Big eBusiness

By Brad

The numbers are in on this year’s “Cyber Monday” online holiday shopping blitz, and as The Hill‘s Gautham Nagesh reports, they’re big:

While big business was expected on Cyber Monday, Tuesday and Wednesday were also two of the four heaviest online spending days in history, at $1.12 billion and $1.03 billion, respectively. Combined with the bump in traditional retails sales, the figures show increased confidence from consumers ahead of the end of the year.

All told, e-commerce generated nearly $6 billion in sales last week.

A Report From CWA

By Brad

In response to the Department of Justice’s move to block the merger of AT&T and T-Mobile, the Communications Workers of America has released a new report on the effect blocking the merger will have. Titled, rather bluntly, “Blocking the AT&T/T-Mobile Merger will Harm Consumers, Communities & the Economy,” the report covers everything from AT&T’s commitment to expand 4G LTE, to the effect the merger will have on much-needed job creation.

The entire report is a must-read, but there are a few points made that are worth highlighting, beginning with the argument that blocking the merger will be good for preserving competition. As CWA states:

“[T]here is no long-term future for a stand-alone T-Mobile as an effective competitor: it has neither the spectrum nor the capital to create a competitive network utilizing the latest wireless technology (called 4G LTE). In January 2011 the CEO of T-Mobile’s parent company, Deutsche Telekom (DT), stated that DT would not provide the capital for T-Mobile’s 4G LTE deployment. T-Mobile also is on a downward trajectory suffering from declining revenue, eroding profit margins and increasing customers defections.”

With Verizon, AT&T, and now Sprint making the shift to 4G LTE technology, the fact that T-Mobile will soon be left behind regardless of the merger continues to be overlooked. And given that only AT&T and T-Mobile are compatible when it comes to network technology, the idea that T-Mobile could simply merge with someone else simply isn’t realistic. From the report:

There are two separate technological family trees that are not easily compatible. GSM based systems have evolved through UMTS, HSPA+, LTE and, the next step, LTE Advanced. CDMA based systems have evolved to EVDO.

• The merger between AT&T and T-Mobile creates technological synergies because each of these companies utilizes GSM and HSPA based networks.

• A merger between Sprint and T-Mobile (these companies were in merger discussions) would have experienced significant technological challenges because the two companies utilize different and incompatible technologies. T-Mobile’s systems are GSM based while Sprint’s systems are CDMA based.

As for AT&T’s ability to expand its 4G LTE network to cover nearly every corner of America — a key point, as it dovetails with President Obama’s State of the Union pledge to bring advanced mobile broadband to everyone — CWA points out such an expansion wouldn’t be feasible without the merger due to capacity and spectrum constraints:

AT&T’s other options could not remotely approach the merger in terms of increasing capacity, utilizing spectrum more efficiently, improving service and expanding 4G LTE deployment… [I]t would take AT&T eight years to obtain and activate the number of cell sites it will obtain from T-Mobile. AT&T also could not depend on a possible federal auction to reallocate spectrum because it is a multi-year process that needs Congressional approval, a FCC rule making, the actual auction and then a period for relocation of incumbent licenses and integration of existing network and equipment with the spectrum — if the bid is successful.

These are just a few of the salient points CWA makes about the merger. There’s much more to be found in the full report, including the effects blocking the merger will have on job creation and efforts to close the digital divide. You should definitely dig in.

Boucher on Fox News

By Brad

Our Honorary Chairman Rick Boucher recently appeared on Fox News to talk about how broadband is today’s light bulb, and how it’s in America’s best interests to ensure everyone has access to the digital economy. Here’s video of the appearance:

Lunch in Madison

By Brad

Earlier this week, WisBusiness.com organized a luncheon in Madison, Wisconsin on the topic of broadband expansion and economic development. IIA co-sponsored the event with the Wisconsin Technology Council, and our Senior Advisor Broderick Johnson was a featured guest.

For a good rundown of the lively discussion — which ranged from the importance of private investment in broadband to reforming USF — head over to WisBusiness.com.

Cost Campaign 2011

By Brad

To coincide with this week’s CTIA Enterprise and Applications Convention in San Diego, we updated our “Top 10 Ways Being Online Saves You Money” study. Sources and methodology are available here. You can also compare this year’s study to last year’s.

