Lessons From The Derecho 9-1-1 Failure: When Industry Self-Regulation Is Not Enough.

The FCC released a fairly thorough report on the widespread 9-1-1 failure that followed the June 2012 “derecho” windstorm. For those who don’t remember, the derecho differs from most weather events by coming up almost without warning. According to the report, carriers had approximately two hours of warning from the time the derecho started in the Ohio Valley to when it hit the D.C. Metro region.

 

As a consequence of the damage done by the derecho, Northern Virginia experienced a massive failure of its 9-1-1 network, leaving over 1 million people with working phones (at least in some places) but no access to 9-1-1.  West Virginia experienced systemic problems as well, as a did a scattering of locations in other states impacted by the derecho. Verizon maintains the network in Northern Virginia, while West Virginia is managed by Frontier.

 

In both cases, the report concluded that both Verizon and Frontier failed to follow industry best practices or their own internal procedures. To be clear, this was not a massive dereliction of duty. But the accumulation of some corner cutting over here, some poor practice over there, meant that when the unpredicted crisis hit the system suffered critical failures precisely when most needed. Unlike just about every other part of the network, where providers balance the cost of hardening a network against potential events with a number of other factors, the core 9-1-1 system is explicitly supposed to remain operational in even the most extraordinary circumstances.  It is the foundation of public access to emergency services. As long as I can contact the phone network, I should be able to get 9-1-1 service. Public safety responders rely on the public reporting emergencies so that they can efficiently deploy resources as much as the public depends on its ability to contact emergency services through 9-1-1.

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Farewell Aaron, and thank you

On behalf of the Wetmechanics of Wetmachine, I express our condolences to the family and friends of Aaron Swartz. I did not know the man, but I know of his work, for which I am deeply grateful. Aaron’s contributions benefited me personally, because I cherish and depend upon a free and open Internet, and he championed the same causes that we tend to champion here on Wetmachine. But in a much larger sense his work benefited everyone who believes in democracy, fairness, and civilized society. He was evidently not a perfect man, which should come as no surprise, since as far as I know there is no such thing. But he fought the good fight in search of a more just world. His heart was good, and he was effective. By that I mean he was a doer, not a pundit. We need more people like him.

Cory Doctorow has written a very beautiful and nuanced remembrance of Mr. Swartz. I recommend you take a few moments to read it if you haven’t done so already.

We wish for the family and friends of Aaron Swartz whatever solace they may find in the knowledge that he was loved and appreciated by people of goodwill all over the earth.

Ergen Makes Bid For CLWR After All, What’s Up With That?

Last Sunday, I noted that while Ergen was a potential bidder on Clearwire’s (CLWR) 2.5 GHz spectrum, it seemed unlikely given the fact that Sprint would still own a majority stake in CLWR and that governance issues would make this a very messy fight that would potentially tie up DISH assets when they are needed for its own network deployment and for a potential H Block Auction bid. I also noted a lot of other issues that make a purchase by anyone other than Sprint less attractive — such as the cost of network buildout — that cast serious doubt on Crest’s valuation of CLWR’s spectrum at $30 billion.

48 hours later, Ergen makes a bid for CLWR valuing CLWR at at $3.30 a share (a reasonable enough premium over Sprint’s offer to require serious consideration). Mind you, nothing in the bid (what details there are can be found here) contradicts anything I said previously. As noted by CLWR in it’s press release, the proposed deal comes with a bunch of conditions and caveats that reflect Sprint’s ownership and the cost of building out a network that would integrate with Ergen’s AWS-4 spectrum. Which naturally raises the question of why Ergen decided it was worth it to make the bid anyway. Making a serious tender offer — even if you think it will ultimately be rejected — is a non-trivial process that incurs expense. Before dismissing this as mere payback for Sprint’s (successful) push to amend the AWS-4 rules to protect H Block (creating delay in the approval and potential issues for deployment), it is worth considering what the potential upsides are to DISH that justify the cost.

Oh yeah, I should also talk about some consumer stuff and broader stuff as well. Horse race is all well and good, but there are a lot of industry folks that do that better than I do.

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Crest’s Moronic Petition To Deny In Sprint/CLWR Symptom of Broader Idiocy That Actually Matters.

OK, I suppose I should really wait until they file, but this story detailing Crest Financial’s planned Petition to Deny in Sprint/Softbank/CLWR appears to be, in my humble opinion, the single dumbest grounds for a Petition to Deny. EVAR. For those just tuning in, Sprint, backed by Softbank, has offered approximately $3/share for the outstanding shares of Clearwire (CLWR). Because some analysts with no understanding of the actual spectrum market think CLWR is sitting on a spectrum pot ‘o gold, Crest is pissed and wants more money. It has already filed a shareholder derivative suit claiming that Sprint leveraged its insider position to buy out Clearwire below fair market value. Given how corporate law has crapped all over minority shareholder rights in recent decades, I am not giving this much hope. Apparently, Crest feels the same way, because they are now taking the fight to the FCC.

According to the story: “In going to the FCC, Crest will argue that the Clearwire deal artificially undervalues the company’s spectrum holdings, Schumacher said. That in turn potentially devalues future revenue for the U.S. government when it auctions off spectrum licenses.” Crest apparently thinks CLWR’s spectrum holdings are worth $30 billion, prompting me to wonder what planet they live on and whether they share it with House Republicans who keep thinking spectrum auctions are automatic pots of gold.

What makes this utterly dumb is the combination of a false factual premise combined with an utter lack of legal grounds, on top of a near zero chance of holding things up politically (unless AT&T or possibly DISH file, which might introduce greater political uncertainty). I would normally confine myself to simply snickering but there is a rather important point to be made here — especially for all those listening to analysts telling broadcasters they can make gajillions in the upcoming incentive auction –about spectrum valuations.

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