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The Almighty Buck

Covad Files For Bankruptcy Protection 182

xnuandax writes: "Well, it's finally happened, DSL provider Covad Communications has buckled under its post-tech-bubble debt load and filed for Chapter 11 (See this c|net article). While this doesn't mean that Covad is turning off the lights on its 330,000+ customers, things are not looking so rosy for the last competitive (non-Bell) DSL provider left standing. Seems that the USA is setting herself up for a broadband cartel (of Baby Bells) that's going to make OPEC look like a poster child of free market competition." The announcement is from earlier this week, but they've been acting bankrupt for a while. Just like with Loki though, this doesn't mean they're out of business, at least not yet.
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Covad Files For Bankruptcy Protection

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  • by revscat ( 35618 ) on Sunday August 19, 2001 @08:41AM (#2193492) Journal

    Well, everyone says that the Pres. Bush administration is married to big money interests. Now would be a perfect time to prove all those people wrong. If Pres. Bush can get the FCC and/or Congress to rework the Telecommunications Act of 1996 to reflect the current situation of the telecom market (namely that long distance is no longer an attractive market), he could prove himself to be an astute leader and someone who is truly dedicated to free market principles, not someone who is dedicated to campaign contributors.

    I doubt it will happen, but I'm hopeful.

    • If Pres. Bush can get the FCC and/or Congress to rework the Telecommunications Act of 1996 to reflect the current situation of the telecom market (namely that long distance is no longer an attractive market)

      Huh? What's the long distance market have to do with an ISP like Covad? And call me crazy, but long distance is at least attractive enough that I still get constant spam wanting me to switch my long distance company to someone else. At the same time, I never see that constant spam for changing ISP's (from anybody other than AOL, of course).

      The government should have nothing to do with bailing out companies that invested too much in tech with the wrong ideas in mind. It's one thing to bail out monsters like Chrysler or Continental, because they employ tens of thousands of American workers. It's entirely another thing to rework federal law simply because yet another dot-com servicer went belly-up.
      • It is related somehow. See, back in the day when the telecommunications act of '96 was passed, it linked the opening of local phone markets to competition to the baby bells ability to get into the long-distance game. Back then, the baby bells wanted to get in on the LD game as it was very profitable. Now it isn't and they could care less about.

        This being the case, they aren't terribly concerned about playing nice with other providers and CLEC's who are in their local areas. This allows them to drive out people like Covad, Rhthmys (sp) and others with impunity.
        • Even in 96, the writing was on the wall for LD. "It's like selling water", one reseller told me back in 92 or so, "everyone has the same product, only the brandnames are different".

          I think the comment about the bells being 10 years behind is right on the mark. Don't forget that these guys are born-and-bred AT+T end-to-end monopolists, and controlling things end-to-end is the only way they know how to think.
        • Let us remember, to the RBOCs, LD equates to the ability to cross LATA boundries without involving a third party (LD company.)

          For instance, look at Bellsouth.Net. It's their dialup hardware on their property with their dialtone, however, they have no wide area IP network because they cannot cross LATA boundries. Each POP is connected to the world via a "Global Service Provider" (UUNet in my area.) Connecting all these sites themselves would save them millions. (And give them a very big stick to weild over other ISPs.)

          Alot of the problems in the DSL market stems from companies not being prepared for the bullshit required when dealing with Telcos. DSL is 100 times worse than normal telco services because hardware has to be installed on the Telco turf and that hardware needs power and connectivity to your infrastructure. Buying lines from Bell is no worse than buying anything else from them. There have been problems with some RBOCs prioritizing their own customers above competitive parties, but those have dwendled -- I've not (directly) seen any problems with BellSouth delaying installation of local loops. (Think about it, the RBOCs have a very powerful advantage in the DSL market -- they don't pay colo or loop fees.)
        • Back then, the baby bells wanted to get in on the LD game as it was very profitable. Now it isn't and they could care less about.

          This isn't exactly true. LD is still profitable (prices may have even hit bottom), but even if that weren't the case, it will almost always be profitable for the RBOCs. When an LD carrier connects a call, the RBOCs on each end of a long distance call generally get a couple of cents per minute. If a customer is paying between 7 and 10 cents/min for their long distance, this means that a big percentage of the money is going to the RBOCs. If you're AT&T, that means you're only keeping maybe 5 or 6 cents per minute (which is why they've been so desperate to get into the local phone market, to avoid paying the RBOCs.)

          On the other hand, if you're an RBOC offering LD, a long distance call becomes enormously profitable (especially if you're the local service provider on both ends of the connection.) A company like Verizon only has to pay what it really costs to provide the local lines, which makes the whole prospect much more attractive. If the LD call is a state-to-state call within their own network, it probably doesn't cost much more to run the long-distance connection themselves than it does to pipe it into AT&T's network. That means they can charge a competitive LD rate and pocket the difference.

          Of course, the Telecommunications Act was supposed to balance this by opening local markets to other companies, but look at the disaster that's been. Both 3rd party DSL and local telephone service are examples of how easy it is for the phone company to make business impossible. If AT&T or Covad wants to offer some sort of local service, they have to go to Verizon et al. on hands and knees, hoping their customers'll get something approaching timely service. If Verizon wants to offer Long Distance, they don't need to beg.

      • by scoove ( 71173 ) on Sunday August 19, 2001 @11:31AM (#2193796)
        The government should have nothing to do with bailing out companies that invested too much in tech with the wrong ideas in mind.

        That's nice, in theory. However, the government created this mess in the first place.

        Consider the state of the RBOCs in the first place - a monopoly granted a hundred years ago had at least a bit of time to get entrenched. Breaking up AT&T only segmented the monopoly into smaller (but also less dormant) entities.

        The Internet nearly came under the same monopolistic jurisdiction back in the early 90s (namely ANS and the "Baby Bell NAP" architecture - thanks to UUNET, PSI and Sprint for killing this animal). Again, government (then (D) Sen. Al Gore and the NSFNET folks) promoted the vision of a Bell-centric model.

        Now we've got plenty of (D) Senators and Representatives, like the Swamp Thing from Bellsouth [house.gov] (evidently a foreign nation within national bounderies) and a few (R) types on the paid Bell lobby working hard to fix what Gore couldn't complete. Bell dominance of the Internet last mile is a key component.

        Per a few other points:

        What's the long distance market have to do with an ISP like Covad?

        Well, for one, Covads and other "OSI 2+ last mile" entities can help slaughter the long distance toll model, at least domestically. Don't forget that the Bells are still hungry for the long distance market - mostly since their upper management is still about 10 years behind (hey, they used to be 40 years behind - that's progress!).

        government...bailing out companies that invested too much in tech with the wrong ideas in mind

        What bailing out? Much of the problem comes from exclusive local partnerships with the Bells and cable providers, limiting right-of-ways to a single entity in exchange for a lucritive franchise agreement (read "bribe to the government"). Bailing out DSL providers - how? Through chapter 11? By demanding a community resource be opened to competition (which calls that franchise agreement network what it should: public property).

