Regulatory approval should contain strict conditions to ensure that consumer concerns about cost, access, choice, and competition are adequately addressed. Moreover, such high wireless market concentration raises serious potential net-neutrality concerns that should be addressed. The largest mobile network in the nation must not be allowed to limit access to content in a discriminatory manner.” — Co-authored with S. Derek Turner, Free Press research director.

Read the full article →

AT&T To Buy T-Mobile For $39 Billion

March 20, 2011

NEW YORK — AT&T Inc. said Sunday it will buy T-Mobile USA from Deutsche Telekom AG in a cash-and-stock deal valued at $39 billion that would make it the largest cellphone company in the U.S. The deal would reduce the number of wireless carriers with national coverage from four to three, and is sure to face close regulatory scrutiny. It also removes a potential partner for Sprint Nextel Corp., the struggling No. 3 carrier, which had been in talks to combine with T-Mobile USA, according to Wall Street Journal reports. AT&T is now the country’s second-largest wireless carrier and T-Mobile USA is the fourth largest. The acquisition would give AT&T 129 million subscribers, vaulting it past Verizon Wireless’ 102 million. The combined company would serve about 43 percent of U.S. cellphones. For T-Mobile USA’s 33.7 million subscribers, the news doesn’t immediately change anything. Because of the long regulatory process, AT&T expects the acquisition to take a year to close. But when and if it closes, T-Mobile USA customers would get access to AT&T’s phone line-up, including the iPhone. The effect of reduced competition in the cellphone industry is harder to fathom. Public interest group Public Knowledge said that eliminating one of the four national phone carriers would be “unthinkable.” “We know the results of arrangements like this – higher prices, fewer choices, less innovation,” said Public Knowledge president Gigi Sohn, in a statement. T-Mobile has relatively cheap service plans compared with AT&T, particularly when comparing the kind that don’t come with a two-year contract. AT&T CEO Randall Stephenson said one of the goals of the acquisition would be to move T-Mobile customers to smart phones, which have higher monthly fees. AT&T “will look hard” at keeping T-Mobile’s no-contract plans, he said. AT&T’s general counsel, Wayne Watts, said the cellphone business is “an incredibly competitive market,” with five or more carriers in most major cities. He pointed out that prices have declined in the past decade, even as the industry has consolidated. In the most recent mega-deal, Verizon Wireless bought No. 5 carrier Alltel for $5.9 billion in 2009. Stifel Nicolaus analyst Rebecca Arbogast said the deal will face a tough review by the Federal Communications Commission and the Justice Department. She expects them to look market-by-market at whether the deal will harm competition. Even if regulators approve the acquisition, she added, they are likely to require AT&T to sell off parts of its business or T-Mobile’s business. Verizon had to sell off substantial service areas to get clearance for the Alltel acquisition. To mollify regulators, AT&T said in a statement Sunday that it would spend an additional $8 billion to expand ultrafast wireless broadband into rural areas. Instead of covering about 80 percent of the U.S. population with its so-called Long Term Evolution, or LTE network, AT&T’s new goal would be 95 percent, it said. That means blanketing an additional area 4.5 times the size of Texas. The network is scheduled to go live in a few areas this summer, but the full build-out will take years. The offer would help the FCC and the Obama administration meet their stated goals of bringing high-speed Internet access to all Americans. They see wireless networks as critical to meeting that goal – particularly in rural areas where it does not make economic sense to build landline networks. AT&T said its customers would benefit from the cell towers and wireless spectrum the deal would bring. In some areas, it would add 30 percent more capacity, AT&T said. “It obviously will have a significant impact in terms of dropped calls and network performance,” Stephenson said. AT&T would pay about $25 billion in cash to Deutsche Telekom, Germany’s largest phone company, and stock that is equivalent to an 8 percent stake in AT&T. Deutsche Telekom would get one seat on AT&T’s board. Like Sprint, T-Mobile has been struggling to compete with much larger rivals AT&T and Verizon Wireless, and its revenue has been largely flat for three years. Bellevue, Wash.-based T-Mobile USA’s subscriber count has stalled at just under 34 million, though it posts consistent profits. Deutsche Telekom has been looking at radical moves to let it get more value out of its U.S. holding, including a possible combination with a U.S. partner. There was a big hurdle to a T-Mobile USA-Sprint deal: The two companies use incompatible network technologies. The same hurdle would apply in a Verizon Wireless-T-Mobile USA deal. But the networks of AT&T and T-Mobile use the same underlying technology, so to some large extent, AT&T phones can already use T-Mobile’s network, and vice versa. The deal has been approved by the boards of both companies. Dallas-based AT&T can increase its cash portion by up to $4.2 billion, with a reduction in the stock component, as long as Deutsche Telekom receives at least a 5 percent equity ownership interest in the buyer. The agreement doesn’t leave room for other buyers to jump in with a higher bid, AT&T said. AT&T would finance the cash part of the deal with new debt and cash on its balance sheet and will assume no debt from T-Mobile. ___ AP Technology Writer Joelle Tessler contributed to this report from Washington, D.C.

Read the full article →

VitaminSpice Adds Mr. Robert Wilke as Chief Marketing Officer

January 13, 2011

WAYNE, PA–(Marketwire – January 13, 2011) – VitaminSpice ( OTCBB : VTMS ) (German WKN: A0YE4L) ( www.vitaminspice.net ) is pleased to announce that Robert Wilke will be joining VitaminSpice in the capacity of Chief Marketing Officer. Mr. Wilke has led in the creation of effective marketing programs for such blue chip companies as J.P. Morgan/Chase, Citibank, National Car Rental, the Bermuda Department of Tourism, Verizon, Guinness, and many others.

Read the full article →

Video: McKechnie Says Verizon 9-12 Months Ahead of AT&T on 4G

December 20, 2010

Dec. 20 (Bloomberg) — Mark McKechnie, an analyst at Gleacher & Co., talks about Verizon Wireless and AT&T Inc.’s plans for fourth-generation wireless networks. AT&T agreed to buy wireless spectrum from Qualcomm Inc. for $1.93 billion as customers increasingly use bandwidth-hogging services such as video downloads. McKechnie speaks with Matt Miller and Carol Massar on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)

Read the full article →

Millions of customers will get refunds from Verizon

October 4, 2010

Millions of customers will get refunds from Verizon

Read the full article →

Verizon Taps Lowell McAdam As COO, Likely CEO Successor

September 20, 2010

NEW YORK — Verizon Communications Inc. has named the head of its wireless division, Lowell C. McAdam, as its chief operating officer, setting him up as a successor to the CEO. The move announced Monday clarifies the succession at Verizon after it said a week ago that chief financial officer John Killian plans to retire at the end of the year. He has been at the job for a year and a half. CEO Ivan Seidenberg, 63, has led the company for the past decade. McAdam, 56, starts in his new job Oct. 1. Verizon shares rose 41 cents, or 1.3 percent, to $32.09 Monday. They set a 52-week high of $32.17 earlier in the session. McAdam became head of Verizon Wireless in 2007. Before that, he was chief operating officer of the venture since it was founded in 2000. During McAdam’s tenure as CEO, the company executed an acquisition – that of Alltel Corp. in 2009 – that made it the largest carrier in the industry. McAdam has also struggled with the surging popularity of the iPhone. It has led to a close relationship between Verizon Wireless and Google Inc., which provides its Android software to phones that compete with Apple Inc.’s phone, and close personal contact between McAdam and Google CEO Eric Schmidt. Daniel S. Mead will take over as head of Verizon Wireless, a joint venture between Verizon Communications and Britain’s Vodafone Group PLC. He was previously the venture’s chief operating officer. Verizon Communications said Monday it is also promoting Francis J. Shammo, head of Verizon Telecom and Business, to succeed Killian in the job of chief financial officer beginning Nov. 1.

