By Mike Montgomery
As seen in SF Examiner
At this very moment, somewhere in San Francisco, an innovative new product is being tested and refined. This product harnesses the power of smartphones, mobile broadband and mobile apps to … well … offer women around the world and their partners a new way to (ahem) connect.
The product is a smartphone app called Vibease (no, really), and it’s being billed as the world’s first “smart vibrator” (no, really). Rather than fumble through my own explanation of how Vibease works, I’ll just crib liberally from the company’s CrunchBase profile: Vibease is a private social network for couples with massager integration. Couples can use Vibease for chatting and share their moments. The best part is the woman’s partner can control her massager using an iPhone or Android phone even though they are separated by distance.
So there’s that.
But here’s the thing: Even if an app-driven vibrator doesn’t tickle your fancy, there does appear to be a market for it. Or at the very least, there are investors who believe there’s a market. Vibease is already $40,000 above its crowdsourced fundraising target on Indiegogo. It has also received seed funding from angel investors and $25,000 in venture funds. With that kind of startup capital, Vibease has to be taken seriously even if its product tends to incite giggles.
It also … and you better hang on to something, because I might lose you with my upcoming segue … it also highlights the need for smart spectrum policies from the Federal Communications Commission.
You see, while masturbazione (as the Italians call it) has been around since we were scribbling in caves, the widespread consumer adoption of mobile broadband is a relatively recent development. But much like the act of shôuyín (as it’s called in China), relying on our mobile devices to get online anytime and anywhere has become a major part of our daily lives. Some of us do it several times a day.
But the unprecedented popularity of mobile broadband faces, well, some obstruction. As Vibease has made clear, there seems to be no limit to what app developers will imagine, nor to what wireless customers will find helpful. This incredible demand for more mobile devices and more applications is where the problem emerges. It’s one thing when consumers have the power to check email and visit their favorite websites wirelessly. It rises to another level when consumers need to also power more data-intensive apps like streaming video (and … well, anything else you might want to stream) that require higher-spectrum resources.
The point of all this (and thank you for staying with me this far) is that when it comes to products and services powered by mobile broadband, we’re only beginning to scratch the surface. Ten years ago, smartphones did not yet exist as we know them, and the idea of a smart vibrator probably had never come up. The fact that smartphones are now everywhere and apps like Vibease are drawing serious interest from investors should be enough to tell us that truly anything is possible with mobile broadband. Whatever innovative ideas arise next, our wireless networks must be equipped with ample spectrum in order to be ready.
This means we cannot afford to impose artificial constraints on the opportunity for providers to obtain more spectrum. When designing its upcoming 2014 spectrum auction, the FCC needs to keep in mind that every wireless provider, both big and small, needs more spectrum capacity on their networks. If the spectrum auctions are encumbered with restrictions on eligible bidders, and all providers are not allowed to bid equally, then the FCC risks leaving millions of consumers … well, unsatisfied.
Mike Montgomery is the executive director of CALinnovates, which works as a bridge between technology communities in California and the public policy communities in Sacramento and Washington, D.C.
Aspen, Colorado. Land of slopes, home of the late, great Hunter S. Thompson, and for one day at least, a place for some fine communications policy trash-talking.
The arena was the opening reception of the Technology Policy Institute’s annual conference. The trash-talker was one R. Stanton Dodge, general counsel for the Dish Network, who told attendees that his company definitely still had plans to jump into the wireless game.
“This is a fine function with Verizon here,” Dodge said, “but we want to eat their lunch and AT&T’s as well.”
While Dodge’s bluster was entertaining, it also highlighted something often forgotten when it comes to communications policy. Specifically, that the industry has no shortage of current or willing participants. According to CTIA, there are now over 30 wireless providers in the U.S., which means Dish is looking to join a rather crowded field that is certainly not lacking a competitive playing field.
