Displaying items by tag: Internet

US regulator settles $17 million dispute with Verizon

Written on Thursday, 19 October 2017 08:13

The US Federal Communications Commission (FCC) announced a settlement with Verizon for possible violations of the FCC’s competitive bidding rules for the E-rate program, which provides discounts to assist most schools and libraries in the United States to obtain affordable internet access. 

Verizon agreed to pay $17.68 million to resolve parallel investigations by the FCC and U.S. Department of Justice, $17.325 million of which will be repaid to the Universal Service Fund (USF).  Verizon has further agreed to withdraw any rights it may have to hundreds of millions of dollars in requested and undisbursed E-rate support.

This settlement follows an investigation into Verizon’s involvement with New York City schools’ use of the E-rate program.  The Commission’s Enforcement Bureau conducted its investigation in parallel with the US Department of Justice Civil Fraud Section and US Attorney’s Office for the Southern District of New York. 

In related actions, former New York City Department of Education consultant Willard “Ross” Lanham was convicted by a federal jury sitting in the Southern District of New York.  In December 2015, the Commission settled a related investigation with the New York City Department of Education. 

The Schools and Libraries Universal Service Program, known as E-rate, subsidizes telecommunications, Internet access, and Wi-Fi services for schools and libraries.  E-rate is funded by the Universal Service Fund under rules established by the FCC. 

The program is designed to bring modern broadband connectivity to students, teachers and library patrons.  Program applicants must seek competitive bids from prospective service providers and must treat the price-eligible products and services as the primary factor when selecting amongst competing service providers. 

To resolve the FCC and Justice Department investigations, Verizon will pay $17.325 million to the Universal Service Fund through the FCC settlement and $354,634 to the US Treasury through the Justice Department settlement. 

In addition, Verizon will surrender any claims against the Universal Service Fund it may have to approximately $7,303,668 in undisbursed E-rate support for products and services provided to the New York City Department of Education between Funding Years 2002 and 2013. 

Furthermore, Verizon will surrender any appeal rights before the Universal Service Administrative Company and the FCC in connection with more than $100 million in E-rate support for which the New York City Department of Education has withdrawn requests for support through its 2015 settlement with the FCC.  As part of the FCC’s settlement, Verizon will also operate under a compliance plan for three years. 

While the Commission adopted the consent decree in May 2017, it has not been released until now in order to allow for a global settlement which includes the US Department of Justice.  The Department of Justice settlement with Verizon was submitted to the Court for approval in the Southern District of New York on October 17.

Published in Finance

Telcos and OTTs shouldn’t be subject to same rules

Written on Tuesday, 26 September 2017 12:26

It’s no secret that telecom operators have struggled against the popularity of over-the-top (OTT) applications like WhatsApp and Skype, who have challenged traditional voice and SMS revenue streams. Some operators have called for regulators to subject OTTs to legacy telecommunications regulations in order to even the playing field. But such suggestions are misguided, according to the ITU.

Telecom operators are stuck in a predicament regarding OTT services who utilize their networks. They have little control over the growth of OTTs because users should be free to use the internet as they please. The network carrier only carries the IP packets from source to destination. They might be aware of the packets and their contents, but cannot do much about it. Carriers have had to roll with the punches and figure out how to adapt.

Ultimately, using VoIP (voice-over-IP) is a cheaper alternative to making expensive phone calls because the user doesn’t have to pay to use the dedicated phone line and instead utilizes an internet connection without any extra costs. As is the case with most VoIP services, calls made using the internet are often free while calls made to a cellular network require a payment. The advanced communication functions of modern smartphones have played a role in the rapid growth of OTT services.

The question is: what can network carriers do about it? Telecom carriers have lost hundreds of millions of dollars of revenue to VoIP services, statistics show. Some network carriers reacted, of course, by imposing restrictions on VoIP services. AT&T did this when Apple released its iPhone and the US telecom operator didn’t want its network being used for VoIP calling. AT&T lifted the block in 2009 after pressure from the Federal Communications Commission (FCC).

AT&T had an agreement with Apple to ban apps that would enable iPhone users to make phone calls using a wireless data connection. The scandal was revealed when the FCC requested that the companies explain why Google’s Voice app was rejected for the iPhone app store. The FCC was led to investigate if AT&T and Apple were colluding to prevent competition, sparking the beginning of a sour relationship between telecom providers and OTTs.

Can telcos come out on top?

For decades, telecom operators had free reign to charge rates for voice, data and SMS largely in excess of their marginal cost, which created a market ripe with innovation. The International Telecommunications Union’s (ITU) recent report ‘The State of Broadband 2017’ highlights the struggle telecom operators have faced since that period began to wane, as online applications became increasingly popular with consumers around the world who wished to interact in ways not possible through traditional communications channels.

Communication has been transformed by the likes of Facebook, Instagram, Skype, WeChat, Google, WhatsApp and Viber. These OTT services have “transformed the way people build communities and search for information, and made valuable contributions to health, education, finance and entertainment,” ITU claims in the report. “Online applications now generate a significant proportion of the socioeconomic impact of digitization and utilization of the internet itself.”