Read the full article →

Art Brodsky: Purists and Zealots for Internet Freedom

September 10, 2010

To hear some big-time business columnists tell it, fighting for freedom is a bad thing. The usually sensible Steve Pearlstein at the Washington Post notes that, “net neutrality zealots” (also known as “ayatollahs of net neutrality”) worked themselves into a “self-righteous lather” over the Verizon-Google compromise on Net Neutrality, caring more about “principles” than the “real world.” For Joe Nocera over at the New York Times , the Verizon-Google deal was a “well-meaning proposal,” that is being set upon by ” fierce, unyielding proponents ” of an open Internet, a group that includes Public Knowledge as part of the “net neutrality purists.” These two columns by respected writers point to an unfortunate tendency among reporters who peer down from Olympian heights onto the world of mortals to bless a compromise as a way to settle a dispute, regardless whether the compromise is productive. There is the surface “pox on both their houses” approach, although it seems as if in practice the tendency further is distinguished by the pejorative descriptions of liberal or progressive parties, and rarely of conservative or business-oriented opinions or groups. (The progressive blogosphere calls this “Broderism” after Washington Post columnist David Broder, who for decades has preached for the non-existent middle ground.) For example, while calling public interest groups names, rarely are telephone and cable companies called out for spending millions of dollars in an attempt to gain control over what had been the most open and free platform for expression and commerce ever invented. Rarely, if ever, are rules seen as a solution to curbing bad corporate behavior — it’s always rules and regulations are seen as the tools of the radical fringe that wants to curb big businesses’ progress. It’s as if the Gulf disasters, the financial/mortgage meltdown and the contaminated eggs had never happened. Had this tendency been in existence a couple of hundred years ago, we might have seen this from prominent columnists: “The angry words from hotheads throughout the colonies, principally from Massachusetts and Virginia, are an affront to good sense. While some of what they want might be helpful, their attitudes are not. There must be a good middle ground, such as allowing Colonial legislatures to exist and to make rules in some areas, but not in others, which should be left to the Crown. Taxation and defense are properly the duty of the King and of Parliament, to be enforced by the Governor. Other items may be delegated to Colonial assemblies, subject to veto.” Then again, there was the dispute between abolitionists and those who favored the “peculiar institution” that existed 150 years ago. There were some compromises attempted, (See Missouri Compromise, Kansas-Nebraska Act) all of which failed. Would the equivalent of today’s columnists have written: “Somewhere between the rantings of abolitionists like William Lloyd Garrison and Henry Ward Beecher, who are peddling the nonsense slavery is evil, and the southern politicians like John C. Calhoun, who cling to the argument of states rights, is this stubborn reality: The southern economy needs to exist, supported by cheap labor. Instead of slavery, one compromise should be widespread adoption of long-term indentured servitude. The slaves of today would be freed, yet their labor would be tied to the land for years, ensuring the continued productivity of the southern economy.” Before all the flaming starts, take note: We are not comparing Net Neutrality to either colonial freedom or to slavery. This is an allegorical analysis of the foolhardiness of the faux evenhandedness and worthless compromise combined with a dose of irrelevant factoid and opinion. In this case, there is the small picture of Net Neutrality and the bigger picture of moving the economy to a broadband basis. Nocera, for example, repeats the Verizon/industry talking point that it’s “unrealistic” that all traffic should be treated the same, particularly in the wireless environment with “bandwidth hogs.” No one has said that telephone and cable companies can’t manage their networks. The issue is whether the company providing the network can favor one company’s content over another’s on the basis of a financial arrangement, i.e., payoff so that one service works better than another on the Internet. It has nothing to do with amount of bandwidth consumed – that’s the network provider’s problem. (And blaming customers for actually using the bandwidth they bought is not smart. It’s AT&T’s fault that it can’t keep up with the iPhone customer base, not the customers, as Nocera argues.) There is one Internet. People access it through a wire or from a wireless connection. Consumption of bandwidth is irrelevant to the discussion whether favoritism should exist. That’s why we “purists” don’t like the Verizon-Google “compromise.” It may be fine for Google, with its Android phones, and for Verizon, with its wireless network, but not for consumers who have one set of rules if connected by a network and another if connected through the air. That’s why we opposed it. The best story on the Verizon-Google deal is this one from AOL Daily Finance, which puts it into perspective. The whole point of the Internet is that customers choose what they want to do online, and companies, which offer services and features, have the opportunity to supply them. It is not a cable system; it is, to use Nocera’s sarcastic term, the “sacred Internet.” It’s sacred because no one has yet the ability to control it as cable operators choose what goes onto their networks. Yes, it’s necessary to prevent a company like Comcast from throttling the bandwidth of BitTorrent users (regardless of the amount of bandwidth they were using or what they were using it for — see Nocera again). They didn’t throttle streaming video, which uses a lot more network capacity. That’s why rules are needed, so that if a company does violate the openness principles, another company or a consumer can bring a complaint and the agency will have the authority to resolve it. There is no peril for a carrier now, or even a threat of one. Consumers don’t have great choice in broadband carriers and the legal status is uncertain. This is not “much ado about very little.” It’s much ado about keeping the Internet as it is based on law, not on corporate good will. That’s why the issue has to be decided in the public interest of everyone, not in the private interest of carriers. In her new book, Internet Architecture and Innovation , Stanford Professor Barbara van Schewick writes, “Leaving the evolution of the network to network providers will significantly reduce the Internet’s value to society.” That’s why the ” Third Way ” proposed by FCC Chairman Julius Genachowski makes sense. It would take back FCC jurisdiction over what is a service it should have jurisdiction over, yet without the burdens of all of the other regulation that accompanied the old “common carrier” regimes of the past. (Yes, future FCCs could change that, but that possibility exists any time.) It is a comprehensive solution that not only takes care of the issue of the open Internet, but opens the way for the Federal Communications Commission (FCC) to have the legal authority it needs to deal with affordable broadband, public safety, cybersecurity and a host of other issues. Yes, there are principles involved, principles that shape the real world and should be enforced in order for the “sacred Internet” based on freedom for consumers and web developers and service innovators to continue to exist. If that makes us “purists” and “zealots” and whatever else, then fine.

