The Machine that Changed the World

The out-of-print and unavailable history of computing video from 1991. The key to solving the "software problem" was found in the existing technology of the telephone state of "off" and "on."

The Machine that Changed the World: Giant Brains

The Machine that Changed the World: Inventing the Future

The Machine that Changed the World: The Paperback Computer

The Machine that Changed the World: The Thinking Machine

The Machine that Changed the World: The World at Your Fingertips


The Machine That Changed the World which was produced by WGBH Television in Boston MA, in cooperation with the British Broadcasting Corp., with support from ACM, NSF and UNISYS. http://ei.cs.vt.edu/~history/TMTCTW.html was broadcast on PBS in 1991.

are you sure about that?...

"As governor I am required to make this appointment."
ROD R. BLAGOJEVICH, of Illinois, naming a successor to Barack Obama in the Senate.


New York Times online December 31, 2008


When I started out on computers in the 70s it was not a conscious choice but a lot of my friends were "geeks" and my work also required me to learn the basics so I did. They were unfriendly machines to me, to be used like a car or the telephone, for a specific utilitarian purpose. Computers were simply a means to an end that I had to master to achieve what I wanted, I wasn't a natural at it.

Some of those friends spurned the way the internet became a multimedia network while I embraced it. At this stage I'm beginning to reflect on that attitude with some regret. Once in the deep waters of technology though you no longer simply wade out of them.

An end of year reprint from the Wall Street Journal online that has a lot of implications in the area of telecommunications as well as the internet and online social networking.



Words That Cause People Who Are Cool With The Vision Thing Cringe: "We’re from the Federal government…we’re here to help"

...unless you're the military protecting my homeland, no thanks, I don't need your kind of government help. You've done enough in my life with the regulated monopoly Bell System, Affirmative Action Consent Decree, Divestiture, Telecommunications Act of 1996...

This holiday week here's another reprint, this time from The Telecommunications History Group by Herb Hackenburg, "We're from the federal government...we're here to help." He makes relevant points about bailouts and the banking industry on the precipice of nationalization.

I foresee the banking industry as some new form of regulated behemoth much like the Bell System was only morphed into a form for this era and that industry. Regardless of how the situation develops the end will be the same, giant organizations that will eventually somehow have to be weaned off taxpayer subsidies because the burden is too much. Likely it will not be pretty either, much like the Divestiture of the Bell System, fraught with problems that eventually bring it all down.

(Does anyone really believe that the current incarnation of AT&T is remotely anything like the original one in spite of reacquiring some of their former companies?)

The government created, aided and abetted the regulated utility monopoly, whether or not that was a good or bad idea became irrelevant decades after the monopolies were established. At the time the regulated monopoly and Universal Service Fund seemed to make sense to some people in order to build out the communications system. It sufficed for it's era but inevitably it became stagnant and needed reform. It's a classic example of why "sunset laws" are effective and necessary, to avoid self-perpetuating entities not realistically dealing with current situations.

The bottom line still is the government created the regulated Bell System and Independent telephone system, good, right, wrong, bad or indifferent and was irresponsible in the manner divestiture and deregulation occurred. In this case, when the government had for decades regulated a private sector industry integral to the economy as a matter of policy, the government should not have walked away as fast as they did without a sensible (not Washington DC or US Court) orderly business unwinding.

It was actions like this, in several major industries in the same era, that very possibly is one of the major early triggers of the current Economic Crisis.

The phone companies were more than just the wires that connect to make people talk, it was also a lot of paychecks to people across all wage scales and in communities across the entire land. The company was vital in multiple ways to the macro-economy.

While there is no doubt that the decades of government intervention need to be reconfigured or unwound in the telephone, airline, trucking and other industries because it was no longer relevant and impeding progress...

was it smart to bust the whole thing in oddball parts with such ineptitude?

Whenever the government steps in to help, that help is institutionalized forever and cannot be untangled once the conduit for the bureaucratic lines has been laid. No matter the originating circumstances and cause and nature of a crisis that may have caused a reaction of government intervention, before it is undertaken we must take into consideration how that intervention will be undone. We learned from a rapid unwinding of the Bell System and subsequently, the telcom and tech crash and the current Telcom Nuclear Winter, what government intervention and subsequent extrication, that nether side was really prepared for, can do destructively. Sunsetting of regulations and policies, after scheduled periodic review and action in a timely manner, is crucial to stop the regulations and policies attendant bureaucracies from snowballing into self-perpetuating money-wasters.

