I have been an advocate for satellite broadband service as a solution for providing broadband in parts of Canada that cannot be served economically by wireline or terrestrial wireless technologies.

This summer, I have put my faith in satellite technology to power my connectivity from my office in Muskoka. Last week, I had broadband service installed by Barrett Xplore and it is working well, delivering all of the capabilities I need to run my consulting practice.

Now, there are some who have suggested that

anyone who thinks that satellite is an effective alternative should be required to use it. And then we’d see just how effective it is as an alternative.

I have been using it – and satellite is an effective alternative. New high-throughput satellites are being launched in 2011 and 2012.

Let me flip around the statement: anyone who thinks that satellite isn’t an effective solution should be required to try it. If my tax dollars are going to be used to subsidize broadband, I’d like to see that we are looking at cost effective solutions. There are a lot of households that cannot be reached any other way without obscene levels of public subsidy.

Let’s be sure Canada explores other innovative options to bridge the rural and remote digital divide – and Barrett Xplore is providing just that.

Often, I have seen overly simplistic perspectives on the levels of service that should be demanded of internet service providers. I’d like to start a discussion on a higher plane. Comments will appear below.

There appear to be a number of people who belive that their internet access should function more like a private line as contrasted with a shared resource. Let’s be clear – $45 per month does not pay for an internet access service that delivers 10 Mbps continuously for all 24 hours in a day.

On the other hand, it seems to me that internet service providers need to be clear in letting consumers know what kind of performance criteria are being used to engineer the customers’ networks.

In the old phone company days, most people simply assumed that the dial tone was always available. But the reality was that the voice network was also a shared resource; not everyone could make a call at the same time. We had various engineering standards that were monitored.

For example, during the busiest 3 months of the year, during the busiest hour of the day, 98.5% of callers were expected to receive dial tone within 3 seconds. Local and long distance circuits were engineered to a certain level of availability.

Are there similar criteria that can be developed for internet access services?

A couple years ago, people were making a lot of noise about Finland’s announced plans to make broadband a universal right by July 1, 2010.

On schedule, last week, the same announcement received more coverage as the regulations went into effect. But not a lot of time has been spent analysing what really happened.

If you look at the details in the press release, you’ll see that FICORA (the regulator) has annointed 26 universal service operators in various regions of the country. In effect, a monopoly universal service provider has the obligation to provide certain services to any customer (consumer and business) for their region, in areas where the regulator has concerns about the competitive supply of services.

FICORA expects that 1Mbps broadband will be available for 30-40 Euros ($40-$53). It isn’t an overly onerous obligation. But the question remains as to whether this program serves to prevent competition from ever emerging in areas that provide subsidies to one provider. Would a portable user-subsidy be more effective at stimulating facilities based competition and having less of a distortionary effect on the market?

Such a program would also stimulate broadband adoption in urban areas among those who find regular broadband pricing a burden.

In the meantime, we are continuing to explore broadband becoming part of the definition of basic service for Canadians. Proceeding 2010-43 will have oral hearings beginning in late October. The file continues to accumulate, attracting many megabytes of data and argument.

An article on Wall Street Journal says that it is time for RIM and Nokia to join forces in order to compete more effectively against Apple in the smart phone segment.

Apple’s iPhone 4 scored sales of 1.7M units in its opening weekend, a new record for an Apple product launch.

The WSJ article highlights Apple’s market cap of $250B towering over the market valuations for Nokia and RIM, each roughly at $30B. The article suggests that Nokia has been unable to “formulate an answer for the iPhone at the high-end, and as smartphones get more affordable for consumers, the market for low-end phones will continue to shrink.” 

I wondered if the WSJ article may be discounting the importance of the developing world in its forecast for shrinking demand for low-end phones. It is often too easy to be focussed on our own markets without keeping the rest of world in mind.

Let’s provide a little context for these numbers. The total mobile handset market in first quarter 2010 was about 323 million units, or roughly 3.5M new handsets sold every day, for the entire quarter. So, on its launch weekend, the iPhone 4 took about 15% of worldwide sales. Nokia has seen sequential declines in quarterly market share, but it still sells more than a million devices every day – with roughly a third of the global market.

It is that global reach that provides an important distinction for low end devices. Less than 5% of Nokia’s revenues from sales of devices comes from North America [Nokia’s quarterly filings]. Three quarters of Nokia’s sales volume is from outside North America and Europe. About 80% of Nokia’s sales were low end devices with an average selling price of 39 EUR.

Integrating Windows functionality into the next generation of high end Nokia devices will provide an alternative other than RIM for Nokia to engage with the corporate market. 

A bigger question is where does RIM go from here?  

Lots of questions remain in the mobile device market. Will success in doing battle with Apple in the mobile device market parallel the computer market? Is it a case of religious debates, like Mac versus PC – Windows? Will Android be a more significant spoiler than Linux has been?

The Don’t Lock My Freedom website purports to represent consumer interests, when it is quite possible the net effect of its advocacy will be to raise initial phone prices and long term service costs. 

An article on Cartt.ca highlights these key flaws in the overly simplistic viewpoint that appears to have motivated the proposal to require wireless service providers to unlock phones.

The organizers of the website and the legislative supporters ignore the fact that there are already lots of alternate channels for people to buy phones without locks. There are service providers who have announced that they will unlock phones for their subscribers. Thanks to on-line third party sites like Tiger Direct, anyone who wants can buy unlocked phones, even if they aren’t in major metropolitan areas. Do a search for “unlock codes” and you will find lots of options at pretty low prices.

In other words, the marketplace is working without government intervention to dictate specific business models to the service providers. Now, I know that some will argue that most phones are being bought from the wireless service providers and have contracts associated with them. Maybe that is because people like the subsidies that they are receiving? Or they appreciate the ability to call the service providers’ technical support lines and have them recognize the model number and provide help.

Michael Geist is quoted in the Cartt.ca article saying:

In certain respects, this was an odd question to even have to ask. No one would ever question whether consumers have the right to tinker with their car or to use the same television if they switch providers from cable to satellite, yet the wireless industry somehow convinced the public that unlocking their phones – consumers’ own property – was wrong.

How many people who buy a Chevy expect a Mercedes dealer to fix their transmission for free? Or vice versa? Would a Ford dealer even be expected to be able to diagnose what is wrong with your Lambourgini? Is the next private member’s bill going to force car dealers to get rid of their oil change and service departments?

The metaphor for TVs just doesn’t hold up to scrutiny at all – unless Professor Geist has figured out a way to use his Bell TV set-top box for Rogers cable service, or vice versa. Maybe that is another private member’s bill.

If a phone that was sold by Rogers is unlocked and now is getting used on the TELUS network, which customer service line should the consumer call to find out how to load a Facebook application? When the TELUS representative has to spend extra time trying to learn the menu system for a model that was never sold by them, who should pay for that call?

How many consumers will be told to take their phones back to the original store for help with the software?

Should you be able to unlock a phone is a very different question from the government dictating a specific business model that requires all phones to be unlocked. The right to unlock phones is part of the copyright reform act, Bill C-32.

The Cellular Freedom Act appears to be naively motivated and could ultimately inconvenience most consumers.