There aren’t a lot of details yet on how that $6 billion would be given out, but it doesn’t seem to encompass the tax breaks phone and cable companies were lobbying for. Even so, the wireless industry was cheering Thursday morning because a summary of the spending released by House Democrats calls for the money to be used on “broadband and wireless grants.”

Wireless companies were concerned that the money would be earmarked for cable and phone companies providing fiber to the home.

On Wednesday, an Obama adviser who’s been in charge of the broadband stimulus package indicated that industry and tech expectations about the broadband part of the package had gotten a bit out of control.

“The broadband piece of the Obama agenda is not going to be done solely in the economic recovery package,” said Blair Levin, a telecom analyst and former FCC chief of staff who’s been advising the campaign on how to structure its broadband plan. He was speaking at a tech conference on Capitol Hill.

Read the full article in Wall Street Journal here.

The proposal has been added to a pending auction of the airwaves. The FCC is scheduled to vote on rules for the sale on Dec. 18. Mr. Martin wants the company that buys the airwaves to devote at least 25% of the spectrum to free Internet access for 95% of the country. The no-cost Internet service also would be smut-free for users under 18. Adult users could opt out of the filter blocking pornographic content.

Mr. Martin said Wednesday that he has circulated two versions of the auction item — one with the unlicensed provision and one without — for the other commissioners on the five-member body to review before the meeting. The FCC will vote on only one version, depending on which version the other commissioners prefer, Mr. Martin said.

Mr. Martin wants to sell a nationwide license to the airwaves rather than give the channels to entrepreneurs because he wants to promote free Internet access. By adding a clause that would give away airwaves where there isn’t an Internet network after five years, Mr. Martin hopes that the owner of the channels would have an added incentive to build a network.

Mr. Martin said Wednesday that both versions of the auction item include a “use it or lose it” provision in which the owner of the channels would lose spectrum where there is no Internet access. The owner of the channels would “continue to serve whatever area they’ve built out,” he said.

Read the full story in the Wall Street Journal here.

The lawsuit involves a 3-2 decision the FCC handed down in early August that found Comcast’s practices violated so-called net-neutrality principles, and ordered the company to provide more details of its network-management policies within 30 days. The FCC also ordered Comcast to stop by the end of the year blocking traffic related to specific applications, such as file-sharing software that allows users to swap videos.

It was the first time the FCC had found a company in violation of the commission’s net-neutrality principles, which lay out consumers’ Internet rights.

Comcast was widely expected to appeal the FCC’s decision, even though the company wasn’t fined. Comcast says its practice of sometimes slowing Internet traffic on file-sharing networks like BitTorrent is reasonable and necessary to prevent a few heavy bandwidth users from slowing other customers’ service. The lawsuit, filed in the U.S. Court of Appeals here, doesn’t go into details about the complaint, but company officials have argued that the FCC has authority to bring enforcement actions under formal rules, not principles. While the FCC has stated a position on net neutrality, it hasn’t established formal rules.

Read the full story in ‘The Wall Street Journal’ here.

However, yesterday’s Wall Street Journal (March 15, 2007) seems to suggest that high speed 3G wireless technology like HSDPA can bring broadband on a large scale to Indonesians. It (misleadingly) implies that since HSDPA is merely a software upgrade to 3G networks it will not require any new major telecom infrastructure investment in Indonesia. The fact is that 3G services have just been launched in the last quarter of 2006 in some urban areas concentrated in and around Jakarta. The Indonesian operators have a long way to go to upgrade all their base stations to support 3G. Even if the base stations were upgraded to 3G standards there are no shortcuts to building backbone infrastructure (preferably fiber optic) to connect the base stations. Furthermore, large parts of eastern Indonesia do not have any connectivity leave alone 2G or 3G.

Realistically, HSDPA will be a connectivity solution for those customers who have been starved off ADSL connectivity thanks to Pt Telkom’s “Dog in the manger” attitude. Those customers who can afford HSDPA compatible handsets will be a very small subset of potential Internet users in Indonesia. 2+G connectivity solutions will continue to remain relevant for a vast majority of Indonesians.
Indonesia Embraces 3G to Get Up to Speed on Web (Wall Street Journal March 15, 2007)
JAKARTA, Indonesia — Indonesia’s rapid adoption of cutting-edge cellphone technology for Internet access is helping Southeast Asia’s largest economy to catch up with its technologically savvier neighbors.