The demand for OTT services has driven the telecom industry to a new era, and some telecom operators – in defense of their traditional revenues – have sought to “handicap” the growth of OTT players, the report suggests. It’s important to note, however, that these OTT services, however disruptive they may be, are driving demand for telecom operators’ broadband services. Without the content and services that OTTs provide, consumers would be less willing to pay operators for internet access, ITU claims.

“The operators’ complaints make as much sense as cable operators that sell access to cable channels complaining that people are watching too much TV, driving up the demand for their own services,” the report says, “Or a restaurant complaining that too many people want to eat its food driving up food costs. Operators sell access – not content – but people only want that access to use online content.”

Telecom operators, according to the report, claim they cannot invest in their networks because online OTT services have limited their ability to generate revenue. The ITU says this is “inaccurate” and “misguided”.

Some telecom operators have called upon regulators to apply the “same rules for the same service” by encouraging authorities to subject all online OTT services to legacy telecommunications regulations. ITU rejects this, emphasizing that OTTs don’t offer the “same service” as telecom operators, and that subjecting them to the same rules would be “entirely inappropriate”.

OTT services like Facebook and Google, for example, don’t provide equivalent services as telecom operators, the report points out. Operators provide access to the internet and some vertically integrated services that take advantage of, and are bundled with, general access. Online OTTs, on the other hand, provide interactive experiences for internet users that go beyond traditional voice and SMS, including payment services, chat services and photo/video sharing.

The fundamental differences between the telecom sector and online OTT services has led to the establishment of different rules, the report highlights. For instance, telecom regulations are intended to ensure that established operators – who own network infrastructure with high barriers to entry and face limited competition – do not use these privileges to the disadvantage of consumers. OTT services, by contrast, don’t control network infrastructure and must compete fiercely to retain customers who could easily be swayed.

There’s also the perception that OTT payers get a “free ride” on telecom network infrastructure which is financed by operators. But in truth, OTT players invest billions of dollars annually in a combination of physical facilities, according to the ITU, including data centers, fiber networks, servers and routers, which form an “essential part of the physical fabric of the internet”. In fact, according to the report, online OTT players invested an average of US$33 billion per year in infrastructure from 2011-2013.

ITU argues that telecom operators should recognize how much online OTT players drive consumers’ willingness to pay for internet access, which then provides more opportunities to generate revenue and finance new infrastructure. According to the report, consumers who demand the most data tend to spend more money on mobile contracts that feature high-speed data – revenue that goes directly to the telecom operators.

“Regulatory authorities do not have to choose directly between the interests of online application providers and telecom operators,” the ITU report concludes with. The most important aspects of internet usage that regulatory authorities should focus on, the report suggests, are adhering to customer needs, ensuring that the internet is widely available, and prioritizing connectivity, competition and innovation.

Published in Featured

British telecommunications colossus BT has announced that it will invest £600m in faster broadband services in rural parts of the United Kingdom. BT believe the investment will enable them to provide all households in Britain with access speeds of at least 10 megabits per-second, which will allow users to be able to stream content from OTT services such as Netflix and YouTube.

Culture Secretary, Karen Bradley has said that the UK government will take into consideration the voluntary offer from BT, whilst also weighing up whether a regulatory approach may be the best way of achieving its ambition to enhance broadband services to all homes and business in the UK.

The proposal tabled by BT consists of a plan from the telecommunications provider to fund the investment themselves, and it would recover costs by charging access to its local networks. BT’s chief executive, Gavin Patterson, claimed that he expected close to 95% of all homes and businesses in the UK would enjoy enhanced broadband speeds by the end of the year.

Patterson said, “We already expect 95 percent of homes and businesses to have access to superfast broadband speeds of 24Mbps or faster by the end of 2017. Our latest initiative aims to ensure that all UK premises can get faster broadband, even in the hardest to reach parts of the UK."

In addition to this, the UK government said that BT’s plan foresaw taking coverage of at least 10Mbps to around 99% of homes and businesses by 2020, with the project estimated to be completed within two years after that. However, the proposal was criticized by representatives of the UK government’s opposition, The Labour Party for not being ambitious enough and called for the proposal to be reexamined.

Published in Telecom Operators

The Investment Plan for Europe, the so-called "Juncker Plan", has backed a €150 million EIB loan agreement with Cosmote, a Greek telecommunications operator, to upgrade its mobile broadband network. This agreement was made possible by the support of the European Fund for Strategic Investments (EFSI).

The loan agreement will help to finance Cosmote's plans to enhance and expand its mobile broadband network, significantly increasing the network's performance in terms of speed, capacity and coverage. It will, in particular, improve the networks performances in more rural and remote areas of the country.

“This agreement demonstrates yet again the valuable role the Juncker Plan can play in mobilizing investment to support and expand growth-enabling infrastructure in Greece,” said Pierre Moscovici, Commissioner for Economic and Financial Affairs, Taxation and Customs.

