January 26, 2012

The Latino mobile adoption story is well told. We know Latinos lead in using mobile, including social networking applications via their handheld devices. This week, a new study by noted economists Rob Shapiro and Kevin Hassettdocuments some interesting developments about job creation in the United States that connect to this overarching narrative.

Shapiro and Hassett show how the money spent by U.S. wireless companies to buy spectrum and build faster and bigger wireless broadband networks has created more than 1.5 million new jobs across the U.S. economy.  The study, released last week by NDN, a progressive think tank, documents the direct link between investing in wireless broadband networks and job creation.  Many economists have discussed the theoretical possibility of investments creating jobs (in studies from Deloitte, Ovum / CTIA, and the Phoenix Center), but this study is the first time anyone has actually looked backwards and proved a direct connection between investment in mobile build-out and jobs.

Study after study shows that Hispanics are key drivers of the demand for more and better wireless broadband. This community is a key part of the driver of private investment which has created the jobs documented in the new study.

So, a few takeaways here.  The new study proves that jobs can be created regardless of a slumping economy.  The study also proves that American ingenuity and innovation can have tangible benefits beyond cool apps and faster networks.  Of most relevance to Hispanic communities is the fact that we have played a leadership role in driving companies to invest – which has driven the job creation Shapiro and Hasset capture.

Jason A. Llorenz, Esq. is Executive Director of the Hispanic Technology and Telecommunications Partnership (HTTP). Twitter: @hispanicttp

The failure of the so-called Congressional “super committee” had left an important piece of the telecommunications policy agenda in limbo. The initiation of spectrum reallocation to address the looming spectrum crunch was reverted back to the Congressional committees with jurisdiction.

Along with the cost-saving deal the super committee was seeking, was a long-awaited plan for auction of broadcast spectrum for wireless, which would have driven billions of dollars to the treasury for deficit reduction. Federal Communications Commission (FCC) Chairman Genachowski and others have widely discussed the importance of making more spectrum available for wireless services, and the National Broadband Plan calls for release of 500 MHz of spectrum over 10 years to address wireless demand that is expected to expand 35 times the 2009 level by 2014. The looming spectrum crunch could affect everything from price to quality of wireless – which Latinos rely on extensively for both phone and Internet access.

A number of bills are pending in the House and Senate that would address spectrum reallocation. On December 1st, the House Subcommittee on Communications and Technology approved the Jumpstarting Opportunity with Broadband Spectrum (JOBS) Act of 2011. This bill would give the FCC the authority to conduct incentive auctions and provide for the construction of an interoperable public safety communications network.

Many agree that authorizing the FCC to conduct incentive auctions would provide a tremendous boost to the economy.  Auctions would direct some of the proceeds to broadcasters seeking to surrender their broadcast TV spectrum. Part of the revenue could be used to fund the interoperable public safety network recommended by the 9-11 Commission, now on hold for a decade. All this, while relocating spectrum to build advanced communications networks, freeing up billions of dollars in investment.

The Need for Action

There is no doubt that spectrum is vital to the continued growth of the American economy.  Spectrum has myriad utilities and is a catalyst for economic growth and job creation. Yet, it is both finite and not currently maximized.  One writersums up the situation succinctly: “Like beachfront property, the natural world only gives us so much prime broadcast spectrum.” That spectrum, as it is allocated today, is not giving us its maximum benefit. “Our uses for that prime broadcast spectrum are unlimited. Consider radio, television, GPS, cellular phones, wireless Internet, air traffic control and first responder communications. All of these compete for access to that finite range of spectrum.”

Americans have come to rely on spectrum in their everyday lives. Yet as wireless providers are looking to innovate and invest based on the availability of spectrum, politics and policy have stalled progress.

While we know that there are no guarantees in Washington DC, there is a chance the JOBS Act adopted last week will be considered by the full House Energy and Commerce committee.  If that occurs, the House of Representatives could pass this spectrum bill prior to its Holiday break.

