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Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
Fixed Broadband in USA
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Fixed Broadband in USA

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  • ILEC: Incumbent Local Exchange Carrier. Both the Regional Bell Operating Companies (RBOCs) and the Independent Operating Companies (IOCs) that usually are located in more rural areas or single cities are called ILECs. CLEC: Competitive Local Exchange Carrier. Any company offering local telephone service in an area already served by an ILEC.
  • CAGR – Compound Annual Growth Rate Broadband is the fastest growing communication category.
  • U.S. lags behind many industrialized nations. Due to the distribution of population across vast areas, it is difficult to reach all potential broadband users cost-effectively. (For example the overall sparsely inhabited Canada has the majority of its population concentrated in or near large cities.) Unlike in other nations, the cable operators in the U.S. offer considerably more broadband connections than the telephone companies combined.
  • High-speed lines are connections to end-user costumers faster than 200 kbps in at least one direction. Advanced services lines deliver services at speeds exceeding 200 kbps for both download and upload streams.
  • The popularity of ADSL is increasing at the expense of cable modem. Other methods are still marginal in the number of customers.
  • Other includes wireline technologies other than asymmetric digital subscriber line (ADSL), optical fiber-to-the subscriber’s premises, satellite, and terrestrial wireless systems. Total is undublicated The number of high-speed connection providers has increased rapidly, led by companies offering ADSL services. As of December 2004, there were as many as 552 providers of high-speed lines in the U.S.
  • SMB: Small and Medium-Size business Cable companies are enchancing their services for SMBs.
  • Populous states lead in broadband usage. Penetration is higher in states with smaller land area or large share of metropolitan population.
  • The five largest players dominate by a large margin to other Internet companies.
  • Cable companies’ dominance shows in the large share of non-ILECs as broadband providers.
  • Industry consolidation is going on. Service providers and Internet companies are adding and diversifying their offerings through acquisitions and partnerships.
  • Both DSL and Cable Internet categories are dominated by a couple of major players. Strongest providers are expected to maintain their positions, but further mergers are possible.
  • The figures clearly illustrate the current advantage cable companies are having vs. telephone companies in offering broadband.
  • Comcast video revenues consist of basic, expanded basic, premium, pay-per-view, equipment and digital services. Other revenues include installation revenues, guide revenues, commissions from electronic retailing, other product offerings, commercial data services and revenues of digital media center and regional sports programming networks
  • Northeast and West Coast are leading the way in broadband use in homes. Bostonians, followed by San Franciscans, are the most advanced in broadband usage. Smaller rural counties are far behind large cities in using broadband.
  • U.S. consumers have been and will be active in buying advanced devices and enabling technologies.
  • Largest growth has occurred in purchases of home media servers and high-definition TV sets.
  • Note: Not every ZIP (postal) code has full broadband coverage. Largely thanks to existence of cable TV and easier availability of other broadband access technologies, cities and their suburbs are well ahead of the countryside in broadband adoption.
  • Better educated and higher earning people are more likely to become broadband customers than average Americans.
  • The penetration of data networks will continue to grow due to a number of variables: A growing number of U.S. households will have more than one computer in use. Broadband drives home networking. The deployment of wireless networking solutions (Wi-Fi) in residential, small business, and public markets has been faster than probably most industry observers expected in their original forecasts.
  • Cable modem’s and DSL’s leading positions are not threatened in the near future by other access technologies.
  • ADSL – Asymmetric Digital Subscriber Line. It shares ordinary telephone lines by using frequencies above the voice band. Upstream speed are considerably lower that the downstream ones. VDSL – Very High bit-rate Digital Subscriber Line. It is used as the final drop from a fiber optic junction point to nearby customers. VDSL lets an apartment or office complex obtain high-bandwidth services using existing copper wires without having to replace the infrastructure with optical fiber. Like ADSL, VDSL can share the line with the telephone. HDSL - High bit-rate Digital Subscriber Line. The oldest of the DSL technologies, it continues to be used by telephone companies deploying T1 lines at 1.5Mbps and requires two twisted pairs. HDSL does not allow line sharing with analog phones, but offers equal data rates to both directions
  • Cable companies invested heavily in the last six years to build up their strong position as broadband providers.
  • PON: Passive Optical Network BPON: Broadband PON EPON: Ethernet PON GPON: Gigabit Ethernet PON
  • Optical fiber deployment has taken off rapidly in the 2000’s.
  • ¹Current Communications is the leader in BPL. The company is partnering with Cinergy to offer BPL in Cincinnati – expected to gain 260,000 customers eventually Has also partnered with Pepco in the pilot project in Potomac, Md.
  • ¹ADSL speeds depend on customer’s distance from provider’s central office. Cable line speeds can vary due to bandwidth sharing. These speeds are maximum without sharing. Prices are based on customer also subscribing to phone service or cable TV service. Intensifying competition will result in lower rates and improved services portfolios.
  • Comcast High Speed Internet serves 7 million residential customers with an always-on cable-powered broadband internet connection. Comcast offers incentives to new customers ranging from free installation to discounted monthly service fees for a specified term. Cable modems can be purchased at local retail outlets or leased from Comcast for an additional monthly fee of $3.00 per month. Customers can opt for self-install or a professional installation. Comcast also offers the convenience of one stop shopping by making a variety of networking hardware available for purchase such as fixed and wireless routers and wireless adapters. In addition to high-speed internet Comcast also provides digital cable television and local and long distance residential telephone services giving customers the convenience of paying all three services on one bill. Contracts are not required. *Comcast speed tiers range from 4.0 to 8.0 Mbps download speed (maximum upload speed from 384Kbps to 768Kbps respectively). The speed tier received and pricing will vary depending upon the speed tier selected and the level of Comcast video service and/or digital telephone service (if any) received. Speed comparisons are for downloads only and are compared to (as applicable, to 56K dial-up, 768Kbps, 1.5Mbps or 3.0Mbps DSL). Actual speeds may vary and are not guaranteed. Many factors affect speed.