A sprawling nation of 220 million people and more than 13,000 islands, Indonesia has one of the least-developed communications systems in Asia. Getting a phone connection without echoes or distortion is a matter of luck, and Internet connections relying on cable networks are among the slowest in the region.

The arrival of High-Speed Downlink Packet Access, or HSDPA — a software upgrade to 3G mobile-phone technology that allows users faster access to the Internet through cellular networks — could help change that[..]

HSDPA technology, pioneered in Indonesia by PT Indonesia Satellite Corp., or Indosat, offers Internet download speeds at least six times as fast as connections relying on cable, a wider difference than in a more-developed economy. And because it’s an add-on to 3G technology, it doesn’t need any major new telecom infrastructure — just some equipment attached to existing mobile base stations.

Indonesia also is primed for expansion because less than 30% of its population currently uses cellphones, compared with 80% in Malaysia and 40% in the Philippines. Indonesia has 65 million mobile users; industry analysts forecast that number will reach 100 million by 2010.

Since starting its service in November, Indosat has signed 60,000 customers in Jakarta and Surabaya, Indonesia’s second-largest city. Working with Ericsson and Nokia, the company hopes to add coverage to eight other major cities by the end of March. “It’s going to be very popular,” predicts Djarot Handoko, a spokesman for Indosat.

Nokia is working with another local telecommunications company, PT Telekomunikasi Selular, to start an HSDPA service in Indonesia later this year. Indonesia is one of the biggest potential markets for 3G, says a Nokia executive advising the company[..]

Dev Yusmananda, an executive at PT Excelcomindo Pratama, which has just started a similar service, says the prospective Indonesian market is huge. “We’re talking about it [HSDPA] as a substitution for a broadband connection,” he says.

Ironically, the interest generated by the arrival of HSDPA is a consequence of Indonesia’s failure to build a decent national cable grid. The country had plans to lay an extensive network in the 1990s, but the Asian financial crisis in 1997-98 intervened, and many projects were shelved. Many of the cables that were installed were poorly laid. Recent flooding in Jakarta damaged networks and left many people without Internet access for days[..]

The US Treasury has scrapped a 3 percent federal excise tax on long-distance calls and promised taxpayer refunds covering the past three years. The move follows a series of federal appeals court rulings against the government, which had tried repeatedly to preserve the US$6 billion generated annually by the tax.

“The Federal Appeals courts have spoken across the board. It’s time to ‘disconnect’ this tax and put it on the permanent ‘do not call’ list,” quipped Treasury Secretary John Snow. The tax was in force for over 100 years after the end of the Spanish-American War it was enacted to fund.
Snow said he hoped excise taxes on local calls would be next to go. “It’s not often you get to kill a tax, particularly one that goes back so far in history,” he said, claiming that government coffers widely considered to be overburdened “can easily absorb” some $13 billion in expected tax refunds.
Snow declined to forecast how refunds would shake out among businesses and consumers, who pay roughly $1.50 in excise taxes per $50 spent on long-distance calls. A report in the Wall Street Journal pegged long-distance excise tax refunds and lost revenue at $60 billion through 2011.
Long-distance carriers including BellSouth praised the move. “The government’s announcement on the significant curbing of the Federal Excise Tax on talking is wonderful news for consumers,” said vice president of governmental affairs Herschel Abbott. “Customers should see a noticeable difference in their phone bills within the next few months. We hope this decision is a harbinger of removal of other discriminatory taxes on communications customers.”
Meanwhile, the US House Judiciary Committee yesterday voted to ban the $12 billion Internet gambling industry. The proposed law would prohibit interstate gambling in the US as well as paying gambling operations via checks, wires, credit cards or Internet transfers. The measure affects more than 2,300 Internet sites – including overseas businesses – and requires banks to block electronic payment to such operations by consumers. “The legislation is badly needed because … the amount of money going to these illegal unregulated offshore enterprises has quadrupled,” said bill author Rep. Bob Goodlatte.
“In the United States, gambling is essentially illegal unless regulated by the states,” he added. “This is a measure to work through that to make sure that the states are indeed protected in their right to continue to regulate gambling.”