Boucher Pod

By Brad

Recently, our Honorary Chairman Rick Boucher appeared on the podcast The Flint Report for an in-depth discussion about rural broadband expansion, job creation, and the proposed merger of AT&T and T-Mobile. You can download Part 1 of the podcast here, and Part 2 here.

IIA Members: Hispanic Technology and Telecommunications Partnership

By IIA

We’re starting a new series here on the blog where we hand the reigns over to one of our members to write about broadband and technology. In this first installment, Jason A. Llorenz, Executive Director of the Hispanic Technology and Telecommunications Partnership (or HTTP) writes about Hispanic Heritage Month and the need to ensure everyone in America has access to the power of broadband. You can follow HTTP on Twitter @hispanicttp. — IIA.

In celebrating Hispanic Heritage Month, we are reminded of the progress made, and the struggles ahead for America’s fastest-growing community. This month, we celebrate the accomplishments of Latinos in politics, business, and every American sphere. Latinos have progressed, and continue to grow in buying power, educational attainment and number. The work of ensuring Latino participation in all aspects of American life must also include ensuring full digital inclusion – the advancement of digitally literate communities who are online and ready to leverage digital tools across their lives.

As the executive director of the Hispanic Technology and Telecommunications Partnership (HTTP), I am proud to represent a coalition of national and regional Hispanic organizations working to increase awareness of the impact of technology and telecommunications policy on the U.S. Hispanic community. As a coalition, HTTP’s members support policies that promote universal access to, and adoption of technology, including broadband Internet. As members of the Internet Innovation Alliance, we support the policies, partnerships and private-sector opportunities to ensure investment leading to expanded broadband access and innovation that makes the Internet more useful to this community.

We care about these policy and business matters for important reasons. According to the Pew Research Center’s Internet and American Life Project, 51 percent of Hispanics access the Internet via a mobile device, while only 33 percent of whites do. The mobile platform has proven to be an accessible “on-ramp” to the Internet while many Latinos continue to lag in adoption of home broadband. Ensuring that Latinos are online, and using the Internet in their daily lives to access education, healthcare and other opportunities is a key to ensuring the future prosperity for the community.

Latinos continue to lead in entrepreneurship — establishing a record number of new businesses. With broadband Internet, small businesses can reduce operating costs while increasing their competitive edge. Broadband access allows business owners, even home-based businesses, to take full advantage of the global digital economy by having real time access to market data, paying bills online, conducting market research through social media, and improving the efficiency of their business operations. It also allows businesses to connect to new markets a few towns or a continent away. These efficiencies can lead to growth and job creation.

The benefits of broadband are not just tied to business. A digital connection also produces significant benefits for individuals and families. For example, broadband access can reduce the cost of delivering high-quality healthcare, especially in rural areas where the closest hospital maybe more than 100 miles away. With broadband Internet, doctors can provide timely diagnoses through remote consultations, saving patients the time and expense of traveling to the doctor’s office (10 Benefits of Health IT). Emerging mobile health and distance healthcare technology offer a significant opportunity to address the health disparities facing the most vulnerable, rural and mobile Latino communities.

For Hispanics, broadband Internet access is no longer a luxury but a competitive necessity. Without reliable access, businesses and individuals will miss out on opportunities and information, putting them at a disadvantage in today’s digital economy. That is why the Hispanic Technology and Telecommunications Partnership is proud to add its voice to the call for the deployment of broadband Internet throughout our country, and national attention to realizing universal digital literacy. It is, in fact, the quickly emerging American communities who will benefit most from the rapid deployment of technology in the digital age.

— Jason A. Llorenz, Esq.

App, App and Away

By Broderick Johnson

Earlier this week, the Robert H. Smith School of Business at the University of Maryland released a study, “The Facebook App Economy,” which estimated the app ecosystem of the popular social networking is now directly responsible for over 182,000 jobs. And that’s just a drop in the job creation bucket. The study also estimates the entire Facebook app economy has produced over 235,000 jobs and contributed some $15 billion to the U.S. economy.

While the current app craze may not last — at least not at its current fever pitch — there’s no denying that right now the ecosystem is thriving. And producing. And it’s not just Facebook that is growing in the app environment. Amazon, Microsoft, and the Android mobile platforms each boast healthy app stores of their own, thereby creating additional jobs, encouraging investment, and adding value to the entire economy.