  • SBC Yahoo! offers packages for residential to small and medium sized business customers. SBC requires DSL customers to have local telephone service through SBC to establish a DSL connection. Internet and telephone service are combined on one monthly bill. One year contracts are not required but will incur a $200.00 penalty for early cancellation. Professional installation required and pricing will vary depending on package. Installations range from $150.00 to $200.00 for Dynamic and $250.00 for Static installation. SBC Yahoo! DSL packages includes these features: Pop-Up Blocker Customizable parental controls Firewall software to help shield computers from unauthorized access SpamGuard to help keep unwanted email from clogging inboxes Email virus protection software shields networks from email threats Email forwarding, address-change notification affords seamless transition from old Internet service Unlimited nationwide dialup Internet access allows access from virtually any location Customizable personalized SBC Yahoo! DSL home page Customized SBC Yahoo! DSL browser SBC Yahoo! Photos with unlimited online storage SBC Yahoo! Briefcase with up to 760MB of online storage Three Consumer Reports(R) guides for invaluable reviews and ratings Enhanced email SBC Yahoo! Mail PLUS with 2 GB of storage, POP access and email forwarding Up to 10 additional SBC Yahoo! Mail accounts with 2 GB of storage each, POP access and email forwarding SBC Yahoo! Messenger with high-quality video DSL Modem price $99.00 - $49.01 instant credit = $49.99 - $49.99 mail-in rebate = $0 (taxes and a $12.95 shipping and handling fee apply).Wireless Home/Office Networking Kit price $149.00 - $49.01 instant credit = $99.99 - $49.99 mail-in rebate = $50 (taxes and a $12.95 shipping and handling fee apply).Wireless Home/Office Networking Bundle for laptops price $179.00 - $49.01 instant credit = $129.99 - $49.99 mail-in rebate = $80 (taxes and a $12.95 shipping and handling fee apply).DSL Router price $199.00 - $119.01 instant credit = $79.99 - $79.99 mail-in rebate = $0 (applicable taxes apply).Office Gateway price $199.00
  • Monthly fees and upfront costs for Satellite are higher than that of DSL or Cable Modem services. The connection speeds are slower than DSL or cable modem. Satellite is considered an alternative for customers in underserved high-speed internet areas. According to the High Speed Internet Access Guide – “If you have a connection to high speed DSL / Cable Internet providers in your service area, then you should always go with those first. Satellite Internet service will not provide you with faster service or better features than either DSL or Cable, and is about twice as expensive. The truth is, satellite Internet service is a necessary connection only for those individuals who absolutely must have high speed Internet access and who are just outside the service area of standard high speed providers.” DirecWay has a customer base of over 250,000 subscribers. Standard installation for both DIRECWAY® Home and DIRECWAY Professional service plans is included in all orders. The Federal Communications Commission (FCC) requires that only trained professionals may install two-way satellite systems, like DIRECWAY. *Stated speeds are not guaranteed. Actual upload speed will likely be lower than speed indicated during peak hours. Download speeds may also be temporarily slowed in cases when patterns of system usage exceed the download threshold for an extended period of time. See the DIRECWAY Fair Access Policy for more information. If you choose to run VPN over satellite, your data speeds may be reduced by as much as 50-75%. Despite the high speeds, time-sensitive applications, such as multi-player “twitch” games, are also not recommended over DIRECWAY. Enables dynamic assignment of private IPs to devices, keeping them private from users outside of the network.
  • When DSL and cable modem connections proliferate, their overlap is growing.
  • The percentage of consumers actively participating in online music and video applications pales in comparison with those active in gaming applications. Online games are quietly popular and played by a wide range of consumers including older adults and women. The kinds of games played vary greatly.
  • Notes: Margin of error is +/- 4% for online teens. Margin of error is +/-3% for online adults for all surveys except for November 2004, which is +/-5% Teen data is from an October- November 2004 survey Adult data is from a December 2002 survey and a November 2004 – January 2005 survey.
  • Entertainment-related activities showed the largest growth from 2003 to 2004, while personals/dating category still remained the most important area measured by spending.
  • Parks Associates forecast home networks based on three major application categories: Data-centric (enabling multiple users at different computers at home to use a single broadband Internet connection simultaneously and allowing all computers to share a single printer or other peripherals) Multimedia-centric (storing and distributing audio and video content from either single or multiple sources to multiple locations throughout the home) Home Management (Sharing data within the home for such systems as security, lighting etc., and outside of home, so they can be accessed and managed remotely)
  • ¹The term gaming covers both games and gambling. The latter one is illegal in the United States – both to operate and participate in. Still, a large number of people are engaged in online gambling run by operators outside the U.S.
  • As many as 84% of households are satisfied or extremely satisfied with their broadband service provider
  • Homeland Security - The Department Homeland Security (DHS) is a department of the U.S. federal government that is concerned with protecting America's people from harm and its property from damage. The department was created primarily from a conglomeration of existing federal agencies in response to the terrorist attacks of 2001. DHS consolidates 22 agencies and 180,000 employees, unifying once-fragmented federal functions in a single agency dedicated to protecting America from terrorism.
  • Federal research and development funding has increased 44% since 2001. The Administration contributes $2 billion annually to networking and IT R&D alone, at agencies such as NIST and National Science Foundation, and areas within the Defense Department The President has also proposed making permanent the Research and Experimentation Tax Credit, which promotes private sector investment in new technologies such as broadband.
  • The peak of VC funding is apparently over; since top year 2001 the annual funding volumes have declined and reached only approximately 1/8 of that record.
  • In late 2004 and early 2005 VC funding experienced a clip. The most recent quarter Q2005 showed a healthy growth.
  • Source :
  • Source :
  • Transcript

    • 1. Fixed Broadband in the USA for GIGA Technology Program Miika Nevalainen, Veijo Iivonen Finpro USA, Silicon Valley November 14, 2005
    • 2. Table of Contents
      • 1. Introduction
      • 2. Market Overview
      • 2.1 Broadband Business Volume
      • 2.2 Major Service Providers
      • 2.3 Broadband Usage and Demographics
      • 3. Technology
      • 3.1 Delivery Technologies
      • 3.2 DSL
      • 3.3 Cable Modem
      • 3.4 Satellite
      • 3.5. Other Methods
    • 3. Table of Contents
      • 4. Services
      • 4.1 Main Technologies and Providers
      • 4.2 Consumer Applications and Trends
      • 4.3 Business Applications and Trends
      • 5. Policymaking and the Role of the Public Sector
      • 6. Public Sector R&D Activities
      • 6.1 Research Activities
      • 6.2 Organizations
      • 7. Private Sector R&D Activities
      • 7 .1 Research Activities
      • 7.2 Funding
      • 8. Possibilities for Finnish Companies
      • 9. Foreseeable Radical Changes
    • 4. 1. Introduction
    • 5. Introduction
      • This report has been compiled for the GIGA program of Tekes, focusing on converging networks. The report provides information on the U.S. fixed broadband market.