        Seriously, how would you feel if I entered into an agreement with your community to be the exclusive grocery store provider, in exchange for giving 3% of the profits to the city government? What a deal for me: no competition, high margins, and the government gets to beef up its budgets (building bigger political empires!). I'll even throw in a donation to your re-election campaign too, and there's no quid pro quo (wink!). What this regulation proposes is recognizing the grocery store for what it is: community granted property that belongs to the community. It's a lousy way to fix the problem created by an unethical prohibition of competition, but there probably isn't a pretty way to get out of this Bell mess.

        bail out monsters like Chrysler or Continental

        And how many hundreds of thousands of dot-com jobs have been lost, in many cases thanks to the unethical action of the Bells?

        rework federal law simply because yet another dot-com servicer went belly-up

        Yea, you probably wouldn't want to change the pollution laws either even though all the fish in the ocean were floating belly up. Really, the only laws that need "changing" are the ones protecting bloated monopolies from complying with the law mandating they open up their community-granted networks.

        Unfortunately, as long as these Bell congresshacks keep getting re-elected, we can expect the government to keep rigging the system in the Bell's favor.


        • Face facts, some things simply are monopolies -- the "natural monopoly". We call them utilities and regulate them. Grocery stores don't present a conciderable infrastructure like a water company or power company.

          How would you like having nine (9) local water companies competing for business? Each one will have to bury their own water mains and distribution lines. In the process, they will certainly end up screwing things up -- cutting people's water lines, cutting through distribution lines, etc.

          How would you suggest we deal with this mess? Have the government install and manage the utilities infrastructure? Oh, that'd be funny.
          • Well, if the water company did a shitty job and didn't provide me with the services i want/need (which it's competitors can/would), then yes, I would like the option of another water provider.

            There must some kind of checks/balances on corporations that are granted local or regional monopolies. That means they should be forced to open their infrastrcture where feasable. Even if were just huge fines, at least my city could fix some frickin potholes.

          • We've got lots of your "natural monopolies" (schools, water utilities, electrical utilities, etc.) and most of them are excellent examples of how the concept doesn't work. Right now, nearly every utility and governmental service agency in our community is demanding more money for less service. No thanks.

            At the same time, we have utilities that exist in a competitive environment.

            Consider the telephone utility. I'm served by two wireline last-mile providers (the RBOC and my cable TV company). Both have a termination to my house. Natural monopoly? Not at all.

            If both can figure out how to get a wire to my house, so can the electric companies.

            If there is a problem with the logistics of running multiples (e.g. water & sewer), then the city should bid the management of the right of way for a period of time to prospective vendors, and upon my deciding to hook up to the public water or sewer grid, I can pay an appropriate fee for that access.

            Remember, there's nothing from stopping me from using my own "sewer" (septic tank) or water (well or even local water tank delivery, albeit expensive). In this case, I'm not forced into anything I don't want to buy, and no monopoly is coercing me.

            In the process, they will certainly end up screwing things up
            Competition has no monopoly on screw-ups:-) (non-uniqueness). My local water monopoly does just fine without any competitors.

            • The phone company and the cable company each has a line running to my house as well, but if I want telephone service I can only buy it from the telephone company and if I want cable television I can only buy it from that cable company.

              If I want to connect to my Internet Service Provider I can only do it via dial-up. Phone company's been saying Real Soon Now on DSL for about a year and a half, and if it ever does get here I'll probably have to go with the phone company as an ISP if I want DSL. If I want something as fast as cablemodem, I can choose Roadrunner or Roadrunner. The cable company just added some more non-scrambled channels (including an exciting golf channel or two, but still no UPN so that I can check out 7 days or the upcoming new Star Trek) and raised the monthly rate. When local subscribers howled the county commissioners (who granted TWC the local franchise) said we don't have any control over that, go bother the FCC or somebody, and the TWC local manager offered the usual "added value for the customer" song and dance, and everybody ducked the "why can't we choose which channels we want to subscribe to and avoid paying for a bunch of stuff we don't want" question.

              Smells like monopolies to me.

              Interestingly enough the phone company has been using co-axial cable 75 ohm RG-6) messengered with BUG (buried under ground) wire (the actual twisted copper pair used for the telephone) for new installs for several years around here now, so there's a bunch of dark co-ax in the ground around here but no move to light it up with anything.

        • also notice how laws regarding what % of subscribers can be serviced by a cable provider have been suspended since at&t got in the game? http://www.fcc.gov/Bureaus/Cable/Orders/2001/fcc01 095.html
    • DSL is not a cost effective technology. It was antiquated the day the first installation was performed, and the hardware requirements together with the service and support costs make it an unatractive business proposition. The only reason the phone companies are in it is because federal regulations require that they provide broadband where possible. I'm certain that if DSL technology hadn't been developed, we'd have fiber to our houses right now.

      DSL was developed in the days when it was thought that it would be impossible to lay fiber throughout the country in any short period of time. Ir REQUIRES copper between the CO and the customer, which means that anyone living in a development between 5 and 10 years old who has a couple T1s terminated at an older DSLaM outside their community is out of luck and will have to settle for the nightmare that is Cable Modem Service. This severely limits that market for DSL, which makes it all the more difficult to amortize the exhorbinent equipment costs. These issues combine to deter telcos from rapidly deploying DSL. Rather they choose to deploy it at the slowest rate possible under federal legulations, because once it is deployed, they will have incurred sunk costs which won't be recoverable for at least a decade, which means all those clamoring for fiber to their houses will have to wait until the telcos decide they've recovered their investment in DSL. All in all, it's vary disappointing.

      • This may be true for business to business, but for high speed access in 'bedroom communities', fiber just isnt going to happen. Cities and outlying areas will get fiber, but those towns like mine (25 miles from Boston) just ARENT going to get fiber anytime soon (hell, theyve been promising cablemodems since 1995) so DSL currently is my ONLY option.
      • Fiber is never going "to the curb" in the US, except maybe in brand new developments or high-density, high-dollar townhouses. The cable companies almost bankrupted themselves wiring America in the 80s, and in the modern competitive landscape, nobody is going to there again -- AT+T, once the biggest blue chip, is now laden with gazillions of dollars of cable build-out debt.

        (And DSL is extremely cost effective technology, especially for neighborhoods like mine where density is high, and good 80 year old copper goes everywhere. Essentially free money for the telcos, although the whole Covad-type middleman thing turned out to be bogus. It's true that DSL is not effective for the more prevelant 70s-style suburban development. Within time, there will be much cheaper wireless solutions, tho.)
  • by Perianwyr Stormcrow ( 157913 ) on Sunday August 19, 2001 @08:42AM (#2193495) Homepage
    The fines for their anti-competitive practices appear to be far less than what they stand to gain in the future if they destroy all competition...