Hindsight on utility monopolies and government help is 20/20 but the lesson is there to be learned for all, so it is not repeated. If you were a pessimist and a betting person, regardless of the obvious lessons, you should bet that we're going to repeat these mistakes. Actually, we have already started.

We should not go down the road of government help no matter how afraid we are of current conditions without checks and balances. We've recently made two giant moves in the wrong direction by effectively nationalizing major banks and creatively bailing out the auto industry. The consequences will be, at the minimum, problematic to the macro-economy in the future.


an aside about preserving telephone history:

We are possibly in danger of losing a lot of our industry history, by collection or a lack of ability and resources to preserve it, since a great deal of it is maintained by retiree-volunteers and the economic crisis has affected all similar organizations. These retiree-volunteers are growing older and fund-raising as well as existing funds are tighter. There is a real possibility these retirees may also be losing retirement benefits and will be less able to afford to contribute more than just their time.
In my mind I see the current caretakers doing excellent jobs in their work but a large gap exists in the use of new technology, the internet, for both research and preservation records. The challenge is in transitioning not only the articles of history but the sense of what the industry was about besides just the wires that connected for people to talk.
Video online is one tool to consider in preserving the sense of the industry.Young people and boomers must get more involved to continue the work.

Please support preserving and maintaining historical items, records and archives in something that interests you. The Telecommunications History Group, Inc. is one such organization for those of us interested in the traditional telephone system.


We’re from the federal government…we’re here to help

By Herb Hackenburg
The Telecommunications History Group, Inc.
from the Winter 2008 print newsletter "Dial-Log"
Winter 2008, Vol. 12, No. 4

2008 will probably be remembered as the year of financial disasters and large government bailouts. The United States government began to buy into the nation’s largest banks. The banks’ cost for government help was additional government oversight of how they conduct business. Not quite bank nationalization…yet.

Ninety years ago, the world was at war. The United States entered the conflict and the government took control of the nation’s telephone industry.

Woodrow Wilson was the President of the United States. Wilson’s Postmaster General was Albert Sidney Burleson, described by most people as a populist, by some as a socialist. In 1913, Burleson advocated that the Nation’s telegraph and telephone service should be “postalized.” Burleson suggested that if that idea was good enough for most of Europe, it should be good enough for the United States.

Albert Sidney Burleson

Burleson had never really sold his idea to the United States’ telephone or telegraph industry, the government, or the voters. The emergency powers brought about by the United States' entry into World War I allowed Burleson make a government operated telephone system a reality.

The marriage between the Bell System, the Independent Telephone Association, and the U. S. Postal Department was not made in heaven--it was made by edict. A press release at 1:01 am on August 1, 1918, was the “wedding announcement.”

The release said:

“Pursuant to the proclamation of the President of the United States I have assumed possession, control and supervision of the telegraph and telephone systems of the United States. This proclamation has already been published and the officers, operators and employees of the various telegraph and telephone companies are acquainted with its terms."

The next paragraph says that the telephone and telegraph companies should operate exactly as they had been, under the same leadership and financing they had in place. There are seven rather important words in this paragraph — “…unless otherwise ordered by the Postmaster General.”

“I earnestly request the loyal cooperation of all officers, operators and employees, and the public in order that the service rendered shall be not only maintained at a high standard but improved wherever possible. It is the purpose to coordinate and unify these services so that they may be operated as a national system with due regard to the interests of the public and the owners of the properties.

“No changes will be made until after the most careful consideration of all the facts. When deemed desirable to make changes announcement will be made.”

Authorization for issuing the edict came from a joint resolution from Congress designed to give the president the authority to assume control of all of the nation’s telegraph and telephone companies. In the Congressional hearings on the matter Theodore Vail, the head of the Nation’s largest telephone company, was not invited to give testimony. In fact, he was not even allowed to attend the hearings.