This would mean that the House and Senate would have the opportunity to reconcile their differences and the President could sign the long-overdue spectrum legislation into law early next year.  If Congress does act, the millions of individuals who will receive smart phones, tablets, and other wireless devices as gifts can enjoy their gadgets knowing the spectrum crunch will be averted.  More importantly, increased investment and the resulting economic stimulus greatly improve the chances countless Americans will soon receive what they are wishing for during this upcoming Holiday season- a job

Jason Llorenz, Esq. is Executive Director of the Hispanic Technology and Telecommunications Partnership (HTTP).  You can follow him on Twitter at @hispanicttp and learn more at: httponline.org.  Email at: Jason@httponline.org.

Following this week’s release of the FCC’s controversial internal report critical of the AT&T/T-Mobile merger, much of the back-and-forth has focused on the details—how many jobs would be created, what percentage of the population would get access to LTE, how much spectrum is really available, etc.

Obviously these are important questions—and there’s clearly merit to criticisms that the FCC cherry-picked facts to support its views—but what’s received less attention is what the entire process may have revealed about the FCC.

As The Dallas Morning News pointed out in a spot-on editorial this morning, throughout the AT&T/T-Mobile review, the FCC has taken a narrow, “old-school” view of competition that is out of touch with the realities of the modern telecom business:

Simply declaring that a big telecom firm is getting bigger, that big is always bad and that jobs might be lost ignores the economics of scale and other technological and procedural efficiencies that lead to new products and services… In the long run, the ability to move data quickly and affordably translates into thousands of new jobs and more efficient commerce, both within telecommunications and other industries.

Telecom innovation moves fast. It is hard for anyone to keep up. But that’s no excuse for the regulators charged with fostering a robust and competitive marketplace. We can not hold on to dated conceptions of competition or ideas about the telecom industry based on old “ACME steel” conceptions of mergers. This ignores the complexities of the world we are moving toward — where wireless competition comes from multiple places and an expanding list of players.

On Wednesday of this week the FCC released a report on broadband adoption which acknowledged that one third of Americans don’t have broadband at home, and warned that the U.S. is falling behind our global competition.

But as the AT&T/T-Mobile review reminds us, we are not going to catch up unless government, industry and all players can approach this brave new world in a way that stimulates investment and makes new ventures possible.

Jason A. Llorenz, Esq. is Executive Director of the Hispanic Technology and Telecommunications Partnership (HTTP). You can follow him on Twitter at @hispanicttp and learn more at: www.httponline.org.  Email at: Jason@httponline.org. Twitter: @hispanicttp

This week, I will be leading a panel in Chicago for LATISM – an online community of Latinos in Social Media, as a part of their annual conference. LATISM is made up of thousands of Latino social media participants — bloggers, tweeters, and online conversants who use social media to build community online under the hashtag, #LATISM. The talk will explore the Latino digital divide – an opportunity to engage a group of the community’s digital elite in HTTP’s work of evangelizing digital literacy and supporting policies focused on closing the digital divide.

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The LATISM conference is a somewhat ironic venue for a talk about the digital divide. After all, the most digitally literate, active, and Internet-astute of the Latino digerati make up this online community.  But beyond LATISM members lay a complex story about Latinos and their relationships with the Internet and the digital tools that drive so much of the future of economic opportunity.

Latinos are widely recognized as leading technology adopters – from mobile phones and devices to tablet computers, Latinos lead Americans in purchasing, and using this technology for some reasons we understand, and others we are just beginning to. Despite these facts, the digital divide yet to be addressed is in two areas: First, there is an access and tools issue — the dramatically lower rate Latinos report in adopting broadband at home, and second, in the community’s level of digital literacy – the digital skills that will facilitate economic opportunity and advancement in the new economy.

Defining the Latino Digital Divide

The Latino digital divide is not simply about being connected to the Internet. It is about the community’s ability to leverage the Internet and digital tools for economic and social advancement. To do so, the community must be digitally literate – something harder to define than the statistics on connectivity.

Literacy, digital and otherwise, comes in so many forms – and Hispanics’ relationship with the Internet and digital skills is complex. Researchers Shapiro and Hasset report: “80% of Latinos view the Internet as important for economic opportunity and ‘keeping up with the times,’ compared to 65% of Whites.” This would lead us to believe that the community values the Internet and understands its power to create opportunity. According to the Pew Research Center’s Internet and American Life Project, 51 percent of Hispanics access the Internet via a mobile device, while only 33 percent of whites do. The mobile platform has proven to be an accessible “on-ramp” to the Internet; Latinos are adopting mobile technology, and using it for access. This is one reason we support private sector opportunities to extend high-speed, next-generation wireless broadband, or 4G/LTE across the country, which, as the technology matures, will offer connectivity at speeds that rival home broadband.