      • The report discusses the following issues:
        • Overview of the U.S. fixed broadband Internet market
        • Competitive environment
        • Technology adoption and outlook
        • Available services
        • Government’s role in the development of fixed broadband
      1. Introduction
    • 6. United States in a Nutshell 1. Introduction Source: U.S. Census Bureau 2004 9,158,000 km ² (Finland 338,000 km²) Land area 230 million Metropolitan population 106 million Households 32.1/km ² (Finland15.7/km²) Population density 294 million (Finland 5.3 million) Population U.S. National Statistics 2004
    • 7. Broadband Evolution
      • 1995 – 1999
        • 1996 Telecom Act
        • Major fiber backbone built
        • CLECs and ILECs building networks
      • 2000 – 2003
        • Large metropolitan areas covered
        • Temporary slowdown in deployment
        • Digital divide occurs
      • 2004 –
        • Broadband access becomes commodity
        • Applications and services proliferate
        • Business and revenue models being developed
        • Convergence
      1. Introduction
    • 8. 2. Market Overview 2.1 Broadband Business Volume 2.2 Major Service Providers 2.3 Broadband Usage and Demographics
    • 9. U.S. Communications Revenues 2.1 Broadband Business Volume 2003-2007 CAGR Source: IDC, US Residential Landline Telecommunications Forecast & Analysis 2002-2007 and IDC analyst imput. Available: http://www.edrgroup.com/pages/pdf/EDRG-NEDA-IT%20Presentation.pdf CAGR – Compound Annual Growth Rate 2. Market Overview 1,8% Total -2,1% Wireline Voice 6,0% Broadband Data 1,8% Wireless
    • 10. Broadband Penetration in Selected OECD Countries 2. Market Overview 2.3 Penetration, number of broadband lines (%) Source: OECD Broadband Statistics, June 2005. Available: www.oecd.org/document/16/0,2340,en_2649_34225_35526608_1_1_1_1,00.html 2.1 Broadband Business Volume 42 645 815 14.5 1.1 8.0 5.5 United States 20 953 030 16.4 3.0 2.4 11.0 Japan 1 482 843 16.4 3.0 2.4 11.0 Sweden 978 600 16.5 2.5 2.7 11.3 Finland 6 142 662 19.2 0.1 9.7 9.4 Canada 1 176 637 21.8 2.4 6.1 13.2 Denmark 3 624 315 22.5 0 8.9 13.6 Netherlands 12 260 969 25.5 2.7 8.9 13.9 Korea Total Subscribers Total Other Cable DSL
    • 11. High-Speed Services for Internet Access Source: Federal Communications Commission, 2005. Available: www.internetnews.com/stats/article.php/3518746 2. Market Overview 2.1 2.1 Broadband Business Volume
    • 12. Residential and Small Business High-Speed Line Market Share by Technology 2. Market Overview Source: Federal Communications Commission, 2005. Available: Broadband Reality Check, August 2005 2.1 2.1 Broadband Business Volume 35,266,281 25,976,850 17,356,912 11,005,396 Total number of lines 2004 2003 2002 2001
    • 13. Number of providers of High-Speed Lines by Technology (over 200 kbps in at Least One Direction) Source: Federal Communications Commission releases data on high-speed services for internet access. July 7, 2005. Available: http://www.fcc.gov/Bureaus/Common_Carrier/Reports/FCC-State_Link/IAD/hspd0705.pdf 2. Market Overview 2.1 2.1 Broadband Business Volume
    • 14. U.S. Cable Business Subscribers U.S. Cable Small and Medium-Size Business (SMB) Market Source: Yankee Group 2003. Available: Broadband Wireless Business, November/December 2003 2. Market Overview 2.1 2.1 Broadband Business Volume
    • 15. Population and Broadband Top 5 States - # of BB Subscribers (mil) Top 5 States – BB Penetration 1 California 3.0 1 Massachusetts 24% 2 New York 2.0 2 New Jersey 23% 3 Florida 1.4 3 California 23% 4 Texas 1.3 4 Washington, DC 22% 5 Illinois 0.7 5 Alaska 21% 2. Market Overview 2.1 Source: FCC Data and Telephony. Available : http://www.fcc.gov/commissioners/martin/documents/summit011205.ppt#2 2.1 Broadband Business Volume
    • 16. Top Internet Companies
              • Revenues in
              • million USD (2004)
      • AOL 8,692
      • Yahoo! 3,574
      • eBay 3,271  
      • Google 3,189
      • MSN 2,216
      2.2 Major Service Providers Source : Hoovers 2005 2. Market Overview
    • 17. Share of High-Speed Lines by Type of Provider Source: Federal Communications Commission releases data on high-speed services for internet access. July 7, 2005. Available: http://www.fcc.gov/Bureaus/Common_Carrier/Reports/FCC-State_Link/IAD/hspd0705.pdf RBOC: Regional Bell Operating Company. An all-inclusive term for each of the seven telephone companies that were created after AT&T’s divestiture in 1984. Due to merger and acquisition activity, the original seven are currently four: SBC Communications (formerly Pacific Telesis, Southwestern Bell and Ameritech), BellSouth, Verizon (formerly NYNEX and BellAtlantic), and Qwest (formerly US West).   ILEC: Incumbent Local Exchange Carrier. Both the Regional Bell Operation Companies (RBOCs) and the Independent Operating Companies (IOCs) that usually are located in more rural areas or single cities are called ILECs. 2. Market Overview 2.3 2.2 Major Service Providers
    • 18. Share of High-Speed Lines by Type of Provider (Over 200 kbps in at Least One Direction) Source: Federal Communications Commission releases data on high-speed services for internet access. July 7, 2005. Available: http://www.fcc.gov/Bureaus/Common_Carrier/Reports/FCC-State_Link/IAD/hspd0705.pdf 2. Market Overview 2.3 Broadband Usage 2.2 Major Service Providers 62.4% 5.2% 32.4% 37,890,646 2,633,562 1,937,177 12,283907 Total Lines 93.3% * * 1,247,400 1,163,357 * * Other 99.8% * * 21,357,400 21,319,224 * * Coaxial Cable 37.7% 13.6% 48.7% 1,468,566 553,904 199,853 714,809 Other Wireline 4.3% 12.5% 83% 13,817,280 597,077 1,730,927 11,489,276 ADSL Non-ILEC Other ILEC RBOC Total Non-ILEC Other ILEC RBOC Types of Technology Percent of Lines Lines
    • 19. Recent Industry Developments
      • AOL to offer VoIP
      • Yahoo/Verizon portal
      • Google to offer VoIP
      • eBay acquires Skype
      • Qwest and Microsoft to launch VoIP
      • Awaya and Sprint to offer hosted VoIP
      • Earthlink to offer VoIP
      • SBC and AT&T merger
      • Verizon and MCI merger
      2.2 Foreseeable changes 2. Market Overview 2.2 Major Service Providers
    • 20. Top Broadband Internet Providers Net Adds in 1Q 2005 Net Adds in 1Q 2005 Source : The Companies and Leichtman Research Group, Inc., Research Notes 2Q 2005. Available: http://www.leichtmanresearch.com/research/notes06_2005.pdf 2. Market Overview 2.3 2.2 Major Service Providers 14 200 59 000 85 000 253 000 385 000 504 000 Covad Sprint Qwest Bell South Verizon SBC 14 200 59 000 85 000 253 000 385 000 504 000 Cablevision Adelphia Charter Cox Time Warner Comcast
    • 21. Comparison of Broadband Penetration by Four Largest Phone and Cable TV Companies in the U.S. Source :Rider Research www.riderresearch.com and company filings. Available:The online Reporter, une 14-28 2005 – Issue 449. www.onlinereporter.com/TORbackissues/TOR449.htm 2. Market Overview 2.3 Status as of 31.3.2005 2.2 Major Service Providers 14.31% 29.21 204.12 TOTAL 25.54% 16.26 63.66 Subtotal 22.30 1.98 8.68 Charter 24.38% 7.41 30.38 Comcast 26.09% 4.12 15.80 Time Warner Cable 31.23% 2.75 8.80 Cox Cable TV Companies 9.22% 12.95 140.46 Subtotal 6.50% 1.10 15.34 Qwest 7.50% 3.90 52.00 Verizon 10.79% 5.60 51.90 SBC 11.07% 2.35 21.22 Bell South % Penetration Broadband Subscribers (millions) Access Lines/Video Subscribers (millions) Phone Companies
    • 22. Comcast Revenue Structure Second Quarter 2005 - Dollars In Millions 2. Market Overview Source: ComCast. Available: www.comcast.com 2.3 2.2 Major Service Providers 100 $5,103 Total Revenues 3 $ 167 Franchise Fees 4 $ 180 Other 6 $ 296 Advertising 3 $ 173 Phone 18 $ 925 High-Speed Internet 66 $3,362 Video Ratio to total revenue (%) Revenue Service Type
    • 23. SBC Communications Revenue Structure Second Quarter 2005 - Dollars In Millions 2. Market Overview Source: SBC Communications. Available: www.sbc.com 2.13 2.2 Major Service Providers 100 $10,328 Total Revenues 5 $ 486 Other 9 $ 949 Directory advertising 9 $ 922 Long-distance voice 29 $ 2,997 Data 48 $ 4,974 Voice Ratio to total revenue (%) Revenue Service Type
    • 24. Verizon Communications Revenue Structure Second Quarter 2005 – Dollars In Millions 2. Market Overview Source: Verizon Communications. Available: www.verizon.com 2.3 2.2 Major Service Providers 100 $9,445 Total Revenues 10 $ 909 Other services 11 $1,092 Long distance services 32 $3,017 Network access services 47 $4,427 Local Services Ratio to total revenue (%) Revenue Service Type
    • 25. Hughes Network Systems DirecWay Satellite (revenue figures not available)
      • Hughes Network Systems, LLC (HNS), the world's leading provider of satellite broadband solutions, announced that the company continues to achieve record growth in its DIRECWAY® consumer and small business subscriber base. During Q2 2005, HNS’ total subscriber base has reached more than 250,000 customers, achieving double digit growth from Q4 2004.
