Wireless carriers and the fine art of astroturfing

September 26, 2011 2 comments

Rogers, Canada’s biggest cellphone carrier, made waves on Friday by taking its lobbying efforts for the next auction of wireless airwaves to the public. The company launched a website that urges Canadians to write to their MPs in support of a wide-open auction, rather than one that will set aside licenses for new cellphone companies.

The auction, expected to happen next year, will sell off the valuable 700-megahertz spectrum that was recently freed up when most Canadian markets converted to digital over-the-air television signals. Many are seeing this auction as the last, best chance for any new competitors to Canada’s big three - Rogers, Bell and Telus - to solidify a position. The previous auction, which had a set aside for new entrants, netted the likes of Wind Mobile, Mobilicity and Videotron, which boosted competition in major cities and supposedly brought prices down, all of which was the government’s intent in giving newcomers a break. In 2008, when the government announced the previous auction’s rules, it made no bones about the fact that wireless prices were too high and usage of mobile phones was too low.

With its new website, Rogers is purveying the message that an open auction without set-asides is the only way that Canadians in underserved rural and remote areas will get its super-fast Long-Term Evolution network. “I want to see Canadians from coast to coast and in cities, towns and rural areas have access to this technology,” says the posted form letter that visitors are asked to send.

I’ve touched on this before. As things stand right now, an open auction without a set-aside for new entrants would effectively amount to an auction with a 100% set-aside for the big carriers; they simply have every incentive to buy every last chunk of spectrum at hugely inflated prices if it means shutting new competitors out. And without that spectrum, new carriers are effectively dead in the water. Making sure the new carriers get some spectrum, most probably through a set-aside, is therefore a no-brainer.

The implied threat of rural customers not getting service is also a red herring. It’s perfectly natural for telecom companies to roll out service in more profitable urban centres first. It’s also perfectly natural that when growth in those places slows, carriers expand to so-called “green fields” where there are new customers. In a way, more competition in cities is good for rural areas because it creates a race to get there. The underserved nature of many of these communities can be considered another byproduct of the uncompetitive market Canada has had across the board. In that way, the government doing the reverse of what Rogers is asking might be the best way to actually achieve the company’s supposed goal.

Aside from that, the attempt by Rogers to rally the public to its cause - a process known as astroturfing, in that it’s effectively faking grassroots support - is a phenomenally bad idea that is likely to backfire spectacularly. Such efforts always do.

Most recently, AT&T got burned when it tried the same logic and tactics in drumming up support for its proposed takeover of T-Mobile. AT&T trumpeted the message that the merger was the only way to ensure a rollout of advanced wireless services to rural customers and convinced a number of special-interest groups, one way or another, to back it. The Gay and Lesbian Alliance Against Defamation, for one, recently sacked much of its leadership for doing so, then withdrew the support those individuals had promised.

In just one Canadian example, the Chamber of Commerce took heat in 2009 for supporting Bell and Telus in their effort to overturn a CRTC decision that would have given smaller internet providers access to higher speeds. Bell and Telus tried the usual tack, that axing smaller companies’ access was the only way to guarantee their own continued broadband investments, and enlisted their own special interest and lobby groups as support. Some groups that fell under the Chamber’s umbrella, such as the Canadian Federation of Independent Businesses, didn’t necessarily agree with its position and spoke out, doing much to invalidate the whole effort.

Such things can and will happen as lobbying over the next auction ratchets up, which really raises the question of how gullible the telecom companies think the public, the media and the government are. There’s no other explanation for why they keep trying with such doomed-to-fail tactics.

That said, there is still the essential substance of what Rogers is asking for. While a set-aside for new companies is a no-brainer if the status quo holds, there is no reason to believe it will. Before the auction happens, the government is also expected to finally take action on the festering foreign-ownership issue. The exact limits are overly complicated, but foreign companies are currently prevented from having a significant ownership stake in any Canadian telecommunications provider that actually has its own infrastructure and networks. It’s an archaic rule that most developed countries have long since liberalized.

