WSJ: The iPhone, Net Neutrality and the FCC

AT&T's Picturephone, shown at the 1964 World's Fair, was a huge flop. Apple's new iPhone 4, announced this week, has a front-facing camera for video chats. It might succeed, except that AT&T isn't providing enough bandwidth capacity.

First, the company won't allow two-way video to work over its data network. Second, AT&T just made bandwidth-intensive video expensive by dropping iPhone and iPad's $30 per month unlimited data plans and replacing them with a two-tiered plan of $15 a month for under 200 megabyte usage or $25 for two gigs. Not that I have a problem with AT&T charging me or the 2% of its customers who are heavy data users. I can always sign up with a competitor. Oh, wait. There are none. AT&T has an exclusive contract with Apple.

AT&T can easily build out enough capacity to handle heavy data users. But it may be playing a game of chess with the FCC over its attempt to impose "network neutrality" rules. The FCC (plus Google and friends) wants all users to have free rein to do what they want on the Internet and smart phones. AT&T just wants users to pay for excess bandwidth.

Both are fine and not incompatible goals, except that competition, rather than rules, will best set the right price and make it happen. But without more broadband capacity and much higher speeds, the productivity applications needed to drive the next wave of growth in the economy will be stillborn.

Read the rest here:

http://online.wsj.com/article/SB10001424052748703303904575293021509968904.html

Comments

[David Ulevitch]

Your article is good, but nothing you mention will speed adoption of fiber to the home. And what Verizon is doing, owning the fiber with FIOS, doesn't help anyone.

Historically, the state has paid for copper to be deployed, and we were lucky DSL could sit on top of it and just require new CPE. But the state still paid (or subsidized) the deployment of copper. They have to do the same with Fiber. In metro's, it's getting to the point where it can be $1000/household. At those prices, surely the benefits of having a nationwide fiber infrastructure outweigh the cost when spread over 10-15 years.

[elliptical reviews]

No offense, but i suggest admin adding a google+ button for easy share!

[Cheap snapback hats]

the company won't allow two-way video to work over its data network. Second,

[licensed real estate brokers]

Do you have a twitter or Facebook page cause i'll be happy if i am the one your fans and followers.

Thanks