Then there’s Apple’s App Store, which this past July hit two impressive milestones: over 500,000 apps available, and over 15 billion — that’s right, billion — app downloads. Think that’s impressive? Think about the number of people working on mobile apps for Apple’s service right now. Then think about the fact the company’s App Store didn’t even exist four years ago.

Just five years ago, the online economy mainly brought to mind services or advertising. But the unprecedented adoption of mobile broadband has launched a new platform where everything from a 99¢ game to an entire online book store can create careers and inspire businesses.

The mobile broadband platform has the power to drive innovation and investment for decades to come. Three short years ago, the second iPhone helped ignite the mobile broadband explosion when it made “3G” a household term. Now mobile broadband is moving into the next generation.

The LTE era is right around the corner. We should all be excited for what it will bring.

Reinforcing Support

By Brad

Last July, 10 attorneys general sent a letter to the Department Justice and Federal Communications Commission in support of AT&T’s merger with T-Mobile. Today, those same attorneys general reenforced their support. From their new letter to the DOJ and FCC:

Within the last two weeks, AT&T announced that in connection with the merger it would bring 5,000 jobs back to the U.S. and it committed to no job losses for wireless call center workers at AT&T and T-Mobile on the payroll at the closing of the merger. We again urge both DOJ and the FCC to focus on ways to resolve specific competitive concerns so this merger can proceed and deliver the significant benefits not only for wireless consumers, but also for investment and jobs that will support economic growth.

Download a PDF of the full letter.

182 Thousand

By Brad

That’s how many jobs the fast-growing Facebook app ecosystem has created, accord to a new study from the University of Maryland Business School. As The Hill‘s Brendan Sasso reports:

Based on those figures and average salary estimates, the researchers concluded Facebook apps have added between $12.19 billion and $15.71 billion to the economy.
“Our findings confirm that social media platforms have created a thriving new industry,” Hann said. “As Facebook and other platforms grow, we will continue to see job growth and the ripple effects of these advances in the U.S. economy.”

The full study is available here (PDF).

Urging a Swift Resolution

By Brad

Yesterday, Rep. Heath Shuler (D-NC) and fourteen other House Democrats sent a letter to President Obama “urging him to swiftly resolve concerns with the proposed transaction between AT&T and T-Mobile USA.” From the official press release:

“The road to economic recovery is long, but there is an opportunity before us to immediately create jobs and spur infrastructure investments and technological innovations that will create jobs for years to come,” said Rep. Shuler.  “By settling the proposed merger of AT&T and T-Mobile USA we can put thousands of Americans back to work and promote economic development across the country. I urge the President to strongly consider the vast benefits this merger will have on job creation and the economy and quickly resolve any concerns the Administration may have with the proposal.”

The full list of co-signers:

Rep. Shuler
Rep. John Barrow
Rep. Mike Ross
Rep. Dan Boren
Rep. Dennis Cardoza
Rep. Joe Baca
Rep. Leonard Boswell
Rep. Ben Chandler
Rep. Jim Costa
Rep. Henry Cuellar
Rep. Mike McIntyre
Rep. Mike Michaud
Rep. Collin Peterson
Rep. Loretta Sanchez
Rep. David Scott

The Social Economy

By Broderick Johnson

65%.

That’s the percentage of adult Internet users now connected to others via social networking sites, according to a study by Pew Research Center released late last month. And surprisingly, it’s not those just past the threshold into adulthood who are jumping in the online social world the most, but rather the Boomers, whose usage on a typical day jumped a whopping 60% in the last year.

What does this tell us? For one, social networks are now a major means of communication in today’s business and social economies. And secondly, the expansion of broadband technology has made the social web faster, increasingly interconnected, and more valuable to its users. Gone are the days when online interaction seemed like a trek into the wild and unruly frontier. The rise of the social web also points to our increasing reliance on digital communication in the economy and thus to job creation and economic growth and opportunity.

Services like Facebook, Twitter, and LinkedIn not only make it easy for us to stay connected to people important to us, they’re also playing an important role in business. More and more companies are leveraging the power of social interaction to sell products and services; for example, the emergence of local and family owned food trucks can be attributed to their use of Twitter for real time menu, location, and deal updates.

In addition to changing the conversation between businesses and consumers, the social web, networking through networks, has also enhanced the job seeker’s ability to find (and be found by) potential employers, careers, and startup business opportunities.