    One would almost think that things were engineered this way from the beginning.

    Everyone who I've talked to who has gotten DSL service from anyone other than the phone company has related a tale of delays and ball-dropping by the phone company... which are believable, since they are the ones with the incentive to do so! If Covad provides bad service, it will drive them out of the market. If the phone company provides bad service... well, isn't that what phone companies are known for?

    All in all, it makes me wonder if the last mile shouldn't be a truly public utility, with all companies at an equal footing outside of it.
    • This is confirmed indirectly in the article, although the business model also has some potential problems.
      Covad charges its customers less than the actual cost of setting up a new connection and makes that money back over time. McMinn says the company takes a bigger hit to set up business customers, but gets paid back more quickly than through its consumer business. So the company must strike a balancing act between its need to acquire customers, the cash it has to work with, and the time it takes to recoup its investment in new customers.

      The times for telecom upstarts have become leaner as many companies across the industry have trouble building their networks

      You could even have free installation for all of this, but then I wonder how long it would take make back the money. Throw in the large companies messing with the small companies, and there is a big problem.

      - - -
      Radio Free Nation [radiofreenation.com]
      is a general news site based on Slash Code
      "If You have a Story, We have a Soap Box"
      - - -

    • Well, not everyone had problems, you know. Personally, I've never had a single problem with my DSL provider (Directv DSL, formerly Telocity). Setting it up took exactly how long they said it would take, everything worked right out of the box with my Linux set-up, line speeds are as advertised and I've only had to call customer support once in 4 months (and that's because I was too tired to realize that power cycling the modem would solve the problem). Besides, they give me DHCP, a fixed IP address, they explicitly allow me to run servers as long as I keep it non-commercial. And they never blamed Verizon for anything.

      I know other people have had problems, but there are some of us who are very happy with our current DSL setup and I think that's worth mentioning. Back when I was shopping around for a broadband connection, I almost didn't consider DSL because all I've read on the net about it was horror stories. The only thing that made me reconsider was that there was only one alternative: cable, and I don't care for cable very much (shared bandwidth + dubious provider practices, like closing port 80 for everyone when they feel like it).
      • I know other people have had problems, but there are some of us who are very happy with our current DSL setup and I think that's worth mentioning.

        You are absolutely right. I'm deleriously happy with my current DSL setup. The problem is, with Rhythms going under, I now have no choice but to stay with Telocity and let Ameritech provide the line. Or, I could switch to Ameritech DSL.

        Oh, and either way I'll have to give up my 768/768 SDSL. Ameritech uses ADSL, so I'll probably end up with 768/128. And PPPoE. And have to install a new modem.

        Yeah, I'm real happy about this.

        • The problem is, with Rhythms going under, I now have no choice but to stay with Telocity and let Ameritech provide the line. Or, I could switch to Ameritech DSL.

          Or you could refuse to allow your business to go to the evil entity that helped drive Rhythms out of business and go with Sprint ION [sprint.com]. Yeah, it is ADSL, but it is (up to) 8 Mbit/1 Mbit. They also move your phone line to VoDSL (over ATM, no VoIP) and turn the screws a little bit more on Ameritech.

          I am not sure I consider Sprint any kind of shining knight, but they are considerably lower on the evil scale, are not likely to go belly up soon, and have the legal muscle to minimize Ameritech's ability to screw with them. The loop has already been installed for me, and (in theory) Sprint comes next week to finish it off.

          Basically, fsck Ameritech! Not sure if you are in Sprint's service area for ION, but it sounds like you are in Chicago, if so, you likely are.
      • I hate to post a "me too!" comment, but, me too!

        I've been quite happy with my Telocity connection via BellSouth lines. I have really liked the static IP and full allowances for servers and multiple 'puters. I've also not noticed any changes related to the DirecTV merger, except a couple of email notices and site redesign. I had good technical service from BellSouth as well, before I moved to Telocity, but didn't like the rotating IP's.

        There are a lot of people having problems with their DSL provider, but I get the feeling that there's a larger number of us who have really had no problems and just remain quiet.
      • I get around a 5 megabit connection for $40 a month, sure it's shared but for i'm happy getting 15 ping on counter strike and gettings 600kb/s downloads on gnutella. Their tech support is very good too. The 3com modem they gave me is quite amazing, i accidentally spilled an entire glass of water down the cooling vents, let it dry out a day and it worked again! That's some luck to get a soggy PCB to work again :)
      • I (currently) work for a DSL provider/CLEC/LD company (BTI). I've seen both sides of the coin. The local RBOC can drag their feet and break things in ever more inventive ways. They also install loops flawlessly. In my limited experience (I'm not involved in provisioning the copper loop) they get it right most of the time.

        Most of the line problems I've seen were in the CPE wiring. A few have been caused by the jack installed by Bell. They like installing those jelly filled things. Well, that jelly is marginally conductive at high frequency. And sometimes the modem/router is bad.

        (BTI [btidsl.com] sells DSL for businesses, so don't freak at the cost.)
    • The fines for their anti-competitive practices appear to be far less than what they stand to gain in the future if they destroy all competition

      That's right on the money. The Baby Bells know that the FCC doesn't really care about promoting open competition. Here in California, PacBell was promising DSL before they could provide it - I have several friends who had a terrible time getting DSL through PacBell two years ago, while I had an effortless and very happy experience with Covad.

      Of course, now that the competition has been destroyed, PacBell is jacking up the price and using rediculous service packages (want static IP? you get FIVE static IP addresses and pay twice as much as with a standard PPPoE connection) to make more money off of customers like me who absolutely need fast access.

      I've seen comments in this thread about cable being wonderful, and I sure wish there were high-speed cable access where I live, but there isn't. Like many people, I'm stuck with one and only one broadband choice, and that really sucks.

      I for one like the idea of the last mile being a public utility.
      • Can you see the southern sky? Then you get Starband. If you dont mind a bit of latency, then you'll be all set. Lots of speed, lots of bandwidth, no DSL monopoly.
        • I'm not too keen on paying $100/mo for the DISH network with StarBand service included in that. Not to mention the fact that StarBand seems to run only on "PC"s, most likely meaning Windows machines. I'm assuming that rules out Macs and Linux boxes. Am I right?
          • hmm..first off, you can get Starband by itself, can't you? Seems to me that my next door neightboor has just the Inet, not the TV service.

            Second of all, I know for a fact that it can run on Linux. Check around usenet for details, I have seen several RH boxes with Starband attached.

            Nevertheless, I was throwing it out there just for the fun of it. It is an alternative, albiet a bit poky and a bit expensive.
            • The only deal I saw from DISH was a combined setup, but then again, I didn't go too far into their site to find out. That's great that it runs on Linux.