Read the full article →

Rep. Alan Grayson: Verizon-Google: There’s a Hard Rain Coming

August 19, 2010

“[Barry] Diller asserted that the Google-Verizon proposal “doesn’t preserve ‘net neutrality,’ full stop, or anything like it.” Asked if other media executives were staying quiet because they stand to gain from a less open Internet, he said simply, “Yes.”" New York Times, August 12, 2010 The Verizon-Google Net Neutrality Proposal begins by stating that “Google and Verizon have been working together to find ways to preserve the open Internet.” Well, that’s nice. Imagine what they would have come up with if they had been trying to kill off the open Internet. Actually, you don’t have to imagine it. Because that’s what this is. An effort to kill off the open Internet. Much of the coverage of the Verizon-Google Proposal has focused on only one of the proposal’s many problems: the fact that the proposal allows wireless broadband carriers — like, say, Verizon, for instance — to discriminate in handling Internet traffic in any manner they choose. They can charge content providers, they can block content providers, and they can slow down content providers, just as they please. That sure doesn’t sound “neutral.” We’ve already seen examples of political censorship over mobile networks. In 2007, Verizon refused to run a pro-choice text message from advocacy group NARAL, due to its supposedly ‘unsavory’ nature. Yes, this happened; yes, this kind of censorship would be continue to be legal under the Google-Verizon deal; and yes, Google, this is evil. But the Verizon-Google Proposal allows almost as much latitude to other internet carriers, like cable and DSL carriers. Under the heading “Network Management,” all carriers can “engage in reasonable network management,” which “includes any technically sound practice” (which means what?). And it specifically includes the power to “prioritize general classes or types of Internet traffic, based on latency.” The term “latency” means delays in downloading, from carrying video files and such. So if you want video, and YouTube won’t pay Verizon to provide it, then Verizon can “prioritize” other traffic. And then your two-minute video will take two hours to see. And let’s say you want to start a new website that offers video — good luck getting through to Verizon’s customer service department, to have Verizon place it in the right ‘tier’ of Verizon’s internet service. In my experience, customer service requests have extraordinarily high “latency.” Furthermore, under the heading “Non-Discrimination Requirement” (that sounds promising!), wireline carriers cannot engage in “undue discrimination.” ” Undue discrimination! ” What, exactly, is “due” discrimination? And even then, the presumption of non-discrimination “could be rebutted.” And if a carrier somehow manages to run afoul of these absurdly loose standards, the FCC doesn’t even have the power to act, unless someone actually finds out about the discrimination, complains about it, and can prove it. And even then, the Verizon-Google Proposal limits the penalty to $2 million. Do you happen to know what Verizon’s revenue is every 10 minutes ? It’s . . . $2 million. That’s right. The maximum fine is equal to what Verizon takes in every 10 minutes. Do we laugh? Or do we cry? This would give Verizon — and every other large internet carrier — the equivalent of a cheap “put” option on every company with an internet-based product or service. For a mere $2 million, Verizon could secretly block (or just mess with) the internet content of a billion-dollar company, destroying its market value overnight. And, perhaps, sending those customers to Verizon’s rival product or service. Now, I really would like to believe that the FCC can deliver on guaranteeing net neutrality. But remember, this ‘proposal’ came after months of secret, closed-door meetings with the FCC, spurred by Chairman Julius Genachowski, that sought an industry- brokered deal along the lines of the Verizon-Google Proposal. And when the proposal was issued, net neutrality’s longtime ally, Commissioner Michael Copps, responded as follows: “Some will claim this announcement moves the discussion forward. That’s one of its many problems.” When I see our most stalwart friend on the commission coming out against a deal shepherded by the Chairman, it doesn’t inspire confidence that the FCC can hold the line against telecom and cable companies, when those companies have something else in mind. Google’s market capitalization is $150 billion. Verizon’s is $85 billion. They don’t care about our wellbeing. Never have, never will. Even if one of them tells us it won’t “be evil.” It’s time for the FCC to step up. It’s time for Congress to step up. It’s time for all of us to step up. We need for the law to protect the internet: No discrimination in pricing or in service. No self-regulation by corporate titans. And no blessing of corrupt deals at the FCC. And we need all citizens to engage, to be vigilant. Remember, no one in Big Business has an interest in keeping this medium open to all of us. The only interest that wants to keep the internet open and free, for you and me, is you and me. So if you care about a free and open internet, uncensored by Big Business, then look toward the horizon. A storm is brewing. There’s a hard rain coming.

Read the full article →

James Rucker: Google, Verizon, and You

August 19, 2010

There was a time not long ago when it was easy to believe that Google was a different kind of company — one that considered the public good as well as the bottom line in making decisions. My, how a week changes things. Google had once distinguished itself as one of the strongest corporate proponents of openness and freedom on the Internet. These characteristics are guarded by a principle called network neutrality , which basically means that Internet service providers can’t slow down or speed up data that flows over their networks. But last week, the company turned its back on net neutrality — and the American public. In practical terms, net neutrality prevents AT&T, which provides high-speed Internet service to millions, from making a deal with Hulu.com to make its videos load five times faster than Youtube’s. It means that FoxNews.com couldn’t make a deal with Comcast, another major Internet provider, to block progressive blogs critical of Fox such as JackandJillPolitics.com or Daily Kos. And Myspace couldn’t cut a deal with Verizon to slow down Facebook’s traffic so that consumers would choose Myspace instead. In that way, net neutrality guarantees that the Internet remains an open platform for ideas and innovation, where anyone with a good idea and technical know-how can find success — just like Sergey Brin and Larry Page, Google’s founders. Last Monday Google reversed its historic support for net neutrality, joining Verizon — an Internet provider that has been working to weaken or eliminate net neutrality — in announcing a policy proposal which, if adopted as law, would spell the end of the Internet as we know it. There are tons of problems with this proposal for everyone.  But as is often the case, poor people and people of color will get the worst of it. It would divide the Internet into a network-neutral “public Internet” and a much faster “private Internet,” where broadband carriers could write the rules. But the devil is in the details — the public Internet’s net neutrality protections are so weak that most Internet providers would be able to go around the rules frequently. The other major problem here is that the private Internet would come to choke the life out of the public Internet. As more of the companies and organizations that wanted to take advantage of cutting edge speed and services merely stopped producing content for the public Internet, the Internet would become a pay-to-play enterprise. As io9′s Annalee Newitz put it : “The public internet? Yeah, that’s just for poor people. But guess what’s going to remain on the public net, the place where you go when you don’t have money? Certainly there will be educational resources like Wikipedia. But mostly it’s going to be advertisement-saturated free content from major entertainment companies…. Put in brick-and-mortar terms: There won’t be any produce markets on the public internet, but there will be plenty of liquor stores. Another disturbing aspect of the Google-Verizon proposal is its so-called “wireless carveout” — essentially saying that mobile Internet would not be subject to network neutrality rules. All the same reasons that net neutrality is important on regular wired networks apply to wireless networks, and it’s important for all Americans. Wireless broadband is the future of the Internet, and the telecom companies want to kill neutrality there to lay the groundwork for a profit bonanza. But it’s also true that changing trends in Internet usage indicate that many of the harms of a non-neutral wireless Internet would disproportionately fall on communities of color. According to The New York Times ,the percentage of African-Americans using mobile phones or other connected devices to share e-mail, exchange instant messages and access the Internet for information on an average day has more than doubled since late 2007, jumping to 29 percent, from 12 percent. By comparison, only 19 percent of Americans over all log on to the Internet on a mobile device on a typical day. And nearly half of all African-Americans and English-speaking Hispanics were using mobile devices to surf the Web and send e-mail messages, compared to just 28 percent of white Americans. Perhaps worst of all, the Google-Verizon proposal would leave the web without meaningful protection from corporate abuses. If, under this framework, an Internet provider were caught violating one of the few rules left in place, their maximum fine would be $2 million. But as law professor Marvin Ammori notes , Verizon makes that much money in revenue every 10 minutes, and $10 million in profit every three hours. They would have little incentive to ever do the right thing so long as the benefits of their actions outweighed the cost, and in fact, their shareholders would come to demand it. As Ammori later says: “If the punishment for bank robbery was $10, we’d have more bank robberies…. Verizon and Google have a duty to their shareholders to maximize profit. Their proposal essentially says that cheating on your taxes lets you keep the taxes, if you pay 5 bucks. Of course their shareholders will expect cheating; the law makes it profitable.” This is what happens when corporations write the rules they are supposed to play by — they win, and the public loses. The good news is that this scheme isn’t law yet, and the Federal Communications Commission still has the power to act for the public’s best interest. But it first must revisit a Bush-era decision to deregulate broadband. By revisiting this decision and reclassifying broadband as a communication service, the FCC can do everything it needs to do to protect American consumers. And in fact, the Chair of the FCC, Julius Genachowski, announced his intentions to do this. But he has backed away from this plan under intense pressure from the telecommunications industry, choosing to try negotiating a deal with them instead. That’s why it’s so important to speak out and demand immediate action to protect the Internet, and our future in this new digital century. When the banks wrote and enforced the rules on Wall Street, our financial system melted down. When BP and other oil giants wrote and enforced the rules for deep-sea drilling, the Gulf Coast suffered the worst oil spill in world history. It would be foolish to now entrust the Internet’s future to the profiteers in the broadband industry and their new ally, Google. The FCC has all the tools it needs to protect our interests and ensure the Internet remains a vital engine of information exchange and innovation. Genachowski must act now, before Google and Verizon’s bad idea becomes an even worse reality.