      • HNS’ DIRECWAY service is a two-way broadband satellite Internet solution that is available anywhere in the contiguous United States with a clear view of the southern sky.
      • Hughes Network Systems, LLC (HNS) is the world's leading provider of broadband satellite network solutions for businesses and consumers, with more than 800,000 systems ordered or shipped to customers in 85 countries. HNS pioneered the development of high-speed satellite Internet access services and IP-based networks, which it markets globally under the DIRECWAY brand. DIRECWAY terminals are based on the IPoS (IP over Satellite) global standard, approved by the TIA, ETSI and ITU standards organizations.
      2. Market Overview 2.3 Source: Hughes Network Systems. Available: www.hns.com 2.2 Major Service Providers
    • 26. Internet Growth—U.S. Households Online Source: The Digital Economy Fact Book, Fifth Edition 2003. Available: http://www.fcc.gov/commissioners/martin/documents/summit011205.ppt#2 2. Market Overview 2.3 Broadband Usage and Demographics
    • 27. Used Internet at Home by Broadband/Narrowband Source: MARS 2005. Available: http://www.zonalatina.com/Zldata398.htm 2. Market Overview 2.3 Broadband Usage 2.3 Broadband Usage and Demographics
    • 28. Household Penetration on Convergent Hardware Source: Trade Organization Reports, A.T. Kearney analysis. Available: http://www.metroplextbc.org/downloads/20050121_mitchell.pdf 2. Market Overview 2.3 Broadband Usage 2.3 Broadband Usage and Demographics
    • 29. Household Penetration Growth on Convergent Hardware 2004-2007 Source: Trade Organization Reports, A.T. Kearney analysis. Available: http://www.metroplextbc.org/downloads/20050121_mitchell.pdf 2. Market Overview 2.3 Broadband Usage 2.3 Broadband Usage and Demographics
    • 30. Broadband Adoption by Area Source: Pew, June 2005. Available: Broadband Reality Check, August 2005. http://www.baller.com/pdfs/FP-CU-CFA_Broadband_Reality_Check.pdf 2. Market Overview 2.3 Broadband Usage 2.3 Broadband Usage and Demographics
    • 31. Broadband Availability in Rural Areas
      • Penetration of broadband in rural areas only about half of that in cities and suburban areas
      • All broadband options quite expensive in remote areas; a lot individual users would need to invest thousands of dollars.
      • Satellite broadband technology improving but rarely used due to high cost
      • Aging and relatively slow ISDN still can be the fastest realistic method at many locations
      • Semi-rural customers could have wireless last mile
      2. Market Overview 2.3 Broadband Usage 2.3 Broadband Usage and Demographics
    • 32. Broadband in the Home, User Demographics Source: Horrigan John, PewInternet & American Life Project. Available: http://www.pewinternet.org/pdfs/PIP_Broadband04.DataMemo.pdf 2. Market Overview 2.3 Broadband Usage 2.3 Broadband Usage and Demographics
    • 33. Internet Use in North America between Males and Females ( any connection type, over age 18, millions of users) 2. Market Overview Source : www.computereconomics.com/article.cfm?id=983 2.3 Broadband Usage 2.3 Broadband Usage and Demographics
    • 34. Penetration of Data Networking Source: The Home Network Market: Data and Multimedia Connectivity, Parks Associates White Paper, 2004. e = estimated, p = projected 2. Market Overview 2.3 Broadband Usage 2.3 Broadband Usage and Demographics
    • 35. Factors Promoting Broadband
      • Insufficient capacity of existing networks
      • Proliferation of applications with high bandwidth requirements
      • Corporations and businesses consider enterprise broadband a competitive tool
      • U.S government strives toward strong presence of broadband both within the public sector as well as to ensure international competitiveness
      • Advances in infrastructure and equipment technologies
      2. Market Overview 2.3 Broadband Usage 2.3 Broadband Usage and Demographics
    • 36. 3. Technology 3.2 DSL 3.3 Cable Modem 3.4 Satellite 3.5 Other Methods 3.1 Delivery Technologies
    • 37. Fixed Broadband Delivery Technologies
      • Cable Modem
      • DSL
      • Fiber Optic
      • Satellite
      • Fixed Wireless
      • Powerline (BPL)
      • Traditional Internet Delivery - ISDN, T-1, T-3
      3.1 Delivery Technologies 3. Technology
    • 38. Source: Fontana John, Networkworld, Aug 15, 2005, Vol 22, Number 32, page 56 3.1 Delivery Technologies 3. Technology
    • 39. Digital Subscriber Line (DSL)
      • ADSL over phone lines is the primary broadband access method for home users offered by telephone companies
      • Downstream data rate up to 6 Mbps but enhanced ADSL2 and ADLS2+ versions could double it. Thanks to doubled spectrum, video and VoIP transmissions will improve.