              Glad you did throw it out there - just knowing that there are options, even if none is perfect, helps.
  • I work for a start up telco that isn't making the same mistakes like the current Chapter 11 gang. We had a small conversation about Covad during our Network Admin lunch on thursday. Our VP of IT said it's means more customers for us. Just like Rythms going out of business.
    • by yoz ( 3735 )
      Er, yeah, that all sounds very well, until you get screwed by the Baby Bells in exactly the same way that the others were. As this mess has proved, there's very little you can do about it.
  • other dsl providers (Score:2, Informative)

    by neurocide ( 179122 )
    i'm on ATG (www.callatg.com [callatg.com]) and it's working great. any speed i can get for $49/mo line and isp cost.

    they also offer local/long distance telephone service here, and its cheaper than qworst. guess someone needs to realize that covad wasn't the last non-bell provider left.
  • dsl sux0rs. (Score:5, Informative)

    by jon_c ( 100593 ) on Sunday August 19, 2001 @08:52AM (#2193513) Homepage
    Nov 1: Move to Austin from Seattle.

    Nov 2: Call speakeasy to request DSL

    Nov 3: Get off the phone with speakeasy.

    Nov 15: Speakeasy puts in order with southwestern bell

    Dec 25: Southwestern bell hooks up the loop, but does it wrong.

    Jan 15: Southwestern bell hooks up loop correctly.

    Jan 25: some dude comes to my house to install stuff, but can't get it working becaues my house was built around the 1850's or some such crap. Tells me i -might- be able to get DSL but it requires sacraficeing a chicken around the next full moon, and thats not for another 15 days!!

    Jan 26: I call about Road Runner cable, after ONE ring a person answers the phone and tells me I can have a STUPID FAST connect TOMMOROW.

    Jan 27t: I get my cable modem with NO PROBLEMS, and bitchin 250k sec d/l speeds for 50 bucks a month. w00t!

    • Re:dsl sux0rs. (Score:2, Informative)

      by libre lover ( 516057 )
      I have Road Runner in San Antonio and I can attest to their service.

      One time I called to complain about dropped packets. The person who answered the phone asked me for my IP address, pinged me for a few minutes, then told me that my machine was dropping packets, not my cable modem. Turns out this was a known issue with certain 3c905 cards in Linux; I replaced it with an eepro which fixed the problem.

      Also, these guys will not hesitate to replace bad cable, even if it's in your yard or home to fix a service issue. They have handheld spectrum analyzers and can haul out a TDR if necessary, and they know how to use them. I can't even imagine this level of service from the phone company.

      BTW, it's 250K, not 250k :)

      • I had a competent lesbian technician dispatched from ATT@Home one time. She did a great job.

        My friend down the street had an @Home horror story... weeks of intermittent service interruptions that they couldn't fix. They couldn't even TELL him APPROXIMATELY when a service guy would be out. Their system, in Seattle at least, is not capable of that. Weeks? Months? Hours? They could tell him nothing. he'll be there when he's there. Hope you're home.

        Eventually he went up to a cable company van he saw on the street and talked to the tech, who came by the next day on his OWN time and gave him a cable amp that fixed his problem.

        I have stupid fast downloads, but that is the ONLY good thing I can say about ATT@Home. Looking forward to going with Speakeasy DSL for the benefit of my servers.
    • If you want to live with a crappy 'Terms of Service' that states you won't run servers at your house, install someone else's software that could/couldn't be spying on you, and limits your upload speeds to the equivalent of a 56k dialup modem, you go right ahead buddy!

      That's the kind of service I would recommend for my parents.

      Myself, I'd get the Covad SDSL service.

      No limitations on what I can/can't do.

      Can run sweet unix based servers at home

      Will have sweet upload capability that won't hinder my websites

      Don't have to worry with dynamic IPs or installing someone elses software on my systems


      Oh yeah, BTW, Could you move over? My Mommy wants to play in your 'Safe' Sand box too.

      Ewww...What's that cat doing in there??

      • the TOS for most broadband service says you can't run servers. Even my speakeasy static IP service in seattle said i'm not allowed to run a server. in reality they don't care/check.

        I HAVE NO limitations on what I can/can't do.

        I RUN a run sweet unix based servers at home

        I HAVE sweet upload capability that won't hinder my websites (256kb upstream)

        Ok, i don't have a static IP, but i do have dyndns, which works fine.


        Oh yeah, BTW, STOP THE FUCKING FUD


        • I have Speakeasy (I'm in MN though), and I seem to remember a bit in their TOS saying your could run servers (as long as it's not on NT)! If you check their package comparison applet, look at the "other" category for the sysadmin packages - they all say RTFM. Speakeasy rocks, I just wish they would give free DNS.
        • Speakeasy says you're not allowed to run a chat server, but they explicitly allow everything else. They do reserve the right to request you to scale back your bandwidth usage if you're hammering at your maximum 24/7 but that shouldn't effect most people, even if they want to run ftp, http etc.
      • My TOS for RoadRunner dosn't say anything about NOT running servers. As a matter of fact they helped me get Apache running on my Win2k box. I also have a static IP and it only costs $4.50 per for more if I want. The only thing they don't want on their network is Wingate for security reasons(but even then if I use a firewall it's ok). The 40k UL cap does suck though but I can see the need for the cap it is cable after all.

        • 40k upload cap? Luxury. Here in Seattle (@Home) I get about 12k.

          I paid for a static IP address too. However, they are attempting to move their entire userbase to dynamic IPs via DHCP. Whenever I call tech support about an outage in my area, they threaten to take away my static IP. They are phasing them out now. Scary. DSL time.
      • Plus, your MAC address is not bound to your line. You can swith NICs all you want w/o a call. SpeakEasy r001s!
    • What would you do if the cable company didn't say you could get a connection? probably go back to dsl, which is what most of us have to do. In my town, the cable company has a monopoly, and said they would have cable internet 2 year ago. Of course that didn't happen because there is no incentive to, and none of us can get another service. DSL is the only service here now to allow decent speeds.
    • I haven't had a problem with Speakeasy. And I've asked--I am allowed to run a server, and I do (the Darkchapter.net Free Speech Message Board [darkchapter.net]). Of course, I'm located in DC.

      But from what I know, Speakeasy also has a backup plan even though they're on Covad to keep their users online even if Covad fails. I love Speakeasy.
  • Broadband USA (Score:3, Interesting)

    by qwerty123 ( 63677 ) on Sunday August 19, 2001 @08:54AM (#2193519) Journal
    I think this just goes to show that the internet industry is very very dependent on government support. Without government intervention the internet would not have been created; furthermore, time and time again, government intevention was crucial to make sure the internet ran/runs smoothly. and there needs to be large over seeing force (and I'm not talking Mr. Smith's hand). Broadband is no different. The Internet is like a highway. Business and people use it, but ultimately the government must over see it.
    • Re:Broadband USA (Score:3, Interesting)

      by dada21 ( 163177 )
      This is totally incorrect. What we need is FULL government deregulation of the phone industry.