That’s what makes the rise of the social web so exciting to watch. When social sites first started hitting the mainstream, social networking may have seemed like little more than a fad. But from the Pony Express to email, we have always looked for new — and more immediate — ways to communicate, and social networking has taken its place as the latest leap forward.

Today, we check in to locations to find nearby deals. We check in with friends for reviews of products and services. We check in with companies to find a job. The rise of social networking has been enhanced by the rise of mobile broadband, and together they are changing our ways of communicating and the face of our economy.

All business, whether it’s conducted between co-workers or in the global marketplace, depends on interaction. You want to put America back to work? Give every American the ability to interact. Put the power of broadband — wired or wireless — in their hands.

They’ll do more than announce the score of the ball game.

“Access to advanced wireless Internet is the key”

By Brad

In today’s edition of the Chicago Tribune, the paper’s editorial board comes out strongly in favor of approval of the AT&T and T-Mobile merger. After highlighting the negative effect the Justice Department’s actions could have on job creation, the editorial board writes:

Access to advanced wireless Internet is the key. A merger of AT&T and T-Mobile would bring an under-served swath of America into the 21st century of high-speed mobile data communication. Much like the rural electrification movement of the 1930s, this deal offers a chance for many Americans to leap ahead technologically.

If Justice gets its way, progress will slow to a crawl. We think the FCC should approve the merger after obtaining appropriate concessions — and Justice should settle its case sooner, not later. Dragging out this proceeding stands to hurt a nation that can ill afford more damage from a government too often hostile to business interests.

Read the whole thing, as they say.

Some Questions for the DOJ

By Brad

At The Hill, Gautham Nagesh reports that in the wake of the Justice Department’s lawsuit to stop the merger of AT&T and T-Mobile, members of the House Energy and Commerce Committee want to have a discussion:

Chairman Fred Upton (R-Mich.), telecom subpanel chairman Greg Walden (R-Ore.) and Rep. Joe Barton (R-Texas) point to the nation’s unemployment rate and ask Attorney General Eric Holder and FCC chairman Julius Genachowski to what extent job creation and economic growth factor into their reviews of the merger.

“We have also seen press reports that DOJ’s ‘door is open’ if AT&T and T-Mobile USA want to address the DOJ’s ‘concerns’,” the lawmakers wrote. “We want to know what the DOJ’s specific concerns are and how these concerns relate to the impact on jobs and economic growth.”

Earlier this week, a federal judge asked both the DoJ and AT&T to mark September 21 on their calendars in order to talk through a possible settlement.

IIA Commends AT&T’s Commitment to Create 5,000 New Jobs Through Merger with T-Mobile

By IIA

Alliance disappointed with Department of Justice move to block merger; lawsuit detrimental to economy and U.S. growth

WASHINGTON, D.C. – August 31, 2011 – The Internet Innovation Alliance (IIA), a broad-based coalition supporting broadband access and adoption for all Americans, today issued the following statement in response to reports that:

1. The Department of Justice filed a lawsuit to block the AT&T and T-Mobile merger; and

2. AT&T would create 5,000 new jobs at U.S.-based call centers – jobs that are currently outsourced:

“The Department of Justice decision today is contrary to this Administration’s commitments to grow the economy, create jobs and expand broadband deployment,” said IIA Senior Advisor Broderick Johnson. “Next week, President Obama is expected to unveil a wide ranging pro-jobs plan. Approval of this merger is consistent with that critical message.”

“The IIA is supportive of the merger because it will be helpful to our economy and U.S. job creation,” said IIA Honorary Chairman Rick Boucher. “Bringing jobs back to America and investing in broadband technology which will foster innovation are a win-win for the U.S. economy.”

AT&T, an IIA member, also committed that the merger will not result in job losses for U.S.-based wireless call center employees of T-Mobile or AT&T, when the merger closes. Analysis of the merger has shown the following:

� According to a study by the independent organization Economic Policy Institute (EPI), investment related to the merger will create an estimated 55,000 to 96,000 new jobs.

� The Communication Workers of America (CWA) has stated that a post-merger AT&T will be better able to retain and increase jobs, in the long term, because it will be in a more advantageous position to expand and extend its business than either AT&T or T-Mobile could as separate entities.

“Bringing call center jobs to American workers is commendable, but it’s the tip of the iceberg,” said IIA Co-Chairman Bruce Mehlman. “The real job-generating benefits of the merger will be seen as higher-speed mobile broadband gets deployed to millions more Americans, giving them far greater opportunities to reach new customers, serve new markets and benefit from new applications and services that are transforming the global economy.”