In contrast to the discussion of mobile, Latinos remain on the wrong side of an ongoing divide in home broadband adoption – only 45 percent have home broadband access, compared to 52 percent of African Americans and 65 percent of whites, according to the Federal Communications Commission (FCC). Those numbers may or may not shock – but when we look more closely at the FCC’s numbers, we see that only 20 percent of Spanish-dominant Latinos, who tend to be less affluent and more recent immigrants, have adopted home broadband. Survey participants who were non-adopters cited lack of perceived value of the Internet and price as primary reasons for not adopting. That lack of home access relegates resume-building, job applications and other activity, in most cases, to school time or library time, while their counterparts may work on these at their leisure, as a family, in their homes. The FCC and industry has been working to drive solutions to this problem, first through the Comcast program that brought $9.99 Internet and a $149 computer to families with a child qualified for free school lunch, and, just this week, other cable providers, including Time Warner Cable, Cablevision and others, joined with a similar offering that will extend this opportunity across more markets around the country. These programs hold exciting potential for closing the gap and putting high-speed Internet tools into the hands of families lagging behind.

A Simple Question – Can My Digital Skills Help Feed My Family?

Connectivity is only part of the discussion.  Focusing on the question of what one can do with the Internet is key. Looking at the numbers overall, the Latino digital divide can be confused, as many say, rightly, “I have the Internet on my phone,” and soon,  the low-cost, cable opportunities may begin to close the access gap for poor families.  Fact is, the numbers show that mobile is already providing a lifeline to small businesses, connecting people, and helping families to save money — and the new cable programs will further drive down barriers to home broadband as well.  But to assess digital literacy, the question to ask is, “can you leverage your online skills to get a job or run a business that will feed your family?”

The national unemployment rate in the middle of 2011 was 8.8 percent, yet the rate for Hispanics was 11.3 percent – about 43 percent higher than the 7.9 percent unemployment rate among whites, according to the U.S. Bureau for Labor Statistics. We know that the grand majority of today’s good jobs – and an even larger portion of them in the future – will be those created by the digital economy. One’s ability to Bing or Google something is among the most basic expectations of an entry-level job. But real money can be made by people who can manage a spreadsheet or database program, program HTML – and, more and more, those who can develop and manage social media tools to move the bottom line or get traction for an idea or brand.

To be ready for those jobs, and to build the wealth-creating businesses of the future, communities must be online and ready to use the Internet across platforms. That means access to the tools must include a focus on learning how to use them productively. The iPhone has put a high-powered mini-computer in one’s hand; a tablet is a touch-screen window to the world. But use them only for games and sports scores, and these tools may as well be a pillow in the dessert – comforting, but not so life-enhancing.

Look To The Future

Economies change. The transition from farm to manufacturing took decades. The digital revolution is happening at Internet speed. The digital divide threatens to leave large portions of the Latino community in the last century, without the skills to fully benefit from the opportunities of the future.

The app market, for example, was an $8 billion ecosystem this year – and is only in its infancy. The Latino developers, marketers and digital entrepreneurs of the future have an opportunity to participate in this marketplace and create wealth. If there is an economic movement toward digital literacy, it must involve the opportunities created by this open marketplace where a 99-cent app that catches fire can drive dollars to its inventor and investors, or any cause.

Are you listening #occupiers?

Investment of time and resources in Latino digital literacy, powered by a high speed Internet connection provides opportunities in all of its forms – wireless, and wired interfaces, by laptop, iPhone, desktop or iPad – Latinos must be prepared to leverage the tools to build wealth and participate in the changing economy.

Those future opportunities include helping to address some of the most important, ongoing social problems. Many of the top thinkers in the field believe, for example, that broadband can reduce the cost of delivering high-quality healthcare, especially in rural areas where the closest hospital may be more than 100 miles away. With broadband Internet, doctors can provide timely diagnoses through remote consultations, saving patients the time and expense of traveling to the doctor’s office. Emerging mobile health and distance healthcare technology offer a significant opportunity to address the health disparities facing the most vulnerable, rural and mobile Latino communities. But will Latino entrepreneurs and health providers be a part of creating these revolutionary healthcare offerings?