After the fact, Vail was invited to meet with Burleson. Privately, both men had expressed a dislike and distrust of each other. They had never met face to face. During the meeting, Vail expressed his main concern--that customer service should not be degraded under “postalization.” Burleson, in turn, asked Vail to take a major role in making mutually satisfactory financial arrangements between the phone companies and the government. By the end of the meeting both Burleson and Vail felt the other guy wasn’t so bad after all. However, it’s interesting that a search of Bell System employee publications at this time show that phone company stories concerning this government takeover at no time mention Burleson by name. He is always referred to as the Postmaster General.

While the “postalized” telephone service only lasted about a year, for the average customer it was a service and financial disaster. One of the first things Burleson did was to institute fees for installing a telephone. Vail had been trying to establish an installation fee system, but the state utility commissions would not allow it. Now federal edict instantly trumped all the state regulators, according to the United States Supreme Court. Later, the post office raised both long distance and local service rates by 20 percent.

Service was degraded because much of the newly manufactured phone equipment was being sent overseas for the Army’s use. In addition, there was a shortage of employees to maintain domestic telephone service; the Army Signal Corps had nearly 18,000 Bell System men in its ranks and nearly as many from the nation’s independent telephone companies.

And when customers would complain to the telephone company, many were told politely, “There isn’t anything we can do about it, we’re owned by the government.”

The war ended about a month after the “postalization,” but “postalization” lived on. The voters became restless.

Congress was deluged with letters demanding the end of government controlled telephone service. A new joint resolution was adopted, unique in that Congress admitted that the whole “postalization” idea was wrong and apologized to the voters for adopting it in the first place.

Meanwhile, rather quietly, AT&T enjoyed its most profitable year to date.

And those installation fees are still around.

It will be interesting to see how government ownership affects the banking industry over the next few months.

The iPhone 3G and iPhone clones

The iPhone 3G and iPhone clones

By Phil Goldstein

The news: AT&T Mobility launched the Apple's iPhone 3G July 11, ushering in a new era of high-speed data capable smartphones. Apple's second-generation iPhone, which featured the same sleek look and innovative touchscreen user interface of the first-gen iPhone, now offered consumers the ability to surf the Web using AT&T's HSPA network and that sparked a flurry of iPhone clones.

T-Mobile USA jumped into the ring post-iPhone 3G, with the launch of the G1, the first phone based on Google's Android platform, which boasted a touchscreen and a QWERTY keyboard. Then came the Nokia 5800 XpressMusic, formerly known as the Tube. Verizon Wireless followed up shortly thereafter with the Motorola Krave ZN4--billed as both a touchscreen phone and a flip phone.

Then, the deluge came: the Samsung Epix (AT&T); the HTC Touch Pro, a soup-ed up version of the HTC Touch Diamond (Sprint Nextel); the $800 Sony Ericsson Xperia X1; the Samsung Saga (Verizon) and Samsung Eternity (AT&T); Research In Motion's BlackBerry Storm--the first touchscreen BlackBerry (Verizon); the Samsung Omnia (Verizon); and the Nokia N97.

Why it was significant:
It is easy to pronounce this or that as a paradigm shift, but the launch of the iPhone 3G truly was one. The genius lay behind its marketing, with each 30-second ad almost like an infomercial for how to use the multiple features and applications of the iPhone 3G, and then, at the end, reminding customers that it was a phone, too. Apple marketed the iPhone 3G as a mobile computer and digital media player first, and a phone second. And other handset makers felt they had to follow suit, launching a bevy of sleek phones with touchscreen UI's. While each pretender to the throne was looking to be an iPhone-Killer, so far the iPhone 3G remains at the top, simply by virtue that no other handset has achieved the same kind of brand recognition that the iPhone 3G has.


Now I have questions on this...

but have just started to really delve into it. Originally being a skeptic on the topic doesn't mean an open mind can't later learn more information and develop a more enlightened view.

This article started me thinking about this last summer and a random event this past week has reopened it for further inquiry. more about that, tbc...

What do brain surgeons know about cellphone safety that the rest of us don’t?

Last week, three prominent neurosurgeons told the CNN interviewer Larry King that they did not hold cellphones next to their ears. “I think the safe practice,” said Dr. Keith Black, a surgeon at Cedars-Sinai Medical Center in Los Angeles, “is to use an earpiece so you keep the microwave antenna away from your brain.”