      At this point in time, the government STILL regulates the industry. There are still price caps, still difficulties in setting up an infrastructure.

      If the gov't keeps price caps up, it will be near impossible for ANY company to set up infrastructure. Because of this, the costs for companies WITH current infrastructure are low (the bells) but for others are high (the competitors).

      The bells lobbied VERY hard (check www.opensecrets.org and see your local bell chairpeople) to make sure it stays this way. People believe that the gov't is staying out of the phone business, but they are 100% not.

      If the gov't had stayed out in the first place, there would never have been this kind of trouble. What really troubles me though is that everyone believes having a phone or DSL is a right, not a priviledge. You get what you pay for.

      I wish they never gave away free installs, free hardware, etc etc. 768k of ADSL should have cost, no matter what, $300 to install, $200 for hardware, and $100-$150 a month. Then we'd have people STILL happy to have the speed and good service. But free hardware, free install, $50 a month? Where's the profit so they can branch out?
      • Re:Broadband USA (Score:1, Informative)

        by Anonymous Coward
        Amen Brother Beavis, AMEN!
        The main reason you are seeing all these little DLECs go under is they are trying to offer a service that is clearly work hundreds of dollars a month for free... So they are operating at a loss with no other means of funding (other than selling stock/VC Money). And they are expected to go up against Bell... You know, the company That Never Really Broke Up? ;)

        If I were still in the ISP business, MY DSL service would be in about the price range you suggest, and it would never go down, or have bandwdith contention issues...

        The fundamental rules of the game are set by those that own the copper. If you don't change those rules to level the playing field, you will LOOSE. The funny thing about all the govermental regs involved in 'opening up' access to the copper so DLEC can screw themselves are written by industry experts... ex Bell-Heads!!! Things that should only take 2 steps take 20 or 30, so that it can be demonstrated to the Government that the owners of the copper don't have an unfair advantage... Which creates so much paperwork, and so many delays, that is exactly what the incumbent gets! an unfair advantage...
      • I would argue differently. I believe that it is time that government recognized that last mile broadband service is the electronic equivalent of the local road system. In other words, a service best provided by state and local governments and paid for by state and local taxes.

        And for all the knee-jerk Libertarians, yes this would open a huge avenue for government regulation of the Internet. Sorry, it was bound to happen sooner or later, and I'd rather it be the government doing the regulation than Verizon's Board of Directors. I at least have some ability to change the former.

        • A corporation in direct, vigourous competition on a daily basis will be hundreds of times more responsive than a government worker with a two-hour lunch break.

          Where I live, there are not less than 10 different broadband providers. We have everything from Wireless, to Cable, to several DSL providers, to Satellite.

          Any one of those providers will gladly accomdate you, if for no other reason than to make sure you don't switch to another provider. Businesses especially get great responsive service. Its not a big deal for these people to come to where you are, check your line, hardware and often software setup.

          If the government was any more involved in the process then it would be lame. I really mean lame. Who would I call? City-hall to schedule a line check? BMV/DMV style lines at the main office?

          And why should everyone else fund my electronic fetishes? What about the guy with no computer? Should the government give him one so he can get online? Will the government enforce Internet regulations with filters, caps, and port blocking? Will they be forced to block all access to the gnutella or gnapster networks? How about to foriegn websites that haven't gotten in bed with WIPO?

          The suggestion that the government should provide consumer Internet connections is fraught with technical, funding, and more importantly philosophical questions that you did not address, even in summary. It seems to me that you were the "knee-jerk" here.
          • You mean 9 of the 10 will bend over backwards to accomodate you. AT&T Broadband refuses to even give me contact info that I'd need to complaain about the block on port 80. I'd much rather deal with the goverment, at this point. Maybe the Public Utility Commission will show a little more concern.

            Oh, your post was about competition?!? That must be it, since there is only AT&T Broadband here, of course it's going to be fucked...

            Offtopic: Since when is distributing content, via your own small time webserver, a commercial action? Since AT&T says so, of course!
            • Okay, dont use AT&T.

              Get someone else.
              • Uh...

                "since there is only AT&T here"...

                • Starband. If you can see the southern sky, you can use Starband. Or dialup. Three-dialup lines using Multilink will be about as much bandwidth as a low-end DSL line. 56k x 3 = 168 kb.
                  • Hell, if I can afford 3 dialup lines, I might as well go all out, and order a couple of T1's. That is, after all, what all the elitist asswipes were suggesting a few days back on the other broadband stories. And if you think I'm exaggerating, add it up.

                    3 new phone lines, for the circuit. $100 worth of fees, $60 monthly.

                    3 Dialup ISP accounts, with multilink access, $210 per month. (Not $60, because I'd need a 24/7 account, to be anything at all like what broadband is supposed to be)

                    A new linux server, with 3 hardware modems. Server $600-1000, modems $150-300.

                    As much as $1400 in startup costs, with a monthly of at least $250. Maybe not dual T1's, but I might manage a fractional for that.

                    Starband is somewhat better, but no southern exposure, certainly not with the ordinances around here. Even atop the house, I'd have to take out the neighbors trees.

                    There is DSL in this area, but I'm almost 2 miles too far from the CO.

                    AT&T can pretty much do whatever they want. Such as raise prices (they already have) or block ports (they already have), or be snotty on the phone with me, telling me that I'm not allowed to speak with their supervisor, or anyone else that might actually be able to resolve the problems (they already have). They can insinuate that I'm abusing their service, for just putting up a Code Red safe httpd.

                    I have no choices, and to be honest, I can't imagine regulation OR deregulation helping the least little bit. It takes big money to start a broadband ISP, and now that the Bells have killed off competition, deregulation will allow them to run roughshod over us. Similarly, they'll simply punish the consumers if regulated (because it will take at least 2-4 years to punish the legislators). Not that politicians are even close to being smart enough to regulate something like this.
  • Well... I have some bad news... AT&T is partnered with Covad to provide service to AT&T DSL Customers.... I'm betting the same is true for other bells......
  • by iamklerck ( 445579 ) on Sunday August 19, 2001 @09:03AM (#2193531)
    While there are indeed many problems in the US broadband market, regulation simply is not the answer. Government regulation and subsidizing of telephone is what got us into this mess in the first place. Government is the same reason we haven't seen any kind of advance in non-portable telephone technology almost since its invention.

    The real solution to the problem is a completely open and free market. Let the consumers and the market dictate the answer. Whatever you do, though, keep the government out of it.
    • The real solution to the problem is a completely open and free market. Let the consumers and the market dictate the answer. Whatever you do, though, keep the government out of it.

      So how should illegal actions taken by the telcos be handled? By consumers marching up and down in front of the house of the president of the telco? The DSL market is shrinking because the telcos are breaking the law in order to avoid doing what the law says they must do for competition. They don't care. They can pay their piddling fines, years later, as a simple cost of doing business. Meanwhile, after running their competition into the ground, they get monopoly prices, and there isn't anything the consumers can do about it.