Dish’s wireless plans also highlight how important it will be for the FCC to allow unrestricted, competitive bidding among all qualified bidders in its upcoming spectrum auctions. With its massive spectrum holdings — and plans to acquire more before it launches its service — the satellite TV provider is just one player who could be a major disruptive force in the industry. With every wireless provider in need of more airwaves to keep up with consumer demand on their networks, the FCC must avoid picking winners and losers by favoring some providers while restricting other qualified bidders from participating in the spectrum auctions.
That would be the very definition of anti-competitive behavior.
By: Mike Montgomery
As seen on Daily Kos
In the wireless industry it’s possible to be first and third at the same time.
Take, for example, wireless provider Sprint, which was recently acquired by the Japanese firm SoftBank for a little more than $20 billion. It’s a good-sized sum for America’s third-largest wireless provider—but then, that ranking applies only to number of customers, not its spectrum holdings.
While Sprint has only half as many subscribers as Verizon or AT&T, they happen to hold twice as much wireless spectrum – the invisible airwaves that enable mobile devices to send and receive data – thanks to their recent full buyout of Clearwire. Amazingly, Sprint has shown an uncanny ability to simultaneously win and lose, taking the gold medal in spectrum and a bronze in customers.
With their riches in spectrum holdings and underperformance as a business, it’s no wonder the company found itself in the middle of a bidding war between SoftBank and U.S. satelliteprovider DISH.
The point here isn’t to bash Sprint. They’re trying to run their business shrewdly, even if sitting on their airwaves hoard, while pining for more, risks hurting their customers and potentially their shareholders. But Sprint’s enviable spectrum position also shows that when it comes to the allocation of spectrum for wireless providers, industry rank isn’t as cut and dried as the number of customers in your flock.
This distinction is particularly important in light of calls by some carriers, including Sprint, and government officials to artificially limit the two largest wireless providers from the FCC’s upcoming spectrum incentive auctions based on the gap in subscribers between Sprint and Verizon/AT&T. Instead of banging the drum on Capitol Hill about how bad they’ve got it, Sprint should be trying to get more consumers to use their network.
Nevertheless, Sprint’s obvious spectrum advantage coupled with the fact that provider T-Mobile recently joined forces with fellow provider MetroPCS—a move that places the German-owned company in a much stronger, competitive position—the wireless industry is far more competitive than Sprint would like the world to know.
Competitive industries serve a great benefit to consumers by delivering better services at lower prices. Those on the side of restricting the involvement of certain providers from the FCC’s auctions are actually arguing against consumers. Tens of millions of people just want their phones and tablets to function as designed and want to enjoy exciting new technologies that rely on advanced mobile broadband. The FCC should consider that AT&T and Verizon have the most customers because consumers choose to use their networks. By restricting their auction participation, the FCC isn’t creating more choices for consumers — it’s hamstringing the choices consumers have already made. That’s not a win for anybody.
As the old saying goes, it’s not personal, it’s just business. Sprint has the airwaves it needs to take care of its customers and then some, and the same goes with T-Mobile. But without open spectrum auctions, millions of Americans are at risk of receiving diminished service for their hard-earned dollars. To them, that makes it personal.
By: Mike Montgomery
As featured on The Daily Kos
Two of my favorite Members of Congress recently went toe-to-toe at a hearing on the FCC Process Reform Act. Rep. Anna Eshoo (D-Calif.) and Rep. Greg Walden (R-Ore.) often agree on technology policy issues, but on the issue of whether and how to reform the FCC, they clearly disagree.
That’s not to say the hearing wasn’t illuminating, however. Here are some key takeaways:
General Thoughts from Eshoo and Walden
Rep. Eshoo called on the Energy and Commerce Subcommittee to focus on shaping public policies that encourage private investment in communications infrastructure. She also highlighted the need for a renewed focus on job creation. It’s a common refrain from someone who truly understands the merits of a strong, vibrant Silicon Valley, and Rep. Eshoo should be applauded for maintaining her focus on jobs and the economy.
For his part, Rep. Walden warned that the FCC is “becoming more of a political institution and less an expert agency.” Given some of the Commission’s recent words and actions when it comes to spectrum screens, auctions, and secondary transactions, there is certainly some credence to Walden’s statement.
