22 May 2006

"Free" Internet service

This article reminds me of the business models tried by Juno and NetZero during Internet Boom 1.0. There are a couple of notable, interesting wrinkles and questions here:

  • Is there a value in a nationwide service? What about the municipal networks that are being built?

  • Should government act as a venture capitalist by agreeing to M2Z's proposal to share revenues? What are the dimensions of this policy decision that are worth discussing?
  • Is 25MHz of spectrum enough? Is it more than necessary?

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1 comment:

KuangChiu Huang said...

After reading M2Z’s application, I think its proposal is attractive but I am not fully support for that.

Why it is attractive:

Free wireless broadband access: Affordable broadband access is not enough but free broadband will be available in national scale.

Increase competition in broadband market: New entrant of Wireless broadband can create positive impact on broadband market, increase competition in monthly fee and service quality.

Why I don’t fully support:

Free of spectrum: I can not figure out any reason that the FCC have to assign the spectrum for free to M2Z, because the spectrum policy, free assignment to broadcasting, is out of date and NextTel 700 MHz case is a different one (it is a swap of radio bands to alleviate interference problem and Nextel pays all related expenses). In addition, it might cause unfair competition. (Free licensed wireless broadband versus 3G and licensed M2Z versus unlicensed WiFi) I would prefer that the FCC takes an auction to decide who will be the most efficient broadband service provider of this band.

Internet police: Even it is still ambiguous about content neutrality of ISP; M2Z would filter out indecency content for their subscribers. My questions are what the criteria of indecent content will be and who can decide these criteria.

Universal broadband service: It might take ten years to cover 95% population. I guess the remained 5% population can not have any broadband access after ten years. (Except satellite) M2Z’s service might compete with other BISPs but might not extend broadband service coverage to rural areas.

As for impact on municipal WiFi, other broadband services and its wireless broadband technology, my comments are as following:

Impact on municipal WiFi: If M2Z’s plan comes true, it could be the end of old model municipal WiFi. I would suggest two steps of municipal WiFi to survive in new competition. One is to figure out how to embedded advertising support model into their business models. The other is to form an alliance of these local BISPs to bargain with better deals in advertisement against M2Z (free service BISP with national coverage).

Impact on wired broadband service and 3G: Not sure about their possible substitution effect, because WiBro (similar service) in South Korea provides an example that wired broadband, 3G and WiBro (similar as M2Z) could co-exist in different markets.

20 MHz bandwidth could be sufficient: After comparing with M2z’s technology and WiMAX 802.16e, I find little difference between two of them. Both technologies adopt TDMA and OFDMA. If WiMAX can support 35 Mbps for 10MHz channel, M2Z’s 20MHz would be sufficient to support its broadband service.