USTA Notebook...
Attendance at the USTA convention in Las Vegas topped 2,600 this year, vs. about 1,000 last year in Boca Raton, show organizers said. Exhibit space doubled. They attributed the increase to the Las Vegas site, as well as to increased marketing and affiliations with related conferences. Organizers were predicting a doubling of both attendance and exhibit space again next year, the 2nd of at least 3 consecutive years for the convention to be in Las Vegas.
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The addition of video and data to telcos’ traditional voice service “changes fundamentally the identity of our companies,” said Brian Strom of SureWest Communications, incoming chmn. of USTA. He said the new services were “driven by customer demand, not by the regulators,” although he acknowledged that the days of universal service subsidies were limited so small telcos would have to find new revenue. SureWest this month got a franchise from Roseville, Cal., to deliver cable TV services via twisted pair, and already is in alpha testing, he said. The firm also has about 10,000 of the 40,000 fiber-to-the-home customers nationwide, as well as 20% DSL penetration, twice the national average. Despite entering a competitive video market, Strom said telcos have the advantage of “a stronger reputation [with consumers] than other platforms” as well as a “brand they know and trust.” But he said telcos’ success entering new markets depended largely on Washington: “A lot is on the line in Washington.” He said USTA previously wasn’t equipped to be much lobbying help to the telcos, but that has “changed for the better.”
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This is a good time for telephone firms to introduce fiber to the premises, Rochester Telephone Pres. Alan Terrell said. On a convention panel, he said current advantages included recession-induced lower construction costs and the lowest cost of capital that was likely “in my lifetime.” Some companies are hoping for lower costs for fiber electronics, but while those go down, construction costs are likely to go up, Terrell said, and telcos could face much higher costs for customers who might be lost during the wait.
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The FCC needs to move to new definitions of telecom services, attorney David Irwin said in a convention presentation. He suggested that hybrid services be called Teleinfoservices and that everything transported over a communications pipeline be deemed an application. The “many flavors” of voice-over-Internet protocol (VoIP) are “giving regulators fits,” he said, and will continue to do so. He cited such flavors as: Jeff Pulver’s Pulver Free Earth, which connects only 2 people who are both customers, and only via the Internet; AT&T’s service, which moves over a closed IP network; Vonage, which uses only the Internet when connecting 2 Vonage customers, but has portals to the switched network when necessary. Irwin said the 1996 Telecom Act was “fatally flawed,” resulting in the loss of 1 million jobs, converting Nortel and Lucent into “penny stocks,” skyrocketing regulatory costs, lower revenue and min. of use, and the Universal Service Fund in “severe distress.” Irwin also said “chaos is inevitable” from the Triennial Review Order, predicting it would be overturned by the courts and Congress would have to step in: “The ‘96 Act needs to be by and large trashed.”