Some Smart Changes to the FCC
Former Commissioner Robert McDowell and George Washington University law professorRichard Pierce both testified that the FCC should be removed from the merger review process, thereby allowing experts at the Department Justice to maintain their role as the rightful authority on antitrust law. This sentiment echoes that of economist Hal Singer at a recent Silicon Valley public policy event, where he argued that the FCC should focus its efforts on protecting consumers.
Meanwhile, Harvard Business Review author Larry Downes testified that an agency like the FCC cannot easily “predict an increasingly unpredictable future,” especially in the technology sector. The FCC, he said, should not “design what it calls ‘prophylactic’ remedies for consumer harms that have yet to occur.” In other words, the Commission needs to stop trying to police potential problems before they happen, a la Tom Cruise in Minority Report.
Where the FCC Should Be Focused
The FCC has taken some small steps toward reform, such as speeding the process for secondary market transaction approvals — a welcome change in what has historically been a long, drawn-out process. But that’s not to say the Commission can slow down now—there is still work to be done to increase spectrum availability for mobile broadband for consumers and to prioritize the transition to next-generation advanced broadband networks.
The Issues in a Nutshell
It’s hard to disagree with Rep. Eshoo, who hit the nail on the head when she said, “Let’s work together to craft policies that will create jobs for innovators, promote investment in infrastructure across the country, and technological advances that help American families.”
Hopefully, when and if Tom Wheeler is confirmed as the next FCC Chairman, the Commission will work with all involved to do just that.
By: Mike Montgomery
As featured in The Hill
At first blush, the event held by Pepperdine University’s School of Public Policy entitled “The Broadband Technology Explosion: Rethinking Communications Policy for a Mobile Broadband World” could have easily seemed like a wonk fest for public policy nerds. But for those of us who made the trip to Silicon Valley’s Quadrus Conference Center on Sand Hill Road, the discussion was anything but boring. Quite the opposite, in fact, since the topics being hashed out are critical to the future of the Valley.
Chief among those topics was spectrum, specifically the best way to make more airwaves available for mobile broadband. By happenstance, the Pepperdine event coincided with the news that Instagram was launching new video capabilities, dubbed Instavine on social media as it was launched to compete with Twitter’s video platform, Vine. As this news lit up Twitter, I asked the panel how video from Instragram’s billion-plus users will affect wireless networks.
“[It] will create a larger load,” AT&T’s Richard Clarke replied. “We’re swimming fast, but the current is moving far faster.”
This demand for ever-increasing amounts of data (the “current” that Clarke spoke of) is driving carriers to pursue more wireless spectrum. The FCC plans to auction off 300 MHz of new spectrum to these wireless companies, but the panelists — including Harvard Business Review’s Larry Downes, Navigant Economics’ Hal Singer, and Pepperdine’s James Prieger — were doubtful that the full 300 MHz will ever reach the auction podium.
Put another way, the FCC’s efforts will only go so far, and unless the commission also eases restrictions on the secondary market transactions for spectrum, shortcomings will continue to exist. And these shortcomings, the panelists were sure to point out, could have a very real effect on the health of the wireless industry.
While no one believes the FCC should get out of the spectrum regulation business, there was broad agreement at the event that the commission needed to rethink its definition of public interest when it comes to the airwaves. Mobile broadband has been such a game changer, smartphones and tablets so explosively popular, that the current definition of public interest for spectrum is quickly falling out of stepwith consumer interests.
Singer in particular opined that the FCC should focus less on antitrust laws in its approach to regulation and instead focus more protecting consumers, a role they are uniquely qualified to fill.
Singer’s point has implications for spectrum policy. By focusing on consumer to all wireless carriers regardless of their size, the commission will not place itself in the undesirable position of picking winners and losers in a thriving and highly competitive market. Will keeping auctions open, along with the FCC staying within its regulatory lanes, best serve consumer interests? At the Pepperdine event, the answer was a definite yes.