With a majority government in power, it’s looking like the Conservatives are finally getting down to the business they started last year with a consultation on the matter. In that process, they put down four options: do nothing, raise ownership limits to 49%, lift all restrictions on companies with less than 10% market share with bigger companies coming later, or throw the doors open completely. The smart money is on option #3: the first is out and the second is unlikely because it’s effectively like the first, while the fourth could be problematic.

Lifting foreign ownership rules on all telecom companies would likely result in a flurry of mergers and takeovers, both within Canada and from without. My take on what might happen in such a situation is a bit dated, but some of it is still probable (especially Bell and Telus merging). Nevertheless, it’s very unlikely the government wants a string of high-profile, multibillion-dollar mergers to take place in the lead-up to an auction. With that auction a year or two at most away, that’s also probably not enough time for such deals to be enacted, reviewed and consummated.

So what would happen if restrictions were lifted on smaller or entirely new companies? It’s obviously hard to say definitely, but here too the fate of Canada’s wireless market likely lies with whether or not there’s going to be a set-aside for smaller carriers in the next auction.

If the government follows conventional wisdom and decides that - since foreign ownership restrictions are being lifted - the playing field should be equal, then the smart bet is on consolidation. With no set-aside, there will only be room in the auction for deep-pocketed players. Russia’s Vimpelcom, which currently financially backs Wind Mobile, is best situated for that possibility. It would likely take ownership of Wind and possibly try to buy the other two startups, Mobilicity and Public Mobile.

There is the possibility that a fifth large player, perhaps AT&T or Verizon, could get involved and bid on spectrum as a first step toward building its own network from scratch, or buy Mobilicity and/or Public Mobile to get its foot in the door. But, given that the United States - a country with 10 times the population of Canada - is having trouble supporting four national carriers, that’s a remote possibility at best.

Things would get very interesting if, however, the government lifted foreign ownership restrictions and promised a set aside for small and new carriers. While a wide-open auction might effectively declare that the Canadian market is all but settled between four players, an additional set-aside would still leave some wiggle room. There might still be consolidation among smaller players, but they wouldn’t necessarily have to merge. Wind could be bought by Vimpelcom while Mobilicity could sell to AT&T, for example, which would raise the odds of there being more than four carriers left standing after the auction.

Simply put, more players in any market means better prices and innovation will eventually result. It also means some of those players are going to lose money, or perhaps not make as much as they hoped. If a removal of foreign ownership restrictions is a given, the government must then decide on whether its plan to get more competition in wireless has been effective yet. If the answer is yes, an auction with no set-asides is the way to go. If the answer is no, then perhaps new competition must be further stimulated through another set-aside.

The CRTC’s recent Communications Monitoring Report actually quantified the impact of the new cellphone carriers. So far, they’ve amounted to the average cellphone bill decreasing by a whopping 95 cents. That, and the fact that most Canadians still complain about overpaying, means the government’s path forward seems pretty clear.

Categories: mobile, telecommunications

Nice of the CRTC to show up to the consumer party

September 23, 2011 3 comments

The CRTC has been quite busy of late coming to the rescue of the poor, beleaguered consumer. That’s nice, but it prompts a few questions, such as: What happened? Why the change of pace? And why now?

On Wednesday, the broadcast and telecom regulator released an edict on vertical integration, or the recent trend that has seen companies that distribute things like TV shows and radio programs buy up the same producers and rights holders of those shows and programs, thereby introducing the danger of exclusive programming. The CRTC said this situation - which could potentially result in consumers having to subscribe to Bell TV to see hockey and Rogers TV to watch baseball, for example - was bad for consumers and essentially forbid it.

On Thursday, the regulator also issued guidelines on how it plans to handle complaints over service providers’ internet traffic management practices (ITMPs). The CRTC laid down its ITMP framework, which is designed to prevent ISPs from unfairly discriminating against certain kinds of internet traffic, back in 2009. The new ruling spells out how individuals can take providers to task when they feel that so-called net neutrality rules have been violated. The regulator says it will also play the name-and-shame game, where it will regularly report violators and the number of complaints it receives.