“The agreement also serves as testament to the Commission's broader strategic objective of seeking to fully exploit the opportunities offered by digital technologies to promote innovation, productivity and growth,” Pierre added. “The Commission remains committed to supporting investment that will act to secure Greece's economic recovery.”

The Juncker Plan is working to boost investment, support jobs and spur growth in Greece and across Europe. As of June 2017, operations approved in Greece under the EFSI represent a financing volume of over €1.1 billion and are expected to mobilize over €3.3 billion in investments.

This project contributes to meeting Europeans' growing connectivity needs, promoting access to high quality networks and boosting Europe's competitiveness, as foreseen in the Digital Single Market strategy. Some 10% of EFSI investments are in the digital sector.

Published in Telecom Operators

Vodafone launches WiFi as a service for businesses

Written on Thursday, 21 April 2016 07:37

Vodafone has launched WiFi as a service that allows business customers to offer, in their facilities, WiFi internet access to visitors and employees.

Powered by a centralized authentication and web traffic analysis platform, the service provides a rich set of features including a customized landing page, wide range of end user authentication methods, usage reports and footfall analysis.

With this platform, end users get internet access, while companies may extract end users' data that are relevant for their business depending on their network's traffic. For instance, the owner of a restaurant can find out the number of times a customer visited its restaurant and create special offers based on this data.

The product also provides data about WiFi users’ density, which can be used by local authorities for public areas in order to effectively manage security services. For example, the number of security personnel can be increased in agglomerated locations and surveillance cameras can be integrated for improved security.

WiFi as a service takes all the pain away from business customers by designing, building and operating their WiFi. Delivered as a scalable solution due to the centralized cloud infrastructure, new Hotspots can be easily added. The solution is presented without any implementation costs, with the customer paying a monthly fee for the duration of the contract. The service provides organizations with highly secure premium internet bandwidth with speeds of up to 1Gbps. 

By enriching their managed services portfolio, Vodafone Qatar positions itself as a one stop shop for all enterprise customer communication needs, ranging from mobile, fixed, IOT, datacenter solutions and WiFi. 

Published in Telecom Operators

Akamai’s State of the Internet

Written on Thursday, 07 April 2016 06:29

Through its globally deployed Intelligent Platform, and by virtue of the more than 2 trillion requests for web content that it serves on a daily basis, Akamai has unique visibility into levels of Internet penetration around the world. In the fourth quarter of 2015, over 810 million unique IPv4 addresses from 243 unique countries/regions connected to the Akamai Intelligent Platform. This is a 0.9% increase in the number of unique IPv4 addresses seen by Akamai as compared with the fourth quarter of 2014 and a 0.2% increase from the number seen in the third quarter of 2015.

Each quarter, Akamai publishes the State of the Internet Report based on this data. In the fourth quarter of 2015, Akamai observed a 0.2% quarterly increase in the number of unique IPv4 addresses connecting to the Akamai Intelligent Platform, growing to over 810 million — about 1.7 million more than were seen in the third quarter of 2015. Belgium remained the clear global leader in IPv6 adoption with 37% of its connections to Akamai occurring over IPv6, up 6.2% from the previous quarter.

The global average connection speed increased 8.6% quarter over quarter to 5.6 Mbps, while the global average peak connection speed increased 1.0% to 32.5 Mbps. At a country/region level, South Korea continued to have the highest average connection speed in the world at 26.7 Mbps, a 30% gain over the third quarter, while Singapore maintained its position as the country with the highest average peak connection speed at 135.7 Mbps, a 0.2% quarterly increase.

Globally, 4 Mbps broadband adoption came in at 69%, up 5.8% from the third quarter, with South Korea as the country with the highest level of adoption at 97%. Unsurprisingly, South Korea once again led the world across the 10 Mbps, 15 Mbps, and 25 Mbps broadband tiers as well, with adoption rates of 81%, 63%, and 37% respectively, after seeing substantial quarterly gains across all three metrics. Global 10 Mbps, 15 Mbps, and 25 Mbps adoption also grew robustly in the fourth quarter, posting gains of 15%, 28%, and 37% at each threshold and reaching adoption levels of 32%, 19%, and 7.1% respectively.

As expected, the fourth quarter saw continued depletion of available IPv4 address space as Regional Internet Registries (RIRs) assigned/allocated blocks of IPv4 address space to organizations within their respective territories.

Not directly represented in this data is the fact that there are still many regions of the world with little or no broadband connectivity to the Internet. As mentioned in the previous State of the Internet Report, some organizations, including Google and Facebook, have ambitious plans to try to bring connectivity to those parts of the globe through creative means including high-altitude balloons, solar powered drones, and high-endurance aircraft. In the fourth quarter, Google and Facebook both highlighted current work they are doing to bring Internet access to parts of Africa through more traditional means. Google revealed that its Project Link initiative — which builds out fiber backbone networks in underserved areas — was in the process of laying fiber to serve the cities of Accra and Kumasi in Ghana, while Facebook’s Internet.org announced a partnership with Eutelsat, a French satellite provider, to bring free Internet access to sub-Saharan Africa starting in the second half of 2016.