In the News

Published March 1, 2005

Intel Lobbies for Muni Wi-Fi

Although a company executive conceded taxpayer-funded broadband was not the best model for providing that service, Intel plans to step up its lobbying efforts to thwart legislation aimed at prohibiting municipalities from building their own wireless broadband systems.

Intel is a major manufacturer of computer chips used in wireless data communications and has staked much on the success of WiMAX, a wireless broadband access technology that can cover several square miles.

Legislation that would prevent cities and towns from building their own broadband systems is pending in at least 17 states. That legislation is supported largely by the nation’s commercial broadband service providers, who say municipal systems, as government entities, compete on an unlevel playing field.

As reported by CMP’s TechWeb, Sean Maloney, executive vice president of Intel’s Communications Group, told the Wireless Communications Alliance conference in January that while he did not think municipal ownership was a good model, he opposed laws that pre-empted it. He added, however, that he thought municipal attempts created a needlessly adversarial relationship with the private sector and recommended states and municipalities consider public-private partnerships.

California Parks Get Wi-Fi

In an example of the type of public-private partnership suggested by Intel, the state of California awarded SBC Communications a contract to set up Wi-Fi hot spots in 85 state parks.

The first hot spot became operational at a state park in San Diego in early January, the New York Times reported. Other access points will be in place by May.

Under the deal, SBC will give park visitors free Internet access to California state government Web pages, including information about park activities, weather, camping, and hiking conditions. Access to the rest of the Internet, as well as e-mail, will cost $7.95 a day.

Appeals Court Upholds VoIP Pre-Emption

In a late December ruling, the U.S. Court of Appeals for the Eighth Circuit sided with a lower court and the Federal Communications Commission, agreeing that voice over Internet Protocol (VoIP) is a data service and cannot be regulated by the states.

The decision is seen as a victory for the VoIP segment, which seeks to avoid the price regulation, taxes, and surcharges states place on local wireline phone service. The ruling represents a setback for public utility commissions in a number of states, including California and Minnesota, that have claimed jurisdiction over VoIP service.

According to industry estimates, the number of residential VoIP users grew to 500,000 in 2004 from 100,000 the year before.

Oklahoma Allows Service Bundling

The Oklahoma Corporation Commission (OCC) voted in January to allow service providers in that state to offer packages that combine local, long distance, wireless, and cable TV service, agreeing such packages result in lower prices for consumers.

Until the ruling, local service providers were not able to combine regulated services, such as dial-up phone service, with unregulated services, such as Internet access. Services had to be ordered and billed separately.

At the same time, at the behest of the Oklahoma legislature, the OCC said it would launch a study of the status of competition in the state. It is expected to issue a report this month.

Earthlink, SK Telecom Team on Wireless Data

Earthlink, the nationwide low-cost Internet service provider, has formed a joint venture with South Korea’s SK Telecom to market wireless voice and data services in the U.S., the Wall Street Journal has reported.

The deal will offer SK Telecom growth outside of South Korea, where the wireless market, at 70 percent, is considered saturated. For Earthlink, the deal is an opportunity to extend its brand name to the wireless sphere.

The joint venture company will likely resell capacity on existing networks. Earthlink will be able to leverage its base of residential Internet subscribers and offer them the added value of portability.

Compiled by Steven Titch ([email protected]), who is senior fellow for IT and telecom policy at The Heartland Institute and managing editor of IT&T News.