By: Mike Montgomery
As seen in the Huffington Post
There’s a new sheriff in town.
Or at least there soon will be as the Senate is likely to give Tom Wheeler the nod as FCC Chairman. Wheeler, former chief executive of the National Cable and Television Association and, most recently, a venture capitalist, seems to have left a good impression during this week’s Senate hearing. As Tony Romm reported in Politico:
The initial takeaway from a Senate Commerce Committee hearing Tuesday is that Wheeler’s background as a cable and wireless lobbyist — once considered by some a liability — might instead prove valuable at the helm of the nation’s top telecom agency.
During the Senate hearing, Wheeler said his extensive business experience would “make me a better chairman,” and he will surely need to tap into that experience if his tenure is going to be an effective one. Wheeler will be taking the reins of the FCC during a fascinating and challenging time. Gone are the days when the Commission’s biggest worries were wardrobe malfunctions during live broadcasts. Today’s FCC faces a number of critical decisions that will have a profound effect on the powerhouse that is America’s tech industry.
For Silicon Valley especially, Wheeler’s steerage will be important to keep an eye on. One of his chief concerns must be fostering an environment that continues to inspire innovation and investment for the greater good. Or, as Nick Allen, co-founder of SideCar, told me, “Wheeler should be pro-innovation and make sure Silicon Valley entrepreneurs have the ability and tools to implement new ideas and new technologies to solve problems.”
Here, in no particular order (because they’re all equally important), are some of the issues Wheeler and his Commission will be tackling in the coming years.
Clearing the Air
The FCC’s upcoming spectrum auction is aimed at providing wireless companies with the airwaves they desperately need to provide service to their smartphone-addicted customers. Revenues from the auction will help fund FirstNet, the nationwide interoperable public safety network for first responders.
Wheeler can go a long way toward keeping our mobile market booming by ensuring that every qualified bidder can participate without restrictions. This will also help maximize auction revenue that can help the federal government will raise the money to fully fund FirstNet.
The day when America’s networks are all-Internet based is coming. The only question is when.
Wheeler and the FCC can help accelerate the expansion of next-generation broadband networks — and encourage further adoption of current and future technologies– by focusing on creating a smart regulatory environment. An environment that encourages the private sector investment needed to upgrade networks with a regulatory framework better suited for the Internet age.
Technology guru Kim Polese, Chairman of ClearStreet, is a champion for increased next-gen broadband deployment across the country. “Chairman-nominee Wheeler can help ensure our nation’s prosperity by prioritizing the implementation of a ubiquitous, high speed, affordable national broadband infrastructure, which will help to accelerate innovation and entrepreneurship and drive economic opportunity and prosperity for all Americans,” said Polese.
The FCC’s spectrum auctions will offer some relief for congested wireless networks. So will President Obama’s recent focus on freeing up some federal spectrum for consumers to use for mobile broadband.
Unfortunately, both initiatives are going to take more time than most would like. In the meantime, wireless providers, who are already facing clogged networks, need the flexibility to work together in order to meet the needs of their customers.
That’s why it’s important for Wheeler’s FCC to ease the regulatory hurdles for free market spectrum deals that will help ensure providers can meet consumer demand more quickly.
Glad-handing the Tech Community
Former FCC Chairman Julius Genachowski left some big shoes to fill, especially when it comes to working with the tech community in Silicon Valley and beyond.
With technology increasingly becoming a driving force in America’s economy, the FCC needs to work with tech companies big and small in order to put forward policies that benefit both the tech ecosystem and consumers. As Topher Conway, a Partner at famed venture fund SV Angel, told me, “Wheeler needs to make sure he reaches out to Silicon Valley in order to understand the unique problems we face. That way he can help solve those problems in Washington.”
Serial entrepreneur Jamie Daves, Founder and CEO of LearnerX, was specific about one of those unique problems. “The emerging era often labeled the ‘Internet of Things’ will put unprecedented pressure on the FCC as an avalanche of new, connected devices come into the market,” Daves told me. “Chairman Wheeler should lead in reforming the application and approval process so that consumers can benefit from these new products and services, and companies can rely on a timely and efficient system.”