      • VDSL is the ultimate but still expensive option for short distances the theoretical top data rate of 52 Mbps (expected averages 25 Mbps downstream and 3 Mbps upstream)
      • Symmetrical HDSL common with T1 connections
      • ADSL and its upcoming versions will continue to be the method of choice by phone companies. Fierce competition with cable companies leading to lower flat ADSL rates
      3. Technology 3.2 DSL
    • 40. Cable Modem
      • Primary vehicle to offer broadband in the U.S.
      • Cable companies are ahead of other main broadband providers thanks to their existing infrastructure enabling higher-quality services
      • Approx. 25 % of cable subscribers use broadband vs. only some 10 % of phone company customers
      • Typical download (1.5 to 3.0 Mbps) and upload (384 to 512 kbps) speeds are more than twice the speeds of ADSL
      3. Technology 3.3. Cable Modem
    • 41. U.S Cable Industry Infrastructure Expenditures 3. Technology 3.3 Cable Modem Source: National Cable Television Association ( http:// ncta.com/Docs/PageContent.cfm?pageID =314 ). Available: http://www.fcc.gov/commissioners/martin/documents/summit011205.ppt#2 Billions of Dollars
    • 42. Satellite Broadband
      • Still one of the less popular technologies, because of its cost and performance. Sharing currently the niche market of 5% with other new technologies such as fixed wireless and FTTX
      • An alternative for the areas that do not have DSL or cable – targeting the rural market.
      • Download speed about 500 kbps, upload speed (dial-up) approximately 50 kbps.
      • Typical prices for residential customers in 2004 were up to $50 - $60/month plus $600 for equipment installation
      • Number of U.S. customers around 225,000 in 2004
      • Growth rate for the industry around 2 – 6% a year
      • Speculation: Satellite will become more popular after launching a combination of satellite-wireless system and also when the costs will be lower
      Sources: EPRI, Broadband Over Powerline 2004 – Technology and Prospects. EPRI White Paper, Oct. 2004. Available at www.epriweb.com Hu Jim, Satellite seeks broadband re-entry. CNET News.com, Mar. 11, 2004. Available at news.com.com Mindbrach, Broadband Satellite Communications, 2004. Summary of Broadband via Satellite 2004, Jun. 2004. Available at www.mindbranch.com 3. Technology 3.4 Satellite
    • 43. Last-Mile Fiber
      • Large RBOCs Verizon, SBC and BellSouth in the process of installing fiber optic lines into millions of homes
      • It could take decades to wire the entire country at a cost of up to USD 100 billion (USD 1000 per home)
      • FTTH: Fiber-optic line terminates at customer
      • FTTC: Fiber-optic line terminates within 150 meters from customer, rest covered by copper wire
      • Trend from BPON and EPON toward GPON
      • GPON could be challenged by Active Ethernet
      3.5 Other Methods 3. Technology
    • 44. FTTH 3 . Technology Source: Render Vanderslice & Associates, FTTH Council. Available: http://www.fcc.gov/commissioners/martin/documents/summit011205.ppt#2 3.5 Other Methods
    • 45. Preparation of Homes for Broadband
      • More than half of new single-family homes pre-wired with fiber-optic cables for broadband
      • In-house Wi-Fi popular in existing homes but is subject to disruptions and does not have enough bandwidth for quality
      • To speed up existing connections, the users’ options include also in-house coaxial cable connected to fiber optic line at the building
      • Full-fledged ”digital homes” with integrated IP-based features are still rare
      3 . Technology 3.5 Other Methods
    • 46. Broadband Over Power Line (BPL)
      • Telecom Trends: Worldwide BPL revenue will be approximately $4.4 billion by 2011 (versus yr 2004: $57.1 million)
      • A number of field tests are made - BPL will move from small local trials to deploying systems in larger communities. Tested currently as a business in Manassas, Virginia and Cincinnati, Ohio
      3. Technology Sources: FCC, 2005. Lamb Gregory, Web access may be as close as an electrical outlet. The Christian Science Monitor, Aug. 15, 2005. Available at www.csmonitor.com. Telecom Trends International, Inc., Broadband Powerline Communications poised for rapid growth as access technology says market study. Available at www.telecomtrends.net. 3.5 Other Methods
    • 47. Broadband Over Power Line (BPL)
      • FCC: Sees BPL as a potential ” third wire” that could increase the availability of broadband. FCC showed its approval to deploy BPL systems in 2004, when it issued technical rules for BPL operations
      • Google, Goldman Sachs and Hearst: Investing $100 million in Current Communications ¹
      • ComTek – first CityWide network in Manassas, VA
      • ConEd/Ambient/Earthlink having trials
      Sources: EPRI, Broadband Over Powerline 2004 – Technology and Prospects. EPRI White Paper, Oct. 2004. Available at www.epriweb.com Kutz Thomas, Broadband Over Power Line : A New Technology for the Future. The Telecommunications Review, 2005. Available at www.mitrek.com Deloitte referring to Yankee Group, 2005; Epri, 2004 3. Technology 3.5 Other Methods
    • 48. Fixed Wireless Broadband
      • WiMAX expected to see rapid growth in locations were other access methods are less practical
      • WiMAX standards coming up soon
      • With throughputs of up to 70 Mbps and a maximum theoretical range of over 40 km many remote customers can become broadband users
      • WiMAX is seen as viable extension – ”the last mile” - to fixed broadband in rural areas with ranges of 5 to 10 km
      • WiMAX could become replacement for T-1
      3. Technology 3.5. Other Methods
    • 49. Municipal Broadband
      • Cities and other communities deploying either Wi-Fi or fiber optic networks which citizens can use for free or at nominal fee
      • Municipalities are starting to view broadband as a service such as water and power
      • Steep contrast with incumbent operators who have invested in infrastructure but are forced to lower their rates
      • Municipal networks pose a serious threat to fiber and cable-based services offered by telephone and cable operators
      2 . Foreseeable radical changes 3.5 Other Methods
    • 50. 4. Services 4.1 Main Technologies and Providers 4.2 Consumer Applications and Trends 4.3 Business Applications and Trends
