CEOs Ring Bells, Blow Whistles at NXTcomm

Innovative telecom companies are in the right place, said Seidenberg: “All of the defining experiences of the digital lifestyle -- social networking, media sharing, e- commerce, mobile media -- depend on our advanced networks.” It took many years of “investment and innovation” but the industry “is pushing the envelope on speed,” Seidenberg said.

Motorola CEO Ed Zander told of cellphones starting to see use in Europe as wallets via downloaded credit cards. “Every year you hear, ‘This is the year of convergence, of change'” but this is the year it’s all coming together, said Zander, noting that mobile devices outnumber TVs or PCs. Next year, half of American households will be using on- demand services, he said. Everything is changing in communications and social networking, Zander said. Content products are moving to “spontaneous generators,” letting people produce content at the click of a cellphone camera. Next summer, a product will let people talk to each other on the phone while shooting pictures that both parties can see, he said. “Place shifting” soon will be common, with viewers shifting a TV picture from room to room as they move around their residences. Content distribution is turning into “personacasts,” he said.

Complementing the advanced networks cited by Seidenberg and others, NBC is making waves on the content side, as it plans 2,400 hours of live broadband coverage of the August 2008 Summer Olympics in Beijing, said Bob Wright, vice chairman of NBC parent General Electric. The problem in this explosion of new technology is content piracy, which has been broadband driven to an extent, Wright said. Until recently, content owners and distributors have not “been in the same boat” but that’s changing as ISPs cooperate more, he said. “It serves no one’s interest for the Internet to be the Wild West,” he said. The best route is a 2-part program including education, in which violators are asked to stop, and if that doesn’t work, getting law enforcement involved, he said.

There’s another problem, said FCC Commissioner Jonathan Adelstein on a later panel. Broadband deployment in the U.S. is lagging, demanding a “national plan with benchmarks” to make sure the U.S. remains competitive, he said. John Kneuer, NTIA administrator, strongly disagreed: “Putting in benchmarks has not been a recipe for investment.” Benchmarks force network companies to “redirect their investment to where Washington wants,” rather than relying on their innovation, he said. “We can do better,” responded Adelstein.

Broadband growth elsewhere isn’t necessarily a bad thing for the U.S., since it encourages “free flow of information,” said David Gross, State Department Coordinator of International Communications & Information Policy. Telecom’s creation of low-cost user devices drives openness abroad, he said. Such devices can be used to “show the world” if a country behaves represssively, said Kneuer. The challenge is to “make sure countries don’t use such technology to close down information,” Gross said.

Asked to project two years out, Adelstein said he'd like to close broadband gaps in the U.S. through tax credits and universal service subsidies. The Universal Service Fund now can fund only voice service but “voice is just an application over broadband,” Adelstein said. Kneuer said people will look back at the debate over broadband access as “anachronistic” because the answer will be a “targeted approach… using the innovation that’s in this room,” meaning NXTcomm participants. Gross said technology itself fills holes in service. Zander’s example of using a cellphone for a wallet already goes on in Africa, “partly because they don’t have the infrastructure there for banking,” he said.

Adelstein and Kneuer agreed the 700 MHz auction will have a significant impact worldwide because, in Kneuer’s phrase, it’s a “huge green field” of spectrum capable of extremely good propagation. In the same way that new technology gets shown on the NXTcomm floor, the auction brings “a game changing opportunity,” said Kneuer. Adelstein said he'd like to see another national competitor emerge for the auction but he wasn’t sure if that would happen. -- Edie Herman

NXTcomm Notebook…

With the telecom merger environment driven mainly by strategic deals, clear policy on issues like universal service and broadband deployment incentives could encourage activity and investment in rural broadband deployments, Michael Prior, CEO of Atlantic Tele-Network, said Wednesday on a NXTcomm panel. “There’s a lot of talk about broadband subsidies, and if there were some clarity on that I think you would see a lot more investment,” he said: “Adding that certainty on the subsidy side would drive a lot more investment in rural.” Universal service reform isn’t likely to change SureWest’s strategy, SureWest CEO Steve Oldham said. He'd rather see other government incentives to rural broadband deployments such as tax breaks.