Read the full article →

Video: Jaroslovsky Discusses Google Net-Neutrality Proposal: Video

August 13, 2010

Aug. 13 (Bloomberg) — Bloomberg’s Rich Jaroslovsky discusses this week’s joint statement from Google Inc. and Verizon Communications Inc. on so-called net-neutrality rules. He talks with Erik Schatzker on Bloomberg Television’s “InsideTrack.” (Source: Bloomberg)

Read the full article →

Tony Greenberg: The Google/Verizon Walled Garden Plan: No Substantive Impact on Net Neutrality

August 11, 2010

by Tony Greenberg and Alex Veytsal see more here In the hubbub over the Google and Verizon new net neutrality plan, a couple of things stand out: There is no actual deal, just a proposed compromise that no one actually likes. Everyone seems to be confused about the new, private Internet. While more viable than its critics suppose, this solution will implode in a wave of mistrust. Even if implemented, there is no equilibrium state possible between the public and private Internet. That’s because the new private Internet is not new — it’s what used to be called a walled garden. When there is a free and open alternative (think AOL versus a typical modern ISP), the garden eventually withers as every able-minded user scrambles over the wall. When there is no alternative (think iPhone’s app store), it’s a monopolistic cash cow. Either way, sustained equilibrium between the two is rarely achieved. Each side is likely counting on the loss of that balance betting on their own models of the wall between private and public. And that gets us back to the wave of mistrust that will sink this ship before it leaves harbor. The Upside As artificial as a public/private system is, it’s actually one of the better ways of settling a claim of fact. In this case, whether users are better off in a friendly/fascist dictatorship of the ISP or the wild anarchy of the real internet. The proposal simply puts each party’s money where its marketing claims are. Google, Facebook, Microsoft, etc. will build content and apps for the public Internet. The ISPs will take a pound of flesh from some has-been provider struggling to make it in a free market, prop up a startup or get into the content business directly, ignoring the lessons of AOL Time Warner. Then the two will step into the ring. “In the blue corner, weighing in at three billion users, we have independent content providers.” “In the red corner, weighing their brass knuckles, your friendly neighborhood ISPs” Downside: Competition as Real as the WWF Unfortunately, this match is likely to be viewed by the public as more akin to wrestling than a more noble form of pugilism. Specifically, net neutrality advocates suspect (and not without cause) that the match will be rigged to split championship belts among the participants based on pre-decided backroom deals. Google will be bought off with no competition on search, or something cheaper like peering or local edge caching. And 3D TV or some new market will be left to wither in customer value under the tender auspices of a private walled garden. Most notable in this is the inclusion of wireless networks as explicitly open to traffic shaping of all kinds. Unlike wired networks, which are strongly monopolistic due to the limited amount of access paths for the last mile, wireless networks are much more open to competition. This makes the resolution a bittersweet one. On the one hand, wireless networks are the last resort of customers whose local ISPs have crossed the bounds of decency and good conduct, and a market dominated by non-neutral providers would close that escape hatch. On the other hand, the whole reason for net neutrality as a legal principle was the lack of true competition in the last mile. Since wireless networks are less constrained in terms of reach, a major metro area is likely to get several options, at least one of which is neutral. Rural and suburban areas, on the other hand, may be in for a rougher ride. The History of Walled Gardens One of the big mysteries to most of the observers is what exactly the “private Internet” or “fast lane” actually is. The best vendor neutral term for it is walled garden where the access provider selects a pre-approved, limited, and revenue-generating set of content and applications to push to its users. But the lack of clarity and solid examples is at the heart of the compromise. The way that each side looks at it betrays their expectations of how a free competition would play out: Verizon and other ISPs look at it as some equivalent of the iPhone App Store, generating revenue, giving control over content, and creating a differentiable brand experience that locks people in through third-party efforts. Google and other content providers look at it as some revival of AOL’s keyword system, which served an ever-shrinking fringe of people who were unsuccessful in cancelling their subscription. In our core business of sourcing IT services, these types of compromises where lack of clarity substitutes for true agreement are perhaps the most dangerous thing in a contract. What both parties usually find is that in working together, there are concrete gaps between the gross uptime that a business user wants and the net uptime that a service provider is willing to be responsible for. Similarly, there are differences between the locked-down App Store version of a walled garden and the leaky AOL version that might sink an actual implementation of the private internet as a collaborative venture. A DOA Proposal Both Google and Verizon are manned by pretty bright folks with big visions. The Google story doesn’t need any more dithyrambs, but Verizon certainly deserves some credit for its fiber to the home initiatives and solid mobile infrastructure. But for something that was created by a couple of the more innovative organizations in their respective fields, the compromise came out a bit tone deaf to the needs and prejudices of all the relevant constituencies: The FCC, still smarting from the rejection of its authority to govern Net Neutrality didn’t appreciate being locked out of an informal role as a broker in closed-door talks, which it then completely closed the door on. Other ISPs and content providers that were working with the FCC see Google and Verizon as undermining closed-door talks even as they participated in them, not to mention looking at the private agreement as a publicity stunt. Net Neutrality advocates, spurred on by WSJ and NYT stories, already had their pitchforks and torches ready as soon as they heard about the talks. Any outcome short of, “Google used these talks as a Trojan horse to throw pies at Verizon executives,” would have resulted in the same tarring and feathering for consorting with the enemy and betrayal of the cause. The proposal wasn’t chewed up clearly enough for the mass media, which turned to the easy-to-write reaction stories instead. Much Ado about Nothing The most important outcome of the talks was actually the non-existence of an agreement. Namely that Verizon and Google don’t have a backroom deal to implement their own private net neutrality vision. Without leading by example, this agreement will sink or swim by its public appeal. And since everyone seems to hate it, swimming would likely require quite a miracle. Most likely, it will quietly sink into oblivion three months from now. Perhaps its most salutary effect is going to be highlighting how far apart the sides are and the need for a strong independent arbitrator. And that might still be the FCC despite its shaky legal authority and hissy fit over the separate agreement.

Read the full article →

Adam Green: Google Goes "Evil"

August 9, 2010

I just got off a media conference call with Google CEO Eric Schmidt and Verizon CEO Ivan Seidenberg. They announced a new policy recommendation that would kill the Internet as we know it, if implemented by FCC Chair Julius Genokowski and other policy makers. The Google/Verizon deal ( also posted online ) basically says: The old “wireline” Internet that will be irrelevant in a few years? We propose a “new, enforceable prohibition against discriminatory practices” on that. New “wireless services” (aka the entire future of the Internet)? No equivalent nondiscrimination rules for that, but we'll “create enforceable transparency rules.” That way, as Americans lose access to the free and open Internet, they can visibly watch it go away. Just in case “wireless services” doesn't encompass the entire future of the Internet, a new class of “new services” is envisioned, which Schmidt and Seidenberg actively differentiated from “the public Internet.” Basically, through private contracting, big corporations could deal directly with the Verizons and AT&Ts of the world to create the next YouTube, maybe dangle it without discrimination to the public just long enough for us to be hooked, and then discriminate like hell over it. But don't worry, the FCC will “monitor the development of these services.” Google, a company that I've long admired and currently hold thousands of dollars of stock in, just “went evil.”