Dr. Vini Khurana, an associate professor of neurosurgery at the Australian National University who is an outspoken critic of cellphones, said: “I use it on the speaker-phone mode. I do not hold it to my ear.” And CNN’s chief medical correspondent, Dr. Sanjay Gupta, a neurosurgeon at Emory University Hospital, said that like Dr. Black he used an earpiece.

Along with Senator Edward M. Kennedy’s recent diagnosis of a glioma, a type of tumor that critics have long associated with cellphone use, the doctors’ remarks have helped reignite a long-simmering debate about cellphones and cancer.

That supposed link has been largely dismissed by many experts, including the American Cancer Society. The theory that cellphones cause brain tumors “defies credulity,” said Dr. Eugene Flamm, chairman of neurosurgery at Montefiore Medical Center.

According to the Food and Drug Administration, three large epidemiology studies since 2000 have shown no harmful effects. CTIA — the Wireless Association, the leading industry trade group, said in a statement, “The overwhelming majority of studies that have been published in scientific journals around the globe show that wireless phones do not pose a health risk.”

The F.D.A. notes, however, that the average period of phone use in the studies it cites was about three years, so the research doesn’t answer questions about long-term exposures. Critics say many studies are flawed for that reason, and also because they do not distinguish between casual and heavy use.

Cellphones emit non-ionizing radiation, waves of energy that are too weak to break chemical bonds or to set off the DNA damage known to cause cancer. There is no known biological mechanism to explain how non-ionizing radiation might lead to cancer.

But researchers who have raised concerns say that just because science can’t explain the mechanism doesn’t mean one doesn’t exist. Concerns have focused on the heat generated by cellphones and the fact that the radio frequencies are absorbed mostly by the head and neck. In recent studies that suggest a risk, the tumors tend to occur on the same side of the head where the patient typically holds the phone.

Like most research on the subject, the studies are observational, showing only an association between cellphone use and cancer, not a causal relationship. The most important of these studies is called Interphone, a vast research effort in 13 countries, including Canada, Israel and several in Europe.

Some of the research suggests a link between cellphone use and three types of tumors: glioma; cancer of the parotid, a salivary gland near the ear; and acoustic neuroma, a tumor that essentially occurs where the ear meets the brain. All these cancers are rare, so even if cellphone use does increase risk, the risk is still very low.

Last year, The American Journal of Epidemiology published data from Israel finding a 58 percent higher risk of parotid gland tumors among heavy cellphone users. Also last year, a Swedish analysis of 16 studies in the journal Occupational and Environmental Medicine showed a doubling of risk for acoustic neuroma and glioma after 10 years of heavy cellphone use.

“What we’re seeing is suggestions in epidemiological studies that have looked at people using phones for 10 or more years,” says Louis Slesin, editor of Microwave News, an industry publication that tracks the research. “There are some very disconcerting findings that suggest a problem, although it’s much too early to reach a conclusive view.”

Some doctors say the real concern is not older cellphone users, who began using phones as adults, but children who are beginning to use phones today and face a lifetime of exposure.

“More and more kids are using cellphones,” said Dr. Paul J. Rosch, clinical professor of medicine and psychiatry at New York Medical College. “They may be much more affected. Their brains are growing rapidly, and their skulls are thinner.”

For people who are concerned about any possible risk, a simple solution is to use a headset. Of course, that option isn’t always convenient, and some critics have raised worries about wireless devices like the Bluetooth that essentially place a transmitter in the ear.

The fear is that even if the individual risk of using a cellphone is low, with three billion users worldwide, even a minuscule risk would translate into a major public health concern.

“We cannot say with any certainty that cellphones are either safe or not safe,” Dr. Black said on CNN. “My concern is that with the widespread use of cellphones, the worst scenario would be that we get the definitive study 10 years from now, and we find out there is a correlation.”


Quote of the Day (a twofer!)

Sign of the Times?

two quotes...

The New York Times online:

"I made a coffee one night but forgot to drink it. The next morning I saw a layer of oil floating on it."
Mano Misra, a professor of engineering at University of Nevada-Reno, on his "ah-ha" moment that led to the discovery that used coffee grounds can be turned into diesel fuel.