Minority digital entrepreneurship is one key to long-term economic recovery and creating wealth. Investment of time, energy and community focus on digital skills building is not only a matter of economic necessity, but key to longevity for America’s fastest growing community.

The challenges are real and so is the potential to ensure American prosperity. LATISM is at the head of the curve on this – and now we must all work to ensure policymakers recognize the importance of supporting digital literacy to fuel innovation and drive America’s economic recovery.

Jason A. Llorenz, Esq. is Executive Director of the Hispanic Technology and Telecommunications Partnership (HTTP). You can follow him on Twitter at @hispanicttp and learn more at www.httponline.org . Email at Jason@httponline.org. Twitter: @hispanicttp

Latino communities rely on wireless devices more than other Americans. Hispanics are more likely than Whites to access the Internet and e-mail on a mobile device. Hispanics are also more likely than Whites to rely on a mobile Internet connection in lieu of a home broadband connection. Burdensome local taxes raise the cost of these services for families already struggling through tough economic times. “Excessive wireless taxes are regressive. They hurt struggling families by driving up costs, and discourage use of mobile Internet and the mobile platform at a time when we are fighting to get Latinos, and all Americans online and using the Internet to enhance their lives,” said Brent Wilkes, National Executive Director, League of united Latin American Citizens (LULAC).

“Latinos have been particularly hard hit by the economic downturn. Barriers like excessive taxes, burdensome bureaucracy or arbitrary charges threaten to make wireless services that could assist in getting a job or starting a business unaffordable or out of reach, ” said Lillian Rodríguez López, President, Hispanic Federation.

“Raising the cost of wireless services places barriers to those already struggling to catch up. We applaud the House for this pro-consumer and pro-Latino legislation,” said Jose Marquez, President and CEO, Latinos in Information Sciences and Technology Association (LISTA).

HTTP calls on the Senate to take up and pass companion bill, S.543, introduced in the upper chamber by Senator Ron Wyden and Senator Olympia Snowe.

The average wireless consumer today pays over 16% in taxes on wireless services. This is nearly double the taxes on other goods and services, and regressive on minority communities that already have higher rates of unemployment, and lost more household wealth in the recent economic downturn. We encourage Congress to pass this measure to ease an increasing burden on services relied upon by families across the country.

“Mobile devices provide a connection and information access point for poor families and those already struggling economically. Adding multiple, discriminatory local taxes to these services harms the affordability that makes the mobile platform such a lifeline for Latinos and others in hard times,” said Jason A. Llorenz, HTTP Executive Director.

Read the Full Letter (PDF)

ABOUT  HTTP

The Hispanic Technology and Telecommunications Partnership (HTTP) is a coalition of national Hispanic organizations working to increase awareness of the impact of technology and telecommunications policy on the U.S. Hispanic community. For additional information, visit http://www.httponline.org/.

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A great deal has been said about the U.S. Department of Justice (DOJ) suit to block the AT&T/T-Mobile merger. Some speculate the deal is dead. In fact, there are two simultaneous processes unfolding – one, in which AT&T is defending against the DOJ suit in court (trial is scheduled for February 13th, and another track through negotiations in which AT&T will seek conditions on the transaction that may satisfy the DOJ and allow the transaction to proceed to FCC review. The nature of these legal processes — particularly the DOJ negotiations, means we will not know much about them as they ensue. Here is an update on the conversation, the stakes and what the ongoing uncertainty means for this transaction.

Days ago, CWA’s President suggested that, while many barriers remain, there may be a settlement. Last week, conversation about potential divestiture of assets to Metro PCS to strengthen that smaller carrier as a part of the deal drew attention. Meanwhile, talk continues that a cable buyout deal may be a plan B if such a settlement can’t be reached.

Jobs, Investment In The Lurch
The Communications Workers of America is an unwavering supporter of this deal – its stake in the creation of good jobs, and expanded opportunity to organize T-Mobile’s workers are clear. The organization recently filed a report, Blocking The AT&T/T-Mobile Merger will harm Consumers, Communities and the Economy, with the FCC, outlining the damage that would be done to both companies and the opportunity for job growth if the deal fails. The report does not deal directly with the DOJ’s anti-trust concerns, instead looking more closely at the economic impact of the deal and the scenarios resulting from potentially blocking the merger.

