Lifeline Accountability

USAC LogoUSAC, the group that administers the Universal Service Funds, has started testing a program that is designed to stop people from requesting multiple subsidies from the Lifeline program.

The lifeline program provides a discount of $9.95 from telephone bills for low-income consumers. A consumer is eligible for Lifeline if they a earn less than 135% of the federal poverty level or if somebody in the household participates in any of a number of assistance programs such as Medicaid, Food Stamps, Section 8 housing, low income home-energy assistance, Head Start and various tribal and state programs.

The way this works is that the telephone company providing the service gives the discount to the consumer and then collects the funds from USAC out of the Universal Service Fund.

A consumer can elect to get the discount from either a home telephone or a cellular phone account, but cannot collect from both. Apparently there is a lot of concern in Washington that people are collecting the discounts for both a landline and a cell phone, because the FCC has instructed USAC to put together a program to make certain that people don’t collect multiple benefits.

And so USAC is currently implementing the National Lifeline Accountability Database (NLAD). Carriers who participate in the lifeline program are required to input data about each lifeline customer including the last four digits of their social security number or their tribal ID and their date of birth. The carrier also has to provide the full address for each customer and this address will then be verified by USAC using the USPS database of valid addresses. Expect big problems in this area because rural addresses are often very erratic in the USPS databases.

As you might imagine, many carriers don’t ask for things like the date of birth when somebody gets telephone service, so they are now scrambling to get the needed information from their customers.

States are being added to the NLAD in groups. The first group of states now entering data includes Arkansas, Maryland, Louisiana, Oklahoma and Washington. Already some states have opted out of the NLAD database including Puerto Rico, Oregon, Texas, California and Vermont. Those states are going to have to come up with some version of this database of their own or else carriers in those states will lose Lifeline funding.

There is no fee to use the database, but use of it is mandatory if a carrier wants to collect from the Lifeline fund. The real cost is in the effort of each carrier to implement and keep this database current – another unfunded mandate.

I suppose that this process will turn up some cheaters and they will be asked to pare back to just one Lifeline subsidy. But one has to wonder how many customers might have been given the discount by multiple carriers without even knowing that this is not allowed? And one might suspect that there are somewhat shady carriers who are collecting the payments from the Lifeline fund without giving the discount to a customer, or possibly even having a customer. I would not be surprised to find some carriers collecting Lifeline for customers who died years ago.

I hope the FCC publishes the result of what they find through this database. As much as I hate waste and fraud, one has to wonder of the cost of implementing this kind of red-tape process is worth it compared to any savings that will be achieved through eliminating duplicate payments. These kind of processes end up becoming permanent new requirements for carriers and make it just that much harder to do business.

Cool New Technologies

TodaTransistory blog is not about a new telco gadget or technology, but instead reports on three new technology breakthroughs that might eventually benefit our industry. When it comes to technology I am both an optimist and a dreamer. I am one of those people who watches Star Trek and fully expects that to be our world in a century or so, minus warp drive and beaming people around.

I have seen various estimates that say that total scientific knowledge is doubling between every five years and eight years. With that much new knowledge we are going to keep seeing amazing new discoveries and applications in fields of science from physics  to genetics and our communication and medicine a century now will look nothing like today.

Here are three new things I found intriguing:

Entangled Photons.  Telecom giant NTT has been doing research on quantum communications and they have been able to create what they are calling entangled photons. This means two photons at different places that act in total synch with each other. In a recent experiment they were able to entangle pairs of photons that were 300 kilometers apart.

This is really interesting from a communications perspective, because with entangled photons, whatever is done to change one photon happens simultaneously with the other. This leads to the possibility that locations far apart could transmit information without actually sending the information from one place to the other. Instead we would just manipulate the tangled protons at one end and those changes could be read and interpreted as data at the other end.

This research is in the very early stages, but the good news is that they got it to work. It would take a lot more space than this blog to explain why they think this works and if you want your head to hurt go read a book on quantum mechanics. It’s amazing stuff.