    • 51. U.S. Broadband Basics – Speed and Price 4. Services 4.1 Main Technologies and Providers Source: Broadband Reality Check, August 2005. http://www.baller.com/pdfs/FP-CU-CFA_Broadband_Reality_Check.pdf 200 1.0 478.95 69.95 Wildblue 50 500 kpbs 600.00 59.95 DirecWay Satellite 384 5.0 varies 41.95 TW/Brightline 512 4.0 varies 49.00 Cox 384 4.0 varies 43.95 Adelphia 384 4.0 varies 45.95 Earthlink Modem 256 3.0 74.00 42.99 Charter Cable 384 5.0 varies 44.95 RoadRunner 384 4.0 39.90-149.99 42.95 Comcast 128 256 kbps 0-115.00 34.95 Bell South DSL-Lite 256 1.5 0-115.00 45.92 Bell South 128 1.5 varies 59.00 Atlantech 128 1.5 99.00-349.00 49.95 SBC 128-384 3.0 varies 44.95 Earthlink ADSL 128 728 kbps 99.00 39.95 Speakeasy 128 1.5 99.00 39.95 Covad 128-384 3.0 39.95 37.95 Verizon Maximum Upload Speed (kbps) Maximum Download Speed (Mbps) ¹ Start-Up Costs ($) Monthly Fee ($) Provider Service
    • 52. Example: Comcast High-Speed Internet Pricing - Features - Services 4. Services Source: Comcast. Availabe: www.comcast.net 4.1 Main Technologies and Providers Month-to-month service fee is $42.95 with digital cable television service and $55.95 without Connection speeds up to 8Mbps downstream and 768Kbps upstream* Access to Comcast services, features and partners on customizable home page Included Comcast home page By RealNetworks -unlimited access to music 24 hours a day $9.95 Rhapsody Unlimited Powered by Exert - unlimited access to games 24 hours a day $14.95 Games on Demand By RealNetworks - access to more than 200 free games Included Comcast Arcade By RealNetworks - Commercial-free radio Included Rhapsody Radio Plus Search tools, pop-up blockers and quick access to webmail Included Comcast.net Toolbar By Snapfish (product of HP) - manage, enhance, edit and share digital photos Included Photo Show Deluxe Protection from viruses, security threats and hackers Included McAfee Security downloads Web wizard assists with creation of personal homepages Included Personal Web Pages Content for children – games and activities Included Disney Connection 175MB of online storage accessible from any computer Included Online File Storage Access up to 7 email addresses per account from any computer Included Email Everywhere Send video messages to any email address Included Video Mail Description Monthly Fee Service
    • 53. SBC Yahoo! Service Package Options 4. Services Source: SBC. Available: www.sbc.com 4.1 Main Technologies and Providers 384 to 416 Kbps 384 to 416 Kbps 1 year $119.95 DSL Symmetric-S (5 Static IP addresses) 384 to 512 Kbps 1.5 to 3.0 Mbps 1 year $74.99 DSL Pro-S (5 Static IP addresses) 128 to 384 Kbps 384 Kbps to 1.5 Mbps 1 year $64.95 DSL Express-S (5 Static IP addresses) 384 to 416 Kbps 384 to 416 Kbps 1 year $89.99 DSL Symmetric-S (5 Static IP addresses) 384 to 512 Kbps 1.5 to 3.0 Mbps Not required $74.99 DSL Pro-S (5 Static IP addresses) 128 to 384 Kbps 384 Kbps to 1.5 Mbps Not required $64.95 DSL Express-S (5 Static IP addresses) 384 to 512 Kbps 1.5 to 3.0 Mbps Not required $59.99 DSL Pro (1 dynamic IP address) 128 to 384 Kbps 384 Kbps to 1.5 Mbps Not required $49.95 DSL Express (1 dynamic IP address) 384 to 512 Kbps 1.5 to 3.0 Mbps 1 year $24.99 DSL Pro (1 dynamic IP address) 128 to 384 Kbps 384 Kbps to 1.5 Mbps 1 year $14.95 DSL-Express (1 dynamic IP address) Upstream Speeds Downstream Speeds Contract Term Monthly Fee Service
    • 54. DirecWay Satellite 4. Services Sources : DirecWay. Available: www.direcway.com , High Speed Internet Access Guide - www.high-speed-internet-access-guide.com 4.1 Main Technologies and Providers 200 Kbps* 1 Mbps* 15 months $599.98 $69.99 DirecWay Professional Key Features MyDirectWay.com – included. Create DIRECWAY.com email accounts, visit online Help Center for live technical support and interactive self-help tools, view billing information and invoices online, monitor service with the Satellite Speed Test, enhance broadband experience with free downloads, stay current on DIRECWAY with usage tips and exclusive promotions 5 email accounts with 10MB of storage per account is included 24/7 Live Technical Support is included Equipment and standard installation is included Security Anti-Spam and anti-Virus protection is included Upstream Downstream Contract Term Upfront Fee Monthly fee Service 128 Kbps* 700 Kbps* 15 months $599.98 $59.99 DirecWay Home
    • 55. Cable/DSL Availability Overlap Source: JPMorgan. Available: http://www.fcc.gov/commissioners/martin/documents/summit011205.ppt#2 4. Services 4.1 Main Technologies and Providers Cable and DSL Broadband Overlap Is Increasing 19% 19% 10% 5% 38% 23% 53% 33% 2000 2003 Cable and DSL Cable Only DSL Only No Service 105 Million HH 109 Million HH 100% =
    • 56. Consumer Use of the Internet for Multimedia Activities 4.2 Consumer Applications and Trends Source : Consumers & Emerging Multimedia Platforms, a survey of 4,020 U.S. Internet households. A Parks Associates Brief. Digital Home Entertainment Ecosystems, 2005 Parks Associates 4. Services
    • 57. Likelihood of Teen and Adult Engagement in Online Activities Source: Pew Internet & American Life Project, 2005. Available: http://www.clickz.com/stats/sectors/demographics/article.php/3523376 4. Services 4.2 Consumer Applications and Trends
    • 58. Online Content Spending by Category of Content Source: Online Publishers Association/comScore Networks research. Online Publishers Association. U.S. market Spending Report. March 2005. 4. Services 4.2 Consumer Applications and Trends
    • 59. Broadband Video
      • Internet-delivered video-on-demand is expected to reach $7.9. billion in 2009 from $200 million in 2004.
      • According to In-Stat/MDR, the worldwide value of consumer-oriented video subscription services delivered via Internet will grow to more than $4.6 billion in 2008. Digital Tech Consulting projects the consumer market for online media downloads to be $7 billion by 2008
      • The video-on-demand over broadband is growing at 140% annually.
      • Broadband growth has led advertiser and media companies to increase their use of online video .
      Source: RHK, http://www.brainware.tv/elearning_news.htm 4.1 4. Services 4.2 Consumer Applications and Trends
    • 60. Broadband Video
      • First commercial deployment of HDTV-over-IP will occur by California-based SureWest in fall 2005
      • SureWest’s FTTP network with speeds of up to 10 Mbps passes over 80,000 homes. Max. speed can be doubled to 20 Mbps and with new switches to the 100 Mbps range.
