A Practical Navigator for the Internet Economy

Where is the Unifying View?

In the Absence of a Generally Accepted Framework and Agenda the Incumbents Are Aborting our Future Prosperity to Preserve Their Current Profits and Control

How to purchase this issue. $150 or $450 group.

April 27, 2007 Ewing, NJ -- The June issue contains interviews with Larry Roberts CEO of Anagran on IPv6 in Asia, China's adoption and the need for translation. Also a Norman Lewis decsribes his research on children and their use of cell phones and symposium discussion.

Executive Summary

Finding a Way Forward in the Midst of Efforts to Stop Destabilizing Innovation, pp. 1- 2

We are balanced between an onslaught of innovation and disrupting waves of unsolved problems brought on by those who are threatened by the innovation. The ability to put a server or series of servers running web services architectures in data centers scattered around the Internet is still secure. However as businesses like Vonage, ramp up to offer the duopoly’s customers savings on anything voice related, the two major national incumbent telcos are using patent claims and or blocking methods to begin to deny their captive customers access. The blocking methods range from refusing to route packets to a web based conferencing service to using the marketing muscle of their cell phone operations to get Nokia to disable by pass features of its latest cellular phone.

 

While larger business still has attractive options for VPNs thanks to Level 3’s purchases and on going integration of metro fiber networks in 30 cities across the county, SoHo business is at the mercy of Qwest, ATT and Verizon – companies that exist not to serve their customer’s interests but rather those of their stockholders.

As new OECD reports come out showing that broadband penetration in the US places us near the bottom half of economically developed countries with the cost of bandwidth per megabit in the US and order of magnitude more than in countries like Japan many industry leaders and technology seers are bitterly complaining. The problem is that there are almost as many agendas as people. And that as a discussion between Hendrik Rood, Bob Frankston and Mark Cooper demonstrates getting the technologists, the bankers and the town council to understand what policies are appropriate where is hugely difficult.

This is a problem that must be solved, because in the meantime the incumbents are whacking away at what supports our revolution in order to preserve their profits and control.

Norman Lewis and Digital Children p. 3

Norman Lewis, the Director of Technology Research at Orange mobile, presents his findings on “digital children.” Lewis has been studying how children and young adults use their mobile phones to socialize and provide some escape from constant adult supervision. This is the next generation of customers for the mobile phone companies. These users want not just devices to talk but to use for self expression in building online identities shaped by interaction with their peers. As John Waclawsky pointed out earlier this year in our pages, the winners here will not be the telcos who can charge a fraction of a cent more for each short text message sent by the kid’s phones but rather those who create in working with edge based suppliers such as AgileCO capabilities for building richer more attractive online social networks. Norman’s message is that disruption is coming to the telcos like it or not. Therefore, the most creative thing they can do is by understanding what the kids are doing to provide themselves with some means of shaping and being in control of their environment rather the being controlled by the telco’s devices.

Norman finds that for the parents mobile offers risk management while for the kids it offers self expression.. “It is about identity formation and becoming the person that you will be as an adult. The process of interacting with your peers is the way that these things work themselves out. But in the absence of this, kids are drawn to communicating and interacting with their peers in virtual spaces.”

Self-expression therefore has become a form of communication itself. What this might possibly mean in the future? One of the things that it may mean is that communication has been modified.

I think that this is a key point that quite a lot of people who are looking at the future of voice are missing. This is too narrow a view of communication. We are not going to communicate in the future in the same way that we did in the past. What has really happened here is that the communication of content has become less important and less illustrative than the “network of communication” itself.

You have two things happening together at the same time: Technology enables young people to create their networks through which they express themselves and gain acknowledgment. At the same time this technology is fulfilling the very important demands that young people need as they go through life from being kids to becoming adolescents and then young adults. Its is internalized in a very natural fashion.

What this means is that this is not simply a phase that they are going though. The means of interaction they grow up with becomes the means of interaction for their future lives. I think this has huge implications for what this generation will be like in the work place, what they will be like at home. If companies don’t understand this they are going to have human resource problems like you have never seen in your life.

Lewis’ message is for the phone companies to loosen their attempts at control and embrace things like making the Media Labs Scratch technology available on mobile vies, - as he puts it: “We are aiming to create an environment for authoring applications and programs on mobile phones for kids.” The message in his talk and in others at E-Tel was that mobile phones are on the verge of becoming open architecture and platforms for innovation as PCs were for a period when IBM opened its architecture in the late 80s and early 90s before windows encased the PC industry in its silo.