"We’ve made too many promises and asked for too few sacrifices. We’re going to have to change our culture as we know it."

GOV. DAVID A. PATERSON, of New York, calling for reduced pension benefits because of budget problems.



Qwest: Baby Bell Black Sheep

As a former long time Mountain Bell-USWC-Qwest employee who aaaaaalmost made it to a full pension or buyout but didn't (Joe Nacchio just decided to cut the cord when our turn came around)...

there is still value in Qwest, even if they don't always recognize it, leaving the conclusion that they still have life after debt if they manage it correctly.

The following is a Doug Mohny's FierceTelecom article of December 15, 2008 on Qwest. Then also BloggingStocks blog on Qwest by Steven Halpern, where Doug Mohny derived his information.

The Qwest story: to be continued...

"Qwest Speculation: Turnaround or takeover"

December 15, 2008 — 5:35pm ET | By Doug Mohney

Investors have been focusing on Qwest's shortcomings, but at least one Wall Streeter is looking hungry like the bull at the stock.

Turnaround specialist George Putnam says the company is looking good because of its large base of landline - yes, landline - customers. Each landline customer is an opportunity to sell new or expanded services, including data, video and wireless. While Qwest continues to build out its broadband network, it has partnered with Verizon Wireless to sell cell phone service and DIRECTV for video.

Meanwhile, Qwest has been expanding its business services unit revenues, and Putnam expects revenues to uptick on the consumer side as it continues to add more products.

Cash flow remains "very strong" and, after cutting its debt by nearly a third since 2001, Qwest is now providing dividends and buying back shares. Expenses have been cut by $2.5 billion over the past five years, and the company is trimming another 1,200 jobs this year.

Putnam says that Qwest looks especially tasty for an acquisition by either AT&T or Verizon, or even a foreign telecom firm looking for an American beachhead [Hmm, there's a lot of Persian Gulf money sloshing around these days]. At about six times 2008's expected earnings and four times cash flow, the company looks "very cheap."

Regardless, he expected to see earnings and cash flow to increase and multiples to rebound, translating into a "significantly higher" stock price.

For more:
- Speculation on Qwest's fate is blogged.

Related articles
Qwest CFO reassures investors
Qwest Q3 profit drops, job cuts ahead

Qwest (Q) for profits: Turnaround or takeover?

"Investors have been focusing on the shortcomings at Qwest Communications International (NYSE: Q), and to be sure, it has plenty," observes turnaround specialist George Putnam.

In his The Turnaround Letter, he adds, "But the company also has very valuable assets and strong cash flow. In addition, we believe the stock would command a good premium in a takeover." Here's his bullish review.

"Following its IPO in 1995, Qwest expanded via acquisitions and partnerships, and participated in the telecom bubble of the late 1990's.

"Unlike many of the other high-flying telecoms of that era, however, Qwest realized that in addition to a story you needed customers. In 2000, it went out and acquired US West, which gave Qwest the revenue base to survive the bursting of the telecom bubble

"Although the company survived, the shareholders have had a rocky ride during the current decade. The stock peaked around 60 in 2000, dropped to just above 1 in 2002, rebounded to 10 in 2007 and then declined to its present level.

"Management's challenge is too maximize the value of its assets. One of Qwest's greatest assets, and biggest challenges, is its huge traditional landline telephone business. The landline business is in a slow but steady decline as customers move to wireless or Internet telephony.

"But each landline customer also represents the opportunity to sell new or expanded services, including data, video and wireless. Qwest has partnered with Verizon Wireless to provide cellphone service, and DIRECTV to provide video, and it is building out its own broadband data capability.

"The company is showing good growth in broadband and video customers. Wireless customers have declined recently as Qwest changed partners from Sprint to Verizon, but they should begin to rebound as the new relationship becomes better established.

"Qwest has been successful in expanding the revenues of its business services unit, and as it adds products on the consumer side, it should be able to improve revenues there as well.

"In the meantime, the company is cutting costs to boost the bottom line. Over the past five years, management reduced expenses by $2.5 billion. So far in 2008, Qwest has eliminated 2,300 jobs (6.4% of its workforce), and it just announced plans for another 1,200 job cuts.