Freeing up more spectrum for consumers, enabling the transition to all-Internet based networks, and working collaboratively with the tech industry to ensure an investment-friendly framework — there’s no doubt Wheeler’s dance card will certainly be full if he is confirmed to lead FCC. But by putting forward a manageable, tech-focused agenda, he can oversee a Commission that continues to encourage private investment, spur further innovation, and grow the economy. It won’t be easy, but Wheeler appears to be the right man for the job.
By Mike Montgomery
As seen on The Huffington Post
Last week, the White House dropped a broadband bombshell in the form of a series of initiatives aimed at freeing up government-controlled spectrum for wireless providers. It also released a new report, “Four Years of Broadband Growth,” which is brimming with positive news about our nation’s broadband infrastructure.
It was a good week for both consumers and our country’s vibrant tech industry.
In Silicon Valley, President Obama’s focus on spectrum was especially welcome. In many ways, mobile broadband has become the lifeblood of our tech community. But as wireless providers are increasingly strapped for spectrum — and consumers continue to embrace mobile broadband at an unprecedented pace — there have been valid concerns that the blood would stop flowing. Or at the very least, that clogged airwaves would give the local tech industry chest pains.
As the single largest holder of spectrum, the U.S. government has the power to ensure America remains at the forefront of mobile broadband. The FCC’s upcoming spectrum incentive auctions have the potential to alleviate some of the congestion wireless providers face, but the fact of the matter is more action will be needed to free up spectrum, and needed quickly, in order to keep up with ever-growing consumer demand for advanced broadband-enabled services and applications.
While you could easily take the cynical view and declare allocating more spectrum for wireless is long overdue, it’s worth remembering that mobile broadband — and the mobile app industry it has sparked — is still in its infancy. The smartphone revolution only really began six years ago, after all, and outside of a select few visionaries, few had anticipated the monumental shift that has followed.
If wireless providers were caught somewhat flat footed by the sudden surge in demand for data on their networks, they’ve been investing billions to catch up. As the White House broadband report shows, annual investment in wireless networks jumped by more than 40 percent from 2009 to 2012 — from $21 billion a year to $30 billion. At the same time, the report finds, investment in Europe was static, and in Asia — including China — it only increased by 4 percent.
For Silicon Valley, all this investment in wireless infrastructure has helped inspire a wave of innovation and economic growth. And with more than 500 million connected devices and counting in America, we may only be at just the beginning of the mobile broadband boom. That’s what makes President Obama’s focus on spectrum so critical. More spectrum will mean more powerful networks, which will mean more innovation, which will inspire more investment in more powerful broadband networks.
As long as government policies continue to encourage investment in our nation’s broadband networks, this cycle of investment and innovation has the potential to become an even bigger economic powerhouse. President Obama has called for every part of America to be connected to the digital age. For Silicon Valley, and the country’s other tech hubs, that’s a goal worth achieving.
With an FTC investigation in the rear-view mirror, it’s no surprise that Google’s Larry Page took a few potshots at government regulators and their inability to keep up with the dynamism of the tech sector during the company’s recent I/O event.
The question is, were his criticisms valid? And the answer, as anyone with a passing knowledge of how that beast known as bureaucracy routinely punishes innovation knows, is a resounding yes.
Consider, for example, CALinnovates’ member company SideCar, whose business model is regulated by turn-of-the-century laws. Seriously. Regs placed on the books when no one could have fathomed mobile applications would even exist, let alone disrupt the world of… well, anything… are hamstringing a company that encourages people to carpool.
If hopelessly outdated laws are creating regulatory uncertainty for companies like SideCar, it’s easy to imagine the constant migraines Page constantly nurses as head of Google. While the tech giant has certainly earned its fair share of government scrutiny over the years, there’s no denying they’re one of the most innovative companies in the world. And that innovation, that eagerness to push the boundaries, often hits the roadblock of slow-moving regulators.