CWA, like many advocates for the deal, argue that consumers, workers and communities will be better off from the jobs-creating investments to be made, and the opportunities to be offered to consumers from better use of T-Mobile’s assets.  In terms of jobs and consumer benefits, CWA’s report highlights the following:

• AT&T will keep all T-Mobile call center workers employed and bring 5,000 call center jobs to the US from overseas;
• AT&T will expend additional capital to expand its 4G-LTE network to 55 million more people and, in the process of that investment, create as many as 96,000 jobs;
• AT&T has already promised to maintain T-Mobile’s existing rate plans;
• AT&T will use its spectrum to create a more efficient network with better service quality, which benefits communities.

T-Mobile Crunched
T-Mobile has continued to experience a decline in revenues and subscribers. Deutsche Telekom, the parent company of T-Mobile USA, has repeatedly stated it would not make any further capital investment into T-Mobile.

Under current circumstances, T-Mobile’s customers would not expect the company to deploy a next-generation 4G LTE wireless network – a necessary action for T-Mobile to remain competitive in the wireless market.  In fact, since this deal was announced, T-Mobile faces even worse circumstances in facing Verizon, AT&T and Sprint, which has now added the iPhone to its device offering, strengthening its competitive edge in the market. This, along with the fierce competition being fought for the lower-income customer by Metro PCS, Cricket, Virgin Mobile and a bevy of pre-paid phone and data options, T-Mobile is not in a good place.

The only solution is for T-Mobile to be sold to a company that can afford to make the needed investments in its assets for growth.

CWA’s report is clear on the danger to T-Mobile’s workers. They expect that, if the deal is blocked, current ownership is likely to cut thousands of T-Mobile workers to maintain its margin and maximize proceeds from any future deal.

One fact for the economy is that uncertainly benefits neither business nor consumers.

Jason Lorenz, Esq. Is Executive Director of the Hispanic Technology and Telecommunications Partnership (HTTP).
Twitter: @hispanicttp

Enrique Cortez is President and Founder, Enitial Advanced Communications.

In celebrating Hispanic Heritage Month, we are reminded of the progress made, and the struggles ahead for America’s fastest-growing community. This month, we celebrate the accomplishments of Latinos in politics, business, and every American sphere. Latinos have progressed, and continue to grow in buying power, educational attainment and number. The work of ensuring Latino participation in all aspects of American life must also include ensuring full digital inclusion – the advancement of digitally literate communities who are online and ready to leverage digital tools across their lives.

HTTP is proud to represent a coalition of national and regional Hispanic organizations working to increase awareness of the impact of technology and telecommunications policy on the U.S. Hispanic community. As a coalition, HTTP’s members support policies that promote universal access to, and adoption of technology, including broadband Internet. HTTP members support the policies, partnerships and public- and private-sector opportunities to ensure investment leading to expanded broadband access and innovation that makes the Internet more useful to this community.

We care about these policy and business matters for important reasons. According to the Pew Research Center’s Internet and American Life Project, 51 percent of Hispanics access the Internet via a mobile device, while only 33 percent of whites do. The mobile platform has proven to be an accessible “on-ramp” to the Internet while many Latinos continue to lag in adoption of home broadband. Ensuring that Latinos are online, and using the Internet in their daily lives to access education, healthcare and other opportunities is a key to ensuring the future prosperity for the community. This adoption of mobile must be matched by overall digital literacy that comes with Hispanics adopting digital tools across platforms.

Latinos continue to lead in entrepreneurship — establishing a record number of new businesses. With broadband Internet, small businesses can reduce operating costs while increasing their competitive edge. Broadband access allows business owners, even home-based businesses, to take full advantage of the global digital economy by having real time access to market data, paying bills online, conducting market research through social media, and improving the efficiency of their business operations. It also allows businesses to connect to new markets a few towns or a continent away. These efficiencies can lead to growth and job creation.

