By flat, I mean that it is not part of the typical stove-pipe solution found in today’s wireless access networks where base stations tie back into radio network controllers which then tie back into a myriad of gateway and anchoring boxes before getting your packet to the internet. Who cares? You will when your femto backhauls your packets half way around the world when all you wanted to do was synchronize your mobile device with your home media center across the room. Especially if that path has network management a la Comcast or content compliance a la AT&T. The ideal model will support local connectivity, forming the center of a home based personal network. The need to go back into the service provider’s network would be minimized to maintaining continuity of specific services that the consumer subscribed to from the service provider.

By free, I mean that the operator will make money in ways other than a recurring tariff on the service. Here I see some creative business model potential intersecting with keen tactics. As observed in a white paper by ip.acces, femto provides a discount structure that is kept from leaking outside the house. Instead of FMC commoditizing mobility, femto enables mobility to be a premium again. Femto can also be linked to customer loyalty, potentially even tying pre-paid customers to an operator via post paid-femto service. Finally, femto is a perfect opportunity to kick start a whole host of wholesale models from bundles of minutes similar to airline miles, to spectrum leasing. Key retail channels with partners more familiar with consumer premises support could easily integrate femto technology into STBs in a quad-play that would give wireless operators wallet share from inside the house while preserving existing ARPU. Furthermore, if the partner was the incumbent LEC, it would also minimize total erosion of fixed line assets found in wireless operator lead FMC models.

Most of the day was taken up on a workshop around Communications Enabled Business Processes hosted by Tom Howe. His “voice is a spice” lecture is worthy of another post entirely.

What I really wanted to share was my complete disappointment in the leadership reflected by the Town Hall panel. The moderator opened the session as a bridge between those in the beltway and the rest of us innovating outside. Although I’m not from the Valley, I get the distinct feeling that few here care about what happens on the other coast; sad given how there lives could be destroyed if we get broadband policy wrong. For me, the frustration is this slow gnawing process of change. Tweak interconnect here, reform termination there. Everyone on the panel was content at leaving the debate at the services layer. Specifically, government having a light touch on services and nothing else. I could not disagree more. Let’s try NO TOUCH on services (other than safety and other law enforcement issues) and have the focus on ACCESS. There was the obligatory argument over interpretation of OECD numbers, in which all the panelist (Verizon, Google, Feature Group IP and Internet Innovation Alliance) agreed that US was net net positive. There was also somewhat of consensus that fiber roll-outs were going ok (great if you live in a Verizon territory) and that multi-modal competition was sufficient. I’m sorry, but where is the consumer and business interest on this panel pushing for nothing less than a total fiberization in the same sense as electrification in the last turn of the century.

Most of the afternoon was with a great panel exploring where the next wave of wireless innovation will come from. Quite a few still banking on Android, while others claimed nothing until you had something to take to the bank. Overall it was way to cordial given Vodaphone’s Sr. Director for research was sitting next to Skype’s.

The day ended off with two great futurist presentations. I hope to go into more detail in later posts because some of the statements were jaw-on-the-floor profound.

Michel Bauwens, one of the founders of the P2P Foundation discussed what happens when we move from the closed and paid quadrant to the open and free quadrant as a result of peer generated everything. He postulates that most problems will be solved better by communities than by corporations assembling staff.

The day then ended with Sheldon Renan laying out his view of Netness. This is when “hyperconnectivity” becomes everything and is more than just networks and systems. Connectivity moves from graph edges to a field. He promises to publish more soon.

Adding a nice twist to what can often be a monotonous drone of product pitches and techie jargon, Dawn Nawfus an anthropologist from Intel and Marc Smith a sociologist from Microsoft reminded us of the human side of technology.

Dawn gave a good pitch as to why simply “stirring” in GPS is not always something the customer wants. Technology must allow the consumer to define place, because its not always where the body is.

Marc illustrated some recent work on how technology can facilitate the “spark gap” between people. Curiously, it will all be on the record as persistence will play a key role in the future as mining machine inscriptions become a core piece of social software.

On the Broadband Access front Brough Turner and Bob Frankston both gave calls to new user owned paradigms for last mile solutions tarketing layer 0f infrastructure. Unfortunately they were preaching to the chior as few telco executives were in the room to recieve the message. Hopefully a grass-roots movement will start.

I missed the first half of the day, of which one person summed up as “the phone is dead, long live the phone.” So far the schedule is intense, but not the content. The stand-outs to me where Norman Lewis with Wireless Grids and Sam Aparicio with Angel.com.

Norm is a very passionate speaker, well know for his deep understanding of Millenials given his Baby Boomer status. The concept of a middleware layer to abstract devices from activities so that users can have a personal infrastructure is quite compelling. However, I have to wonder how his story goes with DLNA, which is primed by Intel who is one of their partners.

For me Sam was just as compelling. He has a lot of passion (he is a Spainard after all) for communication applications as an independant developer. He really put his heart on his sleeve, detailing the issues and really trying to envigorate those in the audience who also develop communications applications to do something. His presentation was not the normal death by powerpoint, instead choosing to just talk! (he was not reading for those who wondered why he was carrying a macbook air around on stage - that was a mind map diagram of the whole concept) Unfortunately it was late in the day and many left the room, missing the best rallying call so far for change. I hope to have more conversations with him on this vision in the future.

For those waiting for the femto conclusion… stay tuned.

Before going forward, lets review some of the current environment of a wireless service provider. In the U.S. they have just begun a brutal war based on flat rate unlimited service*. Next, it turns out that unlimited is actually limited. Small print forbids use of VoIP, streaming and other services that might degrade (or compete with) their network.