"Cash flow remains very strong. After using the cash inflows to cut debt by nearly one-third since 2001, the company has begun returning cash to shareholders – about $1 billion over the first nine months of 2008 – in the form of dividends and share buybacks.

"As the stock price has declined, the dividend yield has risen to a very generous 12%. While dividends are never guaranteed, management appears committed to maintaining the high payout. The company also has plans to buy back another $200 million of its stock.

"We believe that Qwest will reward shareholders by growing revenues and profits on its own. But it is also a very attractive acquisition candidate.

"It would fit well with either of the other two, much larger, remaining former Baby Bells, AT&T or Verizon. Or it would provide a good beach-head for a foreign telecom company that wanted to expand into the U.S. market.

"At about six times this year's expected earnings and four times cash flow (measured by EBITDA), Qwest looks very cheap.

"We would expect earnings and cash flow to increase and multiples to rebound as investors become less skittish – leading to a significantly higher stock price. Alternatively, we believe the stock would command a good premium in a takeover."

Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.


Carly Fiorina: "The audacity of hope is about to be tested..."

It seems that Carly Fiorina's strong business ethics philosophy has been shaped by her Bell System and AT&T, Lucent experience and is reflected in this opinion piece she wrote for the Wall Street Journal today, December 12, 2008.

This is illustrated most with her points regarding business must consider employees and customers interests equally as much as the interests of the shareholders. The balancing act is the responsibility of the CEO and boards of companies to act in a fair manner with transparency.

Her points regarding the free-wheeling 90s and the telecom and tech crash, alongside the scandals at Enron, WorldCom and Adelphia (I'll add Qwest) are well taken. The remedies for the current economic crisis are not easy and strong ethical business leadership is required more than ever to recover.


Need a Real Sponsor here

Corporate Leadership and the Crisis

CEOs seeking bailouts should be willing to resign.

The audacity of hope is about to be tested as President-elect Barack Obama's transition team moves forward in the context of bailout strains, job losses, and a pessimistic economic outlook. As we watch the CEOs of the Big Three auto companies plead at congressional hearings for taxpayer money to avert "catastrophe," the great debate about the proper role of government continues with new urgency. It is of equal importance to consider the role business should play in ensuring economic security for a hopeful citizenry.

Business leaders must use these difficult times as an opportunity to restore our credibility with the American people. We must be prepared to step up to new levels of transparency and accountability and to recalibrate our own role in an increasingly competitive world.

The 21st century is one in which literally almost any job can be performed almost anywhere. It is a world in which we can create, seemingly overnight, a global market of complex financial instruments like credit default swaps worth trillions of dollars, and then wake up one morning and realize that this market is completely opaque to regulators and virtually incomprehensible to both shareholders and taxpayers. In other words, the 21st century -- defined by globalization and technology -- is a world of tremendous individual power and almost limitless possibilities.

In less than a decade, the American people have witnessed three major business-led disasters: the dot-com bust, the collapse of Enron, and the current financial crisis. In all three events, jobs were lost, companies were destroyed, hard-earned savings and investments were decimated, and the credibility of business leadership was gravely damaged. All three had common causes.

The dot-com bubble occurred because people suspended good judgment and decided that technology stock prices really could go up forever and a company really was worth hundreds of times forward earnings -- even though profitability was hard to define and was at least five to 10 years away. As long as everyone was making money, everyone played along. Inevitably, the bubble burst.

The fraud at Enron (and WorldCom and Adelphia) occurred because management teams decided that quarterly earnings and a rising stock price trumped ethics. Despite doubts in many quarters, lots of accountants, bankers, lawyers and credit-rating agencies played along. Inevitably, the house of cards collapsed.

In our current situation, we now know that lots of very smart people bet way too much money on the assumption that housing prices would keep on rising. If concerns existed about the unprecedented complexity of new, technology-driven financial instruments and risk-modeling tools, they were pushed aside in the pursuit of wealth.

In a fast-paced, hypercompetitive, technology-driven world, common sense, good judgment and ethics matter more than ever. The American people expect leaders to have sufficient wisdom and perspective to buck the crowd and defy conventional wisdom when necessary, even if it isn't popular at the time. Quarterly earnings and share price cannot be the singular purpose of business or metric of success for CEOs. Shareholders are not the only constituency a CEO and board serve. Businesses have equally important obligations to employees and customers. A CEO's job is to balance the competing requirements of all of these constituencies.