Read the full article →

Lowell Peterson: Verizon and Google: The Deal of the Titans

August 5, 2010

The world’s biggest media companies want to define how people will get content over the Internet. Money talks; independent content creators: take a walk. A mega-deal is reportedly in the works in which Verizon will favor Internet content from Google because Google has the spare cash to pay for preferred access. And this is being touted as the model for how content providers and Internet service providers will do business. We have seen the future, and it is exactly like the past. The Writers Guild of America, East , AFL-CIO represents people who write, edit, produce, and create graphics for television, film, radio, and digital media. Our members write television drama, comedy, news, and public interest programs; they write movies for major studios and for independents; they create original content for the web, for mobile applications, and for other digital platforms. Our members know firsthand how an open Internet permits them to create more innovative, informative content and to distribute it directly to the public. The Internet and other digital media offer an unprecedented opportunity for creators to reach consumers and for people to watch and read what they want, when they want. This is very different from traditional media in which major studios, distributors, and television networks control the flow of movies and programs. Digital technology presents a vast range of possibilities to content creators and consumers alike, and it would be a tragedy to squeeze all of that into a narrow commercial band. But that is exactly what will happen if the Federal Communications Commission and Congress permit the Verizon-Google deal to become the blueprint for the digital future. If one of our members had written the Verizon-Google deal into a script, it would have been rejected as too obvious, too heavy-handed. At the height of the nation’s debate about net neutrality, two of the biggest players in the industry blow the entire concept to smithereens by discriminating against certain content providers in favor of those with the deepest pockets. Now the Internet will resemble television and the movies: completely dominated by a handful of multinational conglomerates that decide what the public will watch based, not on the quality of the programming, but on the margin of profit. Verizon falls easily into the role of villain; Google becomes the feckless sell-out. We could have written it ourselves, but no one would have bought the story. And this movie has a prequel: The proposed merger of Comcast (the other mega-ISP) and NBC Universal (quintessential television network and studio). Comcast the content distributor will have a huge economic incentive to discriminate in favor of the content it creates as a studio and television network. Let’s write a different ending to this story. The FCC and Congress can ensure that the American people have access to a wide array of independently-produced programs that entertain and enlighten, that present the whole spectrum of our diverse opinions and experiences and cultures. We do not have to allow Verizon, Comcast, Google, and NBCU to divide up the digital pie amongst themselves.

Read the full article →

Video: Eichenbaum Discusses AT&T, Verizon Credit-Card Plan: Video

August 2, 2010

Aug. 2 (Bloomberg) — Bloomberg’s Peter Eichenbaum talks with Julie Hyman about AT&T Inc. and Verizon Wireless’s plan to displace credit and debit cards with smartphones, posing a new threat to Visa Inc. and MasterCard Inc. The trial would be the carriers’ biggest effort to spur mobile payments in the U.S. and supplant more than 1 billion plastic cards in American wallets. The system would allow consumers to pay at stores with a contactless wave of a smartphone. (Source: Bloomberg)

Read the full article →

Video: Larsen Says Verizon `Might Not Jump’ to Sell IPhone: Video

July 23, 2010

July 23 (Bloomberg) — Christopher Larsen, an analyst at Piper Jaffray & Co., discusses Verizon Communications Inc.’s second-quarter earnings reported today and prospects for the company to carry Apple Inc.’s iPhone 4. Larsen talks with Betty Liu on Bloomberg Television’s “In the Loop.” (Source: Bloomberg)

Read the full article →

Video: Jeff Jarvis Sees Verizon IPhone Plan Hurting AT&T Sales: Video

June 30, 2010

June 30 (Bloomberg) — Jeff Jarvis, author of “What Would Google Do?,” discusses the prospects of Verizon Wireless selling Apple Inc.’s iPhone and its impact AT&T Inc.’s iPhone sales and on Google Inc., which makes the Android operating system. Jarvis speaks with Betty Liu on Bloomberg Television’s “In the Loop.” (Source: Bloomberg)

Read the full article →

Bob St. Germain’s $18,000 Phone Bill Dismissed By Verizon

May 17, 2010

BOSTON — Verizon says a Massachusetts man won’t have to pay the balance of an $18,000 cell phone bill his son racked up when he connected his phone to a laptop to get Internet service. Dover resident Bob St. Germain tells The Boston Globe newspaper the telecommunications company has told him it’ll no longer try to collect the charges. Bryan St. Germain ran up the charges over six weeks in 2006. He says he didn’t realize a two-year promotional offer allowing free access had expired. Verizon Wireless says it cut the phone bill in half before sending it to a collection agency but it considers the remaining balance uncollectible. Bob St. Germain says he’s glad Verizon has dismissed the charge but it remains on his credit report. Verizon says such cases are “exceptionally rare.” ___ Information from: The Boston Globe, http://www.boston.com/globe

Read the full article →

Verizon Expects to Incur $970 Million Expense From Health-Care Legislation

April 1, 2010

By Amy Thomson April 1 (Bloomberg) — Verizon Communications Inc. , the second-largest U.S. phone company, will incur $970 million in expenses related to the U.S. health-care overhaul signed into law last month. The one-time, non-cash expense will be taken in the first quarter, New York-based Verizon said late today in a regulatory filing . Verizon follows AT&T Inc. , the biggest U.S. carrier, Deere & Co ., Caterpillar Inc. and other companies in disclosing similar costs after losing a tax benefit for retiree plans. The costs may reduce corporate profits by as much as $14 billion as companies factor in the impact of the health-care reforms, according to benefits consulting firm Towers Watson. “From a corporate perspective, they’re probably disappointed because it takes money out of their coffers,” said Jonathan Schildkraut , an analyst at Jefferies & Co. in New York. Still, “this bill doesn’t make Verizon any less well-positioned vis-à-vis cable competitors or AT&T. It doesn’t make AT&T any less well positioned.” Schildkraut, who advises investors to buy Verizon shares and doesn’t own any, said he was expecting the expense to be around $750 million. Verizon rose 26 cents to $31.28 at 4 p.m. in New York Stock Exchange composite trading . The stock has dropped 5.6 percent this year. To contact the reporter on this story: Amy Thomson in New York at athomson6@bloomberg.net