      And don't say this is the marketplace in action -- it isn't. The consumer made their choices and went with alternative sources of DSL instead of the telcos. Instead of competing fairly in response, the telcos broke the law and forced us back into their arms. So if you don't want the government to take any actions (including enforcing existing laws??), how would you solve this problem?

      You say the real solution to the problem is a completely open and free market. We don't actually have that at this time.

    • Regulation of a monopoly is the *best* answer. It's the best answer for all public utilities.

      Now let me qualify that statement: *good* regulation is the best answer. The half-assed sort of regulation that your FCC does is the worst answer, because it harms the public far more than it helps them.

      Regulation works when it focuses on balancing the needs of the public with the needs of the monopoly. Generally, the public needs are more complex than the monopoly needs.

      The monopoly needs to make a reasonable profit. It doesn't need to make huge profits: one of the consequences of being allowed a legal monopoly is a low rate of return on investment. This is balanced by the quality of the investment: it's 100% guaranteed to profit.

      The monopoly is guaranteed a profit because it's the only game in town, it's an essential public service, and the regulatory body ensures that it makes a profit.

      In return for the guarantee of profit, the monopoly must provide certain things to the consumer.

      These consumer needs include: fixed and reasonable costs, guaranteed coverage, guaranteed customer service, guaranteed quality of product, and so on.

      The upshot is that in places where well-regulated monopolies are run, prices are lower than in the open market, service quality is greater, nearly everyone has access to the service, and the product is outstanding.

      An example of an outstanding regulated monopoly is BC's "Insurance Corporation of BC." It provides mandatory, basic auto insurance. Its rates are based not on driver age, sex, or horsepower, but on (a) how long you've been a safe driver and (b) the costs of repairing your model of car.

      As a result, automobile insurance costs *for safe drivers* in BC are lower than most anywhere in Canada and, I daresay, in the USA.

      This is a fair and equitable monopoly, well-regulated and run in the interests of the public. If you're a safe driver -- young or old, male or female, driving a Civic or a Viper -- you get insurance at great rates. If you're an unsafe driver, your insurance premiums are going to reflect that -- and, again, without bias as to sex, car model, or age.

      When the needs of the public are represented by a good regulatory body, monopoly services are a blessing to both the public and the monopoly.
    • Completely open and free markets only work, when corporations are hobbled by reasonable incorporation laws. In the late 1800's, the Supreme Court saw fit to rule that corporations were artificial citizens, with all the rights and privileges that entails (and a few more to boot). Since then, they have been able to do anything they want, and without regulations, they can kill competition with impunity. Anti-trust laws are apparently toothless anymore. Besides, even the minimally clever corporations know, that you don't have to have a literal trust, to accomplish the same effect.

      Corporations are in actuality, groups of citizens banded together, in the attempt to increase the relative power of their constitutionally mandated rights. If they do illegal things, no one has any liability. This is the only thing that the goverment need regulate. Make every shareholder liable for all crimes committed. Make it illegal for corporations to lobby politicians, make it illegal for them to make campaign contributions. Every shareholder can do it on his own individually, or even discuss it with fellow shareholders, so they can coordinate. But allowing them to do so, through a corporation, tends to marginalize the rights of true citizens.

      When all this is done, then we can do away with regulations.
  • The Baby Bells have fought open competition from day one. I think DSL is a great technology, but who would have thought we'd be looking to cable TV companies for relief from monopoly?

    There are a lot of people who want DSL but can't get it, or who have signed up with services like Telocity only to find their service mysteriously interrupted (and be told by Telocity that it's the Bells' fault). Some politician could capitalize on this, and probably will.
    • I think DSL is a great technology, but who would have thought we'd be looking to cable TV companies for relief from monopoly?

      More importantly, who thinks cable internet access is going to stay priced low after the DSL providers all fold? (or have any provision for having more then one IP address, or support anything other then Wintel, and if your lucky Mac...)

      • More importantly, who thinks cable internet access is going to stay priced low after the DSL providers all fold? (or have any provision for having more then one IP address, or support anything other then Wintel, and if your lucky Mac...)

        Well, first off, I doubt that they will *all* fold; the Baby Bells will still sell it. As for support of anything but Wintel, I think you might end up being a bit surprised. Mac owners are pretty "boutiquey" people (i.e., they've got the cash) and whine loudly when things don't go their way. (I know; I'm one of them. :-)) Now, since the way of the Mac in the OS X world will essentially be FreeBSD, I'm pretty sure that the combination of Mac plus BSD/Linux users will be big enough to tolerate, if not hand-hold.

        As far as prices go, I think there's also good news in that cable companies are feeling intense pressure from the dish. In the long run, I think they're on the losing end of the battle as far as broadcast programming is concerned, but probably in better shape for internet access until everything goes wireless. In the mean time, they really will need the market share, and I don't think they'll have time to get especially greedy.

        But, of course, I could be completely wrong...

        • Now, since the way of the Mac in the OS X world will essentially be FreeBSD

          Not really, there is a compatibility layer on top of Mach so you can use FreeBSD device drivers and file systems, but that isn't the only driver interface. They have another one (Kext? I forget the name) that lets you use a fairly large subset of C++ to write your drivers.

          It is possible that they might do a USB device (rather then ethernet), and end up making a OS X driver that can't be ported to FreeBSD trivially because it is C++ code.

          Or they don't port it because they are bastards, and don't release the source for the same reason. :-)

          At least one satalite IP service uses USB devices, and has no BSD support (a 3rd party supports the older USB device, and is working on the newer one).

          As far as prices go, I think there's also good news in that cable companies are feeling intense pressure from the dish. In the long run, I think they're on the losing end of the battle as far as broadcast programming is concerned, but probably in better shape for internet access until everything goes wireless. In the mean time, they really will need the market share, and I don't think they'll have time to get especially greedy.

          I'm not so sure they want market share more then the money from the increased prices, look at what they charge for the same thing dish charges... but I would be happy to be surprised. As long as I can get multiple fixed IP addresses from them...

          I'll probably find out soon, since my home ISP is switching from Northpoint to Covad, and I'm not sure what they will do if (when?) covad falls...

          As for support of anything but Wintel, I think you might end up being a bit surprised. Mac owners are pretty "boutiquey" people (i.e., they've got the cash) and whine loudly when things don't go their way. (I know; I'm one of them. :-))

          I am too (I bought a PowerBook to run OS X on), I'm being pessimistic.

    • "...who would have thought we'd be looking to cable TV companies for relief from monopoly?"

      Who would have thought 2 or 3 decades ago that nowadays such a large percentage of American households would be getting cable television from American Telephone and Telegraph, but not their long distance telephone service?

      I think all these companies are just going to keep going from business to business until they find one in which they can be a monopoly.