Business has an important role to play in rebuilding confidence and restoring credibility. To strengthen accountability, boards should put all aspects of CEO pay up for shareholder vote on an annual basis. Clawback provisions, which require a CEO to return compensation to shareholders if promised results aren't delivered following their departure, should be included. CEO pay should be based on a balanced scorecard that reflects customer satisfaction and investment in employees, in addition to achievement of financial goals.

Every board seat should be voted on annually and board membership should be regularly refreshed to ensure that tough questions continue to be asked. And when CEOs go to Washington and ask for taxpayer money, they should also be prepared to submit their resignations and those of their boards. To earn a bailout, a CEO and board should be held accountable for the decisions they've made -- or perhaps the actions they've failed to take.

To strengthen transparency, companies should provide far more than quarterly earnings projections and annual profit targets. Important strategic issues and operational considerations should be reported consistently. Risks and assumptions should be spelled out rather than buried in the fine print. Employees bet on a company when they show up at work. Shareholders bet when they put their money to work. Customers bet when they buy a product. And now we're asking taxpayers to bet. It's reasonable that we all know what the company is betting on.

I know CEOs who already practice some, or all, of these suggestions. Other CEOS will say these prescriptions go too far. I would remind the latter group that we know there are political consequences to business-led crises. After the dot-com bust, technology companies lost real political clout and could not persuade Congress to vote against the expensing of stock options. The onerous regulations of Sarbanes-Oxley and mark-to-market accounting grew out of Enron's fall. Now, as the economy deteriorates and bailouts continue, a justifiably angry Congress will demand a stiff political price be paid by business. Business leaders must step forward and be part of the solution by volunteering greater disclosure and accepting responsibilities. Otherwise we will be treated as the source of the problem.

There is no doubt that government will now play a greater role in key industries. While this expanded role is perhaps vital for a time, our Founding Fathers knew that government's power should be limited. If we are to emerge stronger from our current crises, businesses must restore their credibility and regain the American people's trust by embracing accountability and transparency.

At no time in human history have we been so unconstrained by our array of capabilities or so challenged by our worst excesses. Never have common sense, good judgment and ethics mattered more.

Ms. Fiorina is a former chairman and CEO of Hewlett-Packard.

Copyright 2008 Dow Jones & Company, Inc. All Rights Reserved


Qwest poses as David versus small New Mexico telecom carrier’s Goliath

The echoes of 1984 and 1996 are still reverberating. . .

red line

http://content.answers.com/main/content/wp/en/thumb/e/ef/200px-QwestLogo.png http://www.nmmagazine.com/links_directory/user_media/logo/images/257.jpg

red line

First an article from the Albuquerque Journal Online Edition Business section on 12.01.2008 by Winthrop Quigley, "Qwest claims disadvantage against ISPs like Cyber Mesa", with excellent information as food for thought...especially on "the last mile" and the business model of Qwest regarding local service and competition.

Following the
Albuquerque Journal Online Edition article is Fierce Telecom's pithy article "Qwest complains about a little New Mexico carrier" by Doug Mohny.

blue and black

Quotation of the Day:

"It really is kind of geared at regaining the monopoly, as far as I can see," Hill said. "If they [Qwest] were willing to compete, why wouldn't they lower their rates or improve their service?"

Cyber Mesa President Jane M. Hill

Albuquerque Journal

Qwest claims disadvantage against ISPs like Cyber Mesa

By Winthrop Quigley
Copyright © 2008 Albuquerque Journal
Journal Staff Writer

It is, perhaps, not inaccurate to call a dispute between Qwest, the multistate Baby Bell telephone company, and Santa Fe-based telecom carrier Cyber Mesa a David-versus-Goliath battle — with Qwest in the role of David.

Rather than Qwest's size offering any advantage, Qwest argues it operates at a disadvantage against the small, unregulated companies that use Qwest's own equipment to deliver telephone service that competes with Qwest's service.