As recent research shows, investment in broadband technology — also a pledge with the merger — will greatly contribute to job creation in the United States:

� Wireless carriers could invest between $25 billion and $53 billion in building out their 4G network through 2016, which could lead to the creation of 371,000 to 771,000 jobs and gross domestic product growth of $73 billion to $151 billion, according to a study from Deloitte.

� According to a McKinsey study, the Internet creates 2.6 new jobs for every one job lost.

FCC Chairman on Broadband and Jobs

By Brad

In an op-ed for USA Today, FCC Chairman Julius Genachowski makes the case for expanding broadband access to create jobs:

Last century, building roads and bridges not only created near-term jobs coming out of the Depression, they laid the foundation for ongoing economic success by connecting communities and people across the country. Broadband can do the same in the 21st century. Yes, let’s repair our roads and bridges, but let’s also build the road to our economic future with broadband — especially when we can do both at the same time. And let’s make sure that all Americans and small businesses get connected.

Our economy is not where we want it to be. But if we harness the power of communications technology, and unleash the creativity of our great entrepreneurs, there’s much we can do to ensure our brightest days are still ahead of us.

The full op-ed is definitely worth the read. And for related discussions, see IIA Special Counsel Broderick Johnson’s thoughts on 4G deployment and economic growth, as well as our recent teleconference on broadband and jobs.

Slowing Job Creation

By Brad

In an opinion piece for CNN, Michael Mandel of the Progressive Policy Institute argues regulations are slowing innovation and much-needed job creation. Highlighting the Federal Trade Commission’s recent investigation into Google, Mandel also looks at the FCC’s slow movement on the proposed merger of AT&T and T-Mobile:

For example,  AT&T invested $19.5 billion in the U.S in 2010, more than any other corporation, at a time when most companies are hoarding cash. But instead of applauding AT&T’s willingness to spend and create jobs, regulators at the Federal Communications Commission have recently decided to slow down their reviews of both AT&T’s bid to merge with T-Mobile and the company’s earlier proposal to buy wireless licenses from Qualcomm, which has been pending since February. The Commission’s slowdown pace adds uncertainty to the marketplace and keeps investment plans from moving forward.

The full op-ed is worth checking out. Mandel will also be taking part in our next press teleconference, which is happening next Wednesday at 2 pm ET.

Savings in St. Louis

By Brad

Earlier this week, FOX affiliate KTVI in St. Louis broadcast a segment on saving money via the Internet based on our own Top 10 Ways Being Online Saves You Money. Here’s video of the segment:

10 Ways Broadband Helps Rural Communities

By Brad

In order to highlight some of the many ways increasing broadband access can benefit America’s rural communities, we’ve put together this handy infographic. Sources and an embed code are available at the bottom.

Read sources and grab the embed code for this graphic.

The Benefits of Connecting Rural America

By Brad

At Internet Evolution, Andrew Keen writes about his trip to Paris to attend e-G8, a technological summit bringing Internet experts together with leaders of the G8 nations. According to Keen, the big takeaways from the summit were 1) The market, rather than the government, should drive the digital economy, and 2) Underprivileged communities are in dire need of access to broadband, which market solutions can provide. Writes Keen:

[The joining of AT&T and T-Mobile] shows the power of the free market to bring the Internet economy to communities. The faster speeds, more reliable performance, and ability to support new real-time services of AT&T’s 4G LTE coverage will be of massive benefit to those millions of Americans in isolated communities, helping to deliver key education, healthcare, and other essential social services to them.

Education and healthcare will particularly benefit from 4G LTE’s advanced video streaming capabilities, which will enable increased access to improved distance learning and telemedicine programs. For small-town Americans, mostly starved of world-class educational and medical programs, such access is critical, opening up their citizens to the most cutting-edge video-streamed technologies in patient care and e-learning.

Keen also examines the economic impact increased broadband investment — including the $8 billion AT&T has said it will invest to build out its 4G LTE network to more of rural America — will have on America’s economy:

Such investment is key to the competitiveness of America in the 21st century digital economy. Not only will these increased wireless and broadband services result in productivity gains that industry analysts estimate will have surpassed $400 billion by 2016, but they will also help in realizing the National Broadband Plan’s goal of universal broadband adoption for all Americans by 2014.