      • Additional emerging video products will be offered
      4.2 4. Services 4.2 Consumer Applications and Trends
    • 61. IPTV and Video Applications
      • Initial services
        • Video-on-demand
        • Pay-per-view
        • Network personal video recorder
      • Future Services
        • Games-on-demand
        • On-screen e-mail and Web
        • On-screen caller ID
        • Videoconferencing
        • Home monitoring and security
      4.1 4. Services 4.2 Consumer Applications and Trends
    • 62. Home Networking Applications Classified Broadband Data Sharing PC LAN Multi -person Gaming DATA-CENTRIC MULTIMEDIA-CENTRIC HOME MANAGEMENT VALUE-ADDED SERVICES Communications Information Platforms Personalized Content Stored/Streamed Multimedia On-Demand Content Home Controls Energy Management Security Remote Apps Voice Protection Upgrades Communities Source: The Home Network Market: Data and Multimedia Connectivity, Parks Associates White Paper, 2004. 4. Services 4.2 Consumer Applications and Trends
    • 63. Favorite Home Broadband Applications
      • Online Music
      • Online Video
      • Online Gaming ¹
      • VoIP
      • IP TV
      • Home Networking
      • Home Security and Access Control
      • Home Controls
      • Firewalls
      4. Services 4.2 Consumer Applications and Trends
    • 64. Bundling Broadband Services
      • Increases customer loyalty / reduces churn
      • Increases revenues per customer
      • Lowers provider’s operating costs
      • Currently, main providers are heavily promoting their triple play offerings
      • For consumers, some services may be cheaper when purchased separately
      • Bundling options are
        • ” Triple Play” – voice, data and video
        • ” Quadruple Play” – voice, data, video and wireless
      • Other bundleable services include VoIP, video-on-demand and music-on-demand
      4.1 4. Services 4.2 Consumer Applications and Trends
    • 65. Satisfaction with Current Broadband Service Provider Source: 2004 Parks Associates. Judo Lessons for Wireless ISP’s, A White Paper from Parks Associates. 4.1 4. Services 4.2 Consumer Applications and Trends
    • 66. Key Business Broadband Applications
      • Homeland Security
      • Teleworking
      • Telemedicine
      • Distance Learning / Education
      • Utility Applications
      • Emergency Services
      • E-Government
      • Office Infrastructure
      4. Services 4.3 Business Applications and Trends
    • 67. VoIP Market
      • Current subscriber base approx. 4 million
      • Vast majority of consumers still unaware of VoIP
      • Market Growth (CAGR) next 3 years over 50 %
      • Largest pure-play VoIP provider Vonage has 1 million subscribers
      • Other noteworthy companies in VoIP space include Skype, Cablevision, Cisco, Nortel, Lucent, Juniper, IBM and Microsoft
      • eBay predicts a trend toward free VoIP calls
      Source: TeleGeography. Available: Telephony, September 19, 2005. page 22 4. Services 4.3 Business Applications and Trends
    • 68. Issues Surrounding VoIP
      • Consolidation
      • Convergence
      • Security
      • Spam over Internet telephony
      • 911 service
      • VoIP in call centers
      • VoIP regulation
      • Open source PBX
      Source: TelecomDirectNews, Key VoIP Trends to Watch in 2005. Jan 3, 2005. Available: http://www.telecomdirectnews.com/do.php/101/11192?9181 4. Services 4.3 Business Applications and Trends
    • 69. E -Learning
      • IDC estimates that North-American e-learning market will be worth of $ 7 billion (US) in 2005, and will grow to $21 billion by 2008.
      • According to CNN World News, e-learning is one of the fastest growing sectors in the education market, worth $4-5 billion a year already and poised for further growth.
      • Global corporate training sales of U.S.-based firms will increase 8% to $10.72 billion in 2005. E-learning is forecast to grow by 30%.
      • According to American Society of Development and Training (ASTD), online training grew almost 30% in mid-size companies and close to 35% in larger companies in 2004 and will continue to increase in 2005. The average U.S. company spends between 2-10 % of total payroll on training (2002).
      • Increasing use of Internet, faster, more reliable connections and declining telecommunication costs have also contributed to the growth of the market.
      Source: http://www.brainware.tv/elearning_news.htm 4. Services 4.3 Business Applications and Trends
    • 70. Health Care over Home Network
      • Due to aging population and high hospital costs home healthcare growing rapidly
      • Broadband-enabled methods facilitate communications between caregivers and patients
      • Home networks complement hospitals’ and doctors’ existing infrastructure in remote monitoring, electronic health records and telehealth
      • Hospitals’ internal infrastructure could hinder rapid deployment
      4. Services 4.3 Business Applications and Trends
    • 71. Health Care over Home Network
      • Telemedicine, telehealth and e-health are terms that are used interchangeably. Telemedicine is the use of medical information exchanged from via electronic communications to provide diagnostic and therapeutic medical information between patient and doctor.
      • The e-health market in the U.S. is generally more developed than that in Europe. Substantial investment from the government and the pharmaceutical industry has propelled the developments in initiatives such as online continuing medical education. ATA estimated that in 2003, the total amount of federal grants and contracts for telemedicine was about $270 million.
      • According to Frost & Sullivan, the North American telemedicine markets generated revenue of $50 million in 2005. Total market revenue is expected to reach $70 million in 2008.
      • Telemedicine encompasses different types of programs and services provided for the patients for example specialist referral services, patient consultations, remote patient monitoring, medical education and consumer medical and health information.
      4. Services Lähde: American Telemedicine Association. Available: http://www.atmeda.org/news/definition.html PRZOOM, September 28, 2005. 4.3 Business Applications and Trends
    • 72. 5. Policymaking and the role of the Public Sector
    • 73. Government Goals
      • Comprehensive Homeland Security ICT infrastructure
      • Seamless communications between various emergency agencies at all government levels
      • Availability of broadband services to every U.S. citizen
      • Advanced broadband-based technologies for rural healthcare facilities (telemedicine)
      • Broadband Internet access for all public schools
      5 . Policy Making and the role of the Public Sector
    • 74.
      • U.S. Government does not have a clear broadband policy, but Bush's administration has set a goal of universal, affordable access to broadband by 2007 (Gross 2005, White House 2004)
      • U.S. Congress has made some initial moves to recast Telecommunications Act from 1996 and is expected to pass some sort of telecommunications reform by late next year
      • The 109th Congress is considering potential federal broadband financial assistance programs, and the effect of telecom regulations, and new technologies on broadband deployment (CRS Report, 2005)
      Public Sector & Broadband Gross Grant, Nortel Chief: U.S. Needs New Broadband Vision. Network World, Aug 2005. Available at wwwlnetworkworld.com The White House, A New Generationof American Innovation. Washington, Apr. 2004. Available at www.whitehouse.gov) CPR: Report for Congress. Science and Technology Policy Issues For The 109th Congress, Mar. 2005. Available at www.fas.org 5 . Policy Making and the role of the Public Sector
    • 75.
      • U.S. cities: Almost 300 cities are planning or moving ahead already with municipal broadband projects (Gross, a2005)
      • 14 U.S. states have passed laws that limit municipal broadband services (Gross, b2005)
        • The Community Broadband Act of 2005, is aiming to prevent states from outlawing municipal broadband service. At the same time cities would be obligated to regulate their own broadband services the same way as they regulate competitors (Gross, 2005, The Community Broadband Act, 2005)
      Public Sector & Broadband a.Gross Grant, Nortel Chief: U.S. Needs New Broadband Vision. Network World, Aug 2005. Available at wwwlnetworkworld.com, b. Gross Grant, U.S. Senators Offer Bill To Protect Municipal Broadband. InfoWorld, Jun. 2005. Available at www.infoworld.com, The Community Broadband Act of 2005, Bill introduced in the Senate on July 1, 2005, by Senator s McCain and Lautenberg. Act available as a pdf at www.publicknowledge.org/issues/fedwifibill 5 . Policy Making and the role of the Public Sector
    • 76. Regulatory Issues
      • FCC decided in favor of large telephone companies to free them from requirements to open their broadband lines to rival ISPs. (Wireline broadband Internet is considered “information” as opposed to “telecommunications”.)