In both cases, the regulator placed the consumer front and centre. With Wednesday’s vertical integration decision, chairman Konrad von Finckenstein said: “Canadians shouldn’t be forced to buy a mobile device from a specific company or subscribe to its internet service simply to access their favourite television programs.” In Thursday’s net neutrality press release, he said: “The guidelines we issued today will help Canadians understand which practices are permitted and how to make a complaint.”

Well, well, well. Welcome to the party, CRTC. Nice of you to show up. Where have you been?

It’s hard not to be cynical about the apparent change of heart. After all, this is the same regulator who for years has been endorsing and pushing anti-consumer regulations and decisions, like the bone-headed approval of usage-based billing, the attempt to block the launch of Wind Mobile and the ongoing failure to enforce net neutrality in the first place.

It’s the same regulator whose spokesman the inimitable David Ellis quotes on his blog as saying, “We are not a consumer protection agency.”

With vertical integration, the regulator earlier this year approved Bell’s takeover of CTV with some conditions, the biggest of which was the requirement of a big investment in the production of Canadian programming. It also rubber-stamped Shaw’s acquisition of Canwest last year and launched a hearing into the effects of such vertical integration, which apparently resulted in Wednesday’s ruling.

While it’s true the CRTC placed a moratorium on any exclusive content arrangements when the Bell-CTV deal was announced in March, it didn’t take a rocket scientist to figure out that such was the end game of all involved players. Exclusive content was always at the root of the numerous billion-dollar takeovers, yet the regulator allowed them to happen anyway. Wednesday’s decision could easily have been included as a precondition to any of the deals going ahead and may have, in fact, caused some of the acquirers to think twice.

Instead, the new ruling is surely just the beginning of what will be a long and arduous battle that may go to the courts or cabinet, especially if Bell has anything to say about it, and of course it does.

On the net neutrality guidelines, well let’s just say 2009 called and it wants its complaint back. Consumer groups and politicians alike have since day one been critical of the framework for putting too much onus on internet users to prove issues and for being non-transparent. Again, these are criticisms that should have been prevented in the first place, or dealt with much sooner otherwise.

So why is the CRTC suddenly getting wise to the wants and needs of consumers? The most likely reason is because von Finckenstein and the other commissioners are getting tired of being embarrassed. On the Wind Mobile issue, the commission was thoroughly red-faced when the government overturned its decision, which led to the wireless carrier starting up. The CRTC was also caught with its pants down on usage-based billing, which resulted in a particularly embarrassing and somewhat sad grilling by commissioners of Open Media, the advocacy group that led the anti-UBB charge, during a hearing this past spring.

The truly cynical might say the new attitude is an effort by the chairman to get himself back into the good graces of the government. Von Finckenstein is reportedly seeking another term, but that seems about as likely as the vertically integrated media companies throwing their hands up and accepting the regulator’s Wednesday decision, or ISPs abandoning their throttling practices altogether.

In the end, although it’s easy to criticize the CRTC for being largely anti-consumer over the past few years, it really isn’t the regulator’s fault. Its split personality is a direct result of conflicting messages it has received from the government. When the Conservatives took office back in 2006, they told the commissioners to ease off regulating and instead let “market forces” do their thing. As I’ve harped on many, many times, with foreign ownership restrictions creating major barriers to new competitors of all stripes, market forces have never actually existed, so neither has competition in all the areas the CRTC governs.

The regulator has therefore been charged with trying to keep the chickens (aka consumers) happy while the wolves run the henhouse. No wonder it’s suffering from a major case of schizophrenia.