And if that is not interesting enough, scientists in Israel recently were able to entangle photons that were separated by both space and time. That is starting to sound like Star Trek to me and opens up the possibility of communicating into another time.

Twisted Magnetic Fields. Scientists have known for a few years that they could increase the surface area of storage media by using twisted magnetic fields, known as skyrmions. Scientists at the University of Hamburg were able recently to be able to write and then erase data on skyrmions. This technology could increase computer storage efficiency by a factor of about 20 times.

The writing and erasing would be done using scanning tunneling microscopes. Like with any new technology there are a lot of bugs to work out. But over time we will continue to see smaller and denser data storage.

Passing the Limits of Silicon. Speaking of smaller, researchers at Applied Materials, the semiconductor and chip maker, have been looking at what comes next after we pass the limits of silicon. Current estimates are that the smallest  ‘transistor’ we can make with silicon is at about 14 nanometers. However, the Applied Materials scientists have been looking at other technologies that could lower that to as small as 3 nanometers. This would reduce the size of chips by about a factor of 25 past what can be done with silicon.

The reasons that the semiconductor industry uses silicon is that it’s cheap and all of the research and tools used in the industry are based upon silicon. But if we want smaller and faster chips we are nearing the time when we are going to have to step away from silicon and start over.

Applied Materials thinks that the next possible materials to use are either silicon-germanium (SiGe) or even pure germanium. Those materials can probably reduce the effective size of a transistor down to the 7 nanometer range.

To go beyond 7 nanometers is going to require a change in topology of the chip surface. Above I mentioned using twisted magnetic fields, but this is more in the line of a physical change, and Applied Materials is betting on shaping the material in what they are calling fins. This will increase the surface area while still preventing quantum tunneling and data gate leakage.

What I love about these kinds of breakthroughs is that scientists keep pushing and probing our knowledge of the universe, with the result that we get smaller, faster computing devices that are going to transform our world.

Is Anybody Happy With Cable TV?

Maryland TerrapinsIn case you don’t know it, I am a University of Maryland Sports nut. This makes me a very one-dimensional TV watcher and sports fan and I will watch a Maryland soccer game or woman’s basketball game over almost any other sporting event or other TV. In many weeks the only TV / radio / web watching I do is Maryland sports. When I lived in Maryland I went to see these events on campus and traveled to many away games. But for a decade now I have lived in the Virgin Islands and am now moving to Florida, and so I am dependent upon what I can get over the air to get my Maryland sports fix.

Living in the VI has been a real challenge to me since the wide array of cable sports that is available on the mainland is not really available in the Caribbean. Normal cable here has ESPN and ESPN2 and the networks, but not much other sports programming is available. The network channels come from Puerto Rico and often will not even carry somewhat big sports events. Satellite is also different here since we are too far below the horizon to see the LEO satellites used by Dish and DirectTV. Instead we get some odd hybrid piped-in version of DirectTV that has a lot of Spanish channels and carries more soccer than college sports.

And so I have spent the last decade listening to Maryland sports on web radio, or in recent years watching something CBS put together called Terrapin TV. That allows me to watch the non-revenue sports like lacrosse, soccer, field hockey, etc live.

I don’t watch much other TV. My preference for watching other TV shows is to watch a whole series end-to-end. I will often go months at a time without turning on the actual cable box. I just watched the Sopranos end-to-end and that gives me a lot more pleasure than watching shows on TV that I am really not interested in. All we ever bothered to get was the basic channels which is a very tiny twenty channels of mostly local stuff.

Why am I telling you so much about my TV viewing habits? It’s because I don’t think I am unusual. Moving to the VI made me focus on what I really wanted out of TV. And so this might have gotten me used to watching only what I wanted a few years before other people have found this same thing. But as I talk to others about what they watch on TV I am finding more and more people like me. Not that they are Maryland sports nuts (too bad for them), but people are now watching more and more of only what interests them.