Read the full article →

Stocks in U.S. Rise as Home Price, Confidence Data Spur Economic Optimism

March 30, 2010

By Rita Nazareth March 30 (Bloomberg) — U.S. stocks rose, sending the Standard & Poor’s 500 Index up for a third day, as better- than-forecast data on home prices and consumer confidence bolstered optimism the economic recovery is strengthening. Verizon Communications Inc. rallied 2.4 percent after the Wall Street Journal reported Apple Inc. is developing a version of its iPhone that will work over the Verizon Wireless network. Danaher Corp. advanced 4.3 percent as the maker of Craftsman tools increased its first-quarter profit forecast. Home Depot Inc. and Lowe’s Cos. climbed after the S&P/Case-Shiller index of home prices in 20 U.S. cities and the Conference Board’s consumer sentiment index topped economists’ estimates. The S&P 500 gained 0.3 percent to 1,177.18 as of 10:04 a.m. in New York. The Dow Jones Industrial Average rose 35.82 points, or 0.3 percent, to 10,931.68. “Housing has certainly bottomed,” said Stanley Nabi , New York-based vice chairman of Silvercrest Asset Management Group, which oversees $8.5 billion. “It obviously won’t be a very strong upturn, but things are getting better. The market is not expensive. We expect stocks to deliver at least a 15 percent return over the next 12 months.” U.S. stocks rose yesterday, sending the Dow Jones Industrial Average to an 18-month high, after consumer spending increased for a fifth month and European confidence in the economic outlook improved. Four-Quarter Rally The S&P 500 has rallied for the last four weeks, heading for a fourth straight quarterly advance, on speculation the economy is recovering from the worst contraction since the 1930s. Stocks could rise “another 3 to 5 percent,” Russ Koesterich , the San Francisco-based head of investment strategy for scientific active equities at BlackRock Inc., which manages $3.35 trillion in assets, told Bloomberg Television. “If you want to be aggressive, I wouldn’t get short the market right now. There are a couple of things that are still going to support you — lower rates, good macro environment and earnings estimates for the first quarter.” U.S. Treasury Secretary Timothy F. Geithner said U.S. employers soon may start hiring again after weathering the worst recession since the Great Depression. “The economy is getting stronger,” Geithner said yesterday in an interview on CNBC. “We’re probably just on the verge now of what we think will be a sustained period of job creation finally.” To contact the reporter on this story: Rita Nazareth in Sao Paulo at rnazareth@bloomberg.net .

Read the full article →

Verizon Said to Plan Putting Skype on Its Mobile Phones to Stave Off AT&T

February 13, 2010

By Olga Kharif, Spencer Ante and Joseph Galante Feb. 13 (Bloomberg) — Verizon Wireless, the largest U.S. wireless carrier, will include Skype Technologies SA’s Internet- calling software on phones to stave off competition from AT&T Inc., according to two people familiar with the matter. The service will let customers make Skype calls over the company’s 3G data network, said the people, who requested anonymity because the agreement hasn’t been announced. Verizon and Skype said yesterday that they will hold a joint press conference Feb. 16 at the Mobile World Congress in Barcelona, Spain. The companies gave no further details. Verizon is relying on 3G data plans for growth as demand slows for voice calls. Teaming up with Skype could draw new users, who might boost spending on extra features. The agreement sets the stage for similar deals with other carriers, said Vanessa Alvarez, an analyst at Frost & Sullivan in Boston. “It’s a big win for Skype,” Alvarez said. “The wireless operators and incumbent service providers are starting to think differently and accept these types of partnerships. Others are going to follow.” Brenda Raney , a spokeswoman for Basking Ridge, New Jersey- based Verizon Wireless, declined to comment. Jennifer Caukin , a spokeswoman for Luxembourg-based Skype, declined to comment. Skype will be preloaded onto a range of phones, including lower-end models, the people said. Hong Kong Carrier Skype’s software has already proven its value in retaining users — and even attracting new subscribers — for at least one company: Hong Kong-based Hutchison Whampoa Ltd. That company’s carrier, known as 3 , began selling phones preloaded with Skype’s software in 2007. The device, called Skypephone, attracted hundreds of thousands of new customers. Almost 80 percent of Skypephone subscribers are new Hutchison customers, Skype told Bloomberg BusinessWeek last year. Verizon has been trying to differentiate itself from AT&T, the second-largest U.S. mobile-phone carrier, which has exclusive U.S. rights to Apple Inc. ’s iPhone. An agreement with Skype, which has more than 520 million users, may give it an edge against AT&T, said Rebecca Swensen, an analyst at IDC , a research firm in Framingham, Massachusetts. “What’s important is that Verizon understands that, at some point, they are going to be losing voice minutes to the data world,” Swensen said. “This makes their platform more valuable for end-users. It could be a differentiator for Verizon Wireless.” AT&T’s Network Skype already works on AT&T ’s Wi-Fi networks in the U.S. Skype has said it’s developing a version that will work on AT&T’s 3G network as well. Skype has been lobbying the U.S. Federal Communications Commission to prohibit carriers from blocking Internet traffic on their wireless networks, something that’s hindered its growth. The agency may vote on these so-called net-neutrality rules this year. Verizon Wireless is co-owned by Verizon Communications Inc. and Vodafone Group Plc. Revenue from its data plans, which make up almost a third of wireless service sales, grew 46 percent last quarter. That was almost double the carrier’s total sales growth of 23 percent. Verizon cut the price of unlimited calling plans over its voice network last month, making them $69.99, down from $99.99. The new price is part of a larger move to get subscribers to pay for more data plans. AT&T cut its prices the same day. Skype aims to reach $1 billion in revenue by 2011. Sales and profit growth accelerated last year, Chief Executive Officer Josh Silverman said in an interview last month. Skype is the largest provider of international calling services, accounting for more than 12 percent of all cross-border voice traffic, according to Washington-based research firm TeleGeography. Verizon Communications fell 11 cents to $28.93 yesterday in New York Stock Exchange composite trading. Shares of the New York-based company have dropped 13 percent this year. Skype is owned by a group of investors led by private- equity firm Silver Lake. EBay Inc., its former owner, retained a 30 percent stake in the company. To contact the reporters on this story: Olga Kharif in Portland, Oregon, at okharif@bloomberg.net ; Spencer E. Ante in New York at sante1@bloomberg.net ; Joseph Galante in San Francisco at jgalante3@bloomberg.net