Qwest has been trying since January 2007 to offer some months of free service to former customers who drop a competitor's phone service and return to Qwest. Cyber Mesa has successfully blocked the promotion by forcing the state Public Regulation Commission to consider whether the rates are legal. The PRC is scheduled to settle the dispute next month.

Since 1996, federal law has required companies like Qwest, which had a monopoly on local telephone service, to negotiate agreements with companies like Cyber Mesa to use Qwest facilities to deliver competing telephone services to customers.

Cyber Mesa President Jane M. Hill said in an interview that her company pays Qwest $20 a month per phone line and purchased equipment that it needs to provide services. The equipment is installed in Qwest's central office. Qwest connects Cyber Mesa gear to the local infrastructure, called switched access lines, that delivers service over what is called "the last mile" to residential and business customers.

Hill said Cyber Mesa's phone service costs 60 cents a month less than Qwest's, and Cyber Mesa offers free caller ID.

In filings with the PRC, Qwest says companies like Cyber Mesa have become a serious threat. "Qwest has lost switched access lines (to competitors) at the rate of more than 3,500 per month," the company argued. "Qwest stands to lose over 88,0000 access lines in New Mexico from the time Qwest first attempted to initiate a promotional offering in January 2007 through the end of this year."

Qwest warned that the erosion of its business will harm shareholders, cost employees their jobs and reduce Qwest's ability to invest in New Mexico. Qwest says it has to be able to compete "on equal footing with unregulated, nonunion competitors."

Qwest said the regulatory agreement it had reached with the PRC, known as AFOR, allowed it "competitive pricing flexibility" by allowing it to offer rate reductions to customers five business days after informing the commission unless the PRC finds there is a reason to suspend the rate decrease and schedule hearings.

Jane Hill said Cyber Mesa objected to the rate decrease because "a regulated entity (like Qwest) cannot offer a regulated service, namely telephone service, below cost." That would violate antitrust law, she said.

"It really is kind of geared at regaining the monopoly, as far as I can see," Hill said. "If they were willing to compete, why wouldn't they lower their rates or improve their service?"

She added, "If Qwest lowered its rates by a dollar or so on a residential basis, then we'd really be in trouble, but it would be legal and the consumer would benefit." Just moving customers from one provider to another through promotions is not competition, it's "marketplace churn," Hill said.

"It's a business decision, not a matter of principle," she said. "I wouldn't do it if I thought there would be no consequences to my business. I think it's the beginning of a real threat."
Qwest argues that Cyber Mesa hasn't proven either that Qwest's offer of temporary free service results in below-cost service or that the harm it might suffer from the promotion is greater than the harm Qwest will suffer by not offering the promotion. Qwest's PRC filing suggests the costs of the promotion would be recovered by providing continuing service to the returning customer.

"Aside from generic, unspecified allegations of prejudice to rights of due process and harm to fair competition, Cyber Mesa neither alleges harm in its objections nor quantifies the harm," Qwest said.

The Albuquerque Journal Online Edition staff writer may be reached at wquigley@abqjournal.com or 505-823-3840.

orange and yellow

Qwest complains about little New Mexico carrier

Qwest feels outmatched when it comes to competing with smaller, unregulated companies that use Qwest's own equipment to deliver competing phone services.

Since January 2007, Qwest has been trying to offer some months of free service to former customers who drop a competitor's service and return "home" to Qwest. Independent carrier Cyber Mesa has - so far - successfully blocked the promotion in New Mexico by forcing the state Public Regulation Commission to consider whether the rates are legal. The PRC is expected to rule next month.

For over a decade, (since the 1996 Telecommunications Act, to be precise) incumbent carriers have been required to negotiate deals with independents to provide facilities to deliver competing phone services to customers. In recent filings with the New Mexico PRC, Qwest describes companies like Cyber Mesa as a serious threat. Qwest has lost landline at a rate of more than 35,000 per month and estimates that it has lost over 88,000 access lines in New Mexico from the time it tried to start its free service promo offering in January 2007.

If Qwest doesn't get the change, the company says the erosion of its business will harm shareholders (Hmm, more than they already have?), cost employees their jobs and, most ominously, reduce Qwest's ability to invest in New Mexico.

For more:
- Albuquerque Journal reports on Qwest complaint. Article.