      • Earlier, U.S. Supreme Court ruled for cable companies to free them from sharing their systems with competition.
      • As a result, competition will intensify, and consumers could benefit from lower pricing and improved services
      5 . Policy Making and the role of the Public Sector
    • 77. 6. Public Sector R&D activities 6.1 Research Activities 6.2. Organizations
    • 78.
      • Federal research and development funding has increased in the past years.
        • FY 2006 budget requests a record of $132 billion for R&D
        • 18-month extension of the research and experimentation tax credit; support on making it permanent and also an extension on the Internet tax moratorium until Oct 2007.
      • Bush's administration aim to make broadband access tax-free, work to enable the rollout of new broadband technologies, making the Federal Government do its part to remove hurdles that slow the deployment of broadband.
      Public Sector & Broadband 6.1 Research Activities 6. Public Sector R&D Activities Source: Greenemeier Larry, R&D Funding and IT Policy to Play Major Role in Bush’s Second Term. Information Week, Jan. 4, 2005. Available at www.informationweek.com The White House, A New Generation of American Innovation. Washington, Apr. 2004. Available at www.whitehouse.gov
    • 79. Public Sector R&D
      • Selected university research activities:
      • Stanford University, Stanford Networking Research Center
        • Information services - engineering and management
        • Internet technologies - infrastructure and applications
        • Access technologies - wireless and wireline
        • Dependable networking - reliable secure computing
      • UC Berkeley, Networks Research
        • Security
        • Better Link Utilization
        • Improved Applications
      • Virginia Tech
        • Fiber optic communications
      • MIT
        • All-Optical Networking Consortium with AT&T and DEC
      6. Public Sector R&D activities 6.1. Research Activities
    • 80. Selected Organizations
      • The Federal Communications Commission (FCC) www.fcc.gov
      • U.S. Department of Commerce , National Telecommunications and Information Administration (NTIA) www.ntia.doc.gov
      • Center for Digital Government www.centerdigitalgov.com
      • The Telecommunications Industry Association www.tiaonline.org
      • The Institute of Electrical and Electronics Engineers (IEEE) www.ieee.org
      • National Institute of Standards and Technology (NIST) www.nist.gov
      6. Public Sector R&D activities 6.2. Organizations
    • 81. 7. Private Sector R&D Activities 7.1 Research Activities 7.2 Funding
    • 82. Private Sector R&D
      • Cisco Systems , sample focus areas:
        • Broadband aggregation routers for triple play
        • Optical packet routers for all-optical network
        • IP Next-Generation Network enabling world’s fastest residential broadband service and enhanced video / IPTV capabilities
        • Carrier Ethernet platforms enabling VPNs and triple play for business and residential users
        • Sophisticated network management tools for SMBs
      7. Private Sector R&D Activities 7.1. Research Activities
    • 83. Private Sector R&D
      • Lucent Technologies , sample focus areas:
        • Networking
          • Soft routers
          • Traffic Engineering and Management System (TEAMS): enable traffic engineering and management within the MPLS networks of large service providers
        • Optical networking
        • Services infrastructure
          • Network support for smart VoIP endpoints
          • Dynamic call routing in VoIP networks
      7. Private Sector R&D Activities 7.1. Research Activities
    • 84. Private Sector R&D
      • AT&T Labs , sample focus areas:
        • Internet & Network Systems
          • Access Networks
          • IP Network Management
          • IP Multicast
          • Network Architecture and Protocols
          • Network Design and Optimization
          • Network Security
          • Optical Systems
          • Voice over IP
        • Collaboration with more than 10 universities
      7. Private Sector R&D Activities 7.1. Research Activities
    • 85. Private Sector R&D
      • IBM Research , sample focus areas:
        • Voice application middleware
        • Peer to peer / content technologies
        • MPLS-based Web switching (layer 4-7)
        • Internet security (VPN, cryptography, secure multicast)
        • Web services security
        • Privacy
      • Collaboration with more than 20 U.S. and foreign universities
      7. Private Sector R&D Activities 7.1. Research Activities
    • 86. Private Sector R&D
      • HP Labs , sample focus areas:
        • Networking; monitoring and management
        • Routing and transport protocols
        • Network architectures
        • Internet media delivery
        • Real-time communications
        • Network quality of service 
      • Many joint research programs with MIT
      7. Private Sector R&D Activities 7.1. Research Activities
    • 87. Venture Capital Funding - Telecommunications
      • Source: MoneyTree Survey, Historical Trend Data: Telecommunications. PricewaterhouseCoopers, 2005. Available at www.pwc.com
      7. Private Sector R&D Activities 7.2 Funding
    • 88. Venture Capital Funding - Telecommunications
      • Source:
      • MoneyTree Survey, Full Year and Q4 2004 Results. PricewaterhouseCoopers, 2004. Available at www.pwc.com
      • MoneyTree Survey, Q1 & Q2, 2005 Results. PricewaterhouseCoopers, 2005. Available at www.pwc.com
      7.2 Funding 7. Private Sector R&D Activities
    • 89. 8. Possibilities for Finnish Companies
    • 90. Opportunities for Finnish Companies
      • Majority of significant fixed broadband technology providers are domestic (American) companies
      • Most product categories dominated by a few strong vendors
      • Foreign technology desired, provided that it meets or exceeds industry requirements
      • Finnish vendors possessing cutting-edge products should concentrate on well-defined market nich és
      • Challenges of the market necessitate teaming up with credible vendors or other industry partners
      8 . Possibilities for Finnish Companies
    • 91. Business Opportunities
        • Firewalls
        • VPN solutions
        • Security software
        • Network and service management
        • Middleware
        • Software testing
        • Consumer applications & content
        • Enterprise applications
        • Internet technology
        • Video streaming
        • Gaming-on-demand
        • Billing
        • VoIP
      8 . Possibilities for Finnish Companies
    • 92. 9. Foreseeable Radical Changes
    • 93. Radical Changes
      • Voice over IP will radically change business models
        • New entrants will join the market for phone service
        • Cable operators start providing triple play (voice, Internet, TV service). They have the advantage of existing customer contact, voice is a way to enhance customer satisfaction
        • Traditional phone operators will need to find new ways to retain customers and compete with triple play (or quad-play)
      • Municipal wireless (Wi-Fi) networks pose a serious threat to fiber and cable-based services offered by telephone and cable operators
      • WiMAX as last-mile solution can be leveraged by service providers to save costs of the last mile
        • This means decreased revenues for providers of the fixed last mile offerings
      9 . Foreseeable Radical Changes
    • 94. Upcoming Developments
      • Media and industry consolidation
      • Continuing deregulation of telecom and media industries
      • Telecommunications Act of 2006 entailing issues in four main areas:
        • Common carriers
        • Broadcast media
        • Spectrum policy / Digital TV
        • Broadband rules
      9 . Foreseeable Radical Changes

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