As Page told the audience at I/O, “There are many exciting, important things that we can do that we can’t do because they’re illegal and they’re not allowed by regulation.” For tech enthusiasts, such words inspire visions of Jetsons-like secrets locked away in a lab behind a wall of red tape that could likely never see the light of day.
No one argues that regulations are unnecessary. But everyone should be able to agree that the current speed at which regulations evolve is laughable at best, potentially disastrous at worst. Technology simply moves too quickly for the old ways of thinking. That’s why Page called for “mechanisms to allow experimentation,” an interesting and meritorious hypothesis that would allow technologists to run beta tests prior to the need to navigate the regulatory obstacle course. Allowing these test trials, he told the crowd, would allow the kinks to be worked out while assuring consumer safety and privacy.
Page’s thoughts could easily apply to companies like SideCar, or to any number of mobile payment start-ups under heavy regulatory scrutiny. We live and work in a rapidly evolving society. Ideas multiply and platforms morph seemingly overnight. History has shown that when our technology changes, we change along with it. Change isn’t always easy, but no matter the disruption, we adapt. If we’re going to keep moving forward, if companies like Google and SideCar are going to continue to thrive, we need government regulations that adapt along with us.
Technology sprints. Regulators need to keep up or work with the tech sector to find solutions. Otherwise, no one is going to reach the finish line.
As Featured on TechZulu
By: Mike Montgomery
According to Google Maps, it would take the average person 915 hours — or a little over 38 days — to walk from Washington D.C. to San Francisco. That’s without sleep, presumably, or even bathroom breaks. Just miles upon miles of constant, seemingly endless trudging. On the bright side, you’d be able to enjoy at least one ferry ride along the way.
In contrast, a direct flight from our nation’s capital to the Bay Area clocks in at just over five hours. Long enough to watch a couple movies on your iPad or plow through the latest Grisham on your Kindle. Sure, you’ll be a little cramped, but at least you’ll get a complimentary beverage. More importantly, you won’t burn an entire day — let alone a month — just getting to your destination.
To put this tortured metaphor I’m constructing out of its misery, when it comes to California’s vibrant tech community, regulators in Washington are much like the person trekking across country on foot. Meanwhile, our tech community is constantly taking flight — until they suddenly find themselves grounded.
Take car service Uber, which has found itself fighting through regulatory gridlock in a number of markets. Or house sharing startup Airbnb, which has been continually whacked by regulators wielding dusty regulations cooked up before the age of dial-up.
One man who knows all too well how regulatory molasses can stifle innovation is Paul Rosenzweig, attorney and founder of Red Branch Consulting in Washington, D.C. A regular moderator and panelist for Stanford, he knows his tech policy backwards and forwards. He’s also a Chemical Oceanographer — fitting, given how hard it can be just to navigate the regulatory waters.
“In a world where notice and comment rulemaking takes 18-24 months to complete,” Rosenzweig says, “our system for making policy is simply ill-suited for the task. Disruption can be a major headache for regulators.”
Since regulators are unlikely to speed up anytime soon, the tech community is at constant risk of their innovations becoming mired in 20th Century quicksand. That places the burden on them to move forward with their next big idea well aware that they’re likely to hit a wall of outdated regulations. The key, Rosenzweig points out, is to identify as many hurdles as you can beforehand.
“When you have a brilliant idea,” Rosenzweig says, “your natural instinct is to set sail with it as soon as possible. But in this age when everything is connected, governments are as slow to react as ever, and privacy is a major concern, the best thing to do is take a deep breath and accept how the process works.”
The good news is that there are few regulatory issues that can’t be solved creatively. Laws can be complicated and burdensome, but they can also evolve. “Regulators very rarely want to stop a technology in its tracks,” Rosenzweig says. “The trick is to make them understand what your technology does, and then work with them to address any regulations that might hold you back.”
In other words, don’t race ahead of the powers that be in Washington. Because chances are, you’re already way ahead of them.