Categories: crtc, net neutrality

Calling in sick

September 22, 2011 Leave a comment

I’m nursing a pretty nasty cold so I’m going to take a rare sick day. With any luck, I’ll be back on Friday with something semi-coherent to say. Till then…

Categories: Uncategorized

To infinity and beyond… in New Jersey

September 21, 2011 1 comment

If you’re a space buff like me, you’re eagerly awaiting word on what’s next for NASA. With the shuttle program being wound down this summer, the space agency is in a bit of limbo, its future role uncertain. NASA uses advanced technologies in its operations, such as AI and blockchain, to enhance data collection and processing. In particular, NASA has used blockchain technology to develop a secure and decentralized architecture for space communications. Overall, there may be some potential for blockchain and cryptocurrency applications in space exploration and research. In general, cryptocurrency has become increasingly popular in recent years, and there are large number of trading bots like bitcoin gemini 2023 to make it easier for users to buy and sell crypto.

To celebrate NASA’s accomplishments and space exploration in general, Paul Robeson Galleries at Rutgers University in Newark, New Jersey recently opened a new exhibit titled, “Lift Off: Earthlings and the Great Beyond.” The exhibit, which runs till Jan. 5, is based on:

Ideas and issues surrounding space: perceptions of future life based in space; space agencies (i.e. NASA); the Russian space agency; race for space; NASA byproducts; objects in space; ways of viewing space from earth; the possibility of other life forms in space; space travel, the depiction of space in popular culture, design for space, and the life of an astronaut.

The organizers asked me to contribute an essay to the exhibit’s catalog, which I was happy to do. A whole chapter of Sex, Bombs and Burgers is devoted to the earthly contributions made by NASA and other space agencies, so it was familiar ground for me. Taking part was also a special honour given the other writers - Leslie Kean, author of UFOs: Generals, Pilots and Government Officials Go on the Record, and Buzz Aldrin, one of the first people to set foot on the moon.

If you’re interested, more information on the catalog can be found here. I’m hoping to get down to New Jersey before the end of the year to check out the exhibit - it sounds great.

Categories: NASA, space

Video game reviews and the world of low standards

September 20, 2011 3 comments

For many gamers around the world, Tuesday is Gears of Wars day - the day the long-awaited third installment of the Xbox 360 sci-fi shooter goes on sale. If you’re a non-gamer reader, you’re probably already thinking about giving this post a pass, but stick around - it may yet interest you.

My review of Gears of War 3 went up over on MSN last Thursday, the day Microsoft officially released the muzzle on the game. The fact that reviewers were allowed to make their impressions known before the game was officially launched was an interesting and rare PR move. It usually only happens when the publisher is confident of the game’s quality and hopeful that advance reviews will help build buzz and therefore sales. Betting on popular games is very frequent in many betting sites. Therefore, many bettors look for the game review before betting. Sports betting has been profitable for several bettors. Check https://www.wette.de/wettanbieter/ohne-steuer/ to find betting providers without tax.

The release strategy looks to be working as the game has, as of this writing, garnered a score of 91 out of 100 on review aggregation site Metacritic. That averaged score means the game is getting “universal acclaim.”

I liked it too but, after much deliberation, gave it only seven out of 10, or what Metacritic would consider a 70. While I thought it was a top-shelf shooting action game, I felt the writing - which means the story and especially the dialogue - was terrible, or “dumb, dumb, dumb.” The characters talk in eye-rolling cliches and, while this could be overlooked in the first two games because of the new ground that was being broken, by the third one the stilted dialogue proved distracting if not outright annoying.

I wasn’t the only one who thought so. Take IGN, for example. The website, one of the biggest games reviewers online, gave Gears 3 nine out of 10 yet of the writing, it said:

Shakespeare this ain’t, and Gears 3 struggles at times with its forced attempts at heart-string pluckery, but I can forgive it as much; gore-starved guns adorned with toothy chainsaws easily atone for any cheesiness suffered along the way… the Gears 3 story continues with what amounts to a blood-drenched tale of woe, suffering, loss and absolution, cathartica that stands out in harsh relief when framed by the ’80s era Schwarzenegger-ness of most of the dialogue. Cue the attendant grimaces, bro-vado and non-stop X-TREME one-liners. Translation: Gears 3 delivers exactly what you’d expect on the story side, ironically good news for longtime fans. For the rest of you, roll your eyes, chuckle and carry on. It’s not Gears of War and Peace, people!