Larry Roberts and IP v6 p. 13

We asked Larry Roberts to update us on the use of IPv6 in Asia and the world in general. Larry points out that China, wanting to bring a billion cell phone users on line, has announced mandatory conversion. Given the US’s enormous trade with China it faces a dilemma in that while the US is not converting any time soon, servers running IPv4 do not talk with servers running v6. The result - with no other solution - will be two huge global economies whose networks cannot communicate.

The problem Larry points out is that if China’s v6 network economy is to communicate with out v4 network economy, routers at the edge of respective networks must be able to translate what routers on the other edge are saying. He explains why only flow state routers can do this.

At Caspian from about 1998 to 2003 when he left Larry was building flow state routers. At Anagran, his new company he is also building a flow state router that will be able to do flow state routing and do so with v6 more efficiently since only a flow and not every packet is routed. There is undoubtedly a serious need for Anagaran’s new product, but its flow control capabilities mean that an incumbent could use the device to discriminate against traffic that it otherwise could control only by much cruder attempts such as port blocking.

Symposium – Strategies for Technology Change p. 26

Discussion between Hendrik Rood and Mark Cooper shed light on the combination of political social and economic strategies that have to be carefully considered in bringing about change.

A technology strategy will have to have political and economic components if it is to get anywhere. Those components involve choices between public and private sector approaches as well as choices or municipal run versus cooperatives that in turn depend on the size of the target community and the economic threshold of viable numbers for the technology chosen. These problems are further complicated by changes in the way language is used within the groups of people who must make decisions to effect change.

An example of language issue is given by Hendrik Rood who talks about the economist’s view of the difference between provisioning of a service and self-provisioning of a good (it's buy vs make),

Rood reminds us that in looking at the viability of a cooperative for fiber infrastructure not only the economic criteria imposed by the fiber technology used in a local build but also the social and political characteristics of a give are that would enhance or make difficult a cooperative approach must be carefully weighed. Therefore geographic proximity and density is also a parameter to include in the scale of a network. This is partially technology determined and thus can change. If it surpasses the typical municipal boundaries, you start to see most mayors and alderman to loose interest since, to put it bluntly, there are no voters at that enlarged scale.

As Mark Cooper concludes: Is technology extremely important? Absolutely. Is it determinative? Not at all. It defines a space in which a range of outcomes it possible. Is sociology important? Absolutely. Is it determinative? Not at all. It defines which outcomes will stick within the space of possible outcomes.

Since Fiber Capacity Is in Terabits, Long Live Pragmatism p. 34

A discussion of what kinds of opto electronics offer what kinds of through put on fiber strands. Complaints that end users in being offered megabits are being gouged. In this context Hendrik Rood responds: if you really want to do so, it is quite easy to construct a kind of libertarian Walhalla without any governmental provisioning where all is done by private enterprise and voluntary co-operation. Obviously it is also possible to do the opposite and show places were the government is not only far more involved, but also very effective. Interestingly it is quite difficult to discriminate on actual performance between the two alternatives.

This is the primary reason why every discussion about "models" is so utterly useless. Think thanks of all flavors offer examples in the particular political mold they like to promote. You can find best-in-class state and municipal run efforts that are at par with the top performing private infrastructure operators, while both governmental and private operators have their examples of very bad performance.

The only thing what really makes sense is not a near-religious advocacy of a model, but an attitude that allows you to switch models. For example when you think you are not getting what is needed because the current incumbent(s), either a government monopoly, a private regulated franchise or when a tight oligopoly of private firms, is (are) not delivering or progressing very slowly, you might then set up one of the other models to show that does work and delivers the goods. Either the incumbent will adapt or users, imitating suitors, will start follow your example.

The remainder of this section discusses various examples of the state of the art in fiber through put.

Identity p. 42

Because of the plasticity of digital technology issues of maintaining and protecting your identity online have become increasingly important. Johannes Ernst reminds us that “The difficulty in "identity" is that (1) it has so many parts (2) nobody agrees what they are (3) in fact, maybe nobody has even successfully enumerated them. (my suspicion, and myself included …)”

While JP Rangaswami adds: I'm often bemused by the level of attention given to privacy and confidentiality in the west. I guess that comes from growing up in Calcutta.

I think identity is a many layered thing, the key is to have a common way of sharing the simplest and smallest aspects. OpenID seems the right place to start and has the advantage of getting traction amongst practitioners rather than theorists.

