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Voice Businesses Growing Stronger for Cable Operators

Cable operators continue to amplify their voice businesses,
according to the latest FCC report on local phone competition and Internet
while broadband service has leveled off.

According to the FCC's just-released 12-month survey ended
June 2010, VoIP grew 21%, with 77% of interconnected VoIP subs getting their
service through a cable operator.

According to the Internet survey, as of June 2010, 60% of
connections (92.5 million) were slower than the 4 megabits download speed the
FCC has said is the baseline for quality reception of triple-play bundles
of voice, video and data (actually, because of the way the form is set up,
those are all under 3 mbps). That is up from 58% who did not meet that download
criteria as of December 2009.

It also concluded that fixed broadband service "appears
to have flattened" at 82 million connections, up only 1% from the previous
12-month period. That finding would support FCC Chairman
Julius Genachowski's push for wireless broadband as a growth area and a
way to expand broadband deployment.

But wireless has a ways to go. Fix broadband continues to
dominate in the speed department, with 41 million connections that met the FCC
benchmarks vs. only 5 million mobile subs.

But the data is based on subscribership, rather than availability,
so there is no way to tell whether a lower speed is because no higher one is
offered, or because a subscriber simply chose the lower speed. It measures
advertised speeds rather than actual, with the caveat that a service may not
always operate at advertised speeds.

Addressing a National Telecommunications Cooperative
Association gathering in Washington
Monday, FCC Chairman Julius Genachowski told the group that there was
still more work to be done to insure all Americans have access to high
quality voice, video, and data, according to a Genachowski aide.

In another report, the FCC's broadband deployment report
issued last summer,
the FCC concluded that because 80 million households did not subscribe to
broadband and somewhere between 14 million and 24 million did not have
access to it, that "broadband deployment to all Americans is not reasonable
and timely." That was a break from past reports and can be used to trigger
FCC actions under section 706 of the Communications Act to "accelerate
deployment of [advanced telecommunications] capability by removing barriers to
infrastructure investment and by promoting competition in the
telecommunications market," including, some argue, the FCC's recently
approved network neutrality regs.