  • by Rogerborg ( 306625 ) on Sunday August 19, 2001 @09:15AM (#2193545) Homepage

    Just as an FYI, this mirrors the situation in the UK. The incumbent monopoly, British Telecom (or just "BT" as they now style themselves) has been stalling and foot dragging on DSL as well.

    • They claimed they'd roll out DSL fast, then spent years testing to make sure they'd "get it right first time.". They then delayed further to switch to a screwed up USB (rather than ethernet) system that nobody wanted, and kicked off with massive installation delays, broken promises and network snafus. If this was them getting it right, god knows what they'd have done if they'd rushed it.
    • They went with a weedy 512/256Kbit/s ADSL system with a maximum 2.5km range from the exchange, meaning only urban customers can get DSL. They're now pushing this to 3.5km (woo hoo), but still have no concrete plans to bring affordable broadband to low density suburban or rural areas, other than a prohibitively expensive satellite solution.
    • When they were finally forced to open their exchanges, they claimed that there was no space. They then offered local loops in the 50 or so least profitable exchanges, while selling off exchange space in the others as luxury flats!
    • Despite the market and local loop being opened, try actually getting DSL from anyone other than BT. They've made the process of taking a local loop so expensive and awkward that nobody can compete that way. They rent DSL loops wholesale at £35~=$53 a month plus a connection fee, while retailing at £40~=$60 a month, which precluding any competition from resellers. Their biggest DSL reseller customer, Freeserve, has recently had to hike their retail price from £40 to £50~=$75 just to break even. So, you can pay £40 to BT or £50 to Freeserve for exactly the same service. Tough choice, huh?

    It sounds like the same sorry mess you have with the Bells. On the bright side, the UK's two main cableco's have just teamed up to market broadband cable together, so at least there's some competition, even if it's not in the DSL space.

    • The expectation is that ntl and Telewest (the two main cablecos) will eventually merge, and that the joint marketing is the first case of them testing the waters with each other.

      What any possible merger would mean for cable modem prices is anyone's guess.

  • uhhh (Score:1, Insightful)

    by timmah ( 447753 )
    Ribalah Ribalah Ribalah TIMMAH!

  • That's what chapter 11 meant for Northpoint and Rhythms and even wireless provider Metricom. Only the telcos will survive DSL and heck based on my experience north of Seattle, they may not bother to deliver at all.
  • by Telek ( 410366 ) on Sunday August 19, 2001 @09:53AM (#2193594) Homepage
    Seriously not trolling here, but up in the Great White North I have had a cable connection at home now for > 2 years with very few problems at all, took 2 days to get it set up and I regularily see 250k download speeds. Actually there's this one site that has this insane connection that can upload to me at 350kb/s. I have also had DSL, had it set up in under 3 days without issue, and don't have any problems. And all this for $50/month (that's $33USD) with no contract, quit anytime, and your first 2 months free! And the 3rd-6th months are at $40CAD ($27USD) because we don't get charged for the cable modem until after that. If you're a student, you get an additional $5CAD off the price. (Plus there is $0 install fees, and you get a free 3com network card)

    So why is it then that we're being charged much less than the US, and yet the US is falling left/right/center when it comes to providers?

    I could see maybe it being because it's our telco and our cable providers, but this has been going on for years, and they do make money off of it. Plus it's not only those. You can get P2P satellite as well for very reasonable prices and exceptionally high transfer rates.
  • The engineer who installed my DSL connection claimed there is a better technology in the pipeline called the 'ATM - Asynchronous Transfer Mode'. This is faster than DSL because it is a synchrounous system based on 53 byte cell switching. He explained that speeds of upto OC3 (200TB/sec) and above are possible with ATM, and it is even faster than the current fastest network - Synchronous Digital Highway (SDH).

    So, for what its worth, as with PCs, it seems that if you wait a year, your performance will treble for the same money. So Moore's law applies to telcoms as well as PCs !

    • The engineer who installed my DSL connection claimed there is a better technology in the pipeline called the 'ATM - Asynchronous Transfer Mode'

      ATM is hardly "in the pipeline" - it's been deployed for years.

      If fact, some DSL networks are based on ATM - ATM is a circuit switching technology used to concentrate a bunch of DSL lines into one upstream link.

      But, as far as I can figure out, ATM isn't a "last-mile" technology. The advantage of DSL and cable modems is that they use existing last-mile infrastructure to reach you.

      But then, maybe that's what was being referred to, a way to use POTS lines to being ATM to your desktop. Anyone know more?

      • "ATM is hardly 'in the pipeline' - it's been deployed for years."

        I'm certain the technician was not talking globally; he meant it is in the pipeline for that company .

        ATM is a "layer and 1/4" tecnology when compered to the ISO 7 layer model. It is actually a set of standards, none of which provide for 'Copper Wire' support. You can learn lots more by heading over to the ATM forum [hhtp].
    • Flabdabb Hubbard wrote:
      The engineer who installed my DSL connection claimed there is a better technology in the pipeline called the 'ATM - Asynchronous Transfer Mode'. This is faster than DSL because it is a synchrounous system based on 53 byte cell switching. He explained that speeds of upto OC3 (200TB/sec) and above are possible with ATM, and it is even faster than the current fastest network - Synchronous Digital Highway (SDH).

      ATM is a common technology for DSL backend networks. However, ATM overhead at speeds of DS-3 or greater gets to be quite a problem. In fact, it is referred to as the "cell tax". Major ISPs who run big national backbones (OC-48/OC-192) use POSIP (Packet over Sonet IP).

      IF you are buying large pipes (DS3 or larger), make sure you are getting POSIP not ATM.
    • The sole reason for DSL is, DSL uses existing wiring to your house. Most people only have three wires to their house: electric power, telephone, and sometimes cable TV. Power companies have been investigating the possibility of providing broadband Internet access through existing power lines, but as far as I know, none of them have implemented anything yet. Obviously, cable companies are offering cable modem services. That leaves the phone lines, which are owned and controlled by the telephone companies.
  • I've had Pacbell install DSL in a different apartment/house in San Francisco every summer, for the past three summers.

    1999: $39.95/mo 384K up and 1.5-6M down

    2000: $39.95/mo 128K up and 384K-1.5M down

    2001: $49.95/mo 128K up and 384K-1.5M down

    With that trend, it won't be long before a 56K modem is better.
  • This is a good thing (Score:1, Informative)

    by Anonymous Coward
    This is not an ordinary chapter 11 bankruptcy proceeding, it's a negotiated deal. The chapter 11 is just a formality required by law. Under the terms of the deal, covad sheds 1.1 billion in debt by paying off bondholders at the rate of 19 cents on the dollar.

    Covad ends up with 250 million in cash and no debt. Covad now has an excellent chance of surviving. Since SBC, the parent company of Ameritech (a baby bell company) owns aprox 30 percent of covad, there is an excellent chance SBC may buy covad outright.
    • I'm skeptical that they'll survive. From an earlier c/net article:

      In September, SBC Communications agreed to invest $150 million for a 6 percent stake in Covad. On the surface, SBC's move looked like a vote of confidence.