My "six aspects of identity" are already eleven, happy to share the others with you.

Editor: On the six see http://confusedofcalcutta.com/2007/03/30/reviewing-identity/

rans Sectoral Innovation p. 46

T The Netherlands is one of the most advanced countries in the world in its use of FTTH and competitive broadband. The Dutch government is also paying attention to investment in infrastructure that can pay economic dividends across multiple sectors.

Hendrik Rood talks about an innovative healthcare solution based on broadband: Your billing relationship with the telco is simply running via your health care insurer. The telco has set up a dedicated broadband service to assure sufficient Quality of Service, run the IT in a high-availability data center and linked the health care monitoring center with dedicated Ethernet over fiber links.

Telecommunication is not for voice anymore. An investment in the expanding communications “mesh” will become more and more important for more ventures. For example: Three years ago we had a west-european clothing and apparel retail chain (near thousand stores as I recollect) as a client. They decided to convert from a setup with not much more than a telephone per store and a modem link to the cash registers, towards a DSL-based narrowcasting network supplying video advertisements to all stores, with multiple widescreen TV's per shop, now showing fashion commercials. They hooked up a higher level security system, since otherwise their burglar insurance bill would go up, installed surveillance camera's against shoplifting etc. Their 10 person central IT department had to expand considerably from primarily running back office applications and logistics software to a substantive multimedia and IP network management operation.

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Contents

Where is the Unifying View?

In the Absence of a Generally Accepted Framework and Agenda the Incumbents Are Aborting our Future Prosperity to Preserve Their Current Profits and Control p. 1

Digital Children and the Future of Disruptive Innovation A Talk by Norman Lewis at E-tel, March 1, 2007

Digital Children p. 3

It's the Kids! p. 4

For the Kids it's Self-Expression p. 5

The Act of Communication has Been Modified p. 8

Myths p. 9

Tapping the Kid's Creative Potential p. 11

 

IPv6 is Coming

A Discussion with Larry Roberts Examines Some of the Strategic Consequences p. 13

Without Translation v6 Talks Only to v6 p. 15

 

China's Networks Do Both V4 and V6 p. 16

Elsewhere in Asia p. 16

Packet Router Vendors Fight a Standards Process? p. 18

IPv6 Discussion p. 21

Flows and IPTV p. 23

Symposium March 17 to April 17

Strategies for Technology Change Cooperative Resources and the Difference Between Service ('Buy”) and Provisioning (“Make”)

Limits of Cooperatives p. 28

How to Understand Whether Local Conditions are Conducive to Fiber Builds p. 28

Importance of Vocabulary p. 31

Long Live Pragmatism Fiber Capacity in the Terabits per Second While “Marketplace” Struggles with Megabits p. 34

Long Live Pragmatism p. 35

40 Gigabits Is Where It's at In Real World p. 36

High Router Prices Make Light Path Switching More Viable p. 37

Growth of Bandwidth Demand p. 39

Issues of Identity p. 42

Trans Sectoral Innovation Health Care Provider, Insurer and Telco Partner to Offer Medical Monitoring in Holland p. 46

Executive Summary Finding a Way Forward in the Midst of Efforts to Stop Destabilizing Innovation p. 51

Symposium & Interview Contributors to this Issue

Affiliation given for purposes of identification - views expressed are those of the contributors alone
Javad Boroumand, Manager for University Research Grant Programs at Cisco
Norman Lewis, Director of Research Technology at Orange
Larry Roberts is chairman and president of Anagran Inc. He was founder of the The Arpanet
Tom Vest, Senior Analyst, Internet Economics & Policy CAIDA
Frank Coluccio, President DTI Consulting Inc., New York City
B Bob Frankston, developed Visicalc and Lotus and later home networking at Microsoft
Mark Cooper, Director of Research Consumer Federation of America
Hendrik Rood, Principal Stratix Consulting and Faculty Delft University
Dirk van der Woude, Civil Servant Amsterdam and fiber expert
David Isenberg, author of the Stupid Network and proprietor of ISEN.com
Bill St Arnaud, Director Ca*Net4, Canada’s high speed research network
Hal Feinstein, Senior Engineer, General Dynamics
Johannes Ernst, CEO of NetMesh, and authority on OpenID
JP Rangaswami, CIO BT Global Services
Roland Cole, Director of Technology Policy at Sagamore Institute for Policy Research
David Reed, HP Fellow at HP Labs and Adjunct Professor at MIT Media Lab

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