Read the full article →

Google to Build High-Speed Internet Network in Challenge to AT&T, Verizon

February 10, 2010

By Ari Levy and Kelly Riddell Feb. 10 (Bloomberg) — Google Inc. is planning to build high-speed fiber-optic broadband networks in the U.S. to offer Internet speeds that are more than 100 times faster than what Verizon Communications Inc. and AT&T Inc. sell today. The company, owner of the world’s most popular Web-search engine, said today it will offer the service at a “competitive price” to at least 50,000 people and potentially as many as 500,000. Google wants to use the networks for applications that consume lots of bandwidth. Google’s jump into the market may pressure AT&T , Verizon and Comcast Corp. to bolster their high-speed networks, said Mike Jude, an analyst at researcher Frost & Sullivan in Denver. The company already offers a wireless network in Mountain View, California, and is an investor in Clearwire Corp. , which provides Internet access using a technology called WiMax. “The more competition in broadband the better, the higher the bandwidth the better,” Jude said. Google’s plan to offer speeds of 1 gigabit per second may prompt competitors to follow, he said. “If Google went out and started delivering a gigabit per subscriber, it would show that anybody with fiber can do the same thing.” Verizon’s FiOS, AT&T’s U-Verse, and Comcast’s DOCSIS 3.0 services offer residential downloads no faster than 50 megabits a second, with the cheapest connections being 1 megabit or less. While the companies could offer faster speeds, they haven’t done so because there hasn’t been demand, said Lawrence Harris , an analyst at CL King & Associates in New York. A 1-gigabit service could be popular with video-game players and those who want faster video, and could eventually extend into 3-D viewing, Harris said. ‘Real Progress’ Google’s first step is to find cities that want the service, said Minnie Ingersoll, a product manager at the Mountain View-based company. She said Google will likely identify at least one city this year. The company’s engineers and outside developers will work on applications that illustrate the speed of the fiber connection, she said. Google plans to work with companies that build fiber-optic networks, Ingersoll said. Google is probably still soliciting interest from vendors, and companies that helped with Verizon’s FiOS build may be poised to benefit from the project, Harris said. Those include Alcatel-Lucent SA , BigBand Networks Inc., Tellabs Inc. and Corning Inc., he said. “Network providers are making real progress to expand and improve high-speed Internet access, but there’s still more to be done,” Google said on its blog. “We don’t think we have all the answers — but through our trial, we hope to make a meaningful contribution to the shared goal of delivering faster and better Internet for everyone.” Broadband ‘Testbed’ Google fell $2 to $534.45 at 4 p.m. New York time on the Nasdaq Stock Market. Comcast slid 8 cents to $15.31. AT&T fell 14 cents to $25.12 on the New York Stock Exchange, and Verizon rose 12 cents to $28.87. Google has urged the Federal Communications Commission to find new ways to promote high-speed Internet access. FCC Chairman Julius Genachowski said today in a statement that Google’s trial is a “testbed for the next generation” of Internet services. Bob Varettoni , a spokesman for New York-based Verizon, said Google’s network expansion is “another new paragraph in this exciting story.” AT&T spokesman Michael Coe and Comcast spokeswoman D’Arcy Rudnay declined to comment. “We look forward to learning more about Google’s broadband experiment in the handful of trial locations they are planning,” Brian Dietz , a National Cable and Telecommunications Association spokesman, said in a statement today. The cable industry will invest in and improve the speed of its networks, he said. Clearwire Investment Google will collect responses from communities until March 26, and will announce which areas have been chosen later this year. The company plans on building the fiber lines to the home, much like Verizon’s FiOS, and will be paying for the deployment, Ingersoll said. Verizon is investing $23 billion in its fiber-optic network. Ingersoll declined to specify how much money Google has dedicated to its venture. The company had $24.5 billion in cash and short-term investments at the end of December. Google is expanding in the telecommunications industry in other ways. In January, the company introduced a touch-screen mobile phone called Nexus One and opened an online store to sell the handset. In 2008, Google was part of a group of companies that invested in Clearwire, founded by mobile-phone pioneer Craig McCaw . ‘Grandiose’ Plans In 2008, Google pushed for spectrum being auctioned by the U.S. government to be open to any device or program. “Google’s announcement today amounts to a nationwide competition for communities to step up and make the case for what a next generation network could do for them and then show America what is possible,” Massachusetts Senator John Kerry said in a statement. “I believe in the power of big broadband pipes over which people are free to innovate and deliberate and will be watching this experiment carefully.” In 2006, Google won a bid to build a free Wi-Fi network in San Francisco. The plan was put on the back burner after EarthLink Inc., which was going to build the network, backed out and city politics delayed deployment. “Sometimes Google has a very short attention span, they have grandiose plans and then a year later everyone asks what have they done with that?” said Tero Kuittinen , an analyst at MKM Partners LP in Greenwich, Connecticut. “This announcement took everyone a bit by surprise and we don’t know what’s going to come of it.” To contact the reporters on this story: Ari Levy in San Francisco at alevy5@bloomberg.net ; Kelly Riddell in Washington at kriddell1@bloomberg.net

Read the full article →

Wizards’ Gilbert Arenas Charged With Felony Gun Count in Locker Room Case

January 14, 2010

By Cary O’Reilly and Scott Soshnick Jan. 14 (Bloomberg) — Washington Wizards guard Gilbert Arenas , suspended indefinitely from professional basketball after admitting to having guns in his locker, was charged with a felony count of carrying a handgun without a license. The charge carries a maximum jail term of five years, Channing Phillips , U.S. Attorney for the District of Columbia in Washington, said in an e-mailed statement. “On or about Dec. 21, 2009, within the District of Columbia, Gilbert J. Arenas, did carry, openly and concealed on or about his person, in a place other than his dwelling place, place of business or on other land possessed by him, a pistol, without license/licenses issued pursuant to law,” Assistant U.S. Attorney Chris Kavanaugh said in a criminal information filed today in Superior Court of the District of Columbia. Arenas, 28, has said he misinterpreted a change in local gun laws when he moved four firearms to his locker at the Verizon Center in Washington from his home in Virginia to keep them away from his children. Arenas was suspended without pay on Jan. 6 by National Basketball Association Commissioner David Stern . To contact the reporters on this story: Cary O’Reilly in Washington at caryoreilly@bloomberg.net ; Scott Soshnick in New York at ssoshnick@bloomberg.net .

Read the full article →

AT&T Drops Lawsuit to Stop Verizon Ad Campaign Over 3G Network’s Coverage

December 2, 2009

By Erik Larson and Amy Thomson Dec. 2 (Bloomberg) — AT&T Inc. , the largest U.S. phone company, agreed to drop its lawsuit to stop a Verizon Wireless advertising campaign that AT&T said unfairly depicts its mobile- phone network coverage. AT&T filed a notice of dismissal today in federal court in Atlanta, less than a month after U.S. District Judge Timothy Batten denied AT&T’s request to stop the ad campaign and said AT&T was unlikely to prevail in the case. In last month’s ruling, Batten said that while the ads, which use maps to compare the companies’ so-called third- generation networks, might be “sneaky” or “clever,” they are “literally true.” A hearing for AT&T to again ask the court to prohibit the ads had been scheduled for Dec. 16. Cellco Partnership , which does business as Verizon Wireless, also dropped its suit against AT&T . Cellco preemptively sued AT&T in federal court in New York in July, asking a judge to rule that its ads claiming to have the “most reliable” network were truthful and accurate. AT&T, which trails Verizon Wireless in mobile subscribers , sued back on Nov. 3 in Atlanta, claiming that Verizon’s “There’s a Map for That” ad suggests that AT&T customers can’t fully use their phones outside 3G coverage areas. Third- generation networks make wireless data services, like Web browsing and game downloads, faster. Low Satisfaction AT&T ranked lowest in customer satisfaction among the top four U.S. wireless carriers in an annual survey by Consumer Reports. Verizon Wireless ranked highest. AT&T customers said they paid the highest monthly bills for voice and data plans for two phone lines, and its voice quality was rated the worst. AT&T and Verizon Wireless are competing for a dwindling pool of new customers as there are enough mobile devices to cover about 90 percent of the U.S. population, according to the CTIA wireless-industry association . AT&T said wireless-data revenue rose 34 percent to $3.6 billion in the third quarter from a year earlier. Verizon reported a 48 percent increase to $4.1 billion. AT&T’s lawyer, David Balser of the firm McKenna Long & Aldridge LLP in Atlanta, didn’t immediately return a call seeking comment. Verizon’s lawyer, Joseph Loveland of King & Spalding LLP in Atlanta, also didn’t return a call. AT&T rose 17 cents to $27.35 in New York Stock Exchange composite trading at 1:34 p.m. The Dallas-based company’s stock had declined 4.6 percent this year before today. Verizon Communications Inc., which co-owns Verizon Wireless with Vodafone Group Plc, rose 33 cents to $32.67 and had also dropped 4.6 percent this year. The case is AT&T Mobility LLC v. Cellco Partnership, 09-cv- 3057, U.S. District Court, Northern District of Georgia (Atlanta). To contact the reporters on this story: Erik Larson in New York at elarson4@bloomberg.net ; Amy Thomson in New York at athomson6@bloomberg.net

Read the full article →

Video: Eagan Says DirecTV Doesn’t Need Phone Company Merger: Video

November 19, 2009

Nov. 19 (Bloomberg) — Tom Eagan, an analyst at Collins Stewart LLC, talks with Bloomberg’s Carol Massar and Matt Miller about the possibility of a takeover of DirecTV Group Inc. by a phone company. DirecTV Chairman John Malone won’t rule out a takeover by AT&T Inc. or Verizon Communications Inc., saying they will likely have close ties to his company as they develop packages of phone and television service. Eagan also discusses new chief executive officer Michael White. (Source: Bloomberg)