      But there may have been other motives. Analysts said SBC's investment in Covad had more to do with creating the appearance of competition than holding out hope for a Covad recovery.

      "The (Bells) are a lot smarter than people think," one analyst said. "It's a travesty and a tragedy in some ways. By keeping a handful of competitors alive, they can show that they're leaving the market open to competition while maintaining higher prices."

      From the current article:

      Covad expects to pay a total of $283.3 million to bondholders and have $250 million in cash remaining that will enable it to keep running until the beginning of next year. The company estimates it will then need $200 million more in financing to reach a positive cash flow by the third quarter of 2003.

      I also wonder about how they treat customers when they have spokespeople making statements like this:

      Some customers who used Covad's service, directly or indirectly, said the company was slow to react to frequent service outages, consistently blamed local phone companies for glitches, and generally delivered poor service.

      Covad spokeswoman Martha Sessums dismissed the complaints from current and former customers, saying "there will always be crybaby boobies who are unhappy with any company.

      "I'd be happy to provide you with many, many customers who are extremely happy with our service," she said.
  • This agreement with the bond holders is going free up cash flow for Covad over the next year and at least give it a chance. The only people who get screwed here are the bond holders. However, they agreed to the deal (it wasn't shoved down their throats by the courts).
  • i know it was in ask slashdot awhile back but what can you do with your equpipment once/if your ISP goes under.

    a highspeed negiborhood area network?

  • little tidbit is mentioned early on: the fact that Covad will need $200 million more in financing to reach profitability in *2003*. Lord only knows where this cash will come from. Even with elimination of debt and whatnot, it seems like a long shot. 'Course, I'm not a financing expert either but it seems like an awful lot of cash to raise in a market that is very skeptical (sp) of the telecom sector.
    • No one seems to be remembering that Covad is the only major DLEC left that is still providing national services. A telecom market that saw Covad (and it's competitors) flying to ultra-inflated stock prices is now seeing what is leftover after the stockholder panic dust settles. The honest truth is that these companies (Northpoint, Rhythms, Jato, DSL.net, etc...) had serious issues with the RBOC's and their brethren, but ultimately they screwed themselves. Covad is now the only company left standing in the previously crowded independent DLEC scene; many capital investors view this as a sign of strength, not as one of weekness. And the fact that Covad can now "suck up" those several thousand Rhythyms customers that are about to get screwed isn't a bad thing either.

      Covad is the only point of DLEC contact that has partnerships with ALL of the US ILEC's in major markets. That means that only Covad can provide DSL as a uniform front to all ILEC's for those ISP/Data customers wishing to deploy across different ILEC "monopoly zones". Good position to be in :).

      As for SBC and their involvement with Covad, the equity stake is only 6%. Maybe nobody remembers, but Covad beat SBC in a giant lawsuit that forces SBC to give Covad over 600 Million USD (in business or in cash, their choice) over the next 3 years.

      Covad has been the only company in the DLEC arena (maybe in telecom in general) to seriously buckle down and cut costs before getting to the point where the investors decided it was time to get out (and sue the pants off them at the same time.) Many of their ISP partners went down not due to lack of financing, but lack of financial responsibility; witness the CEO of ICG purchasing a private jet. Since when does the CEO of a non-profitable company get to buy a private jet?

      The real issue here is not the management of monopolies; Covad has shown that they can handle that by getting into the position they are in now. The real issue is simply managing the business to profitability. The demand for broadband is obviously there; managing technology and deployment is the next step for Covad to take.

      I'm behind this company 100% with no reservations. This is a company that took the Bells head-on and has survived (at least so far). (Reason for AC posting :)As proponents of Open Source in the M$ behemoth monopolistic landscape, I would have assumed that there would be a little more heart here for the little guy that tries to do their job better than the big guy.
  • Is it just me or does anyone on slashdot really know much about DSL? I work for a DSL provider/ISP that is (or was) part of a decent sized telco. I actaully work in the phone building, if that shows the relationship between these two companies. Anyways, making DSL work for people isn't a matter of being the the phone company. From what I have seen a good part of our problems are caused by sales/marketing people. For example, A customer lives 3 blocks away from a Central Office. According to the Telco's hitech systems, it looks like they are well within range for DSL. Then you run into the "for some reason" the lines were run someother way. You get a line test. The person's subdivison has a SLC serving the POTS rather than using the nearby CO. At this point you cannot do a whole lot, cause sales screwed it up. Just cause we are the telco doesn't get us anything special, we don't decide that DSL can only run x number of feet. It is the laws of physics and the marketing people. For the love of god don't get mad at the tech, he inherited someone else's fuckup.

    Anyways, I really hope that Covad can pull out of this. If they don't it could be a serious blow for DSL.
  • Check out www.broadviewnet.com. I'm a sys admin there. When we sign up a new customer we resell a Verizon line at first. Then in a few months we switch the customer onto our network. I heard over a year ago they were simply a reseller of Verizon's lines but it wasn't working out. So now we're building out our own network.
  • by Nick ( 109 )
    If dsl is your only option, then this should be alarming news. Before I say anything else however, I would like to clarify that I work for a cable internet provider, and when customers call me up asking for my opinion on which is better, I tell them my honest opinion (oh and yes I do get a small commission if they sign up, but its trivial).

    dsl is a good option if you live across the street from switch, it may be faster. However it is indeed more costly and the further away you live, the slower it will be. Our company provides generally faster access at a lower rate, which IMHO has been the case for any cable provider that I know of.

    If dsl is not your only option then you shouldn't have anything to worry about.
  • parts of covad have already gone out of business. A company that I designed a website for was using BlueStar ADSL... they went under and tried to switch them over to just plain ol' Covad, but they stopped and switched to another company and got SDSL... ::droooll::
  • by ioman1 ( 474363 )
    The government has allowed another Oligopoloy of sorts with DSL providers. When most smaller DSL providers go into business, they lease the badwidth from the larger telephone companies. There is not enough margin to make profit and the solution is usually " We need an X amount of customers to start to finally make money" The problem is that the X amount of customers is usually years off, and the amound of debt they gain preceeds the time to actually make money. This is a very bad business model. The governemt will need to step in and fix things. Ultimately its the consumers that lose out when competition is not present.
  • Much less known, but staying in business, is New Edge Networks http://www.newedgenetworks.com. They're national, and providing DSL (including iDSL) in Tier II/III markets and rural areas. One of the reasons they're able to stay in business is that they built their own backbone network into those areas at the same time as installing DSLAMs and backone connections are now 60% of their business. They're picking up business from Rhythms and Northpoint (in the markets where they overlapped), and Speakeasy just signed up with them as a national ISP.

"For a male and female to live continuously together is... biologically speaking, an extremely unnatural condition." -- Robert Briffault