This means that there are more and more people like me who are really not interested in the big packages that the cable companies are selling. For a decade I have avoided those. In moving to Florida I am very reluctantly going to buy a DirectTV package, because this looks like the only realistic way to get Maryland Sports when they move to the Big Ten next year. But I am holding my nose in making that purchase, and if there was a way to get only what I want to watch I would gladly pay a la carte prices for it.

I really don’t mind the money I pay to the cable company. I mind that I am supporting a lot of content that has absolutely zero interest for me. And my wife’s viewing habits are similar to mine, sans the Terrapins (but I am slowly working on that).

For now the cable TV companies and the programmers are still tightly holding onto the traditional packages. But as more and more people are getting tired of those packages and elect to opt out for Netflix and the alternatives, the wheels have to eventually come off that model. It has to happen and it’s just a matter of how long it will take to implode. One doesn’t have to be a math wiz to see that in another decade the most basic cable packages are going to be over $100 per month. If for no other reason, people will find alternatives only because they will eventually fail to see the value in writing the big check.

So I asked the question above if anybody is really happy with cable TV anymore? Years ago a lot of people I knew said they liked surfing the channels for hours. But I rarely hear anybody who still prefers to do that anymore. At some point our changing viewing habits are going to make a difference. It can’t come soon enough for me. Go Terps!

Now It’s Verizon’s Turn

Black phone

Lately I have been highlighting the many attempts of AT&T to become deregulated or to abandon landlines by the millions. But now it’s time to look at what Verizon is doing in Massachusetts.

Verizon has been able to get Bill H. 2930 introduced which is their attempt to become totally deregulated in the state. It’s a very short bill and the heart of it says that Verizon will become deregulated “in any municipality for which the company or carrier certifies to the Office of Consumer Affairs and Business Regulation that there are at least two providers offering voice telephone service to retail residential customers in that municipality using any technology, including but not limited to wireless voice service and VoIP service.”

Since there is no town in the state where there is not cell phone coverage or where Vonage and Skype are not available to residents, this would mean total deregulation.

This request makes us look at some really tough questions. Residential telephone penetration rates have plummeted in the last decade and are thought to average around 60%, down from the days when it was 98%. Businesses still mostly have telephones, but many of these phones are provided by competitors to the incumbent telcos.

At what point should the large telcos be deregulated, and what does such deregulation mean? Deregulation really boils down to just a few basic obligations. Regulated telcos are still the carrier of last resort. This means that they cannot refuse to serve a customer who requests service, within reason. The telcos have never been forced, for example, to build copper to the top of a mountain to serve one customer, but they are expected to build to add customers who are within a reasonable distance of existing telco facilities.

Deregulation also means that price caps would be removed from residential service rates and the telco would be free to charge whatever they want for residential dial tone. When you consider that local rates have been largely been frozen for a very long time in most states, the relative price of telephone service has gotten relatively cheap when considering the effect on other prices from a few decades of inflation.

There are other obligations to being regulated such as making sure that customers have access to 911. But this short law takes care to point out that the 911 and lifeline obligations would still remain in place.

So what does deregulation really mean? It might mean that prices will go up. But it also might mean that Verizon would have more flexibility to bundle local rates with features and with DSL in the same manner that the cable companies do it. One would not expect Verizon to impose a significant price increase in a market where people are already fleeing the product.

Probably the biggest change would be to the carrier of last resort obligations. Verizon could charge a considerable hook-up fee to build to a home that doesn’t have wires today. Or they could simply refuse to build to a home. Or they could charge large deposits to get new service. It could mean that the company could refuse to reconnect customers who miss a payment. This could also mean that they could let customer service deteriorate more and that a customer could be on hold even longer than today when calling the company, or perhaps customers would wait even longer to get repairs.

It’s a tough decision for regulators. It begs the question at what point does an incumbent stop being the carrier of last resort. Regulations made sense when the telcos had practically every home as a customer. But today the penetration rates for telephone service are greatly reduced and many of the customers who still have telephones use the cable company instead of Verizon. One would think that they already have less than half of the telco customers in most markets. There clearly ought to come some point where Verizon and the other telcos ought to be deregulated. But I don’t think anybody has an answer at where that point is at.