Read the full article →

Video: Ulanoff Discusses Verizon Droid, Smart Phone Competition: Video

November 6, 2009

Nov. 6 (Bloomberg) — Lance Ulanoff, editor-in-chief of PCMag.com, talks with Bloomberg Television about Motorola Inc.’s Droid smart phone, which is powered by Google Inc.’s Android operating system and serviced through Verizon Wireless. (This is an excerpt from the full interview. Source: Bloomberg)

Read the full article →

Google-Fueled Droid Attacks IPhone With Flash: Rich Jaroslovsky

November 5, 2009

Commentary by Rich Jaroslovsky Nov. 6 (Bloomberg) — “It’s kind of heavy, isn’t it?” Those are the first words people seem to utter when they heft a Droid smart phone. And the answer is, yeah, it is — maybe because so much is packed into it. Start with the ambitions of Google Inc. , whose Android 2.0 operating system powers it, and Verizon Wireless, which is backing it in the U.S. with a huge marketing campaign. And don’t forget the prayers of Motorola Inc. , the humbled former wireless-phone king, which is betting its future on Android. Well, they can relax. Weight notwithstanding, the Droid may be the best smart phone not made by Apple Inc. And if it doesn’t convert legions of iPhone addicts, it still provides a terrific alternative for Verizon customers, as well as for non-U.S. users when it appears later this month as the Motorola Milestone . The Droid was the standout among three new phones I’ve been trying out. The others, both BlackBerrys from Research In Motion Ltd. , will find devotees among RIM’s faithful customer base and those who must carry a BlackBerry for business reasons. But it’s hard to see them winning many new fans. This is a golden era for smart phones, which are really pocket computers that can surf the Web, retrieve e-mail, run programs and play video and games. The iPhone, with its ease of use and 100,000 applications, sets the bar. But there are some things it doesn’t allow — running programs simultaneously, replacing the battery, correctly displaying Web sites that use Adobe Systems Inc .’s Flash multimedia technology — that Droid does. And U.S. iPhone users are locked into AT&T Inc.’s network, which is inferior to Verizon’s in much of the country. Chunkier Than iPhone The Droid will cost $199.99, after a $100 rebate, on a two- year contract; it shouldn’t be confused with a cheaper phone made by HTC Corp. that Verizon is reportedly launching as the “Droid Eris.” Compared with the iPhone, the Droid is longer, thicker, narrower and, at 6 ounces, 25 percent heavier. (Six ounces may not seem like much, but you definitely feel the difference.) The touch screen, which provides the sensation of physically pushing a button, is particularly dazzling, offering noticeably sharper resolution. Your first look at the Droid’s slide-out keyboard might not be encouraging: The keys are flat and undifferentiated. But typing proves surprisingly easy; they are large enough so you can use your fingertip, rather than the fingernail that I had to resort to on, say, Palm Inc.’s Pre. Less useful is the five-way navigation pad, which requires too much pressure and constant monitoring of the screen to see what it is highlighting. I found myself using my finger on the screen for scrolling, highlighting and selecting, even if I was using the physical keyboard for typing. Shutter Lag Also problematic is the camera. On paper, it looks great, boasting 5 megapixels and flash. But a lag between pressing the shutter and taking the picture meant that even slow-moving subjects yielded unsatisfying results. The Droid is the first phone to make use of “Éclair,” Google’s name for version 2.0 of its open-source Android operating system . Previous encounters with Android on devices such as the myTouch 3G from Deutsche Telekom AG’s T-Mobile unit left me lukewarm. Éclair, though, has a more finished feel. Its window-shade metaphor — slide the top shade down for alerts, the bottom one up for apps — works well with the Motorola hardware, and the number of available apps, now 10,000, is steadily climbing. Android seems well on its way toward establishing itself as an important platform for developers. Screen Features Multitouch — the pinch and expand gestures that let you shrink or magnify what’s on the screen — is missing from the Droid but apparently will be enabled for the non-U.S. Milestone version, which will be available from carriers including Vodafone Group Plc , Verizon Communications Inc.’s partner in Verizon Wireless, and Telefonica SA’s O2. The iPhone’s margin in apps and its seamless user experience still make it the best smart phone out there. But the wireless world is big enough for more than one excellent phone; in the Droid, it has another. Research in Motion’s new BlackBerry Storm2 isn’t excellent, but it’s a considerable improvement over its predecessor. The original Storm, released a year ago, was the first BlackBerry without a physical keyboard, and reviewers savaged it: The New York Times memorably labeled it the “ BlackBerry Dud ” for its sluggish performance, lack of WiFi and buggy software. The Storm2 fixes a lot of things, adds some new features and generally allows BlackBerry to at least figure in any discussions about touch-screen smart phones. The most interesting feature of the Storm2 is a screen whose entire surface serves as a button, providing a tactile click when you press it, much like the touchpad on the current- model MacBook. (The clickiness goes away when the phone’s off.) Touch and Press If you’re like me, you’ll quickly banish the optional keyboard layouts that put more than one letter on a key. The touch-to-highlight, press-to-type system isn’t half-bad, though it would take a lot more practice before I could match my speed on either the iPhone or a traditional physical-keyboard BlackBerry. Positives for the Storm2 include WiFi (hooray!). Negatives are a clunky Web browser and many fewer apps than are available for the iPhone and Android devices. The Storm2 is available in the U.S. from Verizon for $179.99 on a two-year contract, and in Europe and South Africa through Vodafone. Finally, if you’re old-school BlackBerry — as in, “I’ll give up my physical keyboard when they pry it from my cold, dead fingers” — there’s the Bold 9700 , the newest iteration of the classic e-mail machine. Smaller and lighter than the previous Bold, it replaces the familiar trackball with a trackpad that makes scrolling easier. The new Bold goes on sale this month from AT&T and T-Mobile in the U.S. for $199 on a two-year contract, and from carriers including Vodafone and T-Mobile internationally. The T-Mobile version, for an extra fee, allows voice calls over WiFi networks. ( Rich Jaroslovsky is a Bloomberg News columnist. The opinions expressed are his own.) Click on “Send Comment” in the sidebar display to send a letter to the editor. To contact the writer of this column: Rich Jaroslovsky in New York at rjaroslovsky@bloomberg.net .

Read the full article →

MediaG3, Inc. Announces Veteran Telecom Executive to Join Management Team

November 2, 2009

MediaG3 Appoints Former Verizon Regional President to Lead WiMax Services

Read the full article →

Video: Wired’s Thompson Sees `Slow Build’ for Android Phones: Video

October 26, 2009

Oct. 26 (Bloomberg) — Nicholas Thompson, senior editor of Wired magazine, talks with Bloomberg’s Matt Miller and Carol Massor about prospects for devices using Google Inc.’s Android operating system.¶ Thompson also discusses Verizon Wireless’s “Droid” phones and Apple Inc.’s iPhone. (Source: Bloomberg)

Read the full article →

Video: In-Depth Look – Wireless Industry Under the Scope

August 21, 2009

FCC Examines AT&T and Verizon – Analysis and Discussion with Paul Glenchur of Potomac Research Group (Bloomberg News)

Read the full article →

Woman Drags Child On Leash Through Verizon Store (VIDEO)

August 3, 2009

The headline doesn’t lie: the following video really does show a woman in Alabama dragging her child through a Verizon Wireless store on a leash, and at surprising speed.

Read the full article →

Verizon Profit Meets Analyst Estimates as Customers Buy FiOS TV Service

July 27, 2009

By Amy Thomson July 27 (Bloomberg) — Verizon Communications Inc. , the second-largest U.S. phone company, reported profit that met analysts’ estimates after adding customers for FiOS TV and high- speed Internet

Read the full article →

Video: Ratings For Verizon And AT&T

July 24, 2009

Report and analysis with Philip Cusick of Macquarie Capital.

Read the full article →