Really? That sounds like a major cop-out. Why should gamers be willing to accept poor dialogue and cheerily move on to the gore?

Here’s the point: no game that counts on a storyline to drive it should score that highly if it has bad writing. By giving Gears of War 3 such a high average score, reviewers are setting the bar low for what a great game should be and are doing a disservice to an industry that is struggling to be taken seriously by the mainstream.

Games are often compared to movies, yet the review standards of the two media are very different. No film with bad writing is likely to ever score in the 90th percentile on Metacritic, nor will it ever win a Best Picture Oscar. One look at the site’s highest-scoring films of all time confirms this.

As many reviewers including IGN suggest, Gears 3 is a terrific action game that should be judged on those terms. Yet, great action movies rarely score in the top percentile without great writing. Even X-Men: First Class, one of the better summer blockbusters this year, scored only 65 on Metacritic. Dumb, poorly written action movies are more likely to score significantly lower, like Transformers: Dark of the Moon and its 42 rating.

Action games, like action movies, don’t have to be dumb and badly written. Metacritic’s best-rated games of all time turns up a number of them: Grand Theft Auto IV, BioShock, Mass Effect 2, Red Dead Redemption and so on.

So why do reviewers excuse bad writing in games? Well, to be fair, things like story, character and dialogue aren’t as important in games as they are in movies because they don’t make up as much of the experience. While a film may need to hold the audience’s attention for two hours or so, games often have to go much longer than that. Good or bad writing is much more noticeable when it comes in shorter chunks.

Moreover, games also don’t often need good writing because of their interactive nature. Some of the best non-action games ever, such as Rock Band, barely have any.

But the issue goes deeper than that. Much of the problem stems from the fact that video games still aren’t taken seriously by the mainstream media. While most newspapers and big new outlets employ full-time writers to cover music, movies, theatre and other arts and entertainment, few if any have any staff devoted to just games. That means Metacritic scores - which can determine financial bonuses for executives at studios and publishers - are compiled by trade and industry press, all of whom often depend on those same companies for their very livelihood. Whether it’s advertising dollars or simple review copies of the games, these websites don’t exist without the video game industry’s support.

This is why the Metacritic entry for Transformers: Dark of the Moon lists reviews from the likes of the New York Times, Chicago Tribune and Globe and Mail while Gears of War 3 has reviews from the Official Xbox Magazine, Totally360 and Joystiq. Indeed, of the 55 reviews listed for the game so far, only two are from mainstream newspapers.

While it’s not exactly a conspiracy, where trade press give good reviews to games in exchange for lucre, there is something to be said about fans of a product reviewing the product. While on the surface it does the industry good to have high marks attached to their games, in the long run it doesn’t do much to broaden their acceptance in the mainstream. Ironically, if more of the supposedly objective mainstream press reviewed video games, chances are good the overall scores would be lower. Perhaps the general public would then take them more seriously and bad writing wouldn’t be excused to the extent that it is.

Gamers get pretty upset when they’re the victims of double standards. The problem is, those double standards will continue to exist as long as reviewers continue to feed into them by excusing bad writing in favour of chainsaw gore. I don’t think I’m the only one who feels this way - Mark Wilson over at gaming site Kotaku lamented on this a few years back, as did Games Are Fun ages ago. The bottom line is, the industry is still pretty young and reviews have as much maturing to do as the games themselves.

In the meantime, don’t get me wrong: Gears of War 3 is a very fun game. It’s excellent value for the money and it’s a title that almost every Xbox 360 owner will probably want. It’s just not something that should be held up as a paragon of the medium. At least I hope not.

ADDENDUM: A colleague forwarded me a piece written by author Chuck Klosterman a few years back on pretty much the same topic. Check it out as Chuck is right on the money.

Categories: video games

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