The benefits of broadband are not just tied to business. A digital connection also produces significant benefits for individuals and families. For example, broadband access can reduce the cost of delivering high-quality healthcare, especially in rural areas where the closest hospital maybe more than 100 miles away. With broadband Internet, doctors can provide timely diagnoses through remote consultations, saving patients the time and expense of traveling to the doctor’s office (10 Benefits of Health IT). Emerging mobile health and distance healthcare technology offer a significant opportunity to address the health disparities facing the most vulnerable, rural and mobile Latino communities.

For Hispanics, broadband Internet access is no longer a luxury but a competitive necessity. Without reliable access, businesses and individuals will miss out on opportunities and information, putting them at a disadvantage in today’s digital economy. That is why the Hispanic Technology and Telecommunications Partnership is proud to add its voice to the call for the deployment of broadband Internet throughout our country, and national attention to realizing universal digital literacy. It is, in fact, the quickly emerging American communities who will benefit most from the rapid deployment of technology in the digital age.

Jason A. Llorenz, Esq. is Executive Director of the Hispanic Technology and Telecommunications Partnership (HTTP)

Twitter: @hispanicttp

Google, the search engine leader is not slowing, even after it recently found itself under investigation by regulators seeking insight into its search practices. Google recently announced its aim to venture further beyond what it has accomplished in cyberspace with its $12.5 billion deal to buy Motorola’s cellphone business.  The move has brought up a great many question as to how the deal will reshape the mobile world, Google’s culture and, from our perspective, Latinos and their use of mobile technology.

For the everyday Jose, the purchase is exciting and intriguing –it combines Google’s modern ingenuity with Motorola’s stalwart engineering expertise and inventiveness, to compete in the cut-throat mobile hardware space.  New meets older, meets tough challenges – compelling stuff.

The story beneath the surface is the less exciting narrative of the sad state of the present patent system and the dizzyingly complicated Intellectual Property litigation landscape.  The real story that may benefit Latino, and other mobile consumers is that Google’s purchase of Motorola Mobility gives it the needed commodity of the manufacturer’s patent portfolio – valued not for the sake of its content alone, but as a shield to protect the company from lawsuits from others such as LG, RIM, Samsung, Apple. Fewer lawsuits mean better prices for consumers.

Competition is already fierce in the smartphone and tablet market, and the purchase enhances the position of Google’s Android-based mobile system by tightly integrating hardware and software.   According to Information Week, “Android’s mobile phone market share [is] at 43.4% vs. 18.2% for Apple’s is, and that Google’s year-over-year share gain was 26.2%, vs. 4.1% for is.  In other words, there is not only an all-out war to win at mobile, but winning in mobile propels companies to untold value.”

For Google’s partners, there are questions as to whether Motorola will become the preferred vendor, allowing the merged company to gain greater market share by virtue of proximity.  Google contends that this won’t be an issue.

“Our vision for Android is unchanged and Google remains firmly committed to Android as an open platform and a vibrant open source community.  We will continue to work with all of our valued Android partners to develop and distribute innovative Android-powered devices,” said Andy Rubin, Google’s senior VP of mobile, in a statement.

The deal for Google comes at a whopping 63% premium at $40 per share in cash.  In exchange for its $12.5 billion, Google gets Motorola’s patents, a huge chunk of engineering brainpower and almost 20,000 additional employees — doubling the Internet company’s work force, though it remains to be seen how much impact Google will have on Motorola’s workforce since they have indicated the company will continue to operate as its own entity, within Google.

Still, growth creates new expectations for Google as an employer and corporate citizen, whose policies for supplier diversity, hiring and retaining diverse talent will be under the microscope of a national community of leaders seeking to ensure Google meets its responsibilities to a Latino community leading in the purchase and use of the mobile platform – much like the companies that appear on the Hispanic Business top companies list released this month.

Google’s innovation of new and exciting mobile services to be driven from this deal is likely to continue the beneficial growth of the mobile platform for Latinos – a platform that continues to drive jobs, communication and connection to the mobile world, especially when the wire-line broadband adoption divide continues as a stark challenge. More and better mobile devices and services remain a key opportunity to connect Latinos, and serves as an important “on-ramp” to the Internet.

While the biggest acquisition in Google’s history still needs to be approved by regulators in the U.S and Europe, industry experts widely expect the deal to be approved.

Jason A. Llorenz, Esq. Is Executive Director of the Hispanic Technology and Telecommunications Partnership (HTTP).

Twitter: @hispanicttp