How is this relevant to femto? First, unlimited minutes were to be the principle draw. Femto tariffs, typically a fixed price for unlimited service while using the femto cell, were supposed to be more attractive compared to regular rates. However, for many the new fixed rate plans eliminate the femto incentive. Next there is that asterisk. The same wireless operator that shuns or manages certain application usage on their network now expects the fixed line provider to accept the femto’s traffic on its broadband network. The same operator who probably just lost a fixed line subscriber. Expect femto to become the asterisk for broadband, assuming that you can get broadband. What I have seen from spectrum planning, the same coverage gaps that femto is best suited for are the same sites that suffer lack of broadband: multi-dwelling facilities and high rises (mostly from lack of open access rights), rural, and economically disadvantaged areas. Bleak? Yes, but possible solution are ahead in the next post.

My largest issue are these claims of pent up consumer demand (consumers just don’t know it yet). Thes are based on the assumption that consumers will at a minimum pay a recurring service charge, obtain high bandwidth backhaul and possibly purchase the femto hardware.  Translated, the consumer will pay a premium to fix coverage gaps in the service providers network. For those wanting more, the Femto Forum asserts that femto will deliver services that only femto cells operating in a licensed spectrum can offer (read wireless operator FMC only).

I shudder to think what innovative service I can only get on a restricted device versus a WiFi enabled one today. But this is not a femto versus WiFi or any other technology issue. The fact remains that wireless operators have holes in their coverage and the impending demand for more mobile bandwidth capacity will only strain the operation of their macro networks.

From an operations perspective, femto provides relief to these problems. However, the medicine might be worse than the cure, at least for the moment. No standard exists today clearly defining how femto solutions are integrated into the network. Each solution has varying impacts to the operators network and to the device and such solution diversity only dilutes the economies of scale needed for mass market deployment. Compounding the standards issue is the shear potential for millions of these in a network presenting a nodal management nightmare not to mention the challenge of taming that much potential RF interference. But most humorous to me is the present tendency toward use of UMA based technologies, the black sheep of the FMC solutions prior to the rise of femto. Bleak? Hold that thought for the next post.

A good example is the Swiss Army Knife. I have set up an entire camp site, cooked dinner for the group and proceeded to eat my food all with a single tool. However, at home I would not think of cooking or eating with such a device. So it is not a battle between one and many, but a contextual coexistence. I will use a device that stores tunes to pass that boring moment which also has a camera to catch that fleeting moment all while packaged in a phone that is with me most of the day. Contrast that with using a SLR for our annual family portrait. The N810 will go with me on my next one-day business trip. The depth finder (fish finder) goes in my boat… Seriously, it has mapping capabilities (nautical charts), receives radio signals for weather reports and stores geo-tagged media (my fishing holes). All are similar to the functions in my phone, but I do not demand them of my phone. Because something is not a phone does not mean it can not benefit from being communications enabled. Take the SLR and the benefit of having something like eye-fi or having an RSS feed from the guy in the next cove who seems to be catching more than me!

Creating a meaningful user experience with divergent devices will be in some instances more difficult than a converged device despite the allure of being more feature rich. Synchronizing media, contacts and other data will require new thinking in services or in the fundamental design of the devices like the Couple-IT. I look forward to having some diversity in my devices.

So, if broadband access is to be functionally separated from services and placed in a monopolistic (franchised, government, co-op or otherwise) utility model as some advocate (including myself), there will have to be mechanisms for innovation.  The solution will have to have incentives, as we can not allow the innovation to only thrive at the services layer. Thankfully this is in the forefront of some of our industry thinkers (like Brough Turner in a recent  interview).

Ignore it and you wake up one day to black-outs. Sadly for ERCOT, it will be an uphill battle in an economically hard time, pleading to a constituency already burned out from some of the highest power rates in the U.S.

Prior to the conference, Brough Turner started the discussion with an summary of an excellent paper by Susan Crawford. The paper dissects the timelines for various pieces to the puzzle. Telco law and FCC policy changes significantly around every 15 years, so why mismatch it with Transport  or application technologies, which run on intervals of 5 years or less, where the current focus lies. Free markets need to dictate the technology and economic models that exist at the higher layers, however, such freedom could be hindered if the foundation is not set properly.

It is with the foundation that I disagree. First, I do not purport government control of telecom infrastructure, however, I will distinguish user owned (co-operative) as a viable, if not preferred, model. Such an ownership could deal with right-of-ways, physical meduim (copper, cable, fiber, or even spectrum), and some aspects of transport.

Transport is the contentious area here and I throw it into the mix because of the timeline argument earlier. Looking at transport technologies, the horizon has been on a 7-10 year cycle. X.25 networks followed by ISDN and then leading into the current mass deployment of ATM. Now we have Ethernet bubbling to the top as the prevailing means. Should this be “regulated”, i.e. stripped from the service provider? I would argue yes because relying on layer 0/1 is to restrictive. Lambda control is not granular enough to allow competitive access. Furthermore, technologies that the incumbents prefer at that level, BPON and GPON are still highly asymmetric.

Allowing municipalities, co-ops or other entities to implement the next level, GE-PON or PBT, allows for the rapid connections at economical rates. Plugging into the access medium would not be specialized, yet it would still allow for differentiation (read QoS) at higher layers. Not to mention that accounting for the depreciation would be on friendlier terms for the co-operative to have (7-10yr) versus the service providers who push the IT cycle envelope.

And this is just one solution for one dimension of the problem…..