UTOPIA Unveils the new Financial Model
After months of working with PacketFront, the company that acquired DynamicCity, UTOPIA has pulled back the curtain on their new plan and model. They plan to re-bond for a longer term (32 years instead of 20 years) with a lower interest rate, adding about $20M in cash to their reserves. This will also improve the cash flow since the bond payments will be lowered. In this environment of deflated interest rates, it made sense to lock in that lower rate.
The real challenge starts now: UTOPIA will have to convince the city councils of current pledging member cities to extend their sales tax guarantees that backed the original bonds. The upshot is that the amount of the guarantee will stay the same, but spread over a longer period. Provided this happens, the new bonding will be in place by mid-May so that construction can pick up again. If you live in a member city, it's absolutely critical that you write your mayor and city council to let them know that you support this change. Since the feds have presumably still not cut the checks on the RUS money they approved nearly two years ago, the funding infusion will be necessary to keep things moving.
Campaign 2008: The First Round of E-mails
I've just finished touching up the questions on the wiki and have sent the first round of e-mail questionnaires to federal candidates in Utah. Once I have one last e-mail address, I'll also fire off a copy to the candidates for governor. Hopefully we'll get some speedy responses and be able to start figuring out which candidates are good for broadband in The Beehive State.
Needless to say, it's a lot of work to pull all this together. It took me about an hour to build both pages and setup the e-mails for that relatively small group of candidates. Where I could really use some help is in building pages for the various candidates for county executive and legislative offices. If you've got some spare time (and a registered account), why not head on over to the Candidate Positions page and add in whatever you can? I sure would appreciate the help.
Woods Cross City Council to Discuss UTOPIA Again
I've just gotten word that the Woods Cross City Council will be discussing UTOPIA membership once again at their next meeting tomorrow, Tuesday March 18th at 6:30PM. The City Council has been waiting for announcements concerning UTOPIA's new model before deciding on any action and hasn't heard anything from them since they took the issue up in late 2007. I'd encourage supporters of UTOPIA in Woods Cross to be at the meeting to provide input and see what happens.
(h/t: Tyler Shaw for forwarding the agenda to me)
Could iProvo Be Up For Grabs?
The word on the street is that some recent closed-door meetings with Provo Mayor Lewis Billings and members of the Provo City Council could mean that iProvo is about ready for some big changes. Right now we've got nothing more than speculation, but the Deseret Morning News points to an obvious possibility: Provo could be getting ready to put a For Sale sign on the money-losing network.
Big Broadband Means Big Economic Gains
You know that old saying that you have to spend money to make money? It seems like that's where our national broadband policy has come to. With slow average speeds and high per-megabit prices, EDUCASE, an association of college IT managers, says that it could run up to $100B to fix our national infrastructure or about half of what we already paid the telcos to do. (h/t: Jonathan Karras) So what's the payoff? How about $134B in new jobs and decreased travel and medical costs? That 34% return isn't too shabby. Also consider that if all eligible federal employees took advantage of telecommuting options, they'd save $13.9B in travel costs.
It also couldn't be more pressing. Live in a rural area? Even if broadband is available, you probably can't afford it (nevermind what industry shills are saying.) Live in an area with broadband to spare? Be prepared to pay a lot more for it. Cable and phone companies are also inconsistent when it comes to upgrades. Some companies (like Qwest and now Embarq) seem to be unconcerned with enhancing speeds or they simply can't deliver. Others are building the infrastructure, but pricing still remains high and the networks may or may not support next-generation speeds from end-to-end.
We're also projected to stay behind. By 2012, a scant 10% of homes will have access to speeds of 10Mbps or higher. While FIOS and U-Verse can pass that many homes, AT&T shows little initiative to fix the last-mile copper bottlenecks on their FTTN U-Verse network (consider that Qwest can deliver 7Mbps on their aging and decrepit network) and FTTH has had limited deployment, leaving the US in eighth place.
Not all states are going to take it lying down. California formed a task force to figure out what to do and determined that public investment should be a component of whatever other solutions they decide to run with. Vermonters are forming a UTOPIA-style consortium to bring fiber to all of their residents. (h/t: Dirk van der Woude) Indiana dropped the hammer on monopolies and now competing providers are springing up like wildflowers in May, forcing prices down and service quality up.
A scary step backwards, however, is coming from our northern neighbors in Canada. The Great White North has spanked the US consistently on average speeds and broadband adoption, yet the Canadian government is talking about dropping the line-sharing requirements that have lead to a robust competitive environment. Scarily enough, this is following the steps that have gotten us into this mess in the first place.
What's obvious is that what we're currently doing isn't working and that efforts to correct course aren't coming from the federal level. Even many states can't seem to come up with a coherent broadband policy that increases competition, improves speeds and lowers pricing. If efforts like the one in Vermont show us anything, it's that solutions to broadband issues need to be local and not be inhibited by interference from state and federal legislators. Make sure those legislators hear from you that they need to let us solve the problems that they helped create.
Campaign 2008: Finding UTOPIA-Friendly Candidates
One of the biggest problems facing supporters of municipal broadband projects is a distinct lack of information on where a candidate stands. All too often, you'll only find out where they are after it's too late and we get an SB66 heaped upon us. To that end, I've decided that it's time that we know which candidates are UTOPIA-friendly and which ones are not.
On March 7, the candidate registration period for state and county offices opened up. It'll close on March 17. At that point, I'm going to send the following list of questions to each candidate and post their responses on the wiki.
- Do you generally support or oppose projects like UTOPIA and iProvo?
- What is the basis for your support or opposition?
- Is your support or opposition based on the general concept or specific implementations used in UTOPIA and/or iProvo?
- What is your position on the regulation of incumbent local exchange carriers (ILECs) such as Qwest?
- What is your position on the regulation of incumbent cable companies such as Comcast?
- What role, if any, should the state play in allegations of unfair business practices leveled at incumbent carriers such as Qwest and Comcast?
- What proposals or concepts do you support to bring better broadband access to rurals Utahns?
- What proposals or concepts do you support to improve average broadband speeds to be better competitive on an international basis?
- What proposals or concepts do you support to increase competitive options for Internet, television and telephone services?
- Do you have any other related comments you would like to add?
Each time I receive a response from a candidate, I'll post it on the wiki with a link from a post on the main page. As part of this, I'm also going to include some background information on each question to provide some neutral basis for the question. You'll be able to track all candidate positions from the wiki. Naturally, anyone that can contribute more information (such as offices up for grabs, candidates who are running, their voting history if they've held office before, etc.) would be very helpful.
Qwest Says Fiber Isn't Happening
CNet has an interview with Edward Mueller, the CEO of Qwest, that reveals their direction on fiber optic networks:
CNet: Let's shift gears here for a minute to broadband. You talked about Qwest's commitment to upgrading its network by taking fiber to the node or fiber to the neighborhood. Why doesn't Qwest follow Verizon's lead and just take fiber to the home?
Mueller: It's too expensive. We don't see the return.
CNet: But Wall Street seems to have looked favorably on Verizon's strategy, and it's starting to pay off. They seem to have a long-term vision.
Mueller: We don't have the resources.
Funny, I would have thought that decades of price-gouging and anti-competitive behavior combined with a $200B federal handout would be resources enough. In the interview, it becomes clear that Verizon and AT&T are using wireless revenues to cross-subsidize their FIOS and U-Verse rollouts, respectively, whereas Qwest can only cook up lame "partnerships" for cellular access. (And picking Sprint? That was dumb.) They're also expressing little interest in either the 700MHz auction or WiMax.
The short version is that we can't expect Qwest to deliver next-generation networks under the current leadership, especially after the last five years where the company spent more time courting a buyer than being a phone company. Without that competitive pressure, do you really think Comcast is going to roll out DOCSIS 3.0 in Utah anytime soon? My magic 8 ball is saying "don't count on it".
h/t: Warren